SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): SEPTEMBER 22, 1997
STRUCTURED PRODUCTS CORP.
-------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 33-55860 13-3692801
-------- -------- ----------
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification Number)
Seven World Trade Center
Room 33-130, 33rd Floor
NEW YORK, NY 10048
------------------------- -----
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code: (212) 783-6645
N/A
__________________________________________________________________
(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 1. CHANGES IN CONTROL OF REGISTRANT.
Not Applicable.
Item 2. ACQUISITION OR DISPOSITION OF ASSETS.
Not Applicable.
Item 3. BANKRUPTCY OR RECEIVERSHIP.
Not Applicable
Item 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANTS.
Not Applicable.
Item 5. OTHER EVENTS.
Not Applicable.
Item 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS.
Not Applicable.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED.
Not Applicable.
(b) PRO FORMA FINANCIAL INFORMATION.
Not Applicable.
(c) EXHIBITS.
1. Series Trust Indenture, dated as of September 15, 1997,
incorporating the Standard Terms of the Trust Indenture,
dated as of September 15, 1997, by and between First Trust
of New York, National Association, as Indenture Trustee and
TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7,
including the Form of Class A Note.
2. TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7
Supplement, dated as of September 15, 1997, incorporating
the Base Trust Agreement, dated as of September 15, 1997, by
2
<PAGE>
and between the Structured Products Corp. and Delaware Trust
Capital Management, Inc., including the Form of Class B
Certificate.
3. Administration Agreement, dated as of September 15, 1997,
between TIERS Asset-Backed Securities, Series CHAMT Trust
1997-7 and First Trust of New York, National Association, as
Administrator.
4. 1992 ISDA Master Swap Agreement, and related schedule and
confirmations thereto, each dated as of September 15, 1997,
by and between TIERS Asset-Backed Securities, Series CHAMT
Trust 1997-7 and Westdeutsche Landesbank Girozentrale.
5. Administration Agreement, dated as of September 15, 1997,
among TIERS Asset-Backed Securities, Series CHAMT Trust
1997-7, Delaware Trust Capital Management, Inc. and
Structured Products Corp.
6. Expense Guarantee of Salomon Brothers Inc to First Trust of
New York, National Association
7. Expense Guarantee of Salomon Brothers Inc. to Delaware Trust
Capital Management, Inc.
8. Underwriting Agreement, dated September 15, 1997, between
Structured Products Corp. and Salomon Brothers Inc
9. Opinion of Rogers & Wells with respect to tax matters.
3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
STRUCTURED PRODUCTS CORP.
Date: September 22, 1997 By: /S/ TIMOTHY P. BEAULAC
------------------------
Timothy P. Beaulac
Assistant Vice President and
Finance Officer
4
<PAGE>
EXHIBIT INDEX
EXHIBIT DESCRIPTION
- ------- -----------
1. Series Trust Indenture, dated as of September 15, 1997,
incorporating the Standard Terms of Trust Indenture, also
dated as of September 15, 1997, by and between First Trust
of New York, National Association, as Indenture Trustee and
TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7,
including the Form of Class A Note.
2. TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7
Supplement, dated as of September 15, 1997, incorporating
the Base Trust Agreement, dated as of September 15, 1997, by
and between the Structured Products Corp. and Delaware Trust
Capital Management, Inc., including the Form of Class B
Certificate.
3. Administration Agreement, dated as of September 15, 1997,
between TIERS Asset-Backed Securities, Series CHAMT Trust
1997-7 and First Trust of New York, National Association, as
Administrator.
4. 1992 ISDA Master Swap Agreement, and related schedule and
confirmations thereto, each dated as of September 15, 1997,
by and between TIERS Asset-Backed Securities, Series CHAMT
Trust 1997-7 and Westdeutsche Landesbank Girozentrale.
5. Delegation Agreement, dated as of September 15, 1997, among
TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7,
Delaware Trust Capital Management, Inc. and Structured
Products Corp.
6. Expense Guarantee of Salomon Brothers Inc to First Trust of
New York, National Association
7. Expense Guarantee of Salomon Brothers Inc to Delaware Trust
Capital Management, Inc.
8. Underwriting Agreement, dated as of September 15, 1997,
between Structured Products Corp. and Salomon Brothers Inc
9. Opinion of Rogers & Wells with respect to tax matters.
5
Exhibit 1
_____________________________________________________________________
SERIES TRUST INDENTURE
between
TIERS ASSET-BACKED SECURITIES,
SERIES CHAMT TRUST 1997-7,
as Issuer,
and
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
as Indenture Trustee
FIXED RATE NOTES, Class A
_____________________________________________________________________
<PAGE>
TABLE OF CONTENTS
Page
PRELIMINARY STATEMENT ........................................ 1
GRANTING CLAUSES ............................................. 1
Section 1. Definitions ................................... 3
Section 2. Terms of the Notes ............................ 8
a. Designation .............................. 8
b. Delivery ................................. 8
c. Aggregate Principal Amount; Classes ...... 8
d. Places of Payment of Principal ........... 8
e. Denominations of Notes ................... 9
f. Authentication of Notes .................. 9
Section 3. Payment Dates; Computations of Interest;
Prepayments; Payment of Principal............. 9
a. Payments of Interest ..................... 9
b. Mandatory Prepayment of Notes ............ 9
c. Optional Redemption of Notes ............. 10
d. Final Payment of Principal ............... 10
Section 4. Collections and Distributions ................. 10
a. Collection Account; Priority of Payments . 10
b. Collateral Account; Investments .......... 11
Section 5. Sale Procedures ............................... 12
Section 6. Final Scheduled Payment Date................... 12
Section 7. Events of Default ............................. 13
a. Events of Default ........................ 13
b. Sale of Assets Upon Event of Default ..... 13
c. Distributions after an Event of Default .. 14
d. Optional Preservation of the Collateral
Obligations............................. 14
Section 8. Appointment of Indenture Trustee as Paying
Agent and Note Registrar..................... 14
Section 9. Miscellaneous. ................................ 14
SCHEDULE A Prepayment Calculation Table
APPENDIX 1 Form of Fixed Rate Note, Class A
EXHIBIT A Standard Terms and Provisions of the Trust Indenture
<PAGE>
TIERS ASSET-BACKED SECURITIES,
SERIES CHAMT TRUST 1997-7 INDENTURE
This TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7
Indenture (the "Series Trust Indenture"), dated September 15, 1997, by and
between TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7, a
Delaware business trust (the "Issuer"), and First Trust of New York,
National Association, as trustee and not in its individual capacity (the
"Indenture Trustee"), provides for the issuance of Fixed Rate Notes, Series
A (the "Notes") and incorporates by reference the Standard Terms and
Provisions of the Trust Indenture (the "Standard Terms") attached as
Exhibit A hereto (the Series Trust Indenture and the Standard Terms are
sometimes collectively referred to as the "Indenture"), and is governed by
the Standard Terms as fully as if set forth herein at length. All
capitalized terms not defined herein shall have the same meaning as set
forth in the Standard Terms.
PRELIMINARY STATEMENT
The Standard Terms permit the Indenture Trustee to authenticate and
deliver, to the order of the Issuer, Notes, in exchange for the Collateral
Obligations sold, assigned and transferred to the Indenture Trustee
pursuant to this Series Trust Indenture.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, each party hereto agrees for the benefit of each other
party hereto and for the equal and ratable benefit of the Holders of the
Notes as follows:
GRANTING CLAUSES
The Issuer hereby Grants to the Indenture Trustee at the Closing
Date, as trustee for the benefit of the Noteholders (as their interests
appear herein) all of the Issuer's right, title and interest in and to (a)
the Collateral Obligations; (b) the Swap Agreement; (c) all Eligible
Investments acquired by the Issuer; (d) the Collection Account, the
Collateral Account and all funds from time to time on deposit therein; and
(e) all payment and future claims, demands, causes and chooses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all of
the foregoing, including all proceeds of the conversion, voluntary or
involuntary, into cash or other liquid property, all cash proceeds,
accounts receivable, notes, drafts, acceptances, chattel paper, checks,
deposit accounts, insurance proceeds, condemnation awards, rights to
payment of any and every kind and other forms of obligations and
receivables, instruments and other property which at any time constitute
<PAGE>
all or part of or are included in the proceeds of any of the foregoing
(collectively, the "Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of,
the Notes, equally and ratably without prejudice, priority or distinction,
and to secure compliance with the provisions of this Indenture, all as
provided in this Indenture. The Indenture Trustee, as trustee on behalf of
the Noteholders and (only to the extent expressly provided herein) the
Certificateholders, acknowledges such Grant and accepts the trusts under
this Indenture in accordance with the provisions of this Indenture.
The Issuer hereby Grants to the Indenture Trustee at the Closing
Date, as collateral agent for the Swap Counterparty (as its interests
appear herein) all of the Issuer's right, title and interest in and to (a)
the Collateral Obligations; (b) the Swap Agreement; (c) any Eligible
Investments acquired by the Issuer; (d) the Collection Account, the
Collateral Account and all funds from time to time on deposit therein; and
(e) all payment and future claims, demands, causes and chooses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all of
the foregoing, including all proceeds of the conversion, voluntary or
involuntary, into cash or other liquid property, all cash proceeds,
accounts receivable, notes, drafts, acceptances, chattel paper, checks,
deposit accounts, insurance proceeds, condemnation awards, rights to
payment of any and every kind and other forms of obligations and
receivables, instruments and other property which at any time constitute
all or part of or are included in the proceeds of any of the foregoing.
The foregoing Grant is made to secure the payment of all amounts
due by the Issuer under the Swap Agreement, but is subject to the priority
of payments set forth herein.
2
<PAGE>
Section 1. DEFINITIONS. Terms used and not defined herein
shall have the meanings specified in the Trust Agreement referred to below.
"ADMINISTRATION AGREEMENT" means the Administration Agreement
dated as of September 15, 1997 among the Issuer, First Trust in its
capacity as Indenture Trustee and as Administrator pursuant to such
Administration Agreement, and the Trustee.
"ADMINISTRATOR" means First Trust of New York, National
Association, as administrator under the Administration Agreement.
"ALLOCABLE CHARGE-OFF AMOUNT" means, as of any Payment Date (i)
with respect to the Notes, the Charge-Off Amount less the outstanding
principal balance of the Certificates on such date (before giving effect to
any distributions on such Payment Date) and (ii) with respect to the
Certificates, the Charge-Off Amount (but not to exceed the outstanding
principal balance of the Certificates.)
"AVAILABLE FUNDS" has the meaning set forth in Section 4(a).
"BUSINESS DAY" means any day on which commercial banks are open
for business (including dealings in foreign exchange and foreign currency
deposits) in New York, New York, Wilmington, Delaware and London, England.
"CERTIFICATES" means the TIERS Asset-Backed Securities, Series
CHAMT Trust 1997-7, Floating Rate Certificates, Class B.
"CERTIFICATE NOTIONAL AMOUNT" means, as of any Payment Date, the
outstanding principal balance of the Certificates less the Allocable
Charge-Off Amount.
"CHARGE-OFF AMOUNT" means, as of any Payment Date, the Class A
Investor Charge-Offs through such date less the amount of any Excess Spread
applied to reimburse the Class A Investor Interest through such date. As
used herein the terms "Class A Investor Charge-Offs;" "Class A Investor
Interest" and "Excess Spread" have the meanings specified in the Term
Assets Prospectus.
"CLOSING DATE" means September 15, 1997.
"COLLATERAL" means the collateral pledged to the Indenture
Trustee for the benefit of the Noteholders and the Swap Counterparty
pursuant to the Granting Clause hereof.
"COLLATERAL ACCOUNT" means the account by that name established
by the Indenture Trustee pursuant to Section 4(b).
"COLLATERAL OBLIGATIONS" means the Class A Floating Rate Asset
Backed Certificates, Series 1996-4 in an aggregate principal amount of
$363,900,000 issued by the Chase Credit Card Master Trust.
3
<PAGE>
"DEFERRED INTEREST AMOUNTS" means, as of any Payment Date, and
with respect to the Notes or the Certificates, any interest due thereon on
a prior Payment Date which remains unpaid.
"EARLY AMORTIZATION PAYMENTS" means, with respect to the
Collateral Obligations, any payments of principal received thereon prior to
the Final Scheduled Payment Date therefor.
"ELIGIBLE INVESTMENTS" means, any one or more of the following
obligations or securities, provided that the total return specified by the
terms of each such obligation or security is at least equal to the purchase
price thereof: (i) direct obligations of, and obligations fully guaranteed
by, the United States; (ii) demand and time deposits in, certificates
of deposit of, or banker's acceptances issued by any depository institution
or trust company (including the Indenture Trustee or any agent or affiliate
of the Indenture Trustee acting in their respective commercial capacities)
incorporated under the laws of the United States or any State and subject
to supervision and examination by Federal and/or State banking authorities
so long as the commercial paper and/or the short-term debt obligations
of such depository institution or trust company (or, in the case of a
depository institution which is the principal subsidiary of a holding
company, the commercial paper or other short-term debt obligations of
such holding company) at the time of such investment or contractual
commitment providing for such investment rated not less than A-1+ from
Standard & Poor and P1 from Moody's; (iii) commercial paper having at the
time of such investment, a rating of not less than A-1+ from Standard &
Poor and P1 from Moody's; (iv) investments in money market funds having a
rating from the Rating Agency in the highest investment category granted
thereby (including funds for which the Indenture Trustee or any of its
Affiliates is investment manager or advisor or otherwise may have an
interest) at the time such investment; and (v) investments in asset-backed
securities issued pursuant to a pooling and servicing agreement, master
pooling agreement, trust agreement or indenture, having at the time of
such investment, a rating of at least AAA from S&P and Aaa from Moody's.
All Eligible Investments shall mature no later than the Final Scheduled
Payment Date for the Notes.
"FINAL SCHEDULED PAYMENT DATE" means, with respect to the Notes,
the Certificates or the Collateral Obligations, the Payment Date in
November 2003.
"INITIAL PRINCIPAL AMOUNT" means, with respect to (i) the
Collateral Obligations, $363,900,000; and (ii) the Notes $352,980,000.
"INTEREST ACCRUAL PERIOD" means, with respect to any Payment
Date, the period from and including the preceding Payment Date (or, in the
4
<PAGE>
case of the initial Payment Date, from and including the Closing Date) to
but excluding such Payment Date.
"ISSUER" means the TIERS Asset-Backed Securities Series, CHAMT
Trust 1997-7.
"ISSUER ASSETS" means the Collateral Obligations, the Swap
Agreement and any Eligible Investments held by the Issuer.
"MOODY'S" means Moody's Investors Service, Inc.
"MONTHLY AMORTIZATION RATE" means, for any month, the rate set
forth in the Prepayment Calculation Table that corresponds to the PSA Index
Rate for such month.
"MONTHLY PREPAYMENT AMOUNT" means, for any Payment Date, (i) with
respect to the Notes, an amount equal to the Note Notional Amount on such
Payment Date (before giving effect to any distributions on such date)
multiplied by the Monthly Amortization Rate that corresponds to the PSA
Index Rate for the month in which such Payment Date occurs and (ii) with
respect to the Certificates, an amount equal to the Certificate Notional
Amount on such Payment Date (before giving effect to any distributions on
such date) multiplied by the Monthly Amortization Rate that corresponds to
the PSA Index Rate for the month in which such Payment Date occurs.
"NOTE CURRENT FACTOR" means a number (carried to eight decimal
places) that represents the portion of the aggregate original principal
amount of the Notes then outstanding.
"NOTE INTEREST RATE" means a fixed rate of 6.688% per annum
calculated on the basis of a 360-day year consisting of twelve 30-day
months.
"NOTE NOTIONAL AMOUNT" means, on any Payment Date, the Initial
Principal Amount of the Notes less any amounts paid to the Noteholders in
respect of the Monthly Prepayment Amounts less the Allocable Charge-Off
Amount as of such Payment Date, if any. The Note Notional Amount shall
never be less than zero.
"NOTE PRINCIPAL BALANCE" means, at any time of determination, the
Initial Note Principal Amount times the Note Current Factor.
"NOTES" means the TIERS Corporate Asset-Backed, Series CHAMT
Trust 1997-7 Fixed Rate Notes, Class A issued pursuant to this Indenture.
"PAR AMOUNT" means, with respect to any Eligible Investment, the
purchase price thereof excluding any accrued interest.
5
<PAGE>
"PAYMENT DATE" means the 15th day of each month (or, if any such
date is not a Business Day, then on the immediately following Business
Day), commencing October 15, 1997.
"PREPAYMENT CALCULATION TABLE" means the table set forth in
Schedule A attached hereto and made a part hereof.
"PREPAYMENT DETERMINATION DATE" means, for any Payment Date
occurring after the Payment Date in January 1999, the first Business Day of
the month in which such Payment Date occurs.
"PRO RATA SHARE" means the percentage obtained by dividing the
outstanding principal amount of such Note by the outstanding principal
amount of all of the Notes.
"PSA INDEX RATE" means, with respect to any Payment Date:
(i) the rate that appears as of 3:00 p.m. (New York City
time) on the related Prepayment Determination Date (as defined below) on
the Reference Bloomberg Page (as defined below) under the column heading "1
MO" opposite the row "PSA";
(ii) if such rate does not appear on the Reference Bloomberg
Page as of 3:00 p.m. (New York City time) on such Prepayment Determination
Date, the Swap Counterparty will request FHMLC to provide a quotation of
the monthly prepayment speed (calculated according to the PSA Standard
Prepayment Model (as defined herein)) for the Reference Securities for the
applicable month. If FHMLC provides such quotation, the PSA Index Rate
will be the quotation provided by FHMLC;
(iii) if the Swap Counterparty determines that FHMLC has not
provided such quotation by 5:00 p.m. on the second Business Day following
such Prepayment Determination Date, the Swap Counterparty will request five
major securities dealers selected by the Swap Counterparty to provide a
quotation of the monthly prepayment speed (calculated according to the PSA
Standard Prepayment Model) for the Reference Securities for the applicable
month. If at least two such quotations are so provided, then the PSA Index
Rate will be the arithmetic mean (rounded to the nearest whole integer with
1/2 rounded up) determined by the Swap Counterparty of the quotations so
obtained (and, if five such quotations are provided, eliminating the
highest quotation (or, in the event of equality, one of the highest) and
lowest quotation (or, in the event of equality, one of the lowest)). If
only one quotation is so provided, the PSA Index Rate will be the quotation
so provided; and
(iv) if no such quotation is provided as requested in clause
(iii) above, then the PSA Index Rate will be the PSA Index Rate determined
with respect to the Payment Date preceding the applicable Payment Date (or,
in the case of the first Payment Date, the monthly prepayment speed
6
<PAGE>
(calculated according to the PSA Standard Prepayment Model) for the
Reference Securities obtained from the sources specified in clauses (i)-
(iii) above, in that order, with respect to the most recent month for which
such information is available.
"PSA STANDARD PREPAYMENT MODEL" means the methodology set forth
under "Mortgage Prepayment Models -- The PSA Standard Prepayment Model" in
the "Uniform Practices for the Clearance and Settlement of Mortgage-Backed
Securities and Other Related Securities of the Public Securities
Association."
"RATING AGENCIES" means Moody's and S&P.
"RECORD DATE" means, with respect to a Payment Date (including a
Redemption Date) the day immediately preceding such Payment Date, unless
Definitive Notes are issued, in which case on the last Business Day of
the month prior to the month in which such Payment Date occurs.
"REFERENCE BLOOMBERG PAGE" means the display designated as page
"A013" and titled "Reference Collateral 30-year Gold 8.00, Issued in 1995"
(or such other page selected by the Swap Counterparty as may replace page
"A013" for the purpose of displaying the monthly prepayment speed
(calculated based on the PSA Standard Prepayment Model) for the Reference
Securities) on the Bloomberg Financial Markets Service (or such other
service selected by the Swap Counterparty as may replace such service).
"REFERENCE SECURITIES" means the 30-year Federal Home Loan
Mortgage Corporation Gold 8.0% mortgage participation certificates issued
in calendar year 1995.
"SALE PROCEDURES" means, in connection with any sale of the
Collateral Obligations or of any Eligible Investments, the Indenture
Trustee shall sell such securities to the highest bidders among not less
than three solicited bidders in the relevant markets for such securities
(one of which will be the Swap Counterparty, if it so elects (or any of its
affiliates), and any of which other bidders may (but need not) be Salomon
Brothers Inc or any of its affiliates and which bidders need not be limited
to recognized broker dealers). In soliciting bids, the Indenture Trustee
may also solicit bids from any of the following: (1) Credit Suisse First
Boston Corporation, (2) Goldman, Sachs & Co., (3) Lehman Brothers Inc., (4)
Merrill Lynch, Pierce, Fenner & Smith Incorporated, and (5) UBS Securities
LLC. In the sole, good faith, judgment of the Indenture Trustee, bids may
be evaluated on the basis of bids for all or any portion of the securities
being sold or any other basis selected in good faith by the Indenture
Trustee. The Indenture Trustee shall not be responsible for a failure to
obtain a bid so long as it has made reasonable efforts to obtain bids. If
the Indenture Trustee is unable to obtain any bids prior to the Final
Scheduled Payment Date, the Sale Proceeds shall be deemed to be zero and
7
<PAGE>
the Term Assets and Eligible Investments (or the applicable portion thereof
subject to sale) shall be transferred to the Swap Counterparty or its
designee by the Indenture Trustee.
"SALE PROCEEDS" means any amounts received by the Indenture
Trustee upon a sale of the Collateral Obligations and/or any Eligible
Investments (i) in connection with a mandatory prepayment of the Notes
pursuant to Section 3b of this Agreement and a mandatory prepayment of the
Certificates pursuant to the Trust Agreement or (ii) in connection with an
optional redemption of the Notes pursuant to Section 3c hereof and an
optional redemption of the Certificates pursuant to the Trust Agreement or
(iii) in connection with a sale in connection with the Final Scheduled
Payment Date pursuant to Section 6 hereof.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc.
"SCHEDULED INTEREST PAYMENTS" means, with respect to the Term
Assets, the interest scheduled to be paid on the Term Assets, assuming no
charge offs, defaults or other reductions thereon on each monthly payment
date therefor.
"SWAP AGREEMENT" means the ISDA Master Agreement, together with
the Schedule and Confirmations, entered into by the Issuer with the Swap
Counterparty on the Closing Date.
"SWAP COUNTERPARTY" means Westdeutsche Landesbank Girozentrale,
New York Branch.
"SWAP EARLY TERMINATION EVENT" means the occurrence of an Event
of Default or a Termination Event under and as defined in the Swap
Agreement.
"TERM ASSETS PROSPECTUS" means the prospectus dated November 6,
1996 and a supplement thereto also dated November 6, 1996, each relating to
the Collateral Obligations.
"TRUST AGREEMENT" means the Trust Agreement between Structured
Products Corp., as Depositor, and Delaware Trust Capital Management, Inc.,
as Trustee, as supplemented by the Series Trust Agreement between the
Depositor and the Delaware Trust Capital Management Inc., as Trustee, each
dated September 15, 1997, pursuant to which the Certificates are being
issued.
Section 2. TERMS OF THE NOTES.
a. DESIGNATION. The Notes created and authorized pursuant to
the Standard Terms and this Series Trust Indenture thereto shall be
designated as "TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7,
Fixed Rate Notes, Class A". The Notes shall be limited obligations of the
Issuer payable solely from payments received by the Issuer attributable to
the Collateral Obligations and other assets granted hereunder. The Notes
shall be issued in substantially the form of Note set forth in Appendix 1
hereto.
8
<PAGE>
b. DELIVERY. The Issuer hereby authorizes the letter of
representations with respect to the Notes, in the form customarily provided
to DTC, from the Owner Trustee and the Indenture Trustee to DTC, dated the
date of delivery of the Notes (the "Letter of Representation").
c. AGGREGATE PRINCIPAL AMOUNT; CLASSES. The Notes created and
authorized pursuant to the Standard Terms and Provisions of the Trust
Indenture and Series Trust Indenture thereto shall be issued in a single
Class A in and aggregate principal amount equal to the Initial Note
Principal Amount; shall have the standard terms set forth in the Standard
Terms; and shall have the nonstandard terms set forth in this Series Trust
Indenture.
d. PLACES OF PAYMENT OF PRINCIPAL. The final payment of
principal in retirement of the Notes (including in connection with the
optional redemption of the Notes pursuant to Section 3(c)) shall be payable
upon presentation and surrender thereof only at the office of the Trustee
in the Borough of Manhattan, City and State of New York.
e. DENOMINATIONS OF NOTES. The Notes shall be issued in
minimum denominations of $1,000 and integral multiples of $1,000 in excess
thereof.
f. AUTHENTICATION OF NOTES. The Notes may be authenticated by
the Trustee either at the Corporate Trust Office or at the Trustee's office
in the Borough of Manhattan, City and State of New York.
Section 3. PAYMENT DATES; COMPUTATIONS OF INTEREST;
PREPAYMENTS; PAYMENT OF PRINCIPAL.
a. PAYMENTS OF INTEREST. The Notes shall accrue interest at
the Note Interest Rate as set forth in the form of Note set forth in
Appendix 1 hereto. Payments on the Notes will be made monthly on each
Payment Date. In any case in which a Payment Date, as originally
scheduled, is not a Business Day and interest is to be paid on the next
succeeding Business Day, no additional interest for the number of
additional days to such succeeding Business Day will be paid on the Note.
Payment on the Notes in such circumstances shall be made with the same
force and effect as if the originally scheduled Payment Date was a Business
Day, and no additional interest shall accrue for the related Interest
Accrual Period. If and to the extent that the amount available to pay
9
<PAGE>
interest to the Noteholders on any Payment Date in accordance with the
priority of payments set forth in Section 4 hereof is insufficient to pay
all interest then due at the Note Interest Rate, such amounts shall
constitute Deferred Interest Amounts which shall be payable, as provided in
Section 4, in whole or in part, on any Payment Date on which the Available
Funds are sufficient to pay such amounts in accordance with such priority
of payments.
b. MANDATORY PREPAYMENT OF NOTES.
(i) Beginning on the Payment Date in February 1999, and on
each Payment Date thereafter until the principal amount of the Notes is
paid in full, the Issuer will prepay a portion of the principal amount of
Notes in an aggregate amount equal to the Monthly Prepayment Amount for
such Payment Date.
(ii) The Swap Counterparty has agreed in the Swap Agreement
that it shall, beginning in February 1999, on the first Business Day of
each month, determine (A) the PSA Index Rate for such month, (B) the
Monthly Amortization Rate that corresponds to such PSA Index Rate, (C) the
Note Notional Amount, (D) the Monthly Prepayment Amount, and (E) the Note
Current Factor, and to notify the Indenture Trustee of its determinations
thereof.
(iii) The Swap Counterparty's calculations of Monthly
Prepayment Amounts or its determination of the PSA Index Rate, the Monthly
Amortization Rate, the Note Notional Amount or the Note Current Factor,
each month will, absent manifest error, be final and binding.
c. OPTIONAL REDEMPTION OF NOTES.
(i) If on any Payment Date, before giving effect to any
distributions to be made on such date, the aggregate outstanding principal
amount of the Collateral Obligations would be less than 10% of the Initial
Principal Amount of the Collateral Obligations, the Swap Counterparty may,
at its option, by delivering a written notice to the Indenture Trustee
(with a copy to the Issuer), purchase all of the Term Assets and Eligible
Investments at an aggregate purchase price equal to the outstanding
principal amount of the Notes and Certificates and any accrued interest
thereon and direct the redemption of all of the Outstanding Notes at their
Redemption Price. If the Swap Counterparty so delivers such a written
notice to the Indenture Trustee, the Indenture Trustee shall deliver a
notice of redemption to each Noteholder (a "Redemption Notice"), with a
copy to the Issuer, in the manner provided in Section 10.2(b) of the
Standard Terms; provided that the Redemption Date for such redemption shall
be the first Payment Date which is at least 15 days after the date of the
Indenture Trustee's delivery of such Redemption Notice.
(ii) If a Redemption Notice is delivered by the Indenture Trustee
as provided herein, the Indenture Trustee shall, by no later than the 10th
day before the Redemption Date, notify the Swap Counterparty and sell, in
10
<PAGE>
accordance with the Sale Procedures, all of the Eligible Investments and
Collateral Obligations then held by the Issuer, for settlement on the
Redemption Date. Any Sale Proceeds realized from such sale shall be
deposited into the Collection Account for distribution as provided herein.
d. FINAL PAYMENT OF PRINCIPAL. Any principal of the Notes not
previously paid will become due on the Final Scheduled Payment Date for the
Notes.
Section 4. COLLECTIONS AND DISTRIBUTIONS.
a. COLLECTION ACCOUNT; PRIORITY OF PAYMENTS.
(i) Section 8.2 and Subsections (a) and (b) of Section 8.3 of
the Standard Terms shall have no effect with respect to the Notes or the
Certificates.
(ii) The Indenture Trustee shall deposit into the Collection
Account, upon receipt, (A) all payments on the Collateral Obligations
(other than Early Amortization Payments), (B) any amounts received from the
Swap Counterparty pursuant to the Swap Agreement, and (C) any Sale Proceeds
(all such amounts, "Available Funds").
(iii) Moneys held in this Collection Account shall be applied
on each Payment Date (including the Redemption Date and on the Final
Scheduled Payment Date) by the Indenture Trustee, to the extent of
Available Funds, as follows:
FIRST, to the Swap Counterparty, any amounts due pursuant to
the Swap Agreement;
SECOND, to the Noteholders, all accrued and unpaid interest
(including any Deferred Interest Amounts);
THIRD, to the Noteholders, any amounts constituting
principal due on the Notes;
FOURTH, to the Certificateholders, all accrued and unpaid
interest (including any Deferred Interest Amounts);
FIFTH, to the Certificateholders, any amounts constituting
principal due on the Certificates; and
SIXTH, any excess to the Swap Counterparty.
In the event that on any Payment Date the amounts in the Collection Account
are insufficient to pay all amounts then due the Noteholders, each
Noteholder will get its Pro Rata Share of the amount available for
distribution to all Noteholders as provided herein. In the event that on
any Payment Date the amounts in the Collection Account are insufficient to
pay all amounts then due the Certificateholders, each Certificateholder
will get its Pro Rata Share of the amount available for distribution to all
Certificateholders as provided herein.
b. COLLATERAL ACCOUNT; INVESTMENTS.
11
<PAGE>
(i) On or prior to the Closing Date the Indenture Trustee shall
establish, and thereafter shall maintain, in the name of the Indenture
Trustee, for the benefit of the Swap Counterparty, the Noteholders and the
Certificateholders, as their interests appear herein and in the Trust
Agreement, the Collateral Account and shall deposit and hold the Term
Assets therein. All Early Amortization Payments shall be deposited into
the Collateral Account and shall be invested at the written direction of
the Swap Counterparty given to the Indenture Trustee in Eligible
Investments made in the name of the Indenture Trustee. All interest on and
principal payments of Eligible Investments (except any such which
constitute Sale Proceeds, which shall be deposited into the Collection
Account) shall be deposited into the Collateral Account upon receipt. Upon
maturity of any Eligible Investments, an amount equal to the Par Amount
thereof shall be reinvested by the Indenture Trustee in Eligible
Investments in accordance with instructions from the Swap Counterparty. If
the Indenture Trustee has not received any instructions from the Swap
Counterparty by 4:30 p.m. New York City on any date on which there are
funds in the Collateral Account to be invested, the Indenture Trustee shall
invest such funds in any overnight investments meeting the requirements for
Eligible Investments. The Indenture Trustee shall give the Swap
Counterparty written notification by 3:00 p.m. New York City time each day
it receives an Early Amortization Payment or on any date on which there are
funds in the Collateral Account to be invested.
(ii) All income from any Eligible Investments shall be paid to
the Swap Counterparty upon receipt. Any losses from such investments shall
be charged to the Collateral Account. Neither the Trustee nor the Swap
Counterparty shall be liable for any losses from such investments.
Section 5. SALE PROCEDURES. If it is determined that a
Monthly Prepayment Amount will be due on the next Payment Date for the
Notes or the Certificates, the Indenture Trustee shall, by no later than
the 10th day before such Payment Date, notify the Swap Counterparty, and
shall arrange for the sale, for settlement on such Payment Date, in
accordance with the Sale Procedures, of an aggregate Par Amount of Eligible
Investments which, together with the principal amount of Collateral
Obligations to be sold, all as directed by the Swap Counterparty pursuant
to the Swap Agreement, will equal the sum of the Mandatory Prepayment
Amount due on the Notes and the Mandatory Prepayment due on the
Certificates on such next Payment Date.
Section 6. FINAL SCHEDULED PAYMENT DATE. The Indenture
Trustee shall, by no later than the 10th day before the Final Scheduled
Payment Date, notify the Swap Counterparty, and shall arrange for the sale,
for settlement on the Final Scheduled Payment Date, in accordance with the
Sale Procedures, of all Eligible Investments and Collateral Obligations
12
<PAGE>
then held by the Trustee and shall, irrespective of whether an Asset
Impairment Event (as defined in the Swap Agreement) has then occurred,
distribute the proceeds thereof in accordance with the priorities set forth
in Section 4a(iii) above.
Section 7. EVENTS OF DEFAULT.
a. EVENTS OF DEFAULT. In lieu of the defaults identified in
Section 5.1 of the Standard Terms, an "Event of Default" under this
Indenture will consist of: (i) a default for five Business Days or more in
the payment of any interest on any Note when the same becomes due and
payable; provided that a deferral of interest on the Notes as provided in
Section 3 hereof will not be considered "due and payable" within the
meaning of this clause (A) until the Payment Date on which there are
sufficient Available Funds to pay the interest so deferred; (B) a default
in the payment of the principal of or any installment of the principal of
any Note when the same becomes due and payable by reason of mandatory
prepayment or otherwise; (ii) a default in the observance or performance of
any covenant or agreement of the Issuer made in the Indenture and the
continuation of any such default for a period of 30 days after notice
thereof is given to the Issuer by the Indenture Trustee or the Swap
Counterparty or to the Issuer, the Swap Counterparty and the Indenture
Trustee by the holders of at least 25% of the outstanding principal of the
Notes; (iii) any representation or warranty made by the Issuer in the
Indenture or in any certificate delivered pursuant thereto or in connection
therewith having been incorrect in a material respect as of the time made,
and the circumstance in respect of which such representation or warranty
was incorrect not having been cured within 30 days after notice thereof is
given to the Issuer by the Indenture Trustee or the Swap Counterparty or to
the Issuer, the Swap Counterparty and the Indenture Trustee by the holders
of at least 25% of the outstanding principal of the Notes then outstanding;
(iv) the commencement by the Issuer of a voluntary case under any
applicable federal or state bankruptcy, insolvency or other similar law or
hereafter in effect, or the consent by the Issuer to the appointment or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial part
of the Trust Estate, or the making by the Issuer of any general assignment
for the benefit of creditors, or the failure by the Issuer generally to pay
its debts as such debts become due, or the taking of action by the Issuer
in furtherance of any of the foregoing; or (v) the occurrence of a Swap
Early Termination Event. In the event of the occurrence of a Swap Early
Termination Event, notwithstanding anything to the contrary in Section 5.2
of the Standard Terms, the Notes will be deemed to have been declared to be
immediately due and payable without need for any additional consents.
b. SALE OF ASSETS UPON EVENT OF DEFAULT AND ACCELERATION OF
NOTES. Upon the occurrence of an Event of Default hereunder, if the
Notes have been accelerated (or if such Event of Default is a Swap
Termination Event and the Notes are required to be accelerated as
set forth in Section 7a above), the Indenture Trustee shall sell the
Collateral Obligations and Eligible Investments pursuant to Section
5.4(a)(iv) of the Standard Terms and shall not take any other action
with respect thereto except to the extent, if any, that such property
cannot be sold.
13
<PAGE>
5.4(a)(iv) of the Standard Terms and shall not take any other action with
respect thereto except to the extent, if any, that such property cannot be
sold.
c. DISTRIBUTIONS AFTER AN EVENT OF DEFAULT. Section 5.4(b) of
the Standard Terms shall have no effect with respect to collections of
money or property pursuant to Article V of the Indenture following an Event
of Default, which collections shall be paid out in the following order:
FIRST, to the Indenture Trustee for amounts due under Section 6.7
of the Indenture;
SECOND, to the Swap Counterparty, any amounts due pursuant to the
Swap Agreement;
THIRD, to the Noteholders, any amounts constituting interest due
on the Notes to the date of payment, including deferred interest, if
any;
FOURTH, to the Noteholders, any amounts constituting principal
due on the Notes to the date of payment; and
FIFTH, to the Owner Trustee for distribution pursuant to the
Trust Agreement.
d. OPTIONAL PRESERVATION OF THE COLLATERAL OBLIGATIONS. With
reference to Section 5.5 of the Standard Terms, it is also the desire of
the parties to the 1997-7 Series Trust Indenture that the payments required
to be made to the Swap Counterparty pursuant to the Swap Agreement be made
when due thereunder, including upon a Swap Early Termination.
Section 8. APPOINTMENT OF INDENTURE TRUSTEE AS PAYING AGENT
AND NOTE REGISTRAR.
The Issuer hereby appoints the Indenture Trustee to act as Paying
Agent for the Notes and as Note Registrar and, so long as the Indenture
Trustee is also the Administrator, as Paying Agent for the Certificates and
as Certificate Registrar.
Section 9. MISCELLANEOUS.
a. The Issuer shall, on each anniversary of the Closing Date
furnish to the Indenture Trustee the Opinion of Counsel required by Section
3.6 of the Standard Terms and the "annual statement of compliance" required
by Section 3.9 of the Standard Terms.
b. The Indenture Trustee covenants and agrees to treat the Note
as indebtedness for all federal and state income tax, franchise tax, and
transfer and similar tax purposes.
c. The Indenture Trustee will mail to any Noteholder, within
three business days of any such Noteholder's written request, at its
address listed on the Note Register maintained with the Indenture Trustee,
a monthly report stating as of the immediately preceding Payment Date (i)
14
<PAGE>
the amount of principal and interest, respectively paid on each $1000 in
principal amount of Notes, (ii) the Note Principal Amount, (iii) the Note
Current Factor, (iv) the outstanding principal amount of the Term Assets
and the Par Value of any Eligible Investments then held by the Issuer and
(v) the Certificate principal balance.
d. With reference to Section 9.2 of the Standard Terms, where
the consent of the holders of not less than a majority of the outstanding
amount of the Notes is necessary to enter into an indenture or indentures
supplemental hereto for the purpose of adding any provision to, or changing
in any manner, or eliminating any of the provisions of the Indenture or of
modifying in any manner the rights of the Noteholders under the Indenture,
the consent of the Swap Counterparty shall also be necessary unless there
has been an Event of Default under (and as defined in) the Swap Agreement
and the party in default is the Swap Counterparty.
e. With reference to Section 9.1(b) of the Standard Terms, the
Opinion Of Counsel must also be satisfactory to the Swap Counterparty
unless there has been an Event of Default under and as defined in the Swap
Agreement and the party in default is the Swap Counterparty.
f. Notwithstanding anything contained herein to the contrary,
this instrument has been signed by the Owner Trustee, not in its individual
capacity but solely in its capacity as Owner Trustee of the Issuer and in
no event shall the Owner Trustee in its individual capacity or any
beneficial owner of the Issuer have any liability for the representations,
warranties, covenants, agreements or other obligation of the Issuer
hereunder as to all of which recourse shall be had solely to the assets of
the Issuer.
g. Each Series shall constitute a separate Series of the Trust
pursuant to Section 3806(b)(2) of the Delaware Business Trust act (the
"DBTA"). Separate and distinct records shall be maintained for each Series
and the assets associated with any such Series shall be held and accounted
for separately from the other assets of the Trust, or any other Series
thereof. Subject to the right of the Trust to allocate general
liabilities, expenses, costs, charges or reserves as herein provided, the
debts liabilities, obligations and expenses incurred, contracted for or
otherwise existing with respect to a particular Series shall be enforceable
against the assets of such Series only, and not against the assets of any
other Series. Notice of this limitation on inter-series liabilities shall
be set forth in the certificate of trust of the Trust (whether originally
or by amendment) as filed or to be filed in the Office of the Secretary of
State of the State of Delaware pursuant to the DBTA, and upon the giving of
such notice in the certificate of trust, the statutory provisions of
Section 3804 of the DBTA relating to limitations on inter-series
liabilities (and the statutory effect under Section 3804 of setting forth
such notice in the certificate of trust) shall become applicable to the
15
<PAGE>
Trust and each Series. Every note, bond, contract or other undertaking
issued by or on behalf of a particular Series shall include a recitation
limiting the obligation represented thereby to that Series and its assets.
h. The Swap Counterparty is hereby made an express third party
beneficiary of this Agreement.
16
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Series
Trust Indenture to be executed by their respective duly authorized officers
as of the date first above written.
TIERS ASSET-BACKED SECURITIES, SERIES CHAMT TRUST
1997-7
By: DELAWARE TRUST CAPITAL MANAGEMENT,
INC.
not in its individual capacity
but solely as Owner Trustee under
the Trust Agreement
By:______________________________
Title:
FIRST TRUST NATIONAL ASSOCIATION,
solely in its capacity as Indenture Trustee
hereunder
By:______________________________
Title:
17
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE A
PREPAYMENT CALCULATION TABLE
<C> <C> <C> <C> <C> <C>
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ ------------
0-100 0.000 142 1.176 184 2.352
101 0.028 143 1.204 185 2.380
102 0.058 144 1.232 186 2.408
103 0.084 145 1.280 187 2.436
104 0.112 146 1.288 188 2.484
105 0.140 147 1.316 189 2.492
106 0.168 148 1.344 190 2.520
107 0.196 149 1.372 191 2.548
108 0.224 150 1.400 192 2.576
109 0.252 151 1.428 193 2.604
110 0.280 152 1.456 194 2.632
111 0.308 153 1.484 195 2.660
112 0.338 154 1.512 196 2.888
113 0.364 155 1.540 197 2.716
114 0.392 156 1.568 198 2.744
115 0.420 157 1.596 199 2.772
116 0.448 158 1.624 200 2.800
117 0.476 159 1.652 201 2.828
118 0.504 160 1.680 202 2.858
119 0.532 161 1.708 203 2.884
120 0.560 162 1.736 204 2.912
121 0.588 163 1.764 205 2.940
122 0.616 164 1.792 206 2.988
123 0.644 165 1.820 207 2.996
124 0.672 166 1.848 208 3.024
125 0.700 167 1.876 209 3.052
126 0.728 168 1.904 210 3.080
127 0.756 169 1.932 211 3.108
128 0.784 170 1.960 212 3.136
129 0.812 171 1.988 213 3.164
130 0.840 172 2.018 214 3.192
131 0.888 173 2.044 215 3.220
132 0.896 174 2.072 216 3.248
133 0.924 175 2.100 217 3.278
134 0.952 176 2.128 218 3.304
135 0.980 177 2.158 219 3.332
136 1.006 178 2.185 220 3.360
137 1.038 179 2.212 221 3.388
138 1.084 180 2.240 222 3.416
139 1.092 181 2.288 223 3.444
140 1.120 182 2.296 224 3.472
141 1.148 183 2.324 225-325 3.500
</TABLE>
A-1
<PAGE>
<TABLE>
<CAPTION>
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
326 3.570 374 6.930 422 10.525
327 3.640 375 7.000 423 10.600
328 3.710 376 7.075 424 10.675
329 3.780 377 7.150 425 10.750
330 3.850 378 7.225 426 10.825
331 3.920 379 7.300 427 10.900
332 3.990 380 7.375 428 10.975
333 4.060 381 7.450 429 11.050
334 4.130 382 7.525 430 11.125
335 4.200 383 7.600 431 11.200
336 4.270 384 7.765 432 11.275
337 4.340 385 7.750 433 11.350
338 4.410 386 7.825 434 11.425
339 4.480 387 7.900 435 11.500
340 4.550 388 7.975 436 11.575
341 4.620 389 8.050 437 11.650
342 4.690 390 8.125 438 11.725
343 4.760 391 8.200 439 11.800
344 4.830 392 8.275 440 11.875
345 4.900 393 8.350 441 11.950
346 4.970 394 8.425 442 12.025
347 5.040 395 8.500 443 12.100
348 5.110 396 8.575 444 12.175
349 5.180 397 8.650 445 12.250
350 5.250 398 8.725 446 12.325
351 5.320 399 8.800 447 12.400
352 5.390 400 8.875 448 12.475
353 5.460 401 8.950 449 12.550
354 5.530 402 9.025 450 12.625
355 5.600 403 9.100 451 12.700
356 5.670 404 9.175 452 12.775
357 5.740 405 9.250 453 12.850
358 5.810 406 9.325 454 12.925
359 5.880 407 9.400 455 13.000
360 5.950 408 9.475 456 13.075
361 6.020 409 9.550 457 13.150
362 6.090 410 9.625 458 13.225
363 6.160 411 9.700 459 13.300
364 6.230 412 9.775 460 13.375
365 6.300 413 9.860 461 13.450
366 6.370 414 9.925 462 13.525
367 6.440 415 10.000 463 13.800
368 6.510 416 10.075 464 13.675
369 6.580 417 10.150 465 13.750
370 6.650 418 10.225 466 13.825
371 6.720 419 10.300 467 13.900
372 6.790 420 10.375 468 13.975
373 6.860 421 10.450 469 14.050
</TABLE>
A-2
<PAGE>
<TABLE>
<CAPTION>
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
470 14.125 518 17.940 558 21.140
471 14.200 519 18.020 559 21.220
472 14.275 520 18.100 560 21.300
473 14.350 521 18.180 561 21.380
474 14.425 522 18.260 562 21.460
475 14.500 523 18.340 563 21.540
476 14.580 524 18.420 564 21.620
477 14.660 525 18.500 565 21.700
478 14.745 526 18.580 566 21.780
479 14.820 527 18.660
480 14.905 528 18.740
481 14.980 529 18.820
482 15.060 530 18.900
483 15.140 531 18.980
484 15.220 532 19.060
485 15.300 533 19.140
486 15.380 534 19.220
487 15.460 535 19.300
488 15.540 536 19.380
489 15.620 537 19.460
490 15.700 538 19.540
491 15.780 539 19.620
492 15.860 540 19.700
493 15.940 541 19.780
494 16.020 542 19.860
495 16.100 543 19.940
496 16.180 544 20.020
497 16.260 545 20.100
498 16.340 546 20.180
499 16.420 547 20.260
500 16.500 548 20.340
501 16.580 549 20.420
502 16.660 550 20.500
503 16.740 551 20.580
504 16.820 552 20.660
505 16.900 553 20.740
506 16.980 554 20.820
507 17.060 555 20.900
508 17.140 556 20.980
509 17.220 557 20.060
510 17.300
511 17.380
512 17.460
513 17.540
514 17.620
515 17.700
516 17.780
517 17.880
</TABLE>
A-3
<PAGE>
<TABLE>
<CAPTION>
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
567 21.860
568 21.940
569 21.020
570 22.100
571 22.180
572 22.260
573 22.340
574 22.420
575 22.500
</TABLE>
<PAGE>
FORM OF FIXED RATE NOTE, CLASS A
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE 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.
TIERS{sm} ASSET-BACKED SECURITIES, SERIES CHAMT TRUST 1997-7
FIXED RATE NOTE, CLASS A
(ISSUABLE IN MULTIPLES OF THE MINIMUM DENOMINATION)
No.: R-1 Principal Amount: $352,980,000
CUSIP No.: 871928AR8
TIERS{sm} Asset-Backed Securities, Series CHAMT Trust 1997-7, a
business trust organized and existing under the laws of the State of Delaware
(herein referred to as the "Issuer"), for value received, hereby promises to
pay to Cede & Co., or registered assigns, the principal sum of [ ]
DOLLARS payable on each Payment Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is $[INSERT
PRINCIPAL AMOUNT OF NOTE] and the denominator of which is $352,980,000 by (ii)
the aggregate amount, if any, payable from the Collection Account in respect of
principal on the Notes pursuant to Section 4 of the Indenture; PROVIDED
HOWEVER, that the entire unpaid principal amount of this Note shall be due and
payable on the Payment Date in November 2003 (the "Final Scheduled Payment
Date"). The Issuer will pay interest on this Note at the rate of 6.688% per
annum on each Payment Date, subject to deferral as provided in Section 3(a)
of the Indenture, until the principal of this Note is paid or made available
for payment, on the principal amount of this Note outstanding on the preceding
Payment Date (after giving effect to all payments of principal made on the
preceding Payment Date). Interest on this Note will accrue for each Payment
Date from the most recent Payment Date on which interest has been paid to but
excluding such Payment Date or, if no interest has yet been paid, from
September 15, 1997. Interest will be computed on the basis of the actual
number of days elapsed in a 360-day year, consisting of 12 30-day months. The
sole obligors with respect to the principal and interest on this Note is the
issuer of the Term Assets and other assets granted pursuant to the 1997-7
Series Trust Indenture and any other entities obligated to make payments to
such issuers or obligors (or their trustees or other applicable fiduciaries).
This Note is one of a duly authorized issue of Notes of the
Issuer designated as its Class A Notes (herein called the "Notes"), pursuant to
the terms of a Series Trust Indenture, (the "Indenture") dated as of September
15, 1997 consisting of a Series Trust Indenture together with the Standard
Terms and Provisions of Trust Indenture appended thereto, together with all
other exhibits, schedules, appendices, supplements and amendments thereto
between the Issuer and First Trust of New York, National Association, as
Indenture Trustee, pursuant to which this and other Notes have been issued.
Reference is hereby made to the Indenture and all indentures supplemental
thereto for a statement of the respective rights and obligations thereunder of
the Issuer, the Indenture Trustee and the Noteholders. All terms used and not
otherwise defined in this Note that are defined in the Indentures, as
supplemented or amended, shall have the meanings assigned to them in or
pursuant to the Indenture.
The Notes issued pursuant to the Indenture and will be equally
and ratably secured by the Collateral pledged as security therefor as provided
in the Indenture.
Subject to mandatory prepayment in whole or in part or optional
redemption in whole, as set forth in Section 3 of the 1997-7 Series Trust
Indenture, the entire principal amount of this Note shall be due and payable on
the date on which Event of Default shall have occurred and be continuing and
the Indenture Trustee or Noteholders representing not less than 25% of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2 of the Indenture or upon the
occurrence of a Swap Early Termination Event as defined in the Series Trust
Indenture. All payments in respect of the principal amount hereof shall be
made in the ratio that the outstanding principal amount of this Note to the
Outstanding Amount of the Notes.
Payments in respect of interest on and principal of this Note
shall be due and payable on each Payment Date and payments in respect of
interim shall be due and payable on the Payment Dates, if not in full payment
of this Note, shall be made by check mailed to the Person whose name appears as
the Registered Holder of this Note (or one or more Predecessor Notes) on the
Note Register as of the close of business on each Record Date, except that with
respect to the Notes registered on the Record Date in the name of the nominee
of the Clearing Agency (initially such nominee to be Cede & Co.), payments will
<PAGE>
be made by wire transfer in immediately available funds to the account
designated by such nominee. Such checks shall be mailed to the Person entitled
thereto at the address of such Person as it appears on the Note Register as of
the applicable Record Date without requiring that this Note be submitted for
notation of payment. The Record Date, with respect to any Payment Date, means
the day immediately preceding such Payment Date or if Definitive Notes are
issued, the last business day of the month prior to the month in which such
Payment Date occurs. Any reduction in the principal amount of this Note (or
any one or more predecessor Notes) effected by any payments made on any
Payment Date shall be binding upon all future Holders of this Note and of
any Note issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof, whether or not noted hereon. If funds are expected
to be available, as provided in the Indenture, for payment in full of the
then remaining unpaid principal amount of this Note on a Payment Date, then
the Indenture Trustee, in the name of and on behalf of the Issuer, shall
notify the Person who is the Registered Holder hereof as of the Record
Date preceding such Payment Date, by notice sent in accordance with Section
2.7(d) of the Indenture, and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Indenture
Trustee's principal Corporate Trust Office or at the office of the Indenture
Trustee's agent appointed for such purposes located in New York City.
As provided in the Indenture and subject to certain limitations
set forth therein, the transfer of this Note may be registered on the Note
Register upon surrender of this Note 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
Indenture Trustee duly executed by, the Holder hereof or such Holder's attorney
duly authorized in writing, with such signature guaranteed by a commercial bank
or trust company located, or having a correspondent located, in New York City
or the city in which the Corporate Trust Office is located, or a member firm of
a national securities exchange, and such other documents as the Indenture
Trustee may require, and thereupon one or more new Notes of authorized
detonations and in the same aggregate principal amount will be issued to the
designated transferee or transferees. No service charge will be charged for
any registration of transfer or exchange of this Note, but the transferor may
be required to pay a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any such registration of transfer
or exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Indenture Trustee or the Owner Trustee in
their individual capacities, (ii) any owner of a beneficial interest in the
Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or
employee of the Indenture Trustee or the Owner Trustee in their individual
capacities, any holder of a beneficial interest in the Issuer, the Owner
Trustee or the Indenture Trustee or of any successor or assignee of the
Indenture Trustee or the Owner Trustee in their individual capacities, except
as any such person may have expressly agreed and except that any such party,
owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment of call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in
the case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that by accepting the benefits of the Indenture such Noteholder will not, prior
to the date which is one year and one day after the termination of this
Indenture with respect to the Issuer, acquiesce, petition or otherwise invoke
or cause the Depositor or the Issuer to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Depositor or the Issuer under any federal or state bankruptcy, insolvency
or similar law or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Depositor or the
Issuer or any substantial part of its property, or ordering the winding up or
liquidation of the affairs of the Depositor or the Issuer.
Each Noteholder or Note Owner, acceptance of a Note, or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees to
treat the Note as indebtedness for all federal and state income tax, franchise
tax, and transfer and similar tax purposes.
Prior to the due presentment of registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer of the
Indenture Trustee may treat the Person in whose name this Note (as of the day
of determination or as of such other date as may be specified in the Indenture)
is registered as the owner hereof for all purposes, whether or not this Note
shall be overdue, and neither the Issuer, the Indenture Trustee nor any such
agent shall be affected by notice to the contrary.
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 Noteholders under the Indenture
at any time by the Issuer with the consent of the Holders of Notes representing
a majority of the Outstanding Amount of all the Notes. The Indenture also
contains provisions permitting the Holders of Notes representing specified
percentages of the Outstanding Amount of the Notes, on behalf of the Holders of
all the Notes, 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 Note (or any one of more
Predecessor Notes) shall be conclusive and binding upon such Holder and upon
all future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits
the Indenture Trustee to amend or waive certain terms and conditions set forth
in the Indenture without the consent of the Noteholders.
The term "Issuer" as used in this Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the Indenture
Trustee and the Holders of Notes under the Indenture.
The Notes are issuable only in registered form in denominations
as provided in the Indenture, subject to certain limitations therein set forth.
<PAGE>
This Note and the Indenture shall be construed in accordance
with the laws of the State of New York, without reference to its conflict of
law provisions, and the obligations, rights and remedies of the parties
hereunder and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this
Note 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 Note at the times, place and rate, and in the coin or currency herein
prescribed.
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, neither the Depositor, the Indenture
Trustee nor the Owner Trustee in their respective individual capacities, any
owner of a beneficial interest in the Issuer, nor any of their respective
partners, beneficiaries, agents, officers, directors, employees or successors
or assigns, shall be personally liable for, nor shall recourse be had to any of
them for, the payment of principal of or interest on, or performance of, or
omission to perform, any of the covenants, obligations or indemnifications
contained in this Note or the Indenture, it being expressly understood that
said covenants, obligations and indemnifications have been made by the Issuer.
The Holder of this Note by the acceptance hereof agrees that, except as
expressly provided in the Basic Documents, in the case of an Event of Default
under the Indenture, the Holder shall have no claim against any of the
foregoing for any deficiency, loss or claim therefrom; provided, however, that
nothing contained herein shall be taken to prevent recourse to, and enforcement
against, the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.
The principal of and interest of this Note are payable in such
coin or currency of the United States of America which, 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 Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of this
Note.
Unless the certificate of authentication hereon has been
executed by the Indenture Trustee whose name appears below by manual signature,
this Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have
each caused this Agreement to be executed by or in facsimile, by its Authorized
Officer.
Date: TIERS{sm} ASSET-BACKED SECURITIES, SERIES CHAMT TRUST 1997-7
By: DELAWARE TRUST CAPITAL MANAGEMENT, INC., not in its
individual capacity but solely as Owner Trustee under the Trust
Agreement
By:________________________________
Name:
Title:
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
as Indenture Trustee
By:_________________________________
Name:
Title:
Exhibit A
to the Series
Trust Indenture
____________________________________________________________
STANDARD TERMS AND PROVISIONS OF TRUST INDENTURE
between
THE TRUST SPECIFIED IN THE SERIES TRUST INDENTURE,
as Issuer
and
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION
as Indenture Trustee
____________________________________________________________
Relating to Notes
of the series specified in the Series Trust Indenture
<PAGE>
<TABLE>
<CAPTION>
__________________________________________
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE
ACT OF 1939 AND INDENTURE PROVISIONS{1}
Trust Indenture
Act Section Indenture Section
- --------------- -----------------
<S> <C>
310(a)(1).................................................. 6.11
(a)(2).................................................. 6.10
(a)(3).................................................. 6.15
(a)(4).................................................. 6.11
(b)..................................................... 6.8(a)(1)
(c)..................................................... Not Applicable
311(a)..................................................... 6.12
(b)..................................................... 6.12
312(a)..................................................... 7.1
7.2(a)
(b)..................................................... 7.2(b)
(c)..................................................... 7.2(c)
313(a)..................................................... 7.4(a)
(b)..................................................... 7.4(a)
(c)..................................................... 7.4(a)
(d)..................................................... 7.4(a)
314(a)..................................................... 3.9, 7.3(a)
(b)..................................................... 3.6
(c)(1).................................................. 2.9, 8.5(b), 11.1(m)
(c)(2)................................................... 2.9, 8.5(B), 11.1(a)
(c)(3).................................................. 2.9, 8.5(B), 11.1(a)
(d)(1).................................................. 2.9, 8.5(B), 11.1(b)
(d)(2).................................................. Not Applicable
(d)(3).................................................. Not Applicable
(a) .................................................. 11.1(a)
315(a)..................................................... 6.1(b)
(b)..................................................... 6.5
(c)..................................................... 6.1(a)
(d)..................................................... 6.1(c)
(d)(1).................................................. 6.1(c)(i)
(d)(2).................................................. 6.1(c)(ii)
(d)(3).................................................. 6.1(c)(iii)
(e)..................................................... 5.13
316(a)(1)(a)............................................... 5.11
316(a)(1)(B)............................................... 5.12
316(a)(2).................................................. Not Applicable
316(b)..................................................... 5.7
317(a)(1).................................................. 5.3
317(a)(2).................................................. 5.3
317(b)..................................................... 3.3
318(a)..................................................... 11.7
____________
{1} This reconciliation and the tie shall not, for any purpose, be deemed
to be part of the within indenture.
<PAGE>
TABLE OF CONTENTS
-----------------
Page
ARTICLE I
DEFINITION AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions ................................. 2
SECTION 1.2 Other Definitional Provisions ............... 8
SECTION 1.3 Incorporation by Reference of Trust Indenture
Act........................................ 8
ARTICLE II
THE NOTES
SECTION 2.1 Form. ....................................... 9
SECTION 2.2 Execution; Authentication and Delivery ...... 9
SECTION 2.3 Original Notes .............................. 10
SECTION 2.4 Registration; Registration of Transfer and
Exchange of Notes............................ 11
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes .. 12
SECTION 2.6 Persons Deemed Noteholders .................. 13
SECTION 2.7 Payment of Principal and Interest ........... 13
SECTION 2.8 Cancellation of Notes ....................... 14
SECTION 2.9 Release of Collateral ....................... 15
SECTION 2.10 Book-Entry Notes ............................ 15
SECTION 2.11 Notices to Clearing Agency .................. 16
SECTION 2.12 Definitive Notes ............................ 16
SECTION 2.13 Depositor as Noteholder ..................... 16
SECTION 2.14 Tax Treatment ............................... 16
ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest ........... 17
SECTION 3.2 Maintenance of Agency Office ................ 17
SECTION 3.3 Money for Payment to Be Held in Trust ....... 17
SECTION 3.4 Existence ................................... 19
SECTION 3.5 Protection of Trust Estate; Acknowledgment
of Pledge.................................. 19
SECTION 3.6 Opinions as to Trust Estate ................. 20
SECTION 3.7 Performance of Bond ......................... 20
SECTION 3.8 Negative Covenants .......................... 21
SECTION 3.9 Annual Statement as to Compliance ........... 22
SECTION 3.10 Consolidation, Merger, etc., of Issuer;
Disposition of Trust Assets................ 22
SECTION 3.11 Successor or Transferee ..................... 24
SECTION 3.12 No Other Business ........................... 24
SECTION 3.13 No Borrowing ................................ 24
SECTION 3.14 Guarantees, Loans, Advances and Other
Liabilities................................ 25
i
<PAGE>
Page
SECTION 3.15 Capital Expenditures ........................ 25
SECTION 3.16 Restricted Payments ......................... 25
SECTION 3.17 Notice of Events of Default ................. 25
SECTION 3.18 Further Instruments and Acts ................ 25
SECTION 3.19 Representations and Warranties by the
Issuer to the Indenture Trustee............ 26
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Indenture ..... 26
SECTION 4.2 Application of Trust Money .................. 27
SECTION 4.3 Repayment of Moneys Held by Paying Agent .... 27
SECTION 4.4 Duration of Position of Indenture Trustee ... 28
ARTICLE V
DEFAULT AND REMEDIES
SECTION 5.1 Events of Default ........................... 28
SECTION 5.2 Acceleration to Maturity; Rescission and
Annulment.................................. 29
SECTION 5.3 Collection of Indebtedness and Suits for
Enforcement by Indenture Trustee........... 30
SECTION 5.4 Remedies; Priorities ........................ 33
SECTION 5.5 Optional Preservation of the Collateral
Obligations................................ 34
SECTION 5.6 Limitation of Suits ......................... 34
SECTION 5.7 Unconditional Rights of Noteholders to
Receive Principal and Interest............. 35
SECTION 5.8 Restoration of Rights and Remedies .......... 35
SECTION 5.9 Rights and Remedies Cumulative .............. 36
SECTION 5.10 Delay or Omission Not a Waiver .............. 36
SECTION 5.11 Control by Noteholders ...................... 36
SECTION 5.12 Waiver of Past Defaults ..................... 37
SECTION 5.13 Undertaking for Costs ....................... 37
SECTION 5.14 Waiver of Stay or Extension Laws ............ 38
SECTION 5.15 Action on Notes ............................. 38
SECTION 5.16 Performance and Enforcement of Certain
Collateral Obligations..................... 38
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 Duties of Indenture Trustee ................. 39
SECTION 6.2 Rights of Indenture Trustee ................. 40
SECTION 6.3 Indenture Trustee May Own Notes ............. 40
SECTION 6.4 Indenture Trustee's Disclaimer .............. 41
SECTION 6.5 Notice of Defaults .......................... 41
SECTION 6.6 Reports by Indenture Trustee ................ 41
ii
<PAGE>
SECTION 6.7 Compensation; Indemnity ..................... 41
SECTION 6.8 Replacement of Indenture Trustee ............ 42
SECTION 6.9 Merger or Consolidation of Indenture Trustee. 43
SECTION 6.10 Appointment of Co-Indenture Trustee or
Separate Indenture Trustee................. 44
SECTION 6.11 Eligibility; Disqualification ............... 45
SECTION 6.12 Preferential Collection of Claims Against
Issuer..................................... 45
SECTION 6.13 Representations and Warranties of Indenture
Trustee.................................... 46
SECTION 6.14 Indenture Trustee May Enforce Claims
Without Possession of Notes................ 46
SECTION 6.15 Suit for Enforcement ........................ 47
SECTION 6.16 Rights of Noteholders to Direct Indenture
Trustee.................................... 47
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 Issuer to Furnish Indenture Trustee Names
and Addresses of Noteholders............... 47
SECTION 7.2 Preservation of Information, Communications
to Noteholders............................. 47
SECTION 7.3 Reports by Issuer ........................... 48
SECTION 7.4 Reports by Trustee .......................... 48
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 Collection of Money ......................... 49
SECTION 8.2 Designated Accounts ......................... 49
SECTION 8.3 Collection Account .......................... 49
SECTION 8.4 Note Payment Account ........................ 50
SECTION 8.5 Release of Trust Estate ..................... 50
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of
Noteholders................................ 50
SECTION 9.2 Supplemental Indenture With Consent of
Noteholders................................ 52
SECTION 9.3 Execution of Supplemental Indentures ........ 53
SECTION 9.4 Effect of Supplemental Indenture ............ 53
SECTION 9.5 Conformity with Trust Indenture ............. 54
SECTION 9.6 Reference in Notes to Supplemental
Indentures................................. 54
iii
<PAGE>
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 Redemption .................................. 54
SECTION 10.2 Notice of Redemption ........................ 55
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Compliance Certificates and Opinions, etc. .. 55
SECTION 11.2 Form of Documents Delivered to Indenture
Trustee................................... 57
SECTION 11.3 Acts of Noteholders ......................... 58
SECTION 11.4 Notices, etc., to Indenture Trustee, Issuer
and Rating Agency.......................... 58
SECTION 11.5 Notice to Noteholders; Waiver ............... 59
SECTION 11.6 Alternate Payment and Notice Provisions ..... 60
SECTION 11.7 Conflict with Trust Indenture Act ........... 60
SECTION 11.8 Effect of Headings and Table of Contents .... 60
SECTION 11.9 Successors and Assigns ...................... 60
SECTION 11.10 Separability ................................ 60
SECTION 11.11 Benefits of Indenture ....................... 60
SECTION 11.12 Legal Holidays .............................. 61
SECTION 11.13 GOVERNING LAW ............................... 61
SECTION 11.14 Counterparts ................................ 61
SECTION 11.15 Recording of Indenture ...................... 61
SECTION 11.16 No Recourse ................................. 61
SECTION 11.17 No Petition ................................. 62
APPENDIX A-I Form of Note.................................A-I-1
iv
<PAGE>
STANDARD TERMS AND PROVISIONS OF TRUST INDENTURE
This document constitutes Standard Terms and Provisions of Trust
Indenture which are to be incorporated by reference in, and attached as
Exhibit A to, one or more Series Trust Indentures by and between the Trust
(as defined herein), as Issuer, and First Trust of New York, National
Association, as Indenture Trustee.
Each Series Trust Indenture will create a trust indenture under
the laws of the State of New York to secure the payment of principal of and
interest on, and any other amounts owing in respect of, the Notes (as
defined herein), and to secure compliance with the provisions of the Series
Trust Indenture.
These Standard Terms shall be of no force and effect unless and
until incorporated by reference into a Series Trust Indenture.
The following terms and provisions shall govern the Notes and
Certificates (as defined herein), subject to contrary terms and provisions
expressly set forth in a Series Trust Indenture, which contrary terms and
provisions of the Series Trust Indenture shall control; provided, that no
such term or provisions of the Series Trust Indenture may limit, qualify or
conflict with Section 11.7 hereof.
<PAGE>
ARTICLE I
DEFINITION AND INCORPORATION BY REFERENCE
SECTION 1.1 DEFINITIONS. Except as otherwise specified herein
or as the context may otherwise require, the following terms have the
respective meanings set forth below for all purposes of this Indenture.
"ACT" means any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Indenture to be
given or taken by Noteholders may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such Noteholders.
"AFFILIATE" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and
the terms "controlling" and "controlled" have meaning correlative to the
foregoing.
"AGENCY OFFICE" means the Office required to be maintained by the
Issuer, at which Notes may be surrendered for registration of exchange, and
where notices and demands to and upon the Issuer may be served.
"AUTHORIZED OFFICER" means, with respect to the Issuer, any
Officer of the Owner Trustee who is authorized to act for the Owner Trustee
in matters relating to the issuer and who is identified on the list of
Authorized Officers delivered by the Owner Trustee to the Indenture Trustee
on the Closing Date (as such list may be modified or supplemented from time
to time thereafter).
"BASIC DOCUMENTS" means the Trust Agreement and this Indenture
and such other documents as specified in the Series Trust Indenture.
"BOOK-ENTRY NOTES" means Notes, ownership and transfer of which
is made through book entries by a Clearing Agency and its participants as
described in Section 2.10.
"BUSINESS DAY" has the meaning set forth in the Series Trust
Indenture.
"CERTIFICATE" means a certificate of a class of certificates
identified in the Series Trust Indenture, which Certificate has been issued
by the Issuer pursuant to the Trust Agreement.
2
<PAGE>
"CERTIFICATE PRINCIPAL AMOUNT" equals initially that amount set
forth and designated as such in the Trust Agreement, and thereafter, such
amount, as reduced by all amounts allocable to principal previously
distributed to Certificateholders.
"CLEARING AGENCY" means an organization registered as "clearing
agency" pursuant to Section 17A of the Exchange Act.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time, a
Clearing Agency effects book-entry transfers and pledges of securities
deposited with the Clearing Agency.
"CLOSING DATE" means the date set forth and designated as such in
the Series Trust Indenture.
"CODE" means the Internal Revenue Code of 1986, as amended from
time to time, and Treasury Regulations promulgated thereunder.
"COLLATERAL" has the meaning specified in the Series Trust
Indenture.
"COLLATERAL OBLIGATIONS" means the credit card securities or
receivables listed in the Series Trust Indenture.
"COLLECTION ACCOUNT" means the Bond Collection Account
established pursuant to Section 8.2 of this Indenture.
"COMMISSION" means the Securities and Exchange Commission.
"CORPORATE TRUST OFFICE" means the principal office of the
Indenture Trustee at which at any particular time its corporate trust
business shall be administered, which office at the date of the execution
of this Indenture is located at 100 Wall Street, Suite 1600, New York, New
York 10005, Attention: Marlene Fahey; or such other office as the
Indenture Trustee may designate from time to time by notice to the
Noteholders, the Certificateholders, the Owner Trustee and the Rating
Agency, or the principal corporate trust office of any successor Indenture
Trustee (in which case the successor Indenture Trustee will notify the
Noteholders, the Certificateholders, the Owner Trustee and the Rating
Agency of the address of such Office).
"DEFAULT" means any occurrence that is, with notice or the lapse
of time or both would become, an Event of Default.
"DEFINITIVE NOTES" has the meaning specified in Section 2.12.
"DEPOSITOR" means Structured Products Corp., a Delaware
corporation, and any permitted successor or assignee.
3
<PAGE>
"DESIGNATED ACCOUNTS" means the Collection Account, the Note
Payment Account and the Distribution Account created pursuant to Section
8.2 of this Indenture.
"DISTRIBUTION ACCOUNT" means the Certificate Distribution Account
established pursuant to Section 8.2 of this Indenture.
"DISTRIBUTION DATE" means any one of the dates set forth and
designated as Distribution Dates in the Series Trust Indenture upon which
payments in respect of the Certificates shall be due and payable.
"DTC" means the Depository Trust Company.
"EVENT OF DEFAULT" has the meaning specified in Section 5.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXECUTIVE OFFICER" means the with respect to any corporation,
the Chief Executive Officer, Chief Operating Officer, Chief Financial
Officer, President, Executive Vice President, any Vice President, the
Secretary or the Treasurer of such corporation; and with respect to any
partnership, any general partner thereof.
"FINAL CALL DATE" means the date, if any, specified as such in
the Series Trust Indenture.
"FINAL SCHEDULED PAYMENT DATE" means the date set forth and
designated as such in the Series Trust Indenture, which shall be the
Payment Date upon which the entire unpaid principal amount of the Notes
shall be due and payable.
"GRANT" means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create, and grant a lien upon
and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to this Indenture. A Grant of the Collateral or of
any other agreement or instrument shall include all rights, powers and
options (but none of the obligations) of the Granting party thereunder,
including the immediate and continuing right to claim for, collect, receive
and give receipt for principal and interest payments in respect of the
Collateral and all other moneys payable thereunder, to give and receive
notices and other communications, to make waivers or other agreements, to
exercise all rights and options, to bring proceedings in the name of the
Granting party or otherwise and generally to do and receive anything that
the Granting party is or may be entitled to do or receive thereunder or
with respect thereto.
"HOLDER" or "NOTEHOLDER" means the Person in whose name a Note is
registered on the Note Register.
4
<PAGE>
"INDENTURE" means the Trust Indenture consisting of the Series
Trust Indenture into which is incorporated by reference the standard terms,
including all exhibits, schedules, appendices, supplements and amendments
to each.
"INDENTURE TRUSTEE" means the First Trust of New York, National
Association, a New York banking corporation and any successor qualifying
under Section 6.11 of this Indenture.
"INDEPENDENT CERTIFICATE" means a certificate of a non-affiliated
accountant, engineer, appraiser or other expert as required by the TIA.
"INTEREST PERIOD" means, with respect to any Payment Date, the
period from and including the Payment Date immediately preceding such
Payment Date (or, in the case of the first such Payment Date, the Closing
Date), to but excluding such Payment Date.
"ISSUER" means the TIERS Asset-Backed Securities, Series CHAMT
Trust 1997-7, the trust created pursuant to the Trust Agreement and
identified as the Issuer in the Series Trust Indenture.
"ISSUER ORDER" and "ISSUER REQUEST" means a written order or
request signed in the name of the Issuer by any one of its Authorized
Officers and delivered to the Indenture Trustee.
"LETTER OF REPRESENTATIONS" means the Letter of Representations,
dated the Closing Date, from the Indenture Trustee and the Owner Trustee to
DTC, as Clearing Agency, with respect to the Notes.
"LIEN" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind.
"MOODY'S" means Moody's Investors Service, Inc., or a successor
thereto.
"NOTE" means a note of a class of Notes identified in the Series
Trust Indenture, which note has been issued by the Issuer pursuant to this
Indenture.
"NOTE DEPOSITORY" means the Clearing Agency, or any nominee
thereof, in whose name any Global Notes are registered.
"NOTE OWNER" means, with respect to a Book-Entry Note, the Person
who is the beneficial owner of such Book-Entry Note, as reflected on the
books of the Clearing Agency, or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, each case in accordance with the
rules of such Clearing Agency).
5
<PAGE>
"NOTE PAYMENT ACCOUNT" means the Note Payment Account established
pursuant to Section 8.2 of this Indenture.
"NOTE REGISTER" and "NOTE REGISTRAR" have the respective meanings
specified in Section 2.4.
"OFFICER'S CERTIFICATE" means a certificate signed by any
Authorized Officer of the Owner Trustee and delivered to the Indenture
Trustee. Unless otherwise specified, any reference in this Indenture to an
Officer's Certificate shall be to an Officer's Certificate of any
Authorized Officer of the Owner Trustee.
"OPINION OF COUNSEL" means one or more written opinions of
counsel who may, except as otherwise expressly provided in this Indenture,
be employees of or counsel to the Owner Trustee and who shall be
satisfactory to the Indenture Trustee, and which opinion or opinions shall
be addressed to the Indenture Trustee as Indenture Trustee, shall comply
with any applicable requirements of Section 11.1 of this Indenture, and
shall be in form and substance satisfactory to the Indenture Trustee.
"ORIGINAL NOTES" means the original notes issued hereunder to be
held by DTC, as Clearing Agency.
"OUTSTANDING" means, as of the date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions of the payment for which money in the
necessary amount has been theretofore deposited with the Indenture
Trustee or any Paying Agent in trust for the Holders of such Notes
(PROVIDED, HOWEVER, that if such Notes are to be redeemed, notice of
such redemption has been duly given pursuant to this Indenture or
provision therefor, satisfactory to the Indenture Trustee, has been
made); and
(iii) Notes in exchange for which or in lieu of which other
Notes have been authenticated and delivered pursuant to this
Indenture, unless proven satisfactory to the Indenture Trustee is
presented that any such Notes are held by a bona fide purchaser;
PROVIDED that in determining whether the Holders of the Notes have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Notes owned by the Issuer, the Depositor, the Indenture Trustee
or any Affiliate of any foregoing Persons shall be disregarded, and for
purposes of determining the requisite Outstanding Amount of Notes shall be
6
<PAGE>
deemed not to be Outstanding, except that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Notes
that the Indenture Trustee actually knows to be so owned shall be so
disregarded.
"OUTSTANDING AMOUNT" means the aggregate principal amount of all
Notes outstanding at the date of determination.
"OWNER TRUSTEE" means Delaware Trust Capital Management, Inc., a
Delaware banking corporation and any successor qualifying under Section
6.13 of the Trust Agreement.
"PAYING AGENT" means the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 and who is authorized by the Issuer to make the payments to
and distributions from the Note Payment Account, including payment of,
principal of or interest on the Notes, on behalf of the Issuer.
"PAYMENT DATE" means any one of the dates set forth in the Series
Trust Indenture upon which payments in respect of the Notes shall be due
and payable.
"PERSON" means any individual, corporation, estate, partnership,
joint venture, association, joint stock company, trust (including any
beneficiary thereof), unincorporated organization or government, or any
agency or political subdivision thereof.
"PREDECESSOR NOTE" means, with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this definition,
any Note authenticated and delivered under Section 2.5 in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the
same debt as the mutilated, lost, destroyed or stolen Note.
"PROCEEDING" means any suit in equity, action at law or other
judicial or administrative proceeding.
"RATING AGENCY" means the credit rating agency identified in the
Series Trust Indenture. If more than one credit rating agency is
identified in the Series Trust Indenture, any reference herein to "Rating
Agency" shall be deemed to include each such credit rating agency. If such
organization or successor is no longer in existence, "Rating Agency" shall
be a United States nationally recognized statistical rating organization or
other comparable Person designated by the Depositor, notice of designation
shall be given to the Indenture Trustee.
"RATING AGENCY CONDITION" means, with respect to any action, that
the Rating Agency shall have been given 10 days prior notice thereof, and
that the Rating Agency shall have notified the Issuer in writing that such
action will not result in a reduction or withdrawal of the then current
rating of the Notes.
7
<PAGE>
"RECORD DATE" means, with respect to a Payment Date or Redemption
Date, the day identified in the Series Trust Indenture.
"REDEMPTION DATE" means any date set for the redemption of the
Notes upon satisfaction of the conditions for early redemption.
"REDEMPTION PRICE" means an amount equal to the unpaid principal
amount of the Notes redeemed, plus accrued and unpaid interest thereon, but
excluding the Redemption Date, plus the redemption premium, if any.
"REGISTERED HOLDER" means the Person in whose name a Note is
registered on the Note Register on the applicable Record Date.
"RESPONSIBLE OFFICER" means, with respect to the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture
Trustee, including any Vice President, Assistant Vice President, Secretary,
Assistant Secretary, or any other officer of the Indenture Trustee
customarily performing functions similar to those performed by any of the
above designated officers, and also with respect to a particular matter,
any other officer to whom such matter is referred because of such officer's
knowledge and familiarity with the particular subject.
"STANDARD & POOR'S" means Standard & Poor's Ratings Services, and
any successor thereto.
"TRUST AGREEMENT" means the trust agreement identified in the
Series Trust Indenture.
"TRUST ESTATE" means all money, instruments, rights and other
property that are subject to or intended to be subject to the lien and
security interest of this Indenture for the benefit of the Noteholders
(including, without limitation, all property and interests Granted to the
Indenture Trustee pursuant to this Indenture), including all proceeds
thereof.
"TIA" means the Trust Indenture Act of 1939, as amended.
"UCC" means the Uniform Commercial Code, as in effect in the
State of Delaware, as amended from time to time.
SECTION 1.2 OTHER DEFINITIONAL PROVISIONS. Capitalized terms
used in this Indenture and not otherwise defined herein shall have the
respective meanings assigned them in the Trust Agreement. All references
in this Indenture to articles, sections, subsections and exhibits are the
same contained in or attached to this Indenture unless otherwise specified.
All terms defined in this Indenture shall have the defined meanings when
used in any certificate, notice, Note or other document made or delivered
pursuant hereto, unless otherwise defined therein.
8
<PAGE>
SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, such provision is
incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture trustee" means the Indenture Trustee.
"obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by a
Commission rule have the respective meanings assigned to them by such
definitions.
ARTICLE II
THE NOTES
SECTION 2.1 FORM.
(a) The Notes, together with the Indenture Trustee's Certificate
of Authentication, shall be in substantially the forms set forth in
Appendix A corresponding to the types of Notes designated in the Series
Trust Indenture, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and
may have such letters, numbers or other marks of identification and such
legends or endorsements placed thereon as may, consistently herewith, be
determined by the officers executing such Notes, as evidenced by their
execution of the Notes. Any portion of the text of any Note may be set
forth on the reverse thereof, with an appropriate reference thereto on the
face of the Note.
(b) The Definitive Notes shall be typewritten, printed,
lithographed or engraved, or produced by any combination of these methods
(with or without steel engraved borders), all as determined by the officers
executing such Notes, as evidenced by their execution of such Notes.
SECTION 2.2 EXECUTION; AUTHENTICATION AND DELIVERY.
(a) Each Note shall be dated the date of its authentication, and
shall be issuable as a registered Note in any authorized denomination set
forth in the Series Trust Indenture.
9
<PAGE>
(b) The Notes shall be executed on behalf of the Issuer by any
Authorized Officer of the Owner Trustee. The signature of any such
Authorized Officer of the Notes may be manual or facsimile.
(c) Notes bearing the manual or facsimile signature of
individuals who were at any time Authorized Officers of the Owner Trustee
shall bind the issuer, notwithstanding that such individuals or any of them
have ceased to hold such office prior to the authentication and delivery of
such Notes, or did not hold such office at the date of such Notes.
(d) The Indenture Trustee, in exchange for the Collateral
Obligations, simultaneously with the sale, assignment and transfer to the
Indenture Trustee of the Collateral Obligations, shall cause to be
authenticated and delivered to or upon the order of the Issuer, the Notes
for original issue in an aggregate principal amount set forth in the Series
Trust Indenture. The aggregate principal amount of Notes outstanding at
any time may not exceed that amount except as provided in Section 2.5.
Such Notes shall be duly authenticated by the Indenture Trustee, in
authorized denominations.
(e) No Note shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose, unless there appears
on such Note a Certificate of Authentication substantially in the form set
forth in Appendix A, executed by the Indenture Trustee by manual signature
of one of its Authorized Officers, and such certificate upon any Note shall
be conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
SECTION 2.3 ORIGINAL NOTES.
(a) The Issuer shall execute, and upon receipt of an Issuer
Order the Indenture Trustee shall authenticate and deliver, Original Notes
which are printed, lithographed, typewritten, mimeographed or otherwise
produced, with such variations from the forms of such Notes set forth in
Appendix A as are consistent with the terms of this Indenture as the
officers executing such Notes may determine, as evidenced by their
execution of such Notes.
(b) Under the circumstances set forth in Section 2.12, the
Issuer shall cause Definitive Notes to be prepared. After the preparation
of Definitive Notes, the Original Notes shall be exchangeable for
Definitive Notes upon surrender of the Original Notes at the Agency Office
of the Issuer to be maintained as provided in Section 3.2, without charge
to the Noteholder. Upon surrender or cancellation of any one or more
Original Notes, the Issuer shall execute and the Indenture Trustee shall
authenticate and deliver in exchange, a like principal amount of Definitive
Notes of authorized denominations. Until so delivered in exchange, the
Original Notes shall in all respects be entitled to the same benefits under
this Indenture as Definitive Notes.
10
<PAGE>
SECTION 2.4 REGISTRATION; REGISTRATION OF TRANSFER AND
EXCHANGE OF NOTES.
(a) The Issuer shall cause to be kept a Note Register for the
Notes in which, subject to such reasonable regulations as it may prescribe,
the Issuer shall provide for the registration of the Notes and the
registration of transfers of the Notes. The Indenture Trustee shall
initially be the Note Registrar for the purpose of registering the Notes
and transfers of the Notes as herein provided. Upon any resignation of any
Note Registrar, the Issuer shall promptly appoint a successor or, if it
elects not to make such an appointment, assume the duties of the Note
Registrar.
(b) If a Person other than the Indenture Trustee is appointed by
the Issuer as Note Registrar, the Issuer will give the Indenture Trustee
prompt written notice of the appointment of such Note Registrar and of the
location, and any change in the location, of the Note Register. The
Indenture Trustee shall have the right to inspect the Note Register at all
reasonable times and to obtain copies thereof. The Indenture Trustee shall
have the right to rely upon a certificate executed on behalf of the Note
Registrar by an Executive Officer thereof as to the name and addresses of
the Noteholders and the principal amounts and number of such Notes.
(c) Upon surrender for registration of transfer of any Note at
the Corporate Trust Office of the Indenture Trustee or the Agency Office of
the Issuer (and following the delivery in the former case of such Notes to
the Issuer by the Indenture Trustee), the Issuer shall execute, the
Indenture Trustee shall authenticate and the Noteholder shall obtain from
the Indenture Trustee, in the name of the designated transferee or
transferees, one or more new Notes of the same series and class in any
authorized denominations, of a like aggregate principal amount.
(d) At the option of the Noteholder, Notes may be exchanged for
other Notes of the same series and class in any authorized denominations of
a like aggregate principal amount, upon surrender of the Notes to be
exchanged at the Corporate Trust Office of the Indenture Trustee or the
Agency Office; provided, however, that in the latter case the Issuer agrees
that such surrendered Notes shall be promptly delivered to the Indenture
Trustee. Whenever any Notes are so surrendered for exchange, the Issuer
shall execute, and the Indenture Trustee shall authenticate and the
Noteholder shall obtain from the Indenture Trustee, the Notes which the
Noteholder making the exchange is entitled to receive.
(e) All Notes issued upon any registration of transfer or
exchange of Notes shall be the valid obligations of the Issuer, evidencing
the same debt, and entitled to the same benefits under the Indenture, as
the Notes surrendered upon such registration of transfer or exchange.
11
<PAGE>
(f) Every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed by, or be accompanied by a
written instrument of transfer in a form satisfactory to the Indenture
Trustee and the Note Registrar, duly executed by the Holder thereof or such
Holder's attorney duly authorized in writing, with such other documents as
the Indenture Trustee may require.
(g) No service charge shall be made to a Holder for any
registration of transfer or exchange of Notes, but the Issuer or Indenture
Trustee may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration
of transfer or exchange of Notes, other than exchanges pursuant to Section
2.3 or 9.6 not involving any transfer.
(h) The preceding provisions of this Section 2.4
notwithstanding, the Issuer shall not be required to transfer or make
exchanges, and the Note Registrar need not register transfers or exchanges
of Notes that: (i) have been selected for redemption pursuant to Article X,
if applicable; or (ii) are due for repayment within 15 days of submission
to the Corporate Trust Office or the Agency Office.
SECTION 2.5 MUTILATED, DESTROYED, LOST OR STOLEN NOTES.
(a) If (i) any mutilated Note is surrendered to the Indenture
Trustee, or the Indenture Trustee receives evidence to its satisfaction of
the destruction, loss or theft of any Note, and (ii) there is delivered to
the Indenture Trustee such security or indemnity as may be required by it
to hold the Issuer and the Indenture Trustee harmless, then in the absence
of notice to the Issuer, the Note Registrar, or the Indenture Trustee that
such Note has been acquired by a bona fide purchaser, the Issuer shall
execute and upon the Issuer's request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note of a like aggregate
principal amount; provided, however, that if any such destroyed, lost or
stolen Note, but not a mutilated Note, shall have become or within seven
days shall be due and payable, or shall have been called for redemption,
instead of issuing a replacement Note, the Issuer may pay to the Holder of
such destroyed, lost or stolen Note the amount due and payable thereon when
so due or payable or upon the Redemption Date without surrender thereof.
(b) If, after the delivery of a replacement Note or payment in
respect of a destroyed, lost or stolen Note pursuant to subsection (a), a
bona fide purchaser of the original Note in lieu of which such replacement
Note was issued presents for payment such original Note, the Issuer and the
Indenture Trustee shall be entitled to recover such replacement Note (or
such payment) from (i) any Person to whom it was delivered; (ii) the Person
12
<PAGE>
taking such replacement Note from the Person to whom such replacement Note
was delivered; or (iii) any assignee of such Person, except a bona fide
purchaser, and the Issuer and the Indenture Trustee shall be entitled to
recovery upon the security or indemnity provided therefor to the extent of
any loss, damage, cost or expense incurred by the Issuer or the Indenture
Trustee in connection therewith.
(c) In connection with the issuance of any replacement Note
under this Section 2.5, the Issuer may require the payment by the Holder of
such Note of a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto, and any other reasonable expenses
(including all fees and expenses of the Indenture Trustee) connected
therewith.
(d) Any duplicate Note issued pursuant to this Section 2.5 in
replacement for any mutilated, destroyed, lost or stolen Note shall
constitute an original additional contractual obligation of the Issuer,
whether or not the mutilated, destroyed, lost or stolen Note shall be found
at any time or be enforced by any Person, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all
other Notes duly issued hereunder.
(e) The provisions of this Section 2.5 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect
to the replacement or payment of mutilated, destroyed, lost or stolen
Notes.
SECTION 2.6 PERSONS DEEMED NOTEHOLDERS. Prior to presentment
for registration of transfer of any Note, the Issuer, the Indenture Trustee
and any agent of the Issuer or the Indenture Trustee may treat the Person
in whose name any Note is registered (as of the day of determination) as
the Noteholder for the purpose of receiving payments of principal of and
interest on such Note and for all other purposes whatsoever, whether or not
such Notes be overdue, and neither the Issuer, the Indenture Trustee nor
any agent of the Issuer or the Indenture Trustee shall be affected by
notice to the contrary.
SECTION 2.7 PAYMENT OF PRINCIPAL AND INTEREST.
(a) Each Note of a series and class of Notes shall be entitled
to payments of interest as provided in the form of Note for such series and
class set forth in Appendix A, and such interest shall be payable on each
Payment Date as specified therein. Any installment of interest payable on
any Note which is punctually paid or duly provided for by a deposit by or
at the direction of the Issuer into the Note Payment Account on the
applicable Payment Date shall be paid to the Person in whose name such Note
(or one or more Predecessor Notes) is registered on the applicable Record
Date, by check mailed first-class, postage prepaid to such Person's address
as it appears on the Note Register on such Record Date; provided, however,
13
<PAGE>
that unless and until Definitive Notes have been issued pursuant to Section
2.12 with respect to Notes registered on the applicable Record Date in the
name of the Note Depository (initially, Cede & Co.), payment shall be made
by wire transfer in immediately available funds to the account designated
by the Note Depository.
(b) The entire unpaid principal amount of the Notes shall be due
and payable, if not previously paid, if:
(i) an Event of Default shall have occurred and be
continuing; and
(ii) the Indenture Trustee or the Noteholders representing
not less that 25% of the Outstanding Amount of the Notes have declared
the Notes to be immediately due and payable in the manner provided in
Section 5.2.
(c) Following an Event of Default and the acceleration of the
Notes as aforesaid, except to the extent otherwise specifically provided
herein, (i) Noteholders will be entitled to ratable repayment of principal
on the basis of their respective unpaid principal balances and (ii)
repayment in full of the accrued interest on and unpaid principal balances
of the Notes will be made prior to any further payment of interest or
principal on the Certificates in respect of the Certificate Principal
Amount.
(d) The Indenture Trustee shall notify each Noteholder of record
as of the Record Date for a Payment Date, of the fact that the final
installment of principal of and interest on such Note is to be paid on such
Payment Date. Such notice shall be sent (i) on such Record Date by
facsimile, if Book-Entry Notes are outstanding; or (ii) not later than
three Business Days after such Record Date in accordance with Section
11.5(a), if Definitive Notes are outstanding, and shall specify that such
final installment shall be payable only upon presentation and surrender of
such Note and shall specify the place where such Note may be presented and
surrendered for payment of such installment. Notices in connection with
redemptions of Notes shall be mailed to Noteholders as provided in Section
10.2.
SECTION 2.8 CANCELLATION OF NOTES. All Notes surrendered for
payment, redemption, exchange or registration of transfer shall, if
surrendered to any Person other than the Indenture Trustee, be delivered to
the Indenture Trustee and shall be promptly cancelled by the Indenture
Trustee. The Issuer may at any time deliver to the Indenture Trustee for
cancellation any Notes previously authenticated and delivered hereunder
which the Issuer may have acquired in any manner whatsoever, and all Notes
so delivered shall be promptly cancelled by the Indenture Trustee. No
Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section 2.8, except as expressly permitted by
this Indenture. All cancelled Notes may be held or disposed of by the
14
<PAGE>
Indenture Trustee in accordance with its standard retention or disposal
policy as in effect at the time unless the Issuer shall direct by an Issuer
Order that they be destroyed or returned to it; provided, however, that
such Issuer Order is timely and the Notes have not been previously disposed
of by the Indenture Trustee.
SECTION 2.9 RELEASE OF COLLATERAL. Subject to Section 11.1,
the Indenture Trustee shall release property from the lien of this
Indenture, including a release of property pursuant to Section 10.4, only
upon receipt of an Issuer Request accompanied by an Officers' Certificate,
an Opinion of Counsel, and Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) or an Opinion of Counsel in lieu of such
Independent Certificates, to the effect that the TIA does not require any
such Independent Certificates.
SECTION 2.10 BOOK-ENTRY NOTES. The Notes, upon original
issuance, shall be issued in the form of a typewritten Original Note or
Notes representing the Book-Entry Notes, to be delivered to DTC, the
initial Clearing Agency, by or on behalf of the Issuer. Such Original Note
or Notes shall be registered on the Note Register in the name of the Note
Depository, and no Note Owner shall receive a Definitive Note representing
such Note Owner's interest in such Note, except as provided in Section
2.12. Unless and until the Definitive Notes have been issued to Note
Owners pursuant to Section 2.12:
(a) the provisions of this Section 2.10 shall be in full force
and effect;
(b) the Note Registrar and then Indenture Trustee shall be
entitled to deal with the Clearing Agency for all purposes of this
Indenture (including the payment of principal of and interest on the Notes
and the giving of instructions or directions hereunder) as the sole holder
of the Notes and shall have no obligation to the Note Owners;
(c) to the extent that the provisions of this Section 2.10
conflict with any other provisions of this Indenture, the provisions of
this Section 2.10 shall control;
(d) the rights of the Note Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by
law and agreements between such Note Owners and the Clearing Agency and/or
the Clearing Agency Participants. Unless and until Definitive Notes are
issued pursuant to Section 2.12, the initial Clearing Agency shall make
book-entry transfers between the Clearing Agency Participants and receive
and transmit payments of principal of and interest on the Notes to such
Clearing Agency Participants, pursuant to the Letter of Representations;
and
(e) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes evidencing
a specified percentage of the Outstanding Amount of the Notes, the Clearing
Agency shall be deemed to represent such percentage only to the extent that
15
<PAGE>
it has (i) received instructions to such effect from Note Owners and/or
Clearing Agency Participants owning or representing respectively, such
required percentage of the beneficial interest in the Notes; and (ii) has
delivered such instructions to the Indenture Trustee.
SECTION 2.11 NOTICES TO CLEARING AGENCY. Whenever a notice or
other communication to the Noteholders is required under this Indenture,
unless and until Definitive Notes shall have been issued to Note Owners
pursuant to Section 2.12, the Indenture Trustee shall give all such notices
and communications specified herein to be given to Noteholders to the
Clearing Agency, and shall have no obligation to the Note Owners.
SECTION 2.12 DEFINITIVE NOTES. If (i) the Depositor advises
the Indenture Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with respect to
the Notes and the Issuer is unable to locate a qualified successor; or (ii)
the Depositor, at its option, advises the Indenture Trustee in writing that
it elects to terminate the book-entry system through the Clearing Agency;
or (iii) after the occurrence of an Event of Default, Note Owners
representing beneficial interests aggregating at least a majority of the
Outstanding Amount of the Notes advise the Clearing Agency in writing that
the continuation of a book-entry system through the Clearing Agency is no
longer in the best interests of the Note Owners, then the Indenture Trustee
shall notify the Clearing Agency of the occurrence of any such event and of
its intent to make Definitive Notes available to Note Owners, and shall
request the surrender to the Indenture Trustee of the typewritten Original
Note or Notes representing the Book-Entry Notes by the Clearing Agency.
Upon such surrender, accompanied by registration instructions from the
Clearing Agency, the Issuer shall execute and the Indenture Trustee shall
authenticate the Definitive Notes in accordance with the instructions of
the Clearing Agency. Neither the Issuer, the Note Registrar or the
Indenture Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Notes, the
Indenture Trustee shall recognize the Holders of the Definitive Notes as
Noteholders.
SECTION 2.13 DEPOSITOR AS NOTEHOLDER. Subject to the proviso
set forth in the definition of "Outstanding" in Section 1.1, the Depositor
in its individual or any other capacity may become the owner or pledger of
Notes and may otherwise deal with the Issuer or its affiliates with the
same rights it would have if it were not the Depositor.
SECTION 2.14 TAX TREATMENT. The Issuer and the Indenture
Trustee, by entering into this Indenture, and the Noteholders by acquiring
any Notes or Interests therein, (i) express their intention that the Notes
qualify under applicable tax law as indebtedness secured by the Collateral
16
<PAGE>
Obligations, and (ii) unless otherwise required by appropriate taxing
authorities, agree to treat the Notes as indebtedness secured by the
Collateral Obligations for the purpose of federal income taxes, state and
local income and franchise taxes and any other taxes imposed upon, measured
by or based upon gross or net income.
ARTICLE III
COVENANTS
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer
shall duly and punctually pay the principal and interest on the Notes in
accordance with the terms of the Notes and this Indenture. On each Payment
Date and on the Redemption Date, the Issuer shall cause all amounts on
deposit in the Note Payment Account to be distributed to the Noteholders in
accordance with Section 8.5, less amounts properly withheld under the Code
or applicable state law by any Person from a payment to any Noteholder of
interest and/or principal. Any amounts so withheld shall be considered as
having been paid by the Issuer to such Noteholder for all purposes of this
Indenture.
SECTION 3.2 MAINTENANCE OF AGENCY OFFICE. As long as any of
the Notes remains outstanding, the Issuer shall maintain in the Borough of
Manhattan, New York City, an office (the "Agency Office"), being an office
or agency where Notes may be surrendered to the Issuer for registration of
transfer or exchange, and where notices and demands to or upon the Issuer
in respect of the Notes and this Indenture may be served. The Issuer
hereby initially appoints the Indenture Trustee to serve as its agent for
the foregoing purposes. The Issuer shall give prompt written notice to the
Indenture Trustee of the location, and of any change in the location, of
any such office or agency. If at any time the Issuer shall fail to
maintain any such office or agency or shall fail to furnish the Indenture
Trustee with the address thereof, such surrenders, notices and demands may
be made or served at the Corporate Trust Office of the Indenture Trustee,
and the Issuer hereby appoints the Indenture Trustee as its agent to
receive all such surrenders, notices, and demands.
SECTION 3.3 MONEY FOR PAYMENT TO BE HELD IN TRUST.
(a) As provided in Section 8.2, all payments of amounts due and
payable with respect to any Notes that are to be made from amounts
withdrawn from the Note Payment Account pursuant to Section 8.5 shall be
made on behalf of the Issuer by the Indenture Trustee or by another Paying
Agent, and no amounts so withdrawn from the Note Payment Account for
payments of Notes shall be paid over to the Issuer except as provided in
this Section 3.3.
(b) On or before the Business Day next preceding each Payment
Date or the Redemption Date, the Issuer shall deposit or cause to be
deposited in the Note Payment Account an aggregate sum sufficient to pay
17
<PAGE>
the amounts then becoming due, such sum to be held in trust for the benefit
of the Persons entitled thereto and (unless the Paying Agent is the
Indenture Trustee) shall promptly notify the Indenture Trustee of its
action or failure so to act.
(c) The Issuer shall cause each Paying Agent other than the
Indenture Trustee to execute and deliver to the Indenture Trustee an
instrument in which such Paying Agent shall agree with the Indenture
Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so
agrees), subject to the provisions of this Section 3.3, that such Paying
Agent shall:
(i) hold all sums held by it for the payment of amounts due
with respect to the Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by the
Issuer of which it has actual knowledge (or any other obligor upon the
Notes) in the making of any payment required to be made with respect
to the Notes;
(iii) at any time during the continuance of any such default,
upon the written request of the Indenture Trustee, forthwith pay to
the Indenture Trustee all sums so held in trust by such Paying Agent
for deposit by the Indenture Trustee in the applicable Designated
Account;
(iv) immediately resign as a Paying Agent and forthwith pay
to the Indenture Trustee all sums held by it in trust for the payment
of Notes if at any time it ceases to meet the standards required to be
met by a Paying Agent in effect at the time of determination; and
(v) comply with all requirements of the Code with respect
to the withholding from any payments made by it on any Notes of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
(d) The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by
Issuer order direct any Paying Agent to pay to the Indenture Trustee all
sums held in trust by such Paying Agent, such sums to be held by the
Indenture Trustee upon the same trusts as those upon which the sums were
held by such Paying Agent; and upon such payment by any Paying Agent to the
Indenture Trustee, such Paying Agent shall be released from all further
liability with respect to such money.
(e) Subject to all applicable laws with respect to escheat of
funds, any money held by the Indenture Trustee or any Paying Agent in trust
for the payment of any amount due with respect to any Note and remaining
18
<PAGE>
unclaimed for one year after such amount has become due and payable shall
be discharged from such trust and be paid to the Issuer on Issuer Request;
and the Holder of such Note shall thereafter, as an unsecured general
creditor, look only to the Issuer for payment thereof (but only to the
extent of the amounts so paid to the Issuer), and all liability of the
Indenture Trustee or such Paying Agent with respect to such trust money
shall thereupon cease; provided, however, that the Indenture Trustee or
such Paying Agent, before being required to make any such repayment, may at
the expense of the Issuer cause to be published once, in a newspaper
published in the English language, customarily published on each Business
Day and of general circulation in New York City, notice that such money
remains unclaimed and that, after a date specified therein, which shall not
be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining shall be repaid to the Issuer. The
Indenture Trustee may also adopt and employ, at the expense of the Issuer,
any other reasonable means of notification of such repayment (including,
but not limited to, mailing notice of such repayment to Holders whose Notes
have been called but have not been surrendered for redemption or whose
right or interest in moneys due and payable but not claimed is determinable
from the records of the Indenture Trustee or of any Paying Agent, at the
last address of record for each such Holder).
SECTION 3.4 EXISTENCE. The Issuer shall keep in full effect
its existence, rights and franchises as a business trust under the laws of
the State of Delaware (unless it becomes, or any successor Issuer hereunder
is or becomes, organized under the laws of any other State or of the United
States of America, in which case the Issuer shall keep in full effect its
existence, rights and franchises under the laws of such other jurisdiction)
and shall obtain and preserve its qualification to do business in each
jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Indenture, the Notes, the
Collateral and each other instrument or agreement included in the Trust
Estate.
SECTION 3.5 PROTECTION OF TRUST ESTATE; ACKNOWLEDGMENT OF
PLEDGE. The Issuer shall from time to time execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other
instruments, and shall take such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest
(and the priority thereof) of this Indenture or carry out more
effectively the purposes hereof;
(ii) perfect, publish notice of or protect the validity of
any Grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
19
<PAGE
(iv) preserve and defend title to the Trust Estate and the
rights of the Indenture Trustee and the Noteholders in such Trust
Estate against the claims of all persons and parties,
and the Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement
or other instrument required by the Indenture Trustee pursuant to this
Section 3.5.
SECTION 3.6 OPINIONS AS TO TRUST ESTATE.
(a) On the Closing Date, the Issuer shall furnish to the
Indenture Trustee an Opinion of Counsel to the effect that, in the opinion
of such counsel, such action has been taken with respect to the recording
and filing of this Indenture, any indentures supplemental hereto and any
other requisite documents, and with respect to the execution and filing of
any financing statements and continuation statement as are necessary to
perfect and make effective the lien and security interest of this Indenture
and reciting the details of such action, or stating that in the opinion of
such counsel, no such action is necessary to make such lien and security
interest effective.
(b) On or before the date set forth in the Series Trust
Indenture in each calendar year, beginning on the date set forth in the
Series Trust Indenture, the Issuer shall furnish to the Indenture Trustee
an Opinion of Counsel to the effect that, in the opinion of such counsel,
such action has been taken with respect to the recording, filing, re-
recording and refiling of this Indenture, any indentures supplemental
hereto and any other requisite documents and with respect to the execution
and filing of any financing statements and continuation statements as is
necessary to maintain the lien and security interest created by this
Indenture and reciting the details of such action or stating that in the
opinion of such counsel no such action is necessary to maintain the lien
and security interest created by this Indenture. Such Opinion of Counsel
shall also describe the recording, filing, re-recording and refiling of
this Indenture, any indentures supplemental hereto and any other requisite
documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be
required to maintain the lien and security interest of this Indenture until
such date in the following calendar year.
SECTION 3.7 PERFORMANCE OF BOND.
(a) The Issuer shall not take any action and shall use best
efforts not to permit any action to be taken by others that would release
any Person from any of such Person's material covenants or obligations
under any instrument or agreement included in the Trust Estate or that
would result in the amendment, hypothecation, subordination, termination or
20
<PAGE>
discharge of, or impair the validity or effectiveness of any such
instrument or agreement, except as expressly provided in this Indenture or
such other instrument or agreement.
(b) The Issuer may contract with other Persons to assist in
performing its duties under this Indenture, and any performance of such
duties by a Person identified to the Indenture Trustee in an Officers'
Certificate of the Issuer shall be deemed to be action taken by the Issuer.
(c) The Issuer shall punctually perform and observe all of its
obligations and agreements contained in this Indenture, the Basic Documents
and in the instruments and agreements included in the Trust Estate,
including but not limited to filing or causing to be filed all UCC
financing statements and continuation statements required to be filed by
the terms of this Indenture in accordance with and within the time periods
provided for therein and therein.
(d) Subject to Article IX, without derogating from the absolute
nature of the assignment granted to the Indenture Trustee under this
Indenture or the rights of the Indenture Trustee hereunder, the Issuer
agrees that it shall not, without the prior written consent of the
Indenture Trustee or the Holders of at least a majority in Outstanding
Amount of the Notes, as applicable, in accordance with the terms thereof,
amend, modify, waive, supplement, terminate or surrender, or agree to any
amendment, modification, supplement, termination, waiver or surrender of,
the terms of the Collateral Obligations or the Basic Documents, or waive
timely performance or observance by the Depositor under the Trust
Agreement. If any such amendment, modification, supplement or waiver shall
be so consented to by the Indenture Trustee or such Holders as applicable,
the Issuer agrees, promptly following a request by the Indenture Trustee to
do so, to execute and deliver, in its own name and at its own expense, such
agreements, instruments, consents and other documents as the Indenture
Trustee may deem necessary or appropriate in the circumstances.
SECTION 3.8 NEGATIVE COVENANTS. So long as any Notes are
Outstanding, the Issuer shall not:
(a) sell, transfer, exchange or otherwise dispose of any of the
properties or assets of the Issuer, except in accordance with Section
3.10(b) of this Indenture;
(b) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than amounts
properly withheld from such payments under the Code or applicable state
law) or assert any claim against any present or former Noteholder by reason
of the payment of the taxes levied or assessed upon any part of the Trust
Estate;
(c) voluntarily commence any insolvency, readjustment or debt,
marshalling of assets and liabilities or other proceeding, or apply for an
21
<PAGE>
order by a court or agency or supervisory authority for the winding-up or
liquidation of its affairs or any other event specified in Section 5.1(f);
or
(d) permit (i) the validity or effectiveness of this Indenture
to be impaired, or permit the lien of this Indenture to be amended,
hypothecated, subordinated, terminated or discharge, or any Person to be
released from any covenants or obligations with respect to the Notes under
this Indenture except as may be expressly permitted hereby; (ii) any lien
charge, excise, claim, security interest, mortgage or other encumbrance
(other than the lien of this Indenture) to be created on or extend to or
otherwise arise upon or burden the Trust Estate or any part thereof or any
interest therein or the proceeds thereof; or (iii) the lien of this
Indenture not to constitute a valid first priority security interest in the
Trust Estate.
SECTION 3.9 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer
shall deliver to the Rating Agency and the Indenture Trustee, on or before
the date set forth in the Series Trust Indenture, beginning on the date set
forth in the Series Trust Indenture, an Officer's Certificate signed by an
Authorized Officer, dated as of the date set forth in the Series Trust
Indenture of such year, stating that:
(a) a review of the activities of the Issuer during such fiscal
year and of performance under this Indenture has been made under such
Authorized Officer's supervision; and
(b) to the best of such Authorized Officer's knowledge, based on
such review, the Issuer has fulfilled all of its obligations under this
Indenture throughout such year, or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to
such Authorized Officer and the nature and status thereof. A copy of such
certificate may be obtained by any Noteholder by a request in writing to
the Issuer addressed to the Corporate Trust Office of the Indenture
Trustee.
SECTION 3.10 CONSOLIDATION, MERGER, ETC., OF ISSUER;
DISPOSITION OF TRUST ASSETS.
(a) The Issuer shall not consolidate or merge with or into any
other Person, unless:
(i) the Person (if other than the Issuer) formed by or
surviving such consolidation or merger shall be a Person organized and
existing under the laws of the United States of America, or any State
and shall expressly assume by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in a form
satisfactory to the Indenture Trustee, the due and punctual payment of
the principal of and interest on all Notes and the performance or
observance of every agreement and covenant of this indenture on the
part of the Issuer to be performed or observed, all as provided
herein;
22
<PAGE>
(ii) immediately after giving effect to such merger or
consolidation, no Default or Event of Default shall have occurred and
be continuing;
(iii) owners of at least 66-2/3% of the Outstanding Amount of
the Notes shall have consented to such transaction and the Rating
Agency Condition shall have been satisfied with respect to such
transaction; and
(iv) The Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel addressed
to the Issuer, stating that such consolidation or merger and such
supplemental indenture comply with the foregoing requirements and
shall have no material adverse tax consequences to the Issuer or to
any Noteholders or Certificateholders.
(b) Except as expressly permitted by this Indenture or the other
Basic Documents, the Issuer shall not sell, convey, exchange, transfer or
otherwise dispose of any of its properties or assets, including those
included in the Trust Estate, to any Person, unless:
(i) the Person that acquires such properties or assets of
the Issuer (A) shall be a United States citizen or a Person organized
and existing under the laws of the United States of America or any
State and (B) by an Indenture supplemental hereto, executed and
delivered to the Indenture Trustee, in form satisfactory to the
Indenture Trustee:
(1) expressly assumes the due and punctual payment of
the principal and interest on all Notes and the performance or
observance of every agreement and covenant of this Indenture on
the part of the Issuer to be performed or observed, all as
provided herein;
(2) expressly agrees that all rights, title and
interest so sold, conveyed, exchanged, transferred or otherwise
disposed of shall be subject and subordinate to the rights of
Noteholders;
(3) unless otherwise provided in such supplemental
indenture, expressly agrees to indemnify, defend and hold
harmless the Issuer against and from any loss, liability or
expense arising under or related to this Indenture and the Notes;
and
(4) expressly agrees that such Person (or if a group
of Persons, then one specified Person) shall make all filings
with the Commission (and any other appropriate Person) required
by the Exchange Act in connection with the Notes;
23
<PAGE>
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) owners of at least 66-2/3% of the Outstanding Amount of
the Notes shall have consented to such transaction and the Rating
Agency Condition shall have been satisfied with respect to such
transaction; and
(iv) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel addressed
to the Issuer, stating that such sale, conveyance, exchange, transfer
or disposition and such supplemental indenture comply with the
foregoing requirements, and shall have no material adverse tax
consequence to the Issuer or to any Noteholders or Certificateholders.
(c) The Issuer shall not liquidate or dissolve without the
consent of owners of at least 66-2/3% of the Outstanding Amount of the
Notes.
SECTION 3.11 SUCCESSOR OR TRANSFEREE.
(a) Upon any consolidation or merger of the Issuer in accordance
with Section 3.10(a), the Person formed by or surviving such consolidation
or merger (if other than the Issuer) shall succeed to, and be substituted
for, and may exercise every right and power of, the Issuer under this
Indenture with the same effect as if such Person had been named as the
Issuer herein.
(b) Upon a conveyance or transfer of all the assets and
properties of the Issuer pursuant to Section 3.10(b), the Issuer shall be
released from every covenant and agreement of this Indenture to be observed
or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery of written notice to the Indenture Trustee
from the Person acquiring such assets and properties stating the Issuer is
to be so released.
SECTION 3.12 NO OTHER BUSINESS. The Issuer shall not engage in
any business or activity other than acquiring and holding the Bonds and the
proceeds therefrom in the manner contemplated by the Basic Documents,
issuing the Notes and the Certificates, making payments on the Notes and
the Certificates and such other activities that are necessary, suitable, or
convenient to accomplish the foregoing or are incidental thereto, as set
forth in Section 2.3 of the Trust Agreement.
SECTION 3.13 NO BORROWING. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for
any indebtedness for money borrowed other than indebtedness for money
borrowed in respect of the Notes or in accordance with the Basic Documents.
24
<PAGE>
SECTION 3.14 GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES.
Except as contemplated by this Indenture or the other Basic Documents, the
Issuer shall not make any loan or advance or credit to, or guarantee
(directly or indirectly or by an instrument having the effect of assuring
another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable,
directly or indirectly, in connection with the obligations, stocks or
dividends, of, or own, purchase, repurchase or acquire (or agree
contingently to do so) any stock, obligations, assets or securities of, or
any other interest in, or make any capital contribution to, any other
Person.
SECTION 3.15 CAPITAL EXPENDITURES. The Issuer shall not make
any expenditure (by long-term or operating lease or otherwise) for capital
assets (either realty or personalty).
SECTION 3.16 RESTRICTED PAYMENTS. Except for payments of
principal or interest, or redemption of the Notes, so long as any Notes are
Outstanding, the Issuer shall not directly or indirectly:
(a) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a
combination thereof, to the Owner Trustee or any owner of a beneficial
interest in the Issuer or otherwise, in each case with respect to any
ownership or equity interest or similar security in or of the Issuer or to
the Depositor;
(b) redeem, purchase, retire or otherwise acquire for value any
such ownership or equity interest or similar security; or
(c) set aside or otherwise segregate any amounts for any such
purpose;
provided, however, that the Issuer may make, or cause to be made,
distributions to the Indenture Trustee, the Owner Trustee and the
Certificateholders as permitted by, and to the extent funds are available
for such purpose under, this Indenture or the Trust Agreement. The Issuer
shall not, directly or indirectly, make payments to or distributions from
the Designated Accounts except in accordance with the Basic Documents.
SECTION 3.17 NOTICE OF EVENTS OF DEFAULT. Within five Business
Days after the occurrence thereof, the Issuer agrees to give the Indenture
Trustee and the Rating Agency prompt written notice of each Event of
Default hereunder.
SECTION 3.18 FURTHER INSTRUMENTS AND ACTS. Upon request of the
Indenture Trustee, the Issuer shall execute and deliver such further
instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purpose of this Indenture.
25
<PAGE>
SECTION 3.19 REPRESENTATIONS AND WARRANTIES BY THE ISSUER TO
THE INDENTURE TRUSTEE. The Issuer hereby represents and warrants to the
Indenture Trustee as follows:
(a) GOOD TITLE. No Collateral Obligation has been sold,
transferred, assigned or pledged by the Issuer to any Person other than the
Indenture Trustee. Immediately prior to the conveyance of the Collateral
Obligations pursuant to this Indenture, the Issuer had good and marketable
title thereto, free of any Lien; and upon execution and delivery of this
Indenture by the Issuer, the Indenture Trustee shall have all of the right,
title and interest of the Issuer in, to and under the Collateral
Obligations, the unpaid indebtedness evidenced thereby and the collateral
security therefor, free of any Lien; and
(b) ALL FILINGS MADE. All filings (including, without
limitation, UCC filings) necessary in any jurisdiction to give the
Indenture Trustee a first perfected ownership interest in the Collateral
Obligations shall have been made.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE. This
Indenture shall cease to be of further effect with respect to the Notes
except as to: (i) rights of registration of transfer and exchange; (ii)
substitution of mutilated, destroyed, lost or stolen Notes; (iii) rights of
Noteholders to receive payments of principal thereof and interest thereon;
(iv) Sections 3.3, 3.4, 3.5, 3.8, 3.10, 3.12, 3.13 and 3.19; (v) the
rights, obligations and immunities of the Indenture Trustee hereunder
(including the rights of the Indenture Trustee under Section 6.7 and the
obligations of the Indenture Trustee under Sections 4.2 and 4.4); and (vi)
the rights of Noteholders as beneficiaries hereof with respect to the
property so deposited with the Indenture Trustee payable to all or any of
them, and the Indenture Trustee, on demand of and at the expense of the
Issuer, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Notes, if:
(a) either:
(1) all Notes theretofore authenticated and delivered
(other than (A) Notes that have been destroyed, lost or stolen and
that have been replaced or paid as provided in Section 2.5 and (B)
Notes for whose payment money has theretofore been deposited in trust
or segregated and held in trust by the Issuer and thereafter repaid to
the Issuer or discharged from such trust, as provided in Section 3.3)
have been delivered to the Indenture Trustee for cancellation; or
26
<PAGE>
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation:
(A) have become due and payable,
(B) shall become due and payable on the Final
Scheduled Payment Date, as appropriate, within one year, or
(C) are to be called for redemption within one year
under arrangements satisfactory to the Indenture Trustee for the
giving of notice or redemption by the Indenture Trustee, in the
name and at the expense of the Issuer,
and the Issuer, in the case of (A), (B), or (C) of subsection
4.1(a)(2) above, has irrevocably deposited or caused to be irrevocably
deposited with the Indenture Trustee cash or direct obligations of or
obligations guaranteed by the United States of America (which will
mature prior to the date such amounts are payable), in trust for such
purpose, in an amount sufficient to pay and discharge the entire
amount principal of and accrued interest on such Notes not theretofore
delivered to the Indenture Trustee for cancellation when due to the
Final Scheduled Payment Date or Redemption Date (if Notes shall have
been called for redemption pursuant to Section 10.1(a)), as the case
may be;
(b) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer; and
(c) the Issuer has delivered to the Indenture Trustee an
Officer's Certificate, an Opinion of Counsel and an Independent Certificate
from a firm of certified public accountant, each meeting the applicable
requirements of Section 11.1(a) and each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with.
SECTION 4.2 APPLICATION OF TRUST MONEY. All moneys deposited
with the Indenture Trustee pursuant to Article VIII shall be held in trust
and applied by it, in accordance with the provisions of the Notes, the
Trust Agreement and this Indenture, to the payment, either directly or
through any Paying Agent, as the Indenture Trustee may determine, to the
Holders of the particular Notes for the payment of redemption of which such
moneys have been deposited with the Indenture Trustee, of all sums due and
to become due thereon for principal and interest.
SECTION 4.3 REPAYMENT OF MONEYS HELD BY PAYING AGENT. In
connection with the satisfaction and discharge of this Indenture with
respect to the Notes, all moneys then held by any Paying Agent other than
the Indenture Trustee under the provisions of this Indenture with respect
27
<PAGE>
to such Notes shall, upon demand of the Issuer, be paid to the Indenture
Trustee to be held and applied according to Section 3.3 and thereupon such
Paying Agent shall be released from all further liability with respect to
such moneys.
SECTION 4.4 DURATION OF POSITION OF INDENTURE TRUSTEE.
Notwithstanding the earlier payment in full of all principal and interest
due to the Noteholders under the terms of the Notes and the cancellation of
the Notes pursuant to Section 3.1, the Indenture Trustee shall continue to
act in the capacity as Indenture Trustee hereunder and, for the benefit of
the Certificateholders, as appropriate, until such time as all payments in
respect of Certificate Principal Amount and interest due to the
Certificateholders have been paid in full.
ARTICLE V
DEFAULT AND REMEDIES
SECTION 5.1 EVENTS OF DEFAULT. For the purposes of this
Indenture, "Event of Default" wherever used herein, means any one of the
following events;
(a) failure to pay interest on any Note as and when the same
becomes due and payable, which failure continues unremedied for a period of
five (5) days; or
(b) failure to pay any installment of the principal of any Note
as and when the same becomes due and payable, which failure continues
unremedied for a period of five (5) days; or
(c) the impairment of the validity or effectiveness of this
Indenture or any grant hereunder, or the subordination, termination or
discharge of the lien of this Indenture, or the release of any Person from
any covenants or obligations under this Indenture unless otherwise
expressly permitted, or the creation of any lien, charge, security
interest, mortgage or other encumbrance with respect to any part of the
property subject to the lien of this Indenture, or any interest in or
proceeds of such property, unless otherwise expressly permitted, or the
failure of the lien of this Indenture to constitute a valid first priority
security interest in the property subject to the lien of this Indenture and
the continuation of any of such defaults for a period of 30 days after
notice to the Issuer by the Trustee or to the Issuer and the Trustee by the
holders of at least 25% of the Outstanding Amount of the Notes; or
(d) default in the observance or performance in any material
respect of any covenant or agreement of the Issuer made in this Indenture
(other than a covenant or agreement, a default in the observance or
performance of which is elsewhere specifically dealt with in this Section
5.1) which failure materially and adversely affects the rights of the
Noteholders, and such default shall continue or not be cured, for a period
of 60 days after there shall have been given written notice of such failure
28
<PAGE>
to the Issuer by the Indenture Trustee or to the Issuer and the Indenture
Trustee by the Holders of at least 25% of the Outstanding Amount of the
Notes; or
(e) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Issuer or any substantial
part of the Trust Estate in an involuntary case under any applicable
federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuer or for
any substantial part of the Trustee Estate, or ordering the winding-up or
liquidation of the Issuer's affairs, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or
(f) the commencement by the Issuer of a voluntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now
or hereafter in effect, or the consent by the Issuer to the entry of an
order for relief in an involuntary case under any such law, or the consent
by the Issuer to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official
of the Issuer or for any substantial part of the Trust Estate, or the
making by the Issuer of any general assignment for the benefit of
creditors, or the failure by the Issuer generally to pay its debts as such
debts become due, or the taking of action by the Issuer in furtherance of
any of the foregoing.
The Issuer shall deliver to the Indenture Trustee, within five Business
Days after learning of the occurrence thereof, written notice in the form
of an Officer's Certificate of any event which with the giving of notice
and the lapse of time would become an Event of Default under Sections
5.1(c), its status and what action the Issuer is taking or proposes to take
with respect thereto.
SECTION 5.2 ACCELERATION TO MATURITY; RESCISSION AND
ANNULMENT.
(a) If an Event of Default, other than an Event of Default as
described in Section 5.1(d) or (e), should occur and be continuing, the
Indenture Trustee or the Holders of Notes representing not less than 25% of
the Outstanding Amount of the Notes may declare all the Notes to be
immediately due and payable, by a notice in writing to the Issuer (and or
the Indenture Trustee if given by the Noteholders) setting forth the Event
or Events of Default, and upon any such declaration the unpaid principal
amount of such Notes, together with accrued and unpaid interest thereon
through the date of acceleration, shall become immediately due and payable.
If an Event of Default, as described in Section 5.1(e) or (f), should occur
29
<PAGE>
and be continuing, the Indenture Trustee shall declare all the Notes to be
immediately due and payable, and upon any such declaration the unpaid
principal amount of such Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall become immediately due and
payable.
(b) Except in the case of an Event of Default as described in
5.1(e), at any time after such declaration of acceleration of maturity has
been made and before a judgment or decree for payment of the money due has
been obtained by the Indenture Trustee as hereinafter provided in this
Article V, the Holders of Notes representing a majority of the Outstanding
Amount of the Notes, by written notice to the Issuer and the Indenture
Trustee, may waive all Defaults set forth in the notice delivered pursuant
to all Defaults set forth in the notice delivered pursuant to Section
5.2(a), and rescind and annul such declaration and its consequences;
provided, however, that no such rescission and annulment shall extend to or
affect any subsequent default or impair any right consequent thereto; and
provided, further that if the Indenture Trustee shall have proceeded to
enforce any right under this Indenture and such proceedings shall have
been discontinued or abandoned because of such rescission and annulment or
for any other reason, or shall have been determined adversely to the
Indenture Trustee, then and in every such case, the Indenture Trustee, the
Issuer and the Noteholders, as the case may be, shall be restored
respectively to their former positions and rights hereunder, and all
rights, remedies and powers of the Indenture Trustee, the Issuer and the
Noteholders, as the case may be, shall continue as though no such
proceedings had been taken.
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY INDENTURE TRUSTEE.
(a) The Issuer covenants that if:
(i) default is made in the payment of any installment of
interest on any Note when the same becomes due and payable, and such
default continues unremedied for a period of five days after receipt
by the Issuer of notice thereof from the Indenture Trustee or receipt
by the Issuer and the Indenture Trustee of notice thereof from the
Holders of at least 25% of the Outstanding Amount of the Notes; or
(ii) default is made in the payment of the principal or any
installment of the principal of any Note when the same becomes due and
payable, and such default continues unremedied for a period of thirty
(30) days after receipt by the Issuer of notice thereof from the
Indenture Trustee of notice thereof from the holders of at least 25%
of the Outstanding Amount of the Notes;
the Issuer shall, upon demand of the Indenture Trustee, pay to the
Indenture Trustee, for the ratable benefit of the Noteholders in accordance
with their respective outstanding principal amounts, the whole amount then
due and payable on such Notes for principal and interest, with interest
30
<PAGE>
upon the overdue principal, at the rate borne by the Notes and in addition
thereto such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and its agents and
counsel.
(b) If the Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee, in its own name and as trustee of an
express trust, may institute a Proceeding for the collection of the sums so
due and unpaid, and may prosecute such Proceeding to judgment or final
decree, and may enforce the same against the Issuer or other obligor upon
such Notes and collect in the manner provided by law out of the property of
the Issuer or other obligor upon such Notes, wherever situated, the moneys
adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the
Indenture Trustee may, as more particularly provided in Section 5.4, in its
discretion, proceed to protect and enforce its rights and the rights of the
Noteholders, by such appropriate Proceedings as the Indenture Trustee shall
deem most effective to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other
proper remedy or legal or equitable right vested in the Indenture Trustee
by this Indenture or by law.
(d) If there shall be pending, relative to the Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Trust Estate, proceedings under Title 11 of the United
States Code or any other applicable federal or state bankruptcy, insolvency
or other similar law, or if a receiver, assignee or trustee in bankruptcy
or reorganization, liquidator, sequestrator or similar official shall have
been appointed for or taken possession of the Issuer or its property or
such other obligor or Person, or in case of any other comparable judicial
Proceedings relative to the Issuer or other obligor upon the Notes, or to
the creditors or property of the Issuer or such other obligor, the
Indenture Trustee, irrespective of whether the principal of any Notes shall
then be due and payable as therein expressed or by declaration or otherwise
and irrespective of whether the Indenture Trustee shall have made any
demand pursuant to the provisions of this Section 5.3, shall be entitled
and empowered, by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of the
Notes and to file such other papers or documents as may be necessary
or advisable in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the Indenture
Trustee and each predecessor Trustee, and their respective agents,
attorneys and counsel, and for reimbursement of all expenses and
31
<PAGE>
liabilities incurred, and all advances made, by the Indenture Trustee
and each predecessor Trustee, except as a result of negligence or bad
faith) and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations to
vote on behalf of the Holders of Notes in any election of a trustee, a
standby trustee or Person performing similar functions in any such
Proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all
amounts received with respect to the claims of the Noteholders and of
the Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Indenture Trustee or the Holders of Notes allowed in any
judicial proceedings relative to the Issuer, its creditors and its
property;
and any trustee, receiver, liquidator, custodian or other similar official
in any such Proceeding is hereby authorized by each of such Noteholders to
make payments to the Indenture Trustee, and, if the Indenture Trustee shall
consent to the making of payments directly to such Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Indenture Trustee, each predecessor trustee
and their respective agents, attorneys and counsel, and all other expenses
and liabilities incurred, and all advances made by the Indenture Trustee
and each predecessor trustee except as a result of negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt
on behalf of any Noteholder any plan of reorganization, rearrangement,
adjustment or composition affecting the Note or the rights of any Holder
thereof or to authorize the Indenture Trustee to vote in respect of the
claim of any Noteholder in any such proceeding except, as aforesaid, to
vote for the election of a trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture
Trustee without the possession of any of the Notes or the production
thereof in any trial or other Proceedings relative thereto, and any such
Proceedings instituted by the Indenture Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment, subject
to the payment of the expenses, disbursements and compensation of the
Indenture Trustee, each predecessor trustee and their respective agents and
attorneys, shall be for the ratable benefit of the Noteholders.
(g) In any Proceedings brought by the Indenture Trustee (and
also any Proceedings involving the interpretation of any provision of this
32
<PAGE>
Indenture to which the Indenture Trustee shall be a party), the Indenture
Trustee shall be held to represent all the Noteholders, and its shall not
be necessary to make any Noteholder a party to any such Proceedings.
SECTION 5.4 REMEDIES; PRIORITIES.
(a) If an Event of Default shall have occurred and be
continuing, the Indenture Trustee may do one or more of the following
(subject to Section 5.5):
(i) institute Proceedings in its own name and as trustee of
an express trust for the collection of all amounts then payable on the
Notes or under this Indenture with respect thereto, whether by
declaration or otherwise, enforce any judgment obtained, and collect
from the Issuer and any other obligor upon such Notes moneys adjudged
due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to the
Trust Estate;
(iii) exercise any remedies of a secured party under the UCC
and take any other appropriate action to protect and enforce the
rights and remedies of the Indenture Trustee and the Noteholders
provided it is understood that Indenture Trustee shall not be required
to assume any obligations of any Trust Estate Obligor; and
(iv) sell the Trust Estate or any portion thereof or rights
or interest therein, at one or one or more public or private sales
called and conducted in any manner permitted by law; provided,
however, that the Indenture Trustee may not sell or otherwise
liquidate the Trust Estate following an Event of Default, unless (A)
the Holders of all of the Outstanding Amount of the Notes consent
thereto, (B) the proceeds of such sale or liquidations distributable
to the Noteholders are sufficient to discharge in full the principal
of and the accrued interest on the Notes at the date of such sales or
liquidation and the Holders of 66-2/3% of the Outstanding Amount of
the Notes consent thereto or (C) the Indenture Trustee in good faith
determines that the Trust Estate may not continue to provide
sufficient funds for the payment of principal of and interest on the
Notes as they would have become due if the Notes had not been declared
due and payable, and the Indenture Trustee obtains the consent of
Holders of 66-2/3% of the Outstanding Amount of the Notes. In
determining such sufficiency or insufficiency with respect to clauses
(B) and (C), the Indenture Trustee may, but need not, obtain and
conclusively rely upon an opinion of an independent investment banking
33
<PAGE>
or accounting firm of national reputation as to the sufficiency of the
Trust Estate for such purpose.
(b) If the Indenture Trustee collects any money or property
pursuant to this Article V, it shall pay out the money or property in the
following order:
FIRST: to the Indenture Trustee for amounts due under Section
6.7;
SECOND: to Noteholders for amounts due and unpaid on the Notes
for interest and principal, ratably among all classes of Noteholders,
according to the amounts due and payable on such Notes for interest
and/or principal; and
THIRD: to the Owner Trustee for amounts required to be
distributed to the Certificate-holders pursuant to the Trust
Agreement.
The Indenture Trustee may fix a record date and payment date for
any payment to Noteholders pursuant to this Section 5.4. At least 15 days
before such record date, the Issuer shall mail to each Noteholder and the
Indenture Trustee a notice that states the record date, the payment date
and the amount to be paid.
SECTION 5.5 OPTIONAL PRESERVATION OF THE COLLATERAL
OBLIGATIONS. If the Notes have been declared to be due and payable under
Section 5.2 following an Event of Default and such declaration and its
consequences have not been rescinded and annulled, the Indenture Trustee
may, but need not, elect to take and maintain possession of the Issuer's
interest in the Trust Estate. It is the desire of the parties hereto and
the Noteholders that there be at all times sufficient funds for the payment
of principal of and interest on the Notes, and the Indenture Trustee shall
take such desire into account when determining whether or not to take and
maintain possession of the Trust Estate. In determining whether or not to
take and maintain possession of the Trust Estate, the Indenture Trustee
may, but need not obtain and conclusively rely upon an opinion of an
independent investment banking or accounting firm of national reputation as
to the feasibility of such proposed action and as to the sufficiency of the
Trust Estate for such purpose.
SECTION 5.6 LIMITATION OF SUITS. No Holder of any Note shall
have any right to institute any Proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee,
or for any other remedy hereunder, unless:
(i) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the Outstanding
Amounts of the Notes have made written request to the Indenture
Trustee to institute such Proceeding in respect of such Event of
Default in its own name as Indenture Trustee hereunder;
34
<PAGE>
(iii) such Holder or Holders have offered to the Indenture
Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to institute
such Proceedings; and
(v) no direction inconsistent with such written request has
been given to the Indenture Trustee during such 60-day period by the
Holders of a majority of the Outstanding Amount of the Notes;
it being understood and intended that no one or more Holders of Notes shall
have any right in any manner whatever by virtue of, or by availing of any
provision of this Indenture to affect, disturb or prejudice the rights of
any other Holders of Notes or to obtain or to seek to obtain priority or
preference over any other Holders of Notes or to enforce any right under
this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all holders of Notes. For the protection and
enforcement of the provisions of this Section 5.6, each and every
Noteholder shall be entitled to such relief as can be given either at law
or in equity.
If the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of
Notes, each representing less than a majority of the Outstanding Amount of
the Notes, the Indenture Trustee in its sole good faith discretion may
determine what action, if any, shall be taken, notwithstanding any other
provisions of this Indenture.
SECTION 5.7 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE
PRINCIPAL AND INTEREST. Notwithstanding any other provisions in this
Indenture, the Holder of any Note shall have the right, which is absolute
and unconditional, to receive payment of the principal of and interest on
such Note on or after the respective due dates thereof expressed in such
Note or in this indenture (or, in the case of redemption, on or after the
Redemption Date) and to institute suit for the enforcement of any such
payment, and such right shall not be impaired without the consent of such
Holder.
SECTION 5.8 RESTORATION OF RIGHTS AND REMEDIES. If the
Indenture Trustee or any Noteholder has instituted any Proceeding to
enforce any right or remedy under this Indenture and such Proceeding has
been discontinued or abandoned for any reason or has been determined
adversely to the Indenture Trustee or to such Noteholder, then and in every
such case the Issuer, the Indenture Trustee and the Noteholders shall,
35
<PAGE>
subject to any determination in such Proceeding, be restored severally and
respectively to their former positions hereunder, and thereafter all rights
and remedies of the Indenture Trustee and the Noteholders shall continue as
though no such Proceeding had been instituted.
SECTION 5.9 RIGHTS AND REMEDIES CUMULATIVE. No right or
remedy herein conferred upon or reserved to the Indenture Trustee or to the
Noteholders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative
and in addition to every other right and remedy given hereunder or now or
hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not
prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 5.10 DELAY OR OMISSION NOT A WAIVER. No delay or
omission of the Indenture Trustee of any Holder of any Note to exercise any
right or remedy accruing upon any Default or Event of Default shall impair
any such right or remedy or constitute a waiver of any such Default or
Event of Default or an acquiescence therein. Every right and remedy given
by this Article V or by law to the Indenture Trustee or to the Noteholders
may be exercised from time to time, and as often as may be deemed
expedient, by the Indenture Trustee or by the Noteholders, as the case may
be.
SECTION 5.11 CONTROL BY NOTEHOLDERS. The Holders of a majority
of the Outstanding Amount of the Notes shall, subject to provisions being
made for indemnification against costs, expenses and liabilities in a form
satisfactory to the Indenture Trustee, have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to
the Indenture Trustee with respect to the Notes or exercising any trust or
power conferred on the Indenture Trustee; provided, however, that:
(i) such direction shall not be in conflict with any rule
of law or with this Indenture;
(ii) subject to the express terms of Section 5.4, any
direction to the Indenture Trustee to sell or liquidate the Trust
Estate shall be by the Holders of Notes representing not less than
100% of the Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.5 have been
satisfied and the Indenture Trustee elects to retain the Trust Estate
pursuant to Section 5.5, then any direction to the Indenture Trustee
by Holders of Notes representing less than 100% of the Outstanding
Amount of the Notes to sell or liquidate the Trust Estate shall be of
no force and effect; and
(iv) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee that is not inconsistent with such
direction;
36
<PAGE>
provided, however, that subject to Section 6.1, the Indenture Trustee need
not take any action that it determines might cause it to incur any
liability or might materially adversely affect the rights of any
Noteholders not consenting to such action.
SECTION 5.12 WAIVER OF PAST DEFAULTS.
(a) Prior to the declaration of the acceleration of the maturity
of the Notes as provided in Section 5.2, the Holders of not less than a
majority of the Outstanding Amount of the Notes may waive any past Default
or Event of Default and its consequences except a Default (i) in the
payment of principal of or interest on any of the Notes or (ii) in respect
of a covenant or provision hereof which cannot be modified or amended
without the consent of the Holder of each Note. In the case of any such
waiver, the Issuer, the Indenture Trustee and the Noteholders shall be
restored to their former positions and rights hereunder, respectively; but
no such waiver shall extend to any subsequent or other Default or impair
any right consequent thereto.
(b) Upon any such waiver, such Default shall cease to exist and
be deemed to have been cured and not to have occurred, and any Event of
Default arising therefrom shall be deemed to have been cured and not have
occurred, for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default of Event of Default or impair any
right consequent thereto.
SECTION 5.13 UNDERTAKING FOR COSTS. All parties to this
Indenture agree, and each Holder of any Note by such Holder's acceptance
thereof shall be deemed to have agreed, that any court may in its
discretion require, in any proceeding for the enforcement of any right or
remedy under this Indenture, or in any Proceeding against the Indenture
Trustee for any action taken, suffered or omitted by it as Indenture
Trustee, the filing by any party litigant in such Proceeding of an
undertaking to pay the costs of such proceeding and that such court may in
its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such Proceeding, having due regard to
the merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section 5.13 shall not apply to:
(a) any Proceeding instituted by the Indenture Trustee;
(b) any Proceeding instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Amount of the Notes; or
(c) any Proceeding instituted by any Noteholder for the
enforcement or the payment of principal of or interest on any Note on or
after the respective due dates expressed in such Note and in this Indenture
(or, in the case of redemption, on or after the Redemption Date).
37
<PAGE>
SECTION 5.14 WAIVER OF STAY OR EXTENSION LAWS. The Issuer
covenants (to the extent that it may lawfully do so) that it shall not at
any time insist upon, or plead or in any manner whatsoever, claim or take
the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, that may affect the covenants or the
performance of this Indenture. The Issuer (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it shall not hinder, delay or impede the
execution of any power herein granted to the Indenture Trustee, but shall
suffer and permit the execution of every such power as though no such law
had been enacted.
SECTION 5.15 ACTION ON NOTES. The Indenture Trustee's right to
seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under
or with respect to this Indenture. Neither the lien of this Indenture nor
any rights or remedies of the Indenture Trustee or the Noteholders shall be
impaired by the recovery of any judgment by the Indenture Trustee against
the Issuer or by the levy of any execution under such judgment upon any
portion of the Trust Estate or upon any of the assets of the Issuer.
SECTION 5.16 PERFORMANCE AND ENFORCEMENT OF CERTAIN COLLATERAL
OBLIGATIONS.
(a) Promptly following a request from the Indenture Trustee to
do so, the Issuer agrees to take all such lawful action as the Indenture
Trustee may request to compel or secure the performance and observance by
the Depositor and the obligors on the Collateral Obligations of its and
their obligations, respectively, to the Issuer under or in connection with
the Trust Agreement, in accordance with the terms thereof, and to exercise
any and all rights, remedies, powers and privileges lawfully available to
the Issuer under or in connection with the Trust Agreement to the extent
and in the manner directed by the Indenture Trustee, including the
transmission of notices of default on the part of the Depositor and the
obligors on the Collateral Obligations thereunder and the institution of
legal or administrative actions or proceedings to compel or secure
performance by the Depositor and the obligors on the Collateral Obligations
on its or their obligations, respectively, under the Trust Agreement.
(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and, at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter)) of the
Holders of 66-2/3% of the Outstanding Amount of the Notes shall exercise
all rights, remedies, powers, privileges and claims of the Issuer against
38
<PAGE>
the Depositor under or in connection with the Trust Agreement, including
the right or power to take any action to compel or secure performance or
observance by the Depositor of its obligations to the Issuer thereunder and
to give any consent, request, notice, direction, approval, extension or
waiver under the Trust Agreement, and any right of the Issuer to take such
action shall be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 DUTIES OF INDENTURE TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct
of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such duties
and only such duties as are specifically set forth in this Indenture
and no implied covenants or obligations shall be read into this
Indenture against the Indenture Trustee, and
(ii) in the absence of bad faith on its part, the Indenture
Trustee may conclusively rely, as to the truth of the statements and
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; PROVIDED, HOWEVER, that the Indenture
Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for
its own negligent action, its own negligent failure to act or its own
wilful misconduct, except that:
(i) this Section 6.1(c) does not limit the effect of
Section 6.1(b);
(ii) the Indenture Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer unless it is
proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts; and
(iii) the Indenture Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to section 5.11.
39
<PAGE>
(d) The Indenture Trustee shall not be liable for interest on
any money received by it except as the Indenture Trustee may agree in
writing with the Issuer.
(e) No provision of this Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its rights or powers if it shall
have reasonable grounds to believe that repayments of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it.
(f) Every provision of this Indenture relating to the Indenture
Trustee shall be subject to the provisions of this Section 6.1 and to the
provisions of the TIA.
SECTION 6.2 RIGHTS OF INDENTURE TRUSTEE.
(a) The Indenture Trustee may rely on any document believed by
it to be genuine and to have been signed or presented by the proper person.
The Indenture Trustee need not investigate any fact or matter stated in the
documents.
(b) Before the Indenture Trustee acts or refrains from acting,
it may require an Officer's Certificate or an Opinion of Counsel. The
Indenture Trustee shall not be liable for any action it takes or omits to
take in good faith in reliance on the Officer's Certificate or Opinion of
Counsel.
(c) The Indenture Trustee may execute any of the trusts of
powers thereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian or nominee, and the Indenture
Trustee shall not be responsible for any misconduct or negligence on the
part of, or for the supervision of, any such agent, attorney, custodian or
nominee appointed with due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any action it
takes or omits to take in good faith which it believes to be authorized or
within its rights or powers; PROVIDED, HOWEVER, subject to any other
standard required under the TIA, that the Indenture Trustee's conduct does
not constitute wilful misconduct, gross negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the
advice or Opinion of Counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and
protection from liability in respect to any action taken, omitted or
suffered by it hereunder in good faith and in accordance with the advice or
opinion of such counsel.
SECTION 6.3 INDENTURE TRUSTEE MAY OWN NOTES. The Indenture
Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Issuer or any of its
40
<PAGE>
respective Affiliates with the same rights it would have if it were not
Indenture Trustee; PROVIDED, HOWEVER, that the Indenture Trustee shall
comply with Sections 6.10 and 6.11. Any Paying Agent, Note Registrar, co-
registrar or co-paying agent may do the same with like rights.
SECTION 6.4 INDENTURE TRUSTEE'S DISCLAIMER. The Indenture
Trustee shall not be responsible for and makes no representations as to the
validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuer's use of the proceeds from the Notes, and it
shall not be responsible for any statement of the Issuer in the Indenture
or in any document issued in connection with the sale of the Notes or in
the Notes other than the Indenture Trustee's certificate or authentication.
SECTION 6.5 NOTICE OF DEFAULTS. If a Default occurs and is
continuing and if it is known to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail to the Rating Agency and each
Noteholder notice of the Default within 90 days after it occurs. Except in
the case of a Default in payment of principal of or interest on any Note
(including payments pursuant to the mandatory redemption provisions of such
Note), the Indenture Trustee may withhold the notice to Noteholders if and
so long as a committee of its Responsible Officers in good faith determines
that withholding the notice is in the interests of Noteholders.
SECTION 6.6 REPORTS BY INDENTURE TRUSTEE.
(a) The Indenture Trustee shall deliver to each Noteholder the
information and documents set forth in Article VII, and, in addition, all
such information with respect to the Notes as may be required to enable
such Holder to prepare its federal and state income tax returns.
(b) On each Payment Date, the Indenture Trustee shall prepare a
report setting forth the following information with respect to the Interest
Period ending on such Payment Date: (i) the amount of moneys credited to
the Collection Account; (ii) the amount of moneys transferred to the Note
Payment Account; (iii) the amount of moneys transferred to the Distribution
Account; (iv) the amount of moneys paid to the Noteholders; and (v) the
amount of moneys distributed to the Certificateholders. Copies of this
report shall be delivered to the Owner trustee and to the Depositor.
SECTION 6.7 COMPENSATION; INDEMNITY.
(a) The Indenture Trustee shall receive as compensation for its
ordinary, pre-Default services hereunder such fees as have been separately
agreed upon before the date hereof between the Depositor and the Indenture
Trustee and the Indenture Trustee hereby acknowledges that such fees have
been paid. The Indenture Trustee's compensation shall not be limited by
41
<PAGE>
any law on compensation of a trustee of an express trust. The Issuer shall
reimburse or cause to be reimbursed the Indenture Trustee for all
extraordinary fees for post-Default services as well as all reasonable out-
of-pocket expenses incurred or made by it, including costs of collection.
In addition to the compensation for its services, such expenses shall
include the reasonable compensation and expenses, disbursements and
advances of the Indenture Trustee's agents, counsel, accountants and
experts. The Issuer shall indemnify the Indenture Trustee against any and
all loss, liability or expense (including attorney's fees) incurred by it
in connection with the administration of this trust and the performance of
its duties hereunder. The Indenture Trustee shall notify the Issuer
promptly of any claim for which it may seek indemnity. Failure by the
Indenture Trustee to so notify the Issuer shall not relieve the Issuer of
its obligations hereunder. The Issuer shall defend the claim and the
Indenture Trustee may have separate counsel and the Issuer shall pay the
fees and expenses of such counsel. The Issuer need not reimburse any
expense or indemnity against any loss, liability or expense incurred by the
Indenture Trustee through the Indenture Trustee's own willful misconduct,
negligence or bad faith.
(b) The Issuer's payment obligations to the Indenture Trustee
pursuant to this Section 6.7 shall survive the discharge of this Indenture.
When the Indenture Trustee incurs fees and expenses after the occurrence of
a Default specified in Section 5.1(e) or (f) with respect to the Issuer,
the expenses are intended to constitute expenses of administration under
Title 11 of the United States code or any other applicable federal or state
bankruptcy, insolvency or similar law.
(c) The Issuer's payment obligations to the Indenture Trustee
pursuant to this Section 6.7 shall be satisfied to the extent that funds
are available to make such payments after all amounts payable to Note
holders and Certificateholders pursuant to this Indenture and the trust
Agreement shall have been paid, and there shall be no recourse to the
issuer for all or any part of any amounts payable pursuant to this Section
6.7 if such funds are at any time insufficient to make all or part of any
such payments.
SECTION 6.8 REPLACEMENT OF INDENTURE TRUSTEE.
(a) The Indenture Trustee may resign at any time by so notifying
the Issuer. The Holders of a majority in Outstanding Amount of the Notes
may remove the Indenture Trustee by so notifying the Indenture Trustee and
may appoint a successor Indenture Trustee. Such resignation or removal
shall become effective in accordance with Section 6.8(c). The Issuer shall
remove the Indenture Trustee if:
(1) the Indenture Trustee fails to comply with Section
6.11;
(2) the Indenture Trustee is adjudged a bankrupt or
insolvent;
42
<PAGE>
(3) a receiver or other public officer takes charge of the
Indenture Trustee or its property; or
(4) the Indenture Trustee otherwise becomes incapable of
acting.
(b) If the Indenture Trustee resigns or is removed or if a
vacancy exists in the office of Indenture Trustee for any reason (the
Indenture Trustee in such event being referred to herein as the retiring
Indenture Trustee), the Issuer shall promptly appoint a successor Indenture
Trustee.
(c) A successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee and to the
Issuer. Thereupon the resignation or removal of the retiring Indenture
Trustee shall become effective, and the successor Indenture Trustee shall
have all the rights, powers and duties of the Indenture Trustee under this
Indenture. The successor Indenture Trustee shall mail a notice of its
succession to Noteholders. The retiring Indenture Trustee shall promptly
transfer all property held by it as Indenture Trustee to the successor
Indenture Trustee.
(d) If a successor Indenture Trustee does not take office within
60 days after the retiring Indenture Trustee resigns or is removed, the
retiring Indenture Trustee, the Issuer or the Holders of a majority of the
Outstanding Amount of the Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee.
(e) If the Indenture Trustee fails to comply with Section 6.11,
any Noteholder may petition any court of competent jurisdiction for the
removal of the Indenture Trustee and the appointment of a successor
Indenture Trustee.
(f) Notwithstanding the replacement of the Indenture Trustee
pursuant to this Section 6.8, the Issuer's and the Depositor's obligations
under Section 6.7 shall continue for the benefit of the retiring Indenture
Trustee.
SECTION 6.9 MERGER OR CONSOLIDATION OF INDENTURE TRUSTEE.
(a) Any corporation into which the Indenture Trustee may be
merged or with which it may be consolidated, or any corporation resulting
from any merger or consolidation to which the Indenture Trustee shall be a
party, or any corporation succeeding to the corporate trust business or the
Indenture Trustee, shall be the successor of the Indenture Trustee under
this Indenture; provided, however, that such corporation shall be eligible
under the provisions of Section 6.11, without the execution or filing of
any instrument or any further act on the part of any of the parties to this
Indenture, anything in this Indenture to the contrary notwithstanding.
43
<PAGE>
(b) If at any time such successor or successors by merger or
consolidation to the Indenture Trustee shall succeed to the trusts created
by this Indenture any of the Notes which shall have been authenticated but
not delivered, any such successor to the Indenture Trustee may adopt the
certificate of authentication of any predecessor trustee, and deliver such
Notes so authenticated; and in case at that time any of the Notes shall not
have been authenticated, any successor to the Indenture Trustee may adopt
the certificate of authentication of any predecessor trustee, and deliver
such Notes so authenticated; and in case at that time any of the Notes
shall not have ben authenticated, any successor to the Indenture Trustee
may authenticate such Notes either in the name of any predecessor hereunder
or in the name of the successor to the Indenture Trustee. In all such
cases such certificate of authentication shall have the same full force as
is provided anywhere in the Notes or herein with respect to the certificate
of authentication of the Indenture Trustee.
SECTION 6.10 APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE
INDENTURE TRUSTEE.
(a) Notwithstanding any other provision of this Indenture, at
any time, for the purpose of meeting any legal requirement of any
jurisdiction in which any part of the Trust may at the time be located, the
Indenture Trustee shall have the power and may execute and deliver all
instruments to appoint one or more Persons to act as a co-trustee or co-
trustees, or separate trustee or separate trustees, of all or any part of
the Trust, and to vest in such Person or Persons in such capacity and for
the benefit of the Noteholders, such title to the Trust, or any part
hereof, and, subject to the other provisions of this Section 6.10, such
powers, duties, obligations, rights and trusts as the Indenture Trustee may
consider necessary or desirable. No co-trustee or separate trustee
hereunder shall be required to meet the terms of eligibility as a successor
trustee under Section 6.11 and no notice to Noteholders of the appointment
of any co-trustee or separate trustee shall be required under Section 6.8.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions
and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Indenture Trustee shall be conferred or imposed upon
and exercised or performed by the Indenture Trustee and such separate
trustee or co-trustee jointly (it being understood that such separate
trustee or co-trustee is not authorized to act separately without the
Indenture Trustee joining in such act), except to the extent that
under any law of any jurisdiction in which any particular act or acts
are to be performed the Indenture Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
44
<PAGE>
powers, duties and obligations (including the holding of title to the
Trust or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Indenture Trustee;
(ii) no separate trustee or co-trustee hereunder shall be
personally liable by reason of any act or omission of any other
trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture
Trustee shall be deemed to have been given to each of the then separate
trustees and co-trustees, as effectively as if given to each of them.
Every instrument appointing any separate trustee or co-trustee shall refer
to this Indenture and the conditions of this Article VI. Each separate
trustee and co-trustee, upon its acceptance of the trusts conferred, shall
be vested with the estates or property specified in its instrument of
appointment, either jointly with the Indenture Trustee or separately, as
may be provided therein, subject to all the provisions of this Indenture,
specifically including every provision of this Indenture relating to the
conduct of, affecting the liability of, or affording protection to, the
Indenture Trustee. Every such instrument shall be filed with the Indenture
Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Indenture Trustee its agent or attorney-in-fact with full
power and authority, to the extent not prohibited by law, to do any lawful
act under or in respect of this Indenture on its behalf and in its name.
If any separate trustee or co-trustee shall die, become incapable of
acting, resign or be removed, all of its estates, properties, rights,
remedies and trusts shall vest in and be exercised by the Indenture
Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
SECTION 6.11 ELIGIBILITY; DISQUALIFICATION. The Indenture
Trustee shall at all times satisfy the requirements of TIA Section 310(a).
The Indenture Trustee shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition and it (or its Ultimate Parent) shall have a long term unsecured
debt rating of Baa3 or better by Moody's Investors Service, Inc and BBB- by
Standard & Poor's or the equivalent rating thereof by the Rating Agency.
The Indenture Trustee shall comply with TIA Section 310(b); PROVIDED,
HOWEVER, that there shall be excluded from the operation of TIA Section
310(b)(1) any indenture or indentures under which other securities of the
Issuer are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
SECTION 6.12 PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER.
The Indenture Trustee shall comply with TIA Section 311(a), excluding any
45
<PAGE>
creditor relationship listed in TIA Section 311(b). A trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the
extent indicated.
SECTION 6.13 REPRESENTATIONS AND WARRANTIES OF INDENTURE
TRUSTEE. The Indenture Trustee represents and warrants as of the Closing
Date that:
(a) the Indenture Trustee is a banking corporation duly
organized, validly existing and in good standing under the laws of New
York;
(b) the Indenture Trustee has full power, authority and legal
right to execute, deliver and perform this Indenture, and has taken all
necessary corporate action to authorize the execution, delivery and
performance by it of this Indenture;
(c) the execution, delivery and performance by the Indenture
Trustee of this Indenture to the best of its actual knowledge (i) do not
violate any provision of any law or regulation governing the banking and
trust powers of the Indenture Trustee or any order, writ, judgment or
decree of any court, arbitrator, or governmental authority applicable to
the Indenture Trustee or any of its assets, (ii) do not violate any
provision of the corporate charter or by-laws of the Indenture Trustee, or
(iii) do not violate any provision of, or constitute, with or without
notice or lapse of time, a default under, or result in the creation or
imposition of any lien on any properties included in the Trust pursuant to
the provisions of any mortgage, indenture, contract, agreement or other
undertaking to which it is a party, which violation, default or lien could
reasonably be expected to have a materially adverse effect on the Indenture
Trustee's performance or ability to perform its duties under this Indenture
or on the transactions contemplated in this Indenture;
(d) this Indenture has been duly executed and delivered by the
Indenture Trustee and constitutes the legal, valid and binding agreement of
the Indenture Trustee, enforceable in accordance with its terms.
SECTION 6.14 INDENTURE TRUSTEE MAY ENFORCE CLAIMS WITHOUT
POSSESSION OF NOTES. All rights of action and claims under this Indenture
or the Notes may be prosecuted and enforced by the Indenture Trustee
without the possession of any of the Notes or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the
Indenture Trustee without the possession of any of the Notes or the
production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Indenture Trustee shall be brought in its own
name as Indenture Trustee. Any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee, its agents and counsel, be for the
ratable benefit of the Noteholders in respect of which such judgment has
been obtained.
46
<PAGE>
SECTION 6.15 SUIT FOR ENFORCEMENT. If an Event of Default
shall occur and be continuing, the Indenture Trustee in its good faith
discretion may, subject to the provisions of Section 6.1, proceed to
protect and enforce its rights and the rights of the Noteholders under this
Indenture by Proceeding whether for the specific performance of any
covenant or agreement contained in this Indenture or in aid of the
execution of any power granted in this Indenture or for the enforcement of
any other legal, equitable or other remedy as the indenture Trustee, being
advised by counsel, shall deem most effective to protect and enforce any of
the rights of the Indenture Trustee or the Noteholders.
SECTION 6.16 RIGHTS OF NOTEHOLDERS TO DIRECT INDENTURE TRUSTEE.
Holders of Notes evidencing not less than a majority of the Outstanding
Amount of the Notes shall have the right to direct the time, method and
place of conducting any Proceeding for any remedy available to the
Indenture Trustee or exercising any trust or power conferred on the
Indenture Trustee; PROVIDED, HOWEVER, that subject to Section 6.1, the
Indenture Trustee shall have the right to decline to follow any such
direction if the Indenture Trustee being advised by counsel determines that
the action so directed may not lawfully be taken, or if the Indenture
Trustee in good faith shall, by a Responsible Officer, determine that the
proceedings as directed would be illegal or subject it to personal
liability or be unduly prejudicial to the rights of Noteholders not parties
to such direction; and provided, further, that nothing in this Indenture
shall impair the right of the Indenture Trustee to take any actin deemed
proper by the Indenture Trustee and which is not inconsistent with such
direction by the Noteholders.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND
ADDRESSES OF NOTEHOLDERS. The Issuer shall furnish or cause to be
furnished to the Indenture Trustee a list, in such form as the Indenture
Trustee may reasonably require, of the names and addresses of the Holders
of Notes as of the close of business on the most recent Record Date, (a)
not more than five days before each Payment Date, and (b) within seven days
of receipt of written request from the Indenture Trustee; provided, that so
long as the Indenture Trustee is the Note Registrar, no such list shall be
required to be furnished.
SECTION 7.2 PRESERVATION OF INFORMATION, COMMUNICATIONS TO
NOTEHOLDERS.
(a) The Indenture Trustee shall preserve, in as current a form
as is reasonably practicable, the names and addresses of the Holders of
Notes contained in the most recent list furnished to the Indenture Trustee
as provided in Section 7.1 and the names and addresses of Holders of Notes
47
<PAGE>
received by the Indenture Trustee in its capacity as Note Registrar. The
Indenture Trustee may destroy any list furnished to it as provided in such
Section 7.1 upon receipt of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b)
with other Noteholders with respect to their rights under this Indenture or
under the Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar
shall have the protection of TIA Section 312(c).
SECTION 7.3 REPORTS BY ISSUER.
(a) The issuer shall:
(i) file with the Indenture Trustee, within 15 days after
the Issuer is required to file the same with the Commission, copies of
the annual reports and of the information documents and other reports
(or copies of such portions of any of the foregoing as the Commission
may from time to time by rules and regulations prescribe) which the
Issuer may be required to file with the Commission pursuant to Section
13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by
the Commission such additional information, documents, and reports
with respect to compliance by the Issuer, with the conditions and
covenants of this Indenture as may be required from time to time by
such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture
Trustee shall transmit by mail to all Noteholders described in TIA
Section 313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (i) and
(ii) of this Section 7.3(a) as may be required by rules and
regulations prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of
the Issuer shall end on December 31 of each year.
SECTION 7.4 REPORTS BY TRUSTEE. If required by TIA Section
313(a), within 60 days after the occurrence of one or more of the following
events including:
(a) Any change to its eligibility and its qualifications under
TIA Section 310;
(b) The creation of or any material change to a relationship
specified in paragraph (1) through (10) of TIA Section 310(b);
48
<PAGE>
(c) The character and amount of any advances made by it, as
Indenture Trustee, which remain unpaid on the date of such report, and for
the reimbursement of which it claims or may claim a lien or charge, prior
to that of the Notes on the trust estate or on property or funds held or
collected by it as trustee, if such advances so remaining unpaid aggregate
more than one-half of one percent centum of the principal amount of the
Notes outstanding on such date;
(d) Any change to the amount, interest rate, and maturity date
of all other indebtedness owing to it in its individual capacity, on the
date of such report, by the obligor upon the Notes, with a brief
description of any property held as collateral security therefor, except an
indebtedness based upon a creditor relationship arising in any manner
described in paragraphs (2), (3), (4), or (6) of subsection (b) of TIA
Section 311.
(e) Any change to the property and funds physically in its
possession as Indenture Trustee on the date of such report;
(f) Any release, or release and substitution, of property
subject to the lien of the Indenture (and the consideration therefor, if
any) which it has not previously reported;
(g) Any additional issues of Notes which it has not previously
reported;
(h) Any action taken by it in the performance of its duties
under the Indenture which it has not previously reported and which in its
opinion materially affects the Notes or the Trust Estate, except action in
respect of a default, notice of which has been or is to be withheld by it
in accordance with an indenture provision authorized by subsection (b) of
TIA Section 315.
The Indenture Trustee shall mail to (i) each Noteholder as
required by TIA Section 313(c) and (ii) the Depositor, a brief report dated
as of such date that complies with TIA Section 313(a). The Indenture
Trustee also shall comply with TIA Section 313(b). A copy of any report
delivered pursuant to this Section 7.4 shall, at the time of its mailing to
Noteholders and the Depositor, be filed by the Indenture Trustee with the
Commission and each stock exchange, if any, on which the Notes are listed.
The Issuer shall notify the Indenture Trustee if and when the Notes are
listed on any stock exchange.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 COLLECTION OF MONEY. Except as otherwise
expressly provided herein, the Indenture Trustee may demand payment or
delivery of, and shall receive and collect, directly and without
49
<PAGE>
intervention or assistance of any fiscal agent or other intermediary, all
money and other property payable to or receivable by the Indenture Trustee
shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default
occurs in the making of any payment or performance under any agreement or
instrument that is part of the Trust Estate, the Indenture Trustee may take
such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate Proceedings. Any
such action shall be without prejudice to any right to claim a Default or
Event of Default under this Indenture and any right to proceed thereafter
as provided in Article V.
SECTION 8.2 DESIGNATED ACCOUNTS. On or prior to the Closing
Date, the Issuer shall cause the Depositor to establish and maintain, in
the name of the Indenture Trustee, for the benefit of the Noteholders and
the Certificateholders, the following accounts:
(a) a Collection Account;
(b) a Note Payment Account; and
(c) a Distribution Account
SECTION 8.3 COLLECTION ACCOUNT. The Indenture Trustee shall
credit to the Collection Account all moneys received in respect of the
Collateral Obligations. On the next succeeding Payment Date, the Indenture
Trustee shall apply moneys held in the Collection Account in the following
order of priority:
(a) on or before each Payment Date and Redemption Date, an
amount equal to the amount due on the respective classes of Notes payable
on such Payment Date or Redemption Date in accordance with the terms of
such Notes shall be transferred from the Collection Account and credited to
the Note Payment Account; and
(b) on or before each Distribution Date and Redemption Date, an
amount equal to the amount due on the respective classes of Certificates on
such Distribution Date or Redemption Date in accordance with the terms of
such Certificates shall be transferred from the Collection Account and
credited to the Certificate Distribution Account.
SECTION 8.4 NOTE PAYMENT ACCOUNT. On each Payment Date and
Redemption Date, the Indenture Trustee shall distribute all amounts on
deposit in the Note Payment Account to Noteholders in respect of the class
of Notes payable on such date to the extent of amounts due and unpaid on
such Notes in accordance with the terms.
50
<PAGE>
SECTION 8.5 RELEASE OF TRUST ESTATE.
(a) Subject to the payment of its fees and expenses pursuant to
Section 6.7, the Indenture Trustee may and when required by the provisions
of this Indenture shall execute instruments to release property from the
lien of this Indenture, or convey the Indenture Trustee's interest in the
same, in a manner and under circumstances that are consistent with the
provisions of this Indenture. No party relying upon an instrument executed
by the Indenture Trustee as provided in this Article VIII shall be bound to
ascertain the Indenture Trustee's authority, inquire into the satisfaction
of any conditions precedent or see to the application of any moneys.
(b) The Indenture Trustee shall at such time as there are no
Notes Outstanding and all sums due to the Indenture Trustee pursuant to
Section 6.7 have been paid, release any remaining portion of the Trust
Estate that secured the Notes from the lien of this Indenture and release
to the Issuer or any other Person entitled thereto any funds then on
deposit in the Designated Accounts. The Indenture Trustee shall release
property from the lien of this Indenture pursuant to this Section 8.5(b)
only upon receipt of an Issuer Request accompanied by an Officer's
Certificate and (if required by the TIA) Independent Certificates in
accordance with TIA Sections 314(c) and 314(d)(1) meeting the applicable
requirements of Section 11.1.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
NOTEHOLDERS.
(a) Without the consent of the Holders of any Notes but with
prior notice to the Rating Agency, the Issuer and the Indenture Trustee,
when authorized by an Issuer Order, at any time and from time to time, may
enter into one or more indentures supplemental hereto (which shall conform
to the provision of the TIA as in force at the date of the execution
thereof), in form satisfactory to the Indenture Trustee, for any of the
following purposes:
(i) to correct or amplify the description of any property
at any time subject to the lien of this indenture, or better to assure
convey and confirm unto the Indenture Trustee any property subject or
required to be subjected to the lien of this Indenture, or to subject
additional property to the lien of this Indenture;
(ii) to evidence the succession, in compliance with Section
3.10 and the applicable provisions hereof, of another person to the
51
<PAGE>
Issuer, and the assumption by any such successor of the covenants of
the Issuer contained herein and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit
of the Noteholders, or to surrender any right or power herein
conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be
inconsistent with any other provision herein or in any supplemental
indenture;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as
shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article VI; or
(vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA, and the
Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, may without the consent of any of the Noteholders, but with
prior notice to the Rating Agency, at any time and from time to time, enter
into any one or more indentures supplemental hereto for the purpose of
adding any provisions to, or changing in any manner or eliminating any of
the provisions of, this Indenture or modifying in any manner the rights of
the Noteholders under this Indenture; provided, however, that such action
shall not, as conclusively evidenced by an Opinion of Counsel, adversely
affect in any material respect the interest of any Noteholder.
SECTION 9.2 SUPPLEMENTAL INDENTURE WITH CONSENT OF
NOTEHOLDERS.
(a) The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, may with prior notice to the Rating Agency and with the
consent of the Holders not less than a majority of the Outstanding Amount
of the Notes (by Act of such Holders delivered to the issuer and the
Indenture Trustee), enter into an indenture or indentures supplemental
hereto for the purpose of adding any provision to, or changing in any
52
<PAGE>
manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Noteholders under this Indenture;
provided, however that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Note affected thereby:
(i) change the date of payment of any installment of
principal or interest on any Note, or reduce the principal amount
thereof, the interest applicable thereto or the Redemption Price with
respect thereto, change the provision of this Indenture relating to
the application of collections on, or the proceeds of the sale of, the
Trust Estate, or to payment of principal of or interest on the Notes,
or change any place of payment where, or the coin or currency in
which, any Note or the interest thereon is payable, or impair the
right to institute suit for the enforcement of the provision of this
Indenture requiring the application of funds available thereof, as
provided in Article V, to the payment of any such amount due on the
Notes on or after the respective due date thereof (or, in the case of
redemption, on or after the Redemption Date);
(ii) reduce the percentage of the Outstanding Amount of the
Notes, the consent of the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of which is
required for any waiver of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences
provided for in this Indenture;
(iii) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of the
Notes required to direct the Indenture Trustee to direct the Issuer to
sell or liquidate the Trust Estate pursuant to Section 5.4 if the
proceeds of such sale would be insufficient to pay the principal
amount of and accrued but unpaid interest on the Outstanding notes;
(v) reduce the percentage of the Outstanding Amount of the
Notes required to amend the sections of this Indenture which specify
the aggregate principal amount of the Notes necessary to amend this
Indenture or the Basic Documents; or
(vi) permit the creation of any lien ranking prior to or on
a parity with the lien of this Indenture with respect to any part of
the Trust Estate or, except as otherwise permitted or contemplated
herein, terminate the lien of this Indenture on any property at any
time subject hereto or deprive the Holder of any Note of the security
provided by the lien of this Indenture.
53
<PAGE>
(b) The Indenture Trustee may in its good faith discretion
determine as conclusively evidenced by an Opinion of Counsel whether or not
any Notes would be affected (such that the consent of the Holder of each
would be required) by any supplemental indenture proposed pursuant to this
Section 9.2, and any such determination shall be conclusive upon the
Holders of all Notes, whether authenticated and delivered thereunder before
or after the date upon which such supplemental indenture becomes effective.
The Indenture Trustee shall not be liable for any such determination made
in good faith.
(c) It shall be sufficient if an Act of Noteholders approves the
substance, but not the form, of any proposed supplemental indenture.
(d) Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section 9.2, the
Indenture Trustee shall mail to the Rating Agency and the Noteholders to
which such amendment or supplemental indenture relates a notice setting
forth in general terms the substance of such supplemental indenture. Any
failure of the Indenture Trustee to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of
any such supplemental indenture.
SECTION 9.3 EXECUTION OF SUPPLEMENTAL INDENTURES. In
executing or permitting the additional trusts created by any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Indenture Trustee shall be entitled
to receive, and subject to Sections 6.1 and 6.2, shall be fully protected
in relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental indenture that affects the Indenture Trustee's own rights,
duties, liabilities or immunities under this Indenture or otherwise.
SECTION 9.4 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the
execution of any supplemental indenture pursuant to the provisions hereof,
this Indenture shall be and be deemed to be modified and amended in
accordance therewith with respect to the Notes affected thereby, and the
respective rights, limitations of rights, obligations, duties, liabilities
and immunities under this Indenture of the Indenture Trustee, the Issuer
and the Noteholders shall thereafter be determined, exercised and enforced
hereunder, subject in all respects to such modifications and amendments,
and all the terms and conditions of any such supplemental indenture shall
be and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes.
SECTION 9.5 CONFORMITY WITH TRUST INDENTURE. Every amendment
of this Indenture and every supplemental indenture executed pursuant to
this Article IX shall conform to the requirements of the TIA as then in
54
<PAGE>
effect so long as this Indenture shall be then qualified under the TIA.
SECTION 9.6 REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX may, and if required by the Indenture
Trustee shall, bear a notation in form approved by the Indenture Trustee as
to any matter provided for in such supplemental indenture. If the Issuer
or the Indenture Trustee shall so determine, new Notes so modified as to
conform, in the opinion of the Indenture Trustee and the Issuer, to any
such supplemental indenture may be prepared and executed by the Issuer and
authenticated and delivered by the Indenture Trustee in exchange for
Outstanding Notes.
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.1 REDEMPTION.
(a) If any or all of the Collateral Obligations of any issue
underlying redeemable Notes are redeemed in whole or in part on the First
Call Date, and upon actual receipt by the Indenture Trustee of notice of
such redemption, the Indenture Trustee shall, in accordance with the
provisions of this Article X, redeem a principal amount of notes equal to
the principal amount of the Collateral Obligations of such issue then being
redeemed. In the absence of the actual notice, the Indenture Trustee shall
be under no obligation to effect the redemption required by this Section
10.1,
(b) In the event of such a redemption of Notes, the Indenture
Trustee shall deposit amounts received in respect of the bonds in the
Collection Account. Within fifteen days of the receipt of funds in the
Collection Account, the Indenture Trustee shall redeem an aggregate
principal amount of Notes equal to the product of (x) the Outstanding
Amount of Notes and (y) a fraction the numerator of which is the aggregate
principal amount of the Collateral Obligations being redeemed by the issuer
thereof and the denominator of which is the aggregate principal amount of
the Collateral Obligations included in the Trust Estate.
(c) If the assets of the Issuer are sold pursuant to Section 7.2
of the Trust Agreement, all amounts on deposit in the Note Payment Account
after payment of the amount, due under <section> 6.7, shall be paid to the
Noteholders. If amounts are to be paid to Noteholders pursuant to this
Section 10.1(c), the Depositor or the Issuer shall, to the extent
practicable, furnish notice of such event to the Indenture Trustee not
later than 25 days prior to the Redemption Date, whereupon all such amounts
shall be payable on the Redemption Date.
55
<PAGE>
SECTION 10.2 NOTICE OF REDEMPTION. (a) Notice of redemption
shall be given by the Indenture Trustee to each Noteholder of any Note to
be redeemed within thirty (30) days after notice of redemption of the
underlying Collateral Obligations has been received by the Indenture
Trustee, the issuer, trustee or paying agent of or for the Collateral
Obligations, as the case may be (but, to the extent practicable not less
than fifteen days prior to the redemption date); provided, however, that
the Indenture Trustee shall not be required to give any notice of
redemption less than three (3) business days after the date it receives
notice of such redemption. (b) All notices of redemption shall be mailed
to each Noteholder at such Noteholder's last address on the Note Register
and shall state the Redemption Date, the amount payable on such date, the
place at which Notes are to be surrendered for payment and that interest on
amounts redeemed will cease to accrue. (c) Notice of Redemption of the
Notes shall be given by the Indenture Trustee in the name and at the
expense of the Issuer. Failure to give notice of redemption, or any defect
therein, to any Holder of any Note shall not impair or affect the validity
of the redemption of any other Note.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 COMPLIANCE CERTIFICATES AND OPINIONS, ETC.
(a) Upon any application or request by the issuer to the
Indenture Trustee to take any action under the provisions of this
Indenture, the Issuer shall furnish to the Indenture Trustee: (i) an
Officer's Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with, and (ii) (if required by the TIA) an Independent Certificate
from a firm of certified public accountants meeting the applicable
requirements of this Section 11.1, except that, in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no additional
certificate need be furnished. Every certificate or opinion with respect
to compliance with a condition or covenant provided for in this Indenture
shall include:
(i) a statement that such signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the judgment of each such
signatory, such signatory has made such examination or investigations
56
<PAGE>
as is necessary to enable such signatory to express an informed
opinion as to whether or not such covenant or condition has been
complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
(b)(i) Prior to the deposit with the Indenture Trustee of any
Collateral or other property or securities that is to be made the
basis for the release of any property or securities subject to the
lien of this Indenture, the Issuer shall, in addition to the
obligation imposed in Section 11.1(a) or elsewhere in this Indenture,
furnish to the Indenture Trustee an Officer's Certificate certifying
or stating the opinion of each person signing such certificate as to
the fair value (within 90 days of such deposit) to the Issuer of the
Collateral or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or described in
clause (b)(i) above, the Issuer shall also deliver to the Indenture
Trustee an Independent Certificate as to the same matters, if the fair
value to the Issuer of the securities to be so deposited and of all
other such securities made the basis of any such withdrawal or release
since the commencement of the then current fiscal year of the Issuer,
as set forth in the Certificates delivered pursuant clause (i) above
and this clause (b)(ii), as 10% or more of the Outstanding Amount of
the Notes, but such a certificate need not be furnished with respect
to any securities so deposited, if the fair value thereof to the
Issuer as set forth in the related Officer's Certificate is less than
$25,000 or less than one percent of the Outstanding Amount of the
Notes.
(iii) Whenever any property or securities are to be released
from the lien of this Indenture, the Issuer shall also furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the
opinion of each Person signing such certificate as to the fair value
(within 90 days of such release) of the property or securities
proposed to be released and stating that in the opinion of such person
the proposed release will not impair the security under this Indenture
in contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the
opinion of any signatory thereof as to the matters described in clause
(b)(iii) above, the Issuer shall also furnish to the Indenture Trustee
an Independent Certificate as to the same matters if the fair value of
the property or securities and of all other property or securities
57
<PAGE>
released from the lien of this Indenture since the commencement of the
then current calendar year, as set forth in the certificates required
by clause (b)(iii) above and this clause (b)(iv), equals 10% or more
of the Outstanding Amount of the Notes, but such certificate need not
be furnished in the case of any release of property or securities if
the fair value thereof as set forth in the related Officer's
Certificate is less than $25,000 or less than one percent of the then
Outstanding Amount of the Notes.
(v) Notwithstanding Section 2.9 or any other provision of
this Section 11.1, the Issuer may make cash payments out of the
Designated Accounts to the extent permitted or required by the Basic
Documents.
SECTION 11.2 FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE.
(a) In any case where several matters are required to be
certified by, or covered by an opinion of any specified Person, it is not
necessary that all such matters be certified by, or covered by the opinion
of, only one such Person, or that they be so certified or covered by only
one document, but one such Person may certify or give an opinion with
respect to some matters and one or more other such Persons may certify or
give an opinion as to other matters, and any such Person may certify or
give an opinion as to such matters in one or several documents.
(b) Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such
officer knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the matters upon
which the certificate or opinion is based are erroneous. Any such
certificate of an Authorized Officer or Opinion of Counsel may be based,
insofar as it relates to factual matters, upon a certificate or opinion of,
or representations by, an officer or officers of the Depositor or the
Issuer, stating that the information with respect to such factual matters
is in the possession of the Depositor or the Issuer, unless such counsel
knows, or in the exercise of reasonable care should know, that such
certificate or opinion or representations with respect to such matters are
erroneous.
(c) Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions
or other instruments under this Indenture, they may, but need not, be
consolidated and form one instrument.
(d) Whenever in this Indenture, in connection with any
application or certificate or report to the Indenture Trustee, it is
provided that the Issuer shall deliver any document as a condition of the
granting of such application, or as evidence of the Issuer's compliance
58
<PAGE>
with any term hereof, it is intended that the truth and accuracy at the
time of the granting of such application or at the effective date of such
certificate or report (as the case may be), of the facts and opinions
stated in such document shall in such case be conditions precedent to the
right of the Issuer to have such application granted or to the sufficiency
of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth
and accuracy of any statement or opinion contained in any such document as
provided in Article VI.
SECTION 11.3 ACTS OF NOTEHOLDERS.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or
taken by the Noteholders may be embodied in and by one or more instruments
of substantially similar tenor signed by such Noteholders in person or by
agents duly appointed in writing; and except as herein otherwise expressly
provided such action shall become effective when such instrument or
instruments are delivered to the Indenture Trustee, and, where it is hereby
expressly required, to the Issuer. Such Instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Noteholders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 6.1) conclusive in favor of the Indenture
Trustee and the Issuer, if made in the manner provided in this Section
11.3.
SECTION 11.4 NOTICES ETC., TO INDENTURE TRUSTEE, ISSUER, AND
RATING AGENCY. Any request, demand, authorization, direction, notice,
consent, waiver or Act of Noteholders or other documents provided or
permitted by this Indenture to be made upon, given or furnished to or filed
with:
(a) the Indenture Trustee by any Noteholder shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Indenture Trustee at its Corporate Trustee Office, or
(b) the Issuer by the Indenture Trustee or by any Noteholder
shall be sufficient for every purpose hereunder if in writing and either
sent by electronic facsimile transmission (with hard copy to follow via
first class mail) or mailed, by certified mail, return receipt requested to
the Issuer and the Owner Trustee, care of the Owner Trustee at its
Corporate Trustee Office, with copies to Richards, Layton & Finger, 1
Rodney Square, P.O. Box 551, Wilmington, Delaware 19899, Attention: Eric
Mazie, Esq. or at any other address previously furnished in writing to the
Indenture Trustee by the Issuer.
The Issuer shall promptly transmit any notice received by it from the
Noteholders to the Indenture Trustee and the Indenture Trustee shall
likewise promptly transmit any notice received by it from the Noteholders
to the Indenture Trustee.
59
<PAGE>
(c) Notices required to be given to the Rating Agency by the
Issuer, the Indenture Trustee or the Owner Trustee shall be in writing,
personally delivered, sent by electronic facsimile transmission (with hard
copy to follow via first class mail) or mailed by certified mail, return
receipt requested to the address set forth in the Series Trust Indenture or
any such other address as shall be designated by written notice to the
other parties.
SECTION 11.5 NOTICE TO NOTEHOLDERS; WAIVER.
(a) Where this Indenture provides for notice to Noteholders of
any event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if it is in writing and mailed, first-class, postage
prepaid to each Noteholder affected by such event, at such Person's address
as it appears on the Note Register, not later than the latest date, and not
earlier than the earliest date, prescribed for the giving of such notice.
If notice to Noteholders is given by mail, neither the failure to mail such
notice nor any defect in any notice so mailed to any particular Noteholder
shall affect the sufficiency of such notice with respect to other
Noteholders, and any notice that is mailed in the manner herein provided
shall conclusively be presumed to have been duly given regardless of
whether such notice is in fact actually received.
(b) Where this Indenture provides for notice in any manner, such
notice may be waived in writing by any Person entitled to receive such
notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Noteholders shall be filed
with the Indenture Trustee but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such a
waiver.
(c) In case, if by reason of the suspension of regular mail
service as a result of a strike, work stoppage or similar activity, it
shall be impractical to mail notice of any event of Noteholders when such
notice is required to be given pursuant to any provision of this Indenture,
then any manner of giving such notice as shall be satisfactory to the
Indenture Trustee shall be deemed to be a sufficient giving of such notice.
(d) Where this Indenture provides for notice to the Rating
Agency, failure to give such notice shall not affect any other rights or
obligations created hereunder, and shall not under any circumstances
constitute an Event of Default.
SECTION 11.6 ALTERNATE PAYMENT AND NOTICE PROVISIONS.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Holder of a Note
providing for a method of payment, or notice by the Indenture Trustee or
any Paying Agent to such Holder, that is different from the methods
provided for in this Indenture for such payments or notices. The Issuer
60
<PAGE>
shall furnish to the Indenture Trustee a copy of each such agreement and
the Indenture Trustee shall cause payments to be made and notices to be
given in accordance with such agreements.
SECTION 11.7 CONFLICT WITH TRUST INDENTURE ACT.
(a) If any provision hereof limits, qualifies or conflicts with
another provision hereof that is required to be included in this Indenture
by any of the provisions of the TIA, such required provision shall control.
(b) The provisions of TIA Sections 310 through 317 that impose
duties on any Person (including the provisions automatically deemed
included herein unless expressly excluded by this Indenture) are a part of
and govern this Indenture, whether or not physically contained herein.
SECTION 11.8 EFFECT OF HEADINGS AND TABLE OF CONTENTS. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 11.9 SUCCESSORS AND ASSIGNS.
(a) All covenants and agreements in this Indenture and the Notes
by the Issuer shall bind its successors and assigns, whether so expressed
or not.
(b) All covenants and agreements of the Indenture Trustee in
this Indenture shall bind its successors and assigns, whether so expressed
or not.
SECTION 11.10 SEPARABILITY. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining provisions shall
not in any way be affected or impaired.
SECTION 11.11 BENEFITS OF INDENTURE. Nothing in this Indenture
or in the Notes, express or implied, shall give to any Person, other than
the parties hereto and their successors hereunder, and the Noteholders, and
any other party secured hereunder, and any other person with an ownership
interest in any part of the Trust Estate, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
SECTION 11.12 LEGAL HOLIDAYS. If the date on which any payment
is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same
force and effect as if made on the date on which nominally due, and no
interest shall accrue for the period from and after any such nominal date.
SECTION 11.13 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO
61
<PAGE>
ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.14 COUNTERPARTS. This Indenture may be executed in
any number of counterparts, each of which so executed shall be deemed to be
an original, but all such counterparts shall together constitute but one
and the same instrument.
SECTION 11.15 RECORDING OF INDENTURE. If this Indenture is
subject to recording in any appropriate public recording offices, such
recording is to be effected by the Issuer and at its expense accompanied by
an Opinion of Counsel (which may be counsel to the Issuer or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that
such recording is necessary either for the protection of the Noteholders or
any other Person secured hereunder or for the enforcement of any right or
remedy granted to the Indenture Trustee under this Indenture.
SECTION 11.16 NO RECOURSE. No recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuer, the Owner
Trustee or the Indenture Trustee or the Notes or under this Indenture or
any certificate or other writing delivered in connection herewith or
therewith, against:
(i) the Indenture Trustee or the Owner Trustee in its
individual capacity;
(ii) any owner of a beneficial interest in the Issuer; or
(iii) any partner, owner, beneficiary, agent, officer,
director, employee or agent of the Indenture Trustee or the Owner
Trustee in its individual capacity, any holder of a beneficial
interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture Trustee or the Owner
Trustee in its individual capacity, except as any such person may have
expressly agreed (it being understood that the Indenture Trustee and
the Owner Trustee have no such obligations in their individual
capacity) and except that any such partner, owner or beneficiary shall
be fully liable, to the extent provided by applicable law, for any
unpaid consideration for stock, unpaid capital contribution or failure
to pay any installment or call owing to such entity. For all purposes
of this Indenture, in the performance of any duties or obligations of
the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Articles VI,
VII and VIII of the Trust Agreement.
SECTION 11.17 NO PETITION. The Indenture Trustee, by entering
into this Indenture, and each Noteholder, by accepting a Note issued
hereunder, hereby covenant and agree that they shall not, prior to the date
62
<PAGE>
which is one year and one day after the termination of this Indenture with
respect to the Notes pursuant to Section 4.1, acquiesce, petition or
otherwise invoke or cause the Depositor or the Issuer to invoke the process
of any court or government authority for the purpose of commencing or
sustaining a case against the Depositor or the Issuer under any federal or
state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of the Depositor or the Issuer or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
depositor or the Issuer.
SECTION 11.18
(a) The Issuer shall, on each anniversary of the Closing Date
furnish to the Indenture Trustee the Opinion of Counsel required by Section
3.6 of the Standard Terms and the "annual statement of compliance" required
by Section 3.9 of the Standard Terms.
(b) Notwithstanding anything contained herein to the contrary,
this instrument has been signed by the Owner trustee, not in its individual
capacity but solely in its capacity as Owner Trustee of the Issuer and in
no event shall the Owner Trustee in its individual capacity or any
beneficial owner of the Issuer have any liability for the representations,
warranties, covenants, agreements or other obligation of the Issuer
hereunder as to all of which recourse shall be had solely to the assets of
the Issuer.
(c) Each Series shall constitute a separate Series of the Trust
pursuant to Section 3806(b)(2) of the Delaware Business Trust act (the
"DBTA"). Separate and distinct records shall be maintained for each Series
and the assets associated with any such Series shall be held and accounted
for separately from the other assets of the Trust, or any other Series
thereof. Subject to the right of the Trust to allocate general
liabilities, expenses, costs, charges or reserves as herein provided, the
debts liabilities, obligations and expenses incurred, contracted for or
otherwise existing with respect to a particular Series shall be enforceable
against the assets of such Series only, and not against the assets of any
other series. Notice of this limitation on inter-series liabilities shall
be set forth in the certificate of trust of the Trust (whether originally
or by amendment) as filed or to be filed in the Office of the Secretary of
State of the State of Delaware pursuant to the DBTA, and upon the giving of
such notice in the certificate of trust, the statutory provisions of
Section 3804 of the DBTA relating to limitations on inter-series
liabilities (and the statutory effect under Section 3804 of setting forth
such notice in the certificate of trust) shall become applicable to the
Trust and each Series. Every note, bond, contract or other undertaking
issued by or on behalf of a particular Series shall include a recitation
limiting the obligation represented thereby to that Series and its assets.
63
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
not in its individual capacity but solely as Indenture
Trustee
By:___________________________
Name:
Title:
64
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ______________________________________________________________________
- ---------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably
constitutes and appoints__________________________________________________
________________, as attorney, to transfer said Note on the books kept for
registration thereof, with full power of substitution in the premises.
Date:____________________ ______________________________
Signature Guaranteed:
______________________________
____________________
NOTE: The signature to this assignment must correspond with the name of
the registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
65
<PAGE>
APPENDIX A-I
FORM OF NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE
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.
TIERS Asset-Backed Securities, Series Chamt Trust 1997-7
________ NOTE
(ISSUABLE IN MULTIPLES OF THE MINIMUM DENOMINATION)
Description of Collateral Obligations
No.:_____________________ Face Amount:_________________
Payment Date:__________________
Interest Payment Amount:______________________
Interest Payment Dates:_______________________
CUSIP No.:________________ Last Maturity Date:_______________
Initial Call Date:_____________________
TIERS Asset-Backed Securities, Series CHAMT Trust 1997-7 a
Delaware business trust organized and existing under the laws of the State
of Delaware (herein referred to as the "Issuer"), for value received,
hereby promises to pay to Cede & Co., or registered assigns, all principal
payments and interest payments due on the above-referenced Collateral
Obligations (the "Collateral Obligations") on each Payment Date with
respect to the Face Amount hereof and on each Interest Payment Date in
respect of the Interest Payment Amount hereof payable in accordance with
the Indenture, prior to the occurrence of an Event of Default and a
declaration that the Notes are due and payable. The amounts payable on
this Note shall be payable from the Note Payment Account pursuant to
Section 3.1 of the Indenture. The sole obligors with respect to the Face
Amount of the principal payment and the Interest Payment Amount of the
interest payment are the issuers or obligors of the Collateral Obligations
and any other entities obligated to make payments to such Persons (or their
trustees or other applicable fiduciaries) with respect to the Collateral
Obligations.
This Note is one of a duly authorized issue of Notes of the
Issuer designated as its ______ Notes (herein called the "Notes"), pursuant
to the terms of a Series Trust Indenture, (the "Indenture") dated as of
____, consisting of a Series Trust Indenture together with the Standard
A-I-1
<PAGE>
Terms and Provisions of Trust Indenture appended thereto together with all
other exhibits, schedules, appendices, supplements and amendments thereto
between the Issuer and First Trust of New York, National Association, as
Indenture Trustee, pursuant to which this and other Notes have been issued.
Reference is hereby made to the Indenture and all indentures supplemental
thereto for a statement of the respective rights and obligations thereunder
of the Issuer, the Indenture Trustee and the Noteholders. All terms used
and not otherwise defined in this Note that are defined in the Indentures,
as supplemented or amended, shall have the meanings assigned to them in or
pursuant to the Indenture.
The Notes issued pursuant to the Indenture will be equally and
ratably secured by the Collateral pledged as security therefor as provided
in the Indenture.
Upon the occurrence of an Event of Default and a declaration
under the Indenture that the Notes are immediately due and payable (i)
Noteholders will be entitled to ratable repayment of principal on the basis
of their respective unpaid principal balances and (ii) repayment in full of
the accrued interest on and unpaid principal balances of the Notes will be
made prior to any further payment of interest on the certificates in
respect of the Certificate Principal Amount.
Notwithstanding the foregoing, the entire Face Amount of this
Note shall be due and payable on the date on which Event of Default shall
have occurred and be continuing and the Indenture Trustee or the
Noteholders representing not less than 25% of the Outstanding Amount of the
Notes have declared the Notes to be immediately due and payable in the
manner provided in Section 5.2 of the Indenture. All payments in respect
of the Face Amount hereof shall be made pro rata to the Holders of the
Notes.
Payments of in respect of the Face Amount on this Note shall be
due and payable on each Payment Date and payments in respect of the
Interest Payment Amount shall be due and payable on the Interest Payment
Dates, if not in full payment of this Note, shall be made by check mailed
to the Person whose name appears as the Registered Holder of this Note (or
one or more Predecessor Notes) on the Note Register as of the close of
business on each Record Date, except that with respect to the Notes
registered on the Record Date in the name of the nominee of the Clearing
Agency (initially such nominee to be Cede & Co.), payments will be made by
wire transfer in immediately available funds to the account designated by
such nominee. Such checks shall be mailed to the Person entitled thereto
at the address of such Person as it appears on the Note Register as of the
applicable Record Date without requiring that this Note be submitted for
notation of payment. The Record Date, with respect to any Payment or
Interest Payment Date, means the close of business on the ________________
day of the calendar month in which such Payment Date or Interest Payment
Date occurs, or if Definitive Notes are issued, the (last day of the
preceding Interest Period). Any reduction in the principal amount of this
A-I-2
<PAGE>
Note (or any one or more predecessor Notes) effected by any payments made
on any Payment Date shall be binding upon all future Holders of this Note
and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof, whether or not noted hereon. If funds
are expected to be available, as provided in the Indenture, for payment in
full of the then remaining unpaid principal amount of this Note on a
Payment Date, then the Indenture Trustee, in the name of and on behalf of
the Issuer, shall notify the Person who is the Registered Holder hereof as
of the Record Date preceding such Payment Date by notice sent in accordance
with Section 2.7(d) of the Indenture, and the amount then due and payable
shall be payable only upon presentation and surrender of this Note at the
Indenture Trustee's principal Corporate Trust Office or at the office of
the Indenture Trustee's agent appointed for such purposes located in New
York City.
As provided in the Indenture and subject to certain limitations
set forth therein, the transfer of this Note may be registered on the Note
Register upon surrender of this Note 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 Indenture Trustee duly executed by, the Holder hereof
or such Holder's attorney duly authorized in writing, with such signature
guaranteed by a commercial bank or trust company located, or having a
correspondent located, in New York City or the city in which the Corporate
Trust Office is located, or a member firm of a national securities
exchange, and such other documents as the Indenture Trustee may require,
and thereupon one or more new Notes of authorized detonations and in the
same aggregate principal amount will be issued to the designated transferee
or transferees. No service charge will be charged for any registration of
transfer or exchange of this Note, but the transferor may be required to
pay a sum sufficient to cover any tax or other governmental charge that may
be imposed in connection with any such registration of transfer or
exchange.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that no recourse may be taken, directly or indirectly, with respect to the
obligations of the Issuer, the Owner Trustee or the Indenture Trustee on
the Notes or under the Indenture or any certificate or other writing
delivered in connection therewith, against (i) the Indenture Trustee or the
Owner Trustee in their individual capacities, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director or employee of the Indenture Trustee or the Owner
Trustee in their individual capacities, any holder of a beneficial interest
in the Issuer, the Owner Trustee or the Indenture Trustee or of any
successor or assignee of the Indenture Trustee or the Owner Trustee in
their individual capacities, except as any such person may have expressly
A-I-3
<PAGE>
agreed and except that any such partner, owner or beneficiary shall be
fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment of call owing to such entity.
Each Noteholder or Note Owner, by acceptance of a Note or, in the
case of a Note Owner, a beneficial interest in a Note, covenants and agrees
that by accepting the benefits of the Indenture such Noteholder will not,
prior to the date which is one year and one day after the termination of
this Indenture with respect to the Issuer, acquiesce, petition or otherwise
invoke or cause the Depositor or the Issuer to invoke the process of any
court or government authority for the purpose of commencing or sustaining a
case against the Depositor or the Issuer under any federal or state
bankruptcy, insolvency or similar law or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the
Depositor or the Issuer or any substantial part of its property, or
ordering the winding up or liquidation of the affairs of the Depositor or
the Issuer.
Prior to the due presentment of registration of transfer of this
Note, the Issuer, the Indenture Trustee and any agent of the Issuer of the
Indenture Trustee may treat the Person in whose name this Note (as of the
day of determination or as of such other date as may be specified in the
Indenture) is registered as the owner hereof for all purposes, whether or
not this Note shall be overdue, and neither the Issuer, the Indenture
Trustee nor any such agent shall be affected by notice to the contrary.
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 Noteholders under the
Indenture at any time by the Issuer with the consent of the Holders of
Notes representing a majority of the Outstanding Amount of all the Notes.
The Indenture also contains provisions permitting the Holders of Notes
representing specified percentages of the Outstanding Amount of the Notes,
on behalf of the Holders of all the Notes, 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 Note (or any one of more Predecessor Notes) shall be
conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent
or waiver is made upon this Note. The Indenture also permits the Indenture
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of the Noteholders.
The term "Issuer" as used in this Note includes any successor to
the Issuer under the Indenture.
The Issuer is permitted by the Indenture, under certain
circumstances, to merge or consolidate, subject to the rights of the
Indenture Trustee and the Holders of Notes under the Indenture.
A-I-4
<PAGE>
The Notes are issuable only in registered form in denominations
as provided in the Indenture, subject to certain limitations therein set
forth.
This Note and the Indenture shall be construed in accordance with
the laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties
hereunder and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this
Note 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 Note at the times, place and rate, and in the coin or
currency herein prescribed.
Anything herein to the contrary notwithstanding, except as
expressly provided in the Basic Documents, neither the Depositor, the
Indenture Trustee nor the Owner Trustee in their respective individual
capacities, any owner of a beneficial interest in the Issuer, nor any of
their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns, shall be personally liable for, nor
shall recourse be had to any of them for, the payment of principal of or
interest on, or performance of, or omission to perform, any of the
covenants, obligations or indemnifications contained in this Note or the
Indenture, it being expressly understood that said covenants, obligations
and indemnifications have been made by the Issuer. The Holder of
this Note by the acceptance hereof agrees that, except as expressly
provided in the Basic Documents, in the case of an Event of Default
under the Indenture, the Holder shall have no claim against any of the
foregoing for any deficiency, loss or claim therefrom; provided,
however, that nothing contained herein shall be taken to prevent recourse
to, and enforcement against, the assets of the Issuer for any and all
liabilities, obligations and undertakings contained in the Indenture or in
this Note.
The principal of and interest of this Note are payable in such
coin or currency of the United States of America which, 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 Note shall be applied
first to interest due and payable on this Note as provided above and then
to the unpaid principal of this Note.
Unless the certificate of authentication hereon has been executed
by the Indenture Trustee whose name appears below by manual signature, this
Note shall not be entitled to any benefit under the Indenture referred to
on the reverse hereof or be valid or obligatory for any purpose.
A-I-5
<PAGE>
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer.
TIERS ASSET-BACKED SECURITIES, SERIES CHAMT TRUST 1997-7
By: Delaware Trust Capital Management, Inc.
not in its individual capacity but solely as Owner
Trustee under the Trust Agreement
By:______________________________
Name:
Title:
<PAGE>
</TABLE>
Exhibit 2
=======================================================================
TIERS<service-mark> ASSET-BACKED SECURITIES,
SERIES CHAMT TRUST 1997-7 SUPPLEMENT
BETWEEN
STRUCTURED PRODUCTS CORP.,
AS DEPOSITOR
AND
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
AS TRUSTEE
FLOATING RATE CERTIFICATES, CLASS B
=======================================================================
<PAGE>
TIERS<service-mark> ASSET-BACKED SECURITIES, SERIES
CHAMT Trust 1997-7 SUPPLEMENT dated as of September 15,
1997 (this "Series Supplement") between STRUCTURED
PRODUCTS CORP., a Delaware corporation, as depositor
(the "Depositor"), and DELAWARE TRUST CAPITAL
MANAGEMENT, INC., as trustee (the "Trustee").
PRELIMINARY STATEMENT
Pursuant to the Base Trust Agreement dated as of September 15,
1997 the "Agreement"), among the Depositor and the Trustee, such parties
may at any time and from time to time enter into a series supplement
supplemental to the Agreement for the purpose of creating a trust. Section
5.13 of the Agreement provides that the Depositor may at any time and from
time to time direct the Trustee to authenticate and deliver, on behalf of
any such trust, a new Series of trust certificates. Each trust certificate
of such new Series of trust certificates will represent a fractional
undivided beneficial interest in such trust. Certain terms and conditions
applicable to each such Series are to be set forth in the related series
supplement to the Agreement.
Pursuant to this Series Supplement, the Depositor and the Trustee
shall create and establish a new Series of trust certificates to be issued
thereby, which certificates shall be known as the Series CHAMT Trust 1997-7
Floating Rate Certificates, Class B (the "Certificates"), and the Depositor
and the Trustee shall herein specify certain terms and conditions in
respect thereof.
The Certificates shall be Floating Rate Certificates issued in
one Class.
On behalf of and pursuant to the authorizing resolutions of the
Board of Directors of the Depositor, an authorized officer of the depositor
has authorized the execution, authentication and delivery of the
Certificates, and has authorized the Agreement and this Series Supplement
in accordance with the terms of Section 5.13 of the Agreement.
SECTION 1. CERTAIN DEFINED TERMS. (a) All terms used in this
Series Supplement that are defined in the Agreement, either directly or by
reference therein, have the meanings assigned to such terms therein, except
to the extent such terms are defined or modified in this Series Supplement
or the context requires otherwise. The Agreement also contains rules as to
usage which shall be applicable thereto.
(b) Pursuant to Article I of the Agreement, the meaning of
certain defined terms used in the Agreement shall, when applied to the
trust certificates of a particular Series, be as defined in Article I but
with such additional provisions and modifications as are specified in the
related series supplement. With respect to the Certificates, the following
definitions shall apply:
"ACCELERATION EVENT": The acceleration of the maturity of the
Notes upon an Indenture Default.
<PAGE>
"ADMINISTRATOR": Each of First Trust of New York, National
Association and the Depositor.
"ADMINISTRATION AGREEMENTS": With respect to the Certificates
and the Notes, (i) the Administration Agreement dated as of September 15,
1997 among the Trust, the Trustee, the Indenture Trustee and the
Administrator and (ii) the Administration Agreement dated as of September
15, 1997 among the Trust, the Owner Trustee and the Depositor.
"AGGREGATE CERTIFICATE PRINCIPAL BALANCE": The Aggregate
Certificate Principal Balance of the Certificates as of any date of
determination shall be equal to the aggregate original principal amount
of the Certificates multiplied by the then Certificate Current Factor.
"ALLOCABLE CHARGE-OFF AMOUNT": With respect to the Certificates,
for any Distribution Date, as defined in the Indenture.
"AVAILABLE FUNDS": For any Distribution Date, as defined in the
Indenture.
"BASIC DOCUMENTS": With respect to the Series of Certificates
established hereunder, the Indenture, the Trust Agreement, this Series
Supplement, the Administration Agreement, and the Swap Agreement .
"BUSINESS DAY": Any day other than a Saturday, Sunday or a day
on which banking institutions in New York, New York, London, England and
Wilmington, Delaware are authorized or obligated by law, executive order or
governmental decree to be closed.
"CERTIFICATE CURRENT FACTOR": Is a number (carried to eight
decimal places) that represents the portion of the aggregate original
principal amount of the Certificates then outstanding.
"CERTIFICATE NOTIONAL AMOUNT": With respect to the Certificates,
for any Distribution Date, the aggregate Certificate Principal Balance for
all Certificates, less the Allocable Charge-Off Amount. The Certificate
Notional Amount shall never be less than zero.
"CERTIFICATE PRINCIPAL BALANCE": For any Certificate, the
denomination of such Certificate multiplied by the then Certificate Current
Factor.
"CLOSING DATE": September 15, 1997.
"COLLECTION ACCOUNT" means the account by that name established
pursuant to the Indenture.
2
<PAGE>
"CORPORATE TRUST OFFICE": Delaware Trust Capital Management,
Inc., 900 Market Street, 2nd Floor, Wilmington, Delaware 19801, or such
other trust office as the Trustee shall designate in writing to the
Depositor and the Certificateholders.
"CUT-OFF DATE": September 15, 1997.
"DEFERRED INTEREST AMOUNTS": For any Distribution Date, and with
respect to the Notes or the Certificates, any interest due thereon on a
prior Distribution Date which remains unpaid.
"DEPOSITARY": The Depository Trust Company.
"DEPOSITED ASSETS": (i) the Term Assets, (ii) the Swap
Agreement, (iii) Eligible Investments and (iv) all earnings on and proceeds
of the foregoing.
"DEPOSITED ASSETS SCHEDULE": means Schedule A attached hereto
and made a part hereof.
"DISTRIBUTION DATE": Monthly, on the 15th day of each month (or,
if any such day is not a Business Day, then on the next succeeding Business
Day) commencing October 15, 1997.
"INDENTURE": means the Series Trust Indenture dated September
15, 1997 under which the Series CHAMT 1997-7 Fixed Rate Notes, Class A were
issued.
"INDENTURE DEFAULT": An Event of Default under and as defined in
the Indenture.
"INDENTURE TRUSTEE": means First Trust of New York, National
Association and any successor thereto under the Indenture.
"INTEREST ACCRUAL PERIOD": means with respect to any Distribution
Date, the date from and including the immediately preceding Distribution
Date (or, in the case of the first Interest Accrual Period, from and
including the Closing Date) to but excluding the current Distribution Date.
"LIBOR": For each Interest Accrual Period, a rate determined as
follows:
(i) On the second London Business Day before the beginning of
each Interest Accrual Period (the "Interest Determination Date") the
Depositor or its designee (either such, the "Calculation Agent") will
determine the offered rate for one-month U.S. Dollar deposits as of
11:00 a.m. (London time) on the applicable Interest Determination
Date. Such offered rate will be that which appears on the display
designated as Telerate Page 3750 on the Dow Jones Telerate Service (or
such other page or service as may replace it for the purpose of
displaying London interbank offered rates of major banks for U.S.
Dollar deposits).
3
<PAGE>
(ii) If for any reason the relevant page is unavailable or such
offered rate does not appear, the rate for such period will be
determined on the basis of the rates at which deposits in U.S. Dollar
amounts are offered by four major banks in the London interbank market
selected by the Calculation Agent (the "Reference Banks") at
approximately 11:00 a.m. (London time) on the Interest Determination
Date to prime banks in the London interbank market for a period of one
month commencing on the first day of the relevant Interest Accrual
Period. The Calculation Agent will request the principal London
office of each of the Reference Banks to provide a quotation of its
rate. If at least two quotations are provided the rate for such
Interest Accrual Period will be the arithmetic mean of the quotations.
If fewer than two quotations are provided as requested, the rate for
that Interest Accrual Period will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Calculation
Agent, at approximately 11:00 a.m. (New York City time) on the first
day of the relevant Interest Accrual Period for loans in U.S. Dollars
to leading European banks for a period of one month commencing on that
date.
"LONDON BUSINESS DAY": Any day (other than a Saturday or Sunday or
a day on which banking institutions in London are authorized or obligated
by law or executive order to close) on which dealings in deposits in U.S.
Dollars are transacted in the London interbank market and commercial banks
and foreign exchange markets settle payments in U.S. Dollars in London.
"MONTHLY AMORTIZATION RATE": means, for any month, the rate set
forth in the Prepayment Calculation Table that corresponds to the PSA Index
Rate for such month.
"MONTHLY PREPAYMENT AMOUNT": For any Distribution Date with
respect to the Certificates, an amount equal to the Certificate Notional
Amount on such Payment Date (before giving effect to any distributions on
such date) multiplied by the Monthly Amortization Rate that corresponds to
the PSA Index Rate for the month in which such Distribution Date occurs.
"NOTE": The Series CHAMT 1997-7 Fixed Rate Notes, Class A issued
pursuant to the Indenture.
"NOTEHOLDER": means any holder of a Note.
"PASS THROUGH RATE": For each Interest Accrual Period, a per
annum rate equal to the sum of 0.20% plus LIBOR for such Interest Accrual
Period, calculated on the basis of the actual number of days in such
Interest Accrual Period divided by 360.
"PAYMENT DEFAULT": A default by the Term Assets Issuer in the
payment of any amount due (and the continuation thereof for any applicable
grace period on the Term Assets).
"PERMITTED INVESTMENTS": shall have the meaning given to the
defined term "Eligible Investments" in the Indenture.
"PLACE OF DISTRIBUTION": New York, New York or Wilmington,
Delaware.
4
<PAGE>
"PREPAYMENT CALCULATION TABLE": means the table set forth in
Schedule B attached hereto and made a part hereof.
"PREPAYMENT DETERMINATION DATE": means, for any Distribution
Date occurring after the Distribution Date in January, 2000, the first
Business Day of the month in which such Distribution Date occurs.
"PRO RATA SHARE": means with respect to each Certificate, the
percentage obtained by dividing the outstanding Certificate Principal
Balance of such certificate by the aggregate outstanding Certificate
Principal Balance of all of the Certificates.
"PSA INDEX RATE": means, with respect to any Distribution Date:
(i) the rate that appears as of 3:00 p.m. (New York City time)
on the related Prepayment Determination Date (as defined below) on the
Reference Bloomberg Page (as defined below) under the column heading "1 MO"
opposite the row "PSA";
(ii) if such rate does not appear on the Reference Bloomberg Page
as of 3:00 p.m. (New York City time) on such Prepayment Determination Date,
the Swap Counterparty will request FHMLC to provide a quotation of the
monthly prepayment speed (calculated according to the PSA Standard
Prepayment Model (as defined herein)) for the Reference Securities for the
applicable month. If FHMLC provides such quotation, the PSA Index Rate
will be the quotation provided by FHMLC;
(iii) if the Swap Counterparty determines that FHMLC has not
provided such quotation by 5:00 p.m. on the second Business Day following
such Prepayment Determination Date, the Swap Counterparty will request five
major securities dealers selected by the Swap Counterparty to provide a
quotation of the monthly prepayment speed (calculated according to the PSA
Standard Prepayment Model) for the Reference Securities for the applicable
month. If at least two such quotations are so provided, then the PSA Index
Rate will be the arithmetic mean (rounded to the nearest whole integer)
determined by the Swap Counterparty of the quotations so obtained (and, if
five such quotations are provided, eliminating the highest quotation (or,
in the event of equality, one of the highest) and lowest quotation (or, in
the event of equality, one of the lowest)). If only one quotation is so
provided, the PSA Index Rate will be the quotation so provided; and
(iv) if no such quotation is provided as requested in clause
(iii) above, then the PSA Index Rate will be the PSA Index Rate determined
with respect to the Payment Date preceding the applicable Payment Date (or,
in the case of the first Payment Date, the monthly prepayment speed
(calculated according to the PSA Standard Prepayment Model) for the
Reference Securities obtained from the sources specified in clauses (i)-
(iii) above, in that order, with respect to the most recent month for which
such information is available.
"PSA STANDARD PREPAYMENT MODEL": The methodology set forth under
"Mortgage Prepayment Models -- The PSA Standard Prepayment Model" in the
5
<PAGE>
"Uniform Practices for the Clearance and Settlement of Mortgage-Backed
Securities and Other Related Securities of the Public Securities
Association."
"RATING AGENCIES": Moody's Investors Service, Inc. ("Moody's")
and S&P and any successor thereto. References to "the Rating Agency" in
the Agreement shall be deemed to be such credit rating agency.
"RECORD DATE": With respect to any Distribution Date, the day
immediately preceding such Distribution Date, unless Definitive
Certificates are issued, in which case on the last Business Day of the
month prior to the month in which such Distribution Date occurs.
"REDEMPTION PRICE": With respect to (i) the Notes, has the
meaning set forth in the Indenture and (ii) with respect to the
Certificates, the Certificate Principal Balance plus accrued interest
thereon.
"REFERENCE BLOOMBERG PAGE" means the display designated as page
"A013" and titled "Reference Collateral 30-year Gold 8.00, Issued in 1995"
(or such other page selected by the Swap Counterparty as may replace page
"A013" for the purpose of displaying the monthly prepayment speed
(calculated based on the PSA Standard Prepayment Model) for the Reference
Securities) on the Bloomberg Financial Markets Service (or such other
service selected by the Swap Counterparty as may replace such service).
"REFERENCE SECURITIES" means the aggregate outstanding 30-year
Federal Home Loan Mortgage Corporate Gold 8.0% mortgage participation
certificates issued in calendar year 1995.
"REQUIRED PERCENTAGE--DIRECTION OF TRUSTEE": For purposes of
this Series Supplement, 66-2/3% of the aggregate Voting Rights of the
Certificates.
"REQUIRED PERCENTAGE--REMEDIES": For purposes of this Series
Supplement, 66-2/3% of the aggregate Voting Rights of the Certificates.
"REQUIRED RATING": With respect to the Certificates, Aa1 by
Moody's Investor Services, Inc.
"SCHEDULED FINAL DISTRIBUTION DATE": November 15, 2003 (or, if
such day is not a Business Day, then on the next succeeding Business Day).
"SPECIFIED CURRENCY": United States Dollars.
"S&P" has the meaning specified in the Indenture.
"SWAP AGREEMENT": The ISDA Master Agreement, together with the
related schedule and confirmations, entered into by the Trust with the Swap
Counterparty on the Closing Date.
"SWAP COUNTERPARTY": Westdeutsche Landesbank Girozentrale, New
York Branch.
6
<PAGE>
"TERM ASSETS": The $363,900,000 aggregate principal amount of
Class A Floating Rate Asset-Backed Certificates, Series 1996-4 issued by
the Term Assets Issuer, deposited in the Trust by the Depositor and
identified on the Deposited Asset Schedule.
"TERM ASSETS DEFAULT DISTRIBUTION DATE": The date on which the
Trustee makes a distribution in kind of the Term Assets following a Payment
Default or an Acceleration.
"TERM ASSETS INDENTURE": The indenture under which the Term
Assets were issued.
"TERM ASSETS ISSUER": Chase Credit Card Master Trust.
"TERM ASSETS PAYMENT DATE": The fifteenth day of each month;
PROVIDED, HOWEVER, that if any Term Assets Payment Date would otherwise
fall on a day that is not a Business Day, such Term Assets Payment Date
will be the following Business Day.
"TERM ASSETS PROSPECTUS": The prospectus of the Term Assets
Issuer, dated November 6, 1996, as supplemented by a supplement thereto,
dated November 6, 1996, with respect to the Term Assets.
"TERM ASSETS TRUSTEE": The trustee under the Term Assets
Indenture.
"TRUST": TIERS Asset-Backed Securities, Series CHAMT Trust 1997-
7.
"TRUST TERMINATION EVENT": The meaning specified in Section 13
hereof.
SECTION 2. CREATION AND DECLARATION OF SERIES OF TRUST; GRANT OF
TERM ASSETS; ACCEPTANCE BY TRUSTEE.
(a) The Depositor, concurrently with the execution and delivery
hereof and pursuant to Section 2.1 of the Agreement, has delivered or
caused to be delivered to the Trustee the Term Assets in exchange for the
delivery to, or at the direction of, the Depositor of all of the
Certificates representing an undivided beneficial interest in all of the
assets of the Trust established hereunder.
(b) The Trustee hereby (i) acknowledges such deposit, pursuant
to subsection (a) above, and receipt by it of the Term Assets, (ii) accepts
the trusts created hereunder in accordance with the provisions hereof and
of the Agreement but subject to the Trustee's obligation, as and when the
same may arise, to make any payment or other distribution of the assets of
the Trust as may be required pursuant to this Series Supplement, the
Agreement and the Certificates, and (iii) agrees to perform the duties
herein or therein required and any failure to receive reimbursement of
expenses and disbursements under Section 15 hereof shall not release the
Trustee from its duties herein or therein.
7
<PAGE>
(c) The Depositor has executed and delivered to the Trustee, in
accordance with Section 5.13 of the Agreement, and the Trustee acknowledges
receipt of, the following:
(i) a Board Resolution of the Depositor with respect to the
Certificates established hereunder;
(ii) Officers' Certificates regarding absence of default and
acquisition of Required Rating from Moody's.
SECTION 3. DESIGNATION. Pursuant to Section 3806(b)(2) of the
Delaware Business Trust Act, there is hereby created a Series of trust
certificates to be issued pursuant to the Agreement and this Series
Supplement to be known as the "TIERS<service-mark> Asset-Backed Securities,
Series CHAMT Trust 1997-7 Floating Rate Certificates, Class B."
SECTION 4. DATE OF THE CERTIFICATES. The Certificates that are
authenticated and delivered by the Trustee to or upon Depositor Order on
the Closing Date shall be dated the Closing Date. All other Certificates
that are authenticated after the Closing Date for any other purpose under
the Agreement shall be dated the date of their authentication. The
Certificates shall all be originally issued on the Closing Date.
SECTION 5. CERTIFICATE PRINCIPAL BALANCE AND DENOMINATIONS. The
maximum Aggregate Certificate Principal Balance of the Certificates that
may be authenticated and delivered under the Agreement and this Series
Supplement is $10,920,000. In each case such maximum amounts shall be
calculated without regard to Certificates authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Certificates pursuant to Section 5.3, 5.4 or 5.5 of the Agreement. The
Certificates are issuable in minimum denominations of $1,000 and in
integral multiples thereof.
SECTION 6. CURRENCY OF THE CERTIFICATES. All distributions on
the Certificates will be made in the Specified Currency.
SECTION 7. FORM OF SECURITIES. The Certificates will be
delivered in registered form and will be represented by one or more Global
Securities issued in accordance with Section 5.9 of the Agreement and
initially registered in the name of Cede & Co., as nominee of The
Depository Trust Company. Certificates shall be in the form attached
hereto as Exhibit A.
SECTION 8. ASSIGNMENT OF RIGHTS IN THE DEPOSITED ASSETS. The
Trust has assigned and pledged to the Indenture Trustee, and granted a lien
upon and security interest in, all of its right title and interest in and
to the Deposited Assets to secure the obligation of the Trust to the
Indenture Trustee on behalf of the Swap Counterparty under the Swap
Agreement and the Noteholders under the Indenture and the Notes. All
amounts payable in respect of the Deposited Assets shall be paid to and
held, invested and distributed by the Indenture Trustee in accordance with
the Indenture.
8
<PAGE>
SECTION 9. DISTRIBUTION DATES; COMPUTATIONS OF INTEREST;
PREPAYMENTS .
(a) PAYMENTS OF INTEREST. Each Certificate shall accrue
interest on the Certificate Principal Balance thereof at the Pass Through
Rate as set forth in the form of Certificate set forth on Exhibit A hereto.
Payments of interest on the Certificates will be made monthly on each
Distribution Date. If and to the extent that the amount available to pay
interest to the Certificateholders on any Distribution Date in accordance
with the priority of payments set forth in Section 4 of the Indenture is
insufficient to pay all interest then due at the Pass Through Rate, such
amounts shall constitute Deferred Interest Amounts which shall be payable,
as provided in Section 4 of the Indenture, in whole or in part, on any
Distribution Date on which the Available Funds are sufficient to pay such
amounts in accordance with the priority of payments set forth therein.
(b) MANDATORY PREPAYMENT OF CERTIFICATES.
(i) Beginning on the Distribution Date in February 2000, and on
each Distribution Date thereafter until the principal balance of the
Certificates is paid in full, a portion of the Certificate Principal
Balance for all Certificates, in an aggregate amount equal to the Monthly
Prepayment Amount for such Distribution Date, shall be paid pro rata to the
Certificateholders.
(ii) The Swap Counterparty has agreed in the Swap Agreement that
it shall, beginning in February 1999, on the first Business Day of each
month determine (i) the PSA Index Rate for such month, (ii) the Monthly
Amortization Rate that corresponds to such PSA Index Rate, (iii) the Note
Notional Amount, (iv) the Certificate Notional Amount (v) the Monthly
Prepayment Amount, and (vi) the Certificate Current Factor and to notify
the Indenture Trustee of its determinations thereof.
(iii) The Swap Counterparty's calculations of Monthly Prepayment
Amounts or its determination of the PSA Index Rate, the Monthly
Amortization Rate, the Certificate Notional Amount or the Note Current
Factor, each month will, absent manifest error, be final and binding.
(c) OPTIONAL REDEMPTION OF CERTIFICATES.
(i) If on any Distribution Date, before giving effect to any
distributions to be made on such date, the aggregate outstanding principal
amount of the Term Assets would be less than 10% of the Initial Principal
Amount of the Term Assets, the Swap Counterparty may, at its option, by
delivering a written notice to the Indenture Trustee pursuant to the
Indenture (with a copy to the Trustee and the Administrator), direct the
redemption of all of the outstanding Notes and Certificates at their
Redemption Price. If the Swap Counterparty so delivers a written notice of
redemption to the Indenture Trustee, the Indenture Trustee shall deliver a
notice of redemption to each Noteholder and Certificateholder (a
"Redemption Notice"), (with a copy to the Trustee and the Administrator),
in the manner provided in the Indenture; PROVIDED that the Redemption Date
for such redemption shall be the first Payment Date which is at least 15
days after the date of the Indenture Trustee's delivery of such Redemption
Notice.
9
<PAGE>
(ii) If a Redemption Notice is delivered by the Indenture Trustee
as provided herein, the Indenture Trustee shall, by no later than the 10th
day before the Redemption Date, notify the Trustee, Administrator and the
Swap Counterparty and arrange for the sale by the Administrator, in
accordance with the Sale Procedures (as defined in the Indenture), of all
of the Eligible Investments and Term Assets then held by the Trust, for
settlement on the Redemption Date. Any Sale Proceeds (as defined in the
Indenture) realized from such sale shall be deposited into the Collection
Account for distribution as provided in the Indenture.
(d) FINAL PAYMENT OF PRINCIPAL. The outstanding Certificate
Principal Balance of each Certificate not previously prepaid will become
due on the Scheduled Final Payment Date for the Certificates.
SECTION 10. CERTAIN PROVISIONS OF AGREEMENT NOT APPLICABLE. With
respect to the Series of Certificates established hereunder:
(a) there is no Administrative Agent specified in or appointed
under this Series Supplement and, accordingly, no Person (including the
Trustee) shall have the right or the obligation to make any advances
pursuant to Section 4.3 of the Agreement; and all references to the
Administrative Agent shall not apply for purposes of, and shall have no
force or effect in respect of, the Certificates of this Series;
(b) Neither (i) the provisions of Sections 2.2(b), 2.3, 3.4,
3.6, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 3.18, 4.3, 4.5, 5.16, 5.17,
5.18, 6.4, 6.5, Article VII, and 9.7 of the Agreement, together with any
other provision of the Agreement which imposes obligations or creates
rights in favor of the Trustee or the Certificateholders as a result of or
by reference to such Sections, nor (ii) any of the defined terms "Event of
Default" "Retained Interest" "Administration Account" "Certificate Account"
"Reserve Account" "Credit Support Instruments" shall apply for purposes of,
or have any force or effect in respect of, the Certificates of this Series;
and
(c) In the event of any conflict between the terms of the
Agreement and the terms of this Series Supplement, the terms of this Series
Supplement shall be controlling for all purposes of the Series of
Certificates established hereunder.
SECTION 11. DISTRIBUTIONS. (a) On each Distribution Date, the
Administrator shall distribute, or cause the Indenture Trustee to
distribute, funds to the Holders of the Certificates, to the extent of
Available Funds, in the manner set forth in Section 4 of the Indenture:
(i) In the event that on any Distribution Date the amounts in
the Collection Account are insufficient to pay all amounts then due the
Certificateholders, each Certificateholder will be entitled to receive its
Pro Rata Share of the amount available for distribution to all
Certificateholders as provided herein.
10
<PAGE>
(ii) Distributions of principal and interest on the Certificates
is subordinated in priority of payment to the payment of amounts owed by
the Trust to the Swap Counterparty under the Swap Agreement and to the
payment of principal and interest on the Notes.
(b) Distributions to the Certificateholders on each Distribution
Date will be made to the Certificateholders of record on the related Record
Date of the Certificates.
(c) Notwithstanding any provision of the Agreement to the
contrary, to the extent funds are available, the Administrator will
instruct the Indenture Trustee to initiate payment in immediately available
funds on each Distribution Date of all amounts (whether in the form of
principal, interest or prepayment) payable to each Certificateholder with
respect to any Certificate held by such Certificateholder or its nominee
(without the necessity for any presentation or surrender thereof or any
notation of such payment thereon) in the manner and at the address as each
Certificateholder may from time to time direct the Trustee or the
Administrator in writing 15 days prior to such Distribution Date requesting
that such payment will be so made and designating the bank account to which
such payments shall be so made. The Administrator, on behalf of the
Trustee, shall be entitled to rely on the last instruction delivered by the
Certificateholder pursuant to this Section 11(c) unless a new instruction
is delivered 15 days prior to a Distribution Date.
(d) The rights of the Certificateholders to receive
distributions in respect of the Certificates, and all interests of the
Certificateholders in such distributions, shall be as set forth in this
Series Supplement. The Trustee shall in no way be responsible or liable to
the Certificateholders nor shall any Certificateholder in any way be
responsible or liable to any other Certificateholder in respect of amounts
previously distributed on the Certificates based on their respective
Certificate Principal Balances.
(e) Upon the occurrence of an Acceleration Event, the Indenture
Trustee shall take the action specified in Section 7b of the Indenture. If
there is such an Acceleration Event the Certificateholders shall be
entitled, to the extent of Available Funds and subject to the subordination
provisions hereof and in the Series Trust Indenture, to distributions in
respect of accrued and unpaid interest on and the aggregate outstanding
Certificate Principal Balance of the Certificates as set forth in Section
7c of the Indenture.
SECTION 12. ADMINISTRATION AGREEMENTS. The Trustee has executed
and delivered the Administration Agreements pursuant to which certain of
the Trustee's and Issuer's duties and obligations hereunder and under the
Indenture have been delegated to the Administrators, thereby relieving, to
the extent provided therein, and to the extent permitted by law, the
Trustee from liability for such duties and obligations hereunder and
thereunder. Each Administrator shall be entitled to the same rights,
privileges, immunities and limitations on liability available to the
parties on whose behalf it is acting.
SECTION 13. TERMINATION OF SERIES OF THE TRUST.
(a) The Trust, together with the Series of Certificates
established hereunder, shall terminate upon (i) the Scheduled Final
11
<PAGE>
Distribution Date or (ii) upon the final distribution to Certificateholders
pursuant to Section 7c of the Indenture following an Acceleration Event
(the first to occur of the foregoing, a "Trust Termination Event").
(b) Promptly after the Trustee or the Administrator has received
a notice of an Indenture Default, the Trustee, or the Administrator on its
behalf, shall provide notice to the Certificateholders of the expected
occurrence of a Trust Termination Event and the termination of the Series
of the Trust.
(c) Except for any reports and other information required to be
provided to Certificateholders hereunder and under the Agreement and except
as otherwise specified herein and therein, the obligations of the Trustee
to the Certificateholders of the Certificates issued under this Series will
terminate upon the distribution to Certificateholders of all amounts or
property required to be distributed to them and the disposition of all Term
Assets held by the Trustee. The Series of the Trust shall thereupon
terminate.
SECTION 14. LIMITATION OF POWERS AND DUTIES. (a) The Trustee
shall administer, or, in accordance with and subject to any limitations set
forth in the applicable Administration Agreement, instruct the
Administrators to administer, the Trust and the Term Assets solely as
specified herein and in the Administration Agreements.
(b) The Series of the Trust is constituted solely for the
purpose of acquiring and holding the Term Assets. The Trustee is not
authorized to acquire any other investments or engage in any activities not
authorized herein and, in particular, the Trustee is not authorized to do
anything that the Depositor advises the Trustee would materially increase
the likelihood that the Trust will be treated as an association taxable as
a corporation for United States federal income tax purposes.
(c) The parties acknowledge that the Trustee, as the holder of
the Term Assets, has the right to vote and give consents and waivers in
respect of the Term Assets and enforce the other rights, if any, of a
holder of the Term Assets, except as otherwise limited by the Agreement or
this Series Supplement. In the event that the Trustee receives a request
from the Term Assets Trustee, the Term Assets Issuer or, if applicable, the
Depositary with respect to the Term Assets, for the Trustee's consent to
any amendment, modification or waiver of the Term Assets, the Term Assets
Indenture or any other document thereunder, or relating thereto, or
receives any other solicitation for any action with respect to the Term
Assets, the Trustee shall within two Business Days mail a notice of such
proposed amendment, modification, waiver or solicitation to each
Certificateholder of record as of the date of such request. The Trustee
shall request instructions from the Certificateholders as to what action to
take in response to such request and shall be protected in taking no action
if no direction is received. Except as otherwise provided herein, the
Trustee shall consent or vote, or refrain from consenting or voting, in the
same proportion (based on the Certificate Principal Balances of the
Certificates) as the Certificates of the Trust were actually voted or not
voted by the Holders thereof as of the date determined by the Trustee prior
to the date such vote or consent is required; PROVIDED, HOWEVER, that,
notwithstanding anything to the contrary in the Agreement or this Series
Supplement, the Trustee shall at no time vote in favor of or consent to any
matter (i) which would alter the timing or amount of any payment on the
Term Assets (including, without limitation, any demand to accelerate the
Term Assets) or (ii) which would result in the exchange or substitution of
any Term Asset pursuant to a plan for the refunding or refinancing of such
Term Asset, except in each case with the unanimous consent of the
12
<PAGE>
Certificateholders and subject to the requirement that such vote would not
materially increase the likelihood that the Trust will be treated as an
association taxable as a corporation for United States federal income tax
purposes, such determination to be based solely on an Opinion of Counsel.
The Trustee shall have no liability for any failure to act or to refrain
from acting resulting from the Certificateholders' late return of, or
failure to return, directions requested by the Trustee from the
Certificateholders. The Trustee shall incur no liability for actions taken
in accordance with instructions from the Certificateholders.
(d) Notwithstanding any provision of the Agreement to the
contrary, for purposes of any security or indemnity against the costs,
expenses and liabilities the Trustee may incur by reason of any action
undertaken at the direction of the Certificateholders, which the Trustee
may require from the Certificateholders prior to taking any such action, an
unsecured indemnity agreement of a Certificateholder or any of its
Affiliates, if acceptable to the Trustee, shall be deemed sufficient to
satisfy such security or indemnity requirement.
(e) Notwithstanding any provision of the Agreement to the
contrary, the Administrator, on behalf of the Trustee, shall, in accordance
with the terms of the Administration Agreement act as the sole
Authenticating Agent, Paying Agent, and Certificate Registrar.
SECTION 15. COMPENSATION OF TRUSTEE. The Trustee shall be
entitled to receive from the Depositor or an Affiliate of the Depositor as
compensation for the Trustee's services hereunder, trustee's fees pursuant
to a separate agreement between the Trustee and the Depositor, and shall be
reimbursed for all reasonable expenses, disbursements and advances incurred
or made by the Trustee (including the reasonable compensation,
disbursements and expenses of its counsel and other persons not regularly
in its employ). The Depositor shall indemnify and hold harmless the
Trustee (including in its individual capacity) and its successors, assigns,
agents and servants against any and all loss, liability or reasonable
expense (including attorney's fees) incurred by it in connection with the
administration of this Trust and the performance of its duties thereunder.
The Trustee shall notify the Depositor promptly of any claim for which it
may seek indemnity. Failure by the Trustee to so notify the Depositor
shall not relieve the Depositor of its obligations hereunder. The
Depositor need not reimburse any expense or indemnify against any loss,
liability or expense incurred by the Trustee through the Trustee's own
willful misconduct, negligence or bad faith. The indemnities contained in
this Section 15 shall survive the resignation or termination of the Trustee
or the termination of the Agreement or the Series Supplement.
Failure by the Depositor to pay, reimburse or indemnify the
Trustee shall not entitle the Trustee to any payment, reimbursement or
indemnification from the Trust, nor shall such failure release the Trustee
from the duties it is required to perform under the Agreement and this
Series Supplement. Any unpaid, unreimbursed or unindemnified amounts shall
13
<PAGE>
not be borne by the Trust and shall not constitute a claim against the
Trust, and the Trustee shall have no recourse against the Trust with
respect thereto; PROVIDED, however, nothing herein shall waive or impair
any rights the Trustee may have against the Depositor.
SECTION 16. MODIFICATION OR AMENDMENT. In addition to and
notwithstanding anything to the contrary in the Agreement or this Series
Supplement, the Depositor shall not enter into any modification or
amendment of the Agreement or this Series Supplement unless such
modification or amendment would not, based on an Opinion of Counsel,
materially increase the likelihood that the Trust would be treated as an
association taxable as a corporation for United States federal income tax
purposes, nor shall the Depositor enter into any such modification or
amendment without either satisfaction of the Rating Agency Condition or the
unanimous written consent of the Certificateholders.
SECTION 17. ACCOUNTING; WITHHOLDINGS REPORTING. (a) Pursuant to
Section 3.16 of the Agreement, INDEPENDENT PUBLIC ACCOUNTANTS'
ADMINISTRATION REPORT, the Trustee shall cause the accountings with respect
to Distribution Dates for the Certificates to be reviewed by an Independent
certified public accountant selected by the Depositor within four months
following the end of an Accounting Period. "Accounting Period" shall mean
each 12-month period ending on the 30th day of June. The Depositor may
change the timing of Accounting Periods upon written notice to the Trustee;
PROVIDED, HOWEVER, that the length of an Accounting Period may in no event
exceed 12 months.
(b) Notwithstanding any other provision of the Agreement or this
Supplement to the contrary, the Trustee shall comply with all federal
withholding requirements regarding income of the Trust that the Trustee
reasonably believes are applicable under the Code. In this regard,
although it is not expected that the Trust would be engaged in a trade or
business in the United States, the Trustee shall withhold as if it were so
engaged in order to protect the Trust from possible adverse consequences
for failing to properly withhold. The Trustee shall withhold on the
portion of its taxable income that is allocable to foreign persons that are
Certificate Owners pursuant to Code Section 1446, as if such income is
effectively connected to a U.S. trade or business. The consent of the
Certificateholders shall not be required for such withholding. The Trustee
shall be entitled to rely on advice of the Administrator or the Depositor
with respect to withholding requirements.
(c) Pursuant to Section 4.2 of the Agreement, REPORTS TO
CERTIFICATEHOLDERS, the Trustee shall, or shall cause an Administrator to,
take such action with respect to the statements as described therein and
to forward such statements as provided therein.
(d) An Independent certified public accountant for the Trust, in
consideration for its duties as described herein and in Section 3.16 of the
Agreement, INDEPENDENT PUBLIC ACCOUNTANTS' ADMINISTRATION REPORT, shall be
compensated by the Depositor for reasonable expenses and disbursements
incurred in connection therewith pursuant to a separate agreement with the
Depositor. The Depositor retains the right to replace any Independent
certified public accountant and the Independent certified public accountant
retains the right to resign from its duties, in which case the Depositor
shall appoint a successor thereto.
14
<PAGE>
(e) The Officer's Certificate of the Depositor to be provided to
the Trustee pursuant to Section 6.1(b) of the Agreement shall be dated on
and as of the Distribution Date occurring in September of each year.
SECTION 18. INVESTMENT OF AMOUNTS RECEIVED ON DEPOSITED ASSETS.
Amounts received on or with respect to the Deposited Assets shall be
invested in accordance with the terms of the Indenture.
SECTION 19. NO EVENT OF DEFAULT. There shall be no Events of
Default defined with respect to the Certificates.
SECTION 20. NOTICES. (a) All directions, demands and notices
hereunder and under the Agreement shall be in writing and shall be deemed
to have been duly given when received if personally delivered or mailed by
first class mail, postage prepaid or by express delivery service or by
certified mail, return receipt requested or delivered in any other manner
specified herein, (i) in the case of the Depositor, to Structured Products
Corp., Seven World Trade Center, Room 33-130, 33rd Floor, New York, New
York 10048, Attention: Secretary, or such other address as may hereafter
be furnished to the Trustee in writing by the Depositor, and (ii) in the
case of the Trustee, to Delaware Trust Capital Management, Inc., 900 Market
Street, 2nd Floor, Wilmington, Delaware 19801, Attention: Corporate Trust
Department, facsimile number (302) 421-7387, or such other address as may
hereafter be furnished to the Depositor in writing by the Trustee.
(b) For purposes of delivering notices to the Rating Agency
under Section 10.07, NOTICE TO RATING AGENCY, of the Agreement or
otherwise, such notices shall be mailed or delivered as provided in Section
10.7, NOTICE TO RATING AGENCY, to: Moody's Investors Service, Inc.,
Structured Derivative Products, 99 Church Street, New York, New York 10007
or such other address as the Rating Agency may designate in writing to the
parties hereto.
(c) Notwithstanding any provisions of the Agreement to the
contrary, the Trustee shall deliver all notices or reports required to be
delivered to or by the Trustee or the Depositor to the Certificateholders
without charge to such Certificateholders.
(d) The office or agency of the Trustee where Certificates may
be surrendered for registration of transfer or exchange and presented for
final distribution with respect thereto, pursuant to Section 8.11 of the
Agreement, is c/o First Trust of New York, N.A., 100 Wall Street, New York,
New York 10005.
SECTION 21. ACCESS TO CERTAIN DOCUMENTATION. Access to
documentation regarding the Term Assets will be afforded without charge to
any Certificateholder so requesting pursuant to Section 3.17 of the
Agreement, ACCESS TO CERTAIN DOCUMENTATION. Additionally, the Trustee
shall provide at the request of any Certificateholder without charge to
such Certificate-holder the name and address of each Certificateholder of
Certificates hereunder as recorded in the Certificate Register for purposes
of contacting the other Certificateholders with respect to their rights
hereunder or for the purposes of effecting purchases or sales of the
Certificates, subject to the transfer restrictions set forth herein.
15
<PAGE>
SECTION 22. SWAP COUNTERPARTY AS THIRD PARTY BENEFICIARY. The
Swap Counterparty is hereby made an express third party beneficiary of this
Series Supplement (including the Agreement).
SECTION 23. [RESERVED.]
SECTION 24. RATIFICATION OF AGREEMENT. With respect to the
Series issued hereby, the Agreement, as supplemented by this Series
Supplement, is in all respects ratified and confirmed and the Agreement as
so supplemented by this Series Supplement shall be read, taken and
construed as one and the same instrument. To the extent there is any
inconsistency between the terms of the Agreement and this Series
Supplement, the terms of this Series Supplement shall govern.
SECTION 25. COUNTERPARTS. This Series 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.
SECTION 26. GOVERNING LAW. This Series Supplement and each
Certificate issued hereunder shall be construed in accordance with and
governed by the substantive laws of the State of Delaware applicable to
agreements made and to be entirely performed therein.
SECTION 27. TRUSTEE ELECTION AND CERTAIN TAX INFORMATION. The
Trustee will, or will cause the Administrator to, elect out of subchapter K
of the Code pursuant to Treasury Regulation Section 1.761-2. Such election
will, to the extent possible, be effective for the first taxable year of
the Trust and thereafter. Each Certificate Owner is deemed to consent to
such election. The Trustee also will the information necessary for
Certificate Owners to integrate the Term Asset and the Swap Agreement
pursuant to Treasury Regulation Section 1.1275-6 and make available such
information to Certificate Owners upon request.
SECTION 28. COVENANT OF DEPOSITOR. The Depositor hereby
covenants that it will be adequately capitalized at all times.
SECTION 29. TRANSFER RESTRICTIONS; RULE 144A INFORMATION; DEEMED
REPRESENTATIONS.
(1) TRANSFER RESTRICTIONS.
(a) No Holder may, in any transaction or series of transactions,
directly or indirectly (each of the following, a "transfer"), (i) sell,
assign or otherwise in any manner dispose of all or any part of its
interest in any Certificate issued to it, whether by act, deed, merger or
otherwise, or (ii) mortgage, pledge or create a lien or security interest
in such interest unless such transfer satisfies the conditions set forth in
this Section 29(1). No purported transfer of any interest in any
Certificate or any portion thereof which is not made in accordance with
this Section 29(1) shall be given effect by or be binding upon the Trust or
the Trustee and any such purported transfer shall be null and void AB
INITIO and vest in the transferee no rights against the Trust or the
Trustee.
16
<PAGE>
By its acceptance of a Certificate, each Holder will be deemed to
have represented and agreed that transfer thereof is restricted and agrees
that it shall transfer such Certificate only in accordance with the terms
of this Agreement and such Certificate and in compliance with applicable
law.
(b) A Holder may transfer a Certificate only in accordance with
the following provisions:
(i) No transfer of any Certificate (other than the sale by
the Trust to Salomon Brothers Inc, as the initial purchaser of the
Certificates) shall be made unless such transfer is made in a
transaction pursuant to Rule 144A under the Securities Act of 1933, as
amended (the "Securities Act"), and pursuant to exemption,
registration or qualification under applicable state securities laws.
The Trustee shall be entitled to rely upon the deemed representations
made by each transferee pursuant to Section 29(3) hereof, and shall
have no duty to undertake any investigation or verify that any
transfer satisfies the requirements of this paragraph.
(ii) No Certificates may be transferred to a person who is
(A) an "employee benefits plan" (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended
("ERISA")), whether or not it is subject to the provisions of Title I
of ERISA, or a "plan" described in Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code") (any such person, a
"Benefit Plan"); (B) any entity whose underlying assets include "plan
assets" of any Benefit Plan; or (C) any "governmental plan" (within
the meaning of Section 3(32) of ERISA) that is subject to any
provision of state or federal law that is, to a material extent,
similar to the prohibited transaction provisions of ERISA or Section
4975 of the Code, or who is using "plan assets" of any Benefit Plan or
such governmental plan to acquire any Certificates, unless such person
is able to make a deemed representation to the effect that such
purchase and holding will not constitute or result in a non-exempt
prohibited transaction, substantially in the form set forth in
paragraph (c) below.
(c) Each Certificate issued hereunder will contain the following
legend:
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND HAS NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY
REGULATORY AUTHORITY OF ANY STATE. THIS CERTIFICATE HAS
BEEN OFFERED AND SOLD PRIVATELY. AS A RESULT, THESE
SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFER. THE
HOLDER HEREOF ACKNOWLEDGES THAT THESE SECURITIES ARE
"RESTRICTED SECURITIES" AND BY ITS HOLDING OF THIS
CERTIFICATE, DIRECTLY OR THROUGH A NOMINEE, THE HOLDER WILL
BE DEEMED:
17
<PAGE>
(A) TO HAVE REPRESENTED TO THE INITIAL
PURCHASE THAT IT IS A QUALIFIED INSTITUTIONAL BUYER AS
DEFINED IN RULE 144A ("RULE 144A") PROMULGATED UNDER
THE SECURITIES ACT AND IS ACQUIRING SUCH CERTIFICATE
FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNTS OF OTHERS)
OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS
MUST ALSO BE QUALIFIED INSTITUTIONAL BUYERS); AND
(B) TO HAVE AGREED THAT ANY RESALE OR OTHER
TRANSFER OF THIS CERTIFICATE WILL BE MADE ONLY TO A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION WHICH MEETS THE
REQUIREMENTS OF RULE 144A; PROVIDED THAT THE AGREEMENT OF
THE PURCHASER IS SUBJECT TO ANY REQUIREMENTS OF LAW THAT
THE DISPOSITION OF THE PURCHASER'S PROPERTY SHALL AT
ALL TIMES BE AND REMAIN WITHIN ITS CONTROL.
NO EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF
ERISA) WHICH IS SUBJECT TO ERISA, NO PLAN (AS DEFINED IN
SECTION 4975(e)1 OF THE CODE, OTHER THAN A GOVERNMENTAL OR
CHURCH PLAN DESCRIBED IN SECTION 4975(g)(2) OR (3) OF THE
CODE) WHICH IS SUBJECT TO SECTION 4975 OF THE CODE, AND NO
ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY
REASON OF ANY SUCH PLAN'S INVESTMENT IN THE ENTITY
(EXCLUDING ANY ENTITY REGISTERED UNDER THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED) (EACH, A "PLAN"), MAY
PURCHASE OR HOLD A CERTIFICATE OR ANY INTEREST THEREIN,
UNLESS SUCH PURCHASE AND THE HOLDING OF SUCH CERTIFICATE OR
SUCH INTEREST THEREIN WOULD NOT CONSTITUTE OR RESULT IN A
NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION
4975 OF THE CODE AND SUCH PLAN IS ABLE TO MAKE A DEEMED
REPRESENTATION TO THE EFFECT THAT SUCH ACQUISITION WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITION
TRANSACTION.
(2) RULE 144A INFORMATION. Upon the request of any Holder, the
Trust shall promptly furnish to such Holder or to a prospective purchaser
of a Certificate designated by such Holder, as the case may be, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act ("Rule 144A Information") in order to permit compliance by
such Holder with Rule 144A in connection with the resale of such
18
<PAGE>
Certificate by such Holder; provided, however, that the Trust shall not be
required to furnish Rule 144A Information in connection with any request
made on or after the date that is three years from the later of (i) the
date such Certificate (or any predecessor Certificate) was acquired from
the Trust or (ii) the date such Certificate (or any predecessor
Certificate) was last acquired from an "affiliate" of the Trust within the
meaning of Rule 144A; and provided further, that the Trust shall not be
required to furnish such information at any time to a prospective purchaser
located outside the United States who is not a U.S. Person (as defined in
Regulation S under the Securities Act) if such Certificate may then be sold
to such prospective purchaser in accordance with Rule 904 under the
Securities Act (or any successor provision thereto).
The Depositor shall be responsible for providing to the Trustee
the information, in substance and form, required by Rule 144A. The Trustee
shall have no obligation to provide information to any Holder or
prospective purchaser under this Section 29(2) other than the information
furnished to it by the Depositor, and the Trustee shall have no duty to
undertake any action to determine the accuracy of completeness of such
information.
(3) DEEMED REPRESENTATIONS.
Each purchaser of Certificates (other than the Initial Purchaser
or the Depositor) will be deemed by its acceptance of a Certificate to have
represented, agreed or acknowledged, as applicable, for the benefit of the
Initial Purchaser and its affiliates, as follows (terms used in this
paragraph that are defined in Rule 144A are used herein as defined
therein);
(i) The purchaser (A) is a Qualified Institutional Buyer,
(B) is aware that the sale of Certificates to it is being made in
reliance on Section 4(2) of the Securities Act or Rule 144A
promulgated thereunder and (C) is acquiring the Certificates for
its own account or for the account of another Qualified
Institutional Buyer.
(ii) The Certificates are being offered, and may be
transferred, only in a transaction not involving any public
offering in the United States within the meaning of the
Securities Act. The Certificates have not been and will not be
registered under the Securities Act, and the purchaser agrees for
the benefit of the Initial Purchaser and its affiliates that if
in the future it decides to offer, resell, pledge or otherwise
transfer the Certificates, the Certificates may be offered, sold,
pledged or otherwise transferred (a) only to a person whom the
seller reasonably believes is a Qualified Institutional Buyer in
a transaction meeting the requirements of Rule 144A, and (b) in
accordance with any applicable securities laws of any state of
the United States or any other jurisdiction.
(iii) If the purchaser is acquiring any Certificates for
the account of one or more Qualified Institutional Buyers, it
represents that it has sole investment discretion with respect to
each such account and that it has full power to make the
foregoing acknowledgments, representations and agreements on
behalf of each such party.
(iv) No action has been or will be taken by the Initial
Purchaser or the Trust which would permit a public offering of
19
<PAGE>
the Certificates or the possession or distribution of this
document or any other offering material in any country or
jurisdiction where, or in any circumstances in which, action for
that purpose is required under applicable local laws and
regulations.
(v) The purchaser is an eligible swap participant under
the regulations of the Commodity Futures Trading Commission set
forth at 12 C.F.R. Part 35.
(vi) The purchaser has sufficient knowledge, experience and
professional advice to make its own legal, tax, accounting and
financial evaluation of the merits and risks of purchasing the
Certificates and in doing so is not relying upon the views or
advice of, or any information with respect to the Issuer provided
by, the Initial Purchaser or any affiliate.
(vii) The purchaser has itself been, and will at all times
continue to be, solely responsible for making its own independent
appraisal of and investigation into the financial condition,
prospects, creditworthiness, affairs, status and business of the
Terms Assets Issuer.
(viii) The Initial Purchaser and its affiliates are not
making, and have not made, in connection with the sale of the
Certificates any representation whatsoever as to the Term Assets
Issuer or any information contained in any document filed by the
Term Assets Issuer with any exchange or with any governmental
entity regulating the purchase and sale of securities.
(ix) The purchaser has been afforded an opportunity to
request from the Initial Purchaser and to review, and it has
received, all additional information considered by it to be
necessary to verify the accuracy of the information contained in
the Private Placement Memorandum for the Certificates or
otherwise necessary to its making an informed investment
decision, including without limitation information relating to
the Term Assets;
(x) The purchaser has not relied on the Initial Purchaser
or any person affiliated with the Initial Purchaser in connection
with its investigation of the accuracy of the information
contained in the Private Placement Memorandum for the
Certificates or its investment decision; and
(xi) No person has been authorized to give any information
or to make any representation concerning the Certificates other
than information or representations contained in the Private
Placement Memorandum for the Certificates or otherwise provided
in writing by the Initial Purchaser, and, if given or made, such
other information or representations should not be relied upon as
having been authorized by the Initial Purchaser.
(xii) (a) The Trust is intended to be a partnership, or in
the case of one owner of Certificates, an entity disregarded as a
separate entity, for federal tax purposes (b) the Trust is not
20
<PAGE>
intended to create a partnership for any other purposes, (c) the
Trust will elect under Section 761(a) of the Code to be excluded
from the operation of Subchapter K of the Code, (d) a Certificate
Owner will not irrevocably authorize any person acting in a
representative capacity to purchase, sell or exchange the
Certificates, unless such delegation of authority is for a period
of not more than one year, and (e) a Certificate Owner will not
to take any action inconsistent with the foregoing.
21
<PAGE>
IN WITNESS WHEREOF, the Depositor and the Trustee have caused
this Series Supplement to be duly executed by their respective officers
thereunto duly authorized as of the day and year first above written.
STRUCTURED PRODUCTS CORP.,
as Depositor
By:___________________________
Authorized Signatory
DELAWARE TRUST CAPITAL MANAGEMENT, INC., not
in its individual capacity but solely as
Trustee
By:___________________________
Authorized Signatory
22
<PAGE>
EXHIBIT A
[Form of Certificate, Class B]
TIERS<service-mark> ASSET-BACKED SECURITIES
SERIES CHAMT TRUST 1997-7
FLOATING RATE CERTIFICATES, CLASS B
NUMBER $10,920,000
R-1 CUSIP NO. 871928AS8
SEE REVERSE FOR CERTAIN DEFINITIONS
THE HOLDER OF THIS CERTIFICATE SHALL HAVE NO RIGHT TO PRINCIPAL
PAYMENTS IN RESPECT OF THE TERM ASSETS. THE REGISTERED HOLDER HEREOF, BY
ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL LOOK SOLELY TO THE TRUST
PROPERTY (TO THE EXTENT OF ITS RIGHTS THEREIN) FOR DISTRIBUTIONS HEREUNDER.
THIS CERTIFICATE REPRESENTS A FRACTIONAL UNDIVIDED INTEREST IN
THE TRUST AND DOES NOT EVIDENCE AN OBLIGATION OF, OR AN INTEREST IN, AND IS
NOT GUARANTEED BY THE DEPOSITOR OR THE TRUSTEE OR ANY OF THEIR RESPECTIVE
AFFILIATES. NEITHER THIS CERTIFICATE NOR THE TRUST ASSETS ARE INSURED OR
GUARANTEED BY ANY GOVERNMENTAL AGENCY OR ANY OTHER PERSON.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY REGULATORY AUTHORITY OF ANY STATE. THIS
CERTIFICATE HAS BEEN OFFERED AND SOLD PRIVATELY. AS A RESULT, THE
CERTIFICATE IS SUBJECT TO RESTRICTIONS ON TRANSFER. THE HOLDER HEREOF
ACKNOWLEDGES THAT THESE SECURITIES ARE "RESTRICTED SECURITIES" AND BY ITS
HOLDING OF THIS CERTIFICATE, DIRECTLY OR THROUGH A NOMINEE, THE HOLDER WILL
BE DEEMED:
(A) TO HAVE REPRESENTED THAT IT IS A QUALIFIED
INSTITUTIONAL BUYER AS DEFINED IN RULE 144A ("RULE 144A")
PROMULGATED UNDER THE SECURITIES ACT AND IS ACQUIRING SUCH
CERTIFICATE FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNTS OF
OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS MUST
ALSO BE QUALIFIED INSTITUTIONAL BUYERS); AND
A-1
<PAGE>
(B) TO HAVE AGREED THAT ANY RESALE OR OTHER TRANSFER OF
THIS CERTIFICATE WILL BE MADE ONLY TO A QUALIFIED INSTITUTIONAL
BUYER IN A TRANSACTION WHICH MEETS THE REQUIREMENTS OF RULE 144A;
PROVIDED THAT THE AGREEMENT OF THE PURCHASER IS SUBJECT TO ANY
REQUIREMENTS OF LAW THAT THE DISPOSITION OF THE PURCHASER'S
PROPERTY SHALL AT ALL TIMES BE AND REMAIN WITHIN IS CONTROL.
NO EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF ERISA)
WHICH IS SUBJECT TO ERISA, NO PLAN (AS DEFINED IN SECTION 4975(e)(1) OF THE
CODE, OTHER THAN A GOVERNMENTAL OR CHURCH PLAN DESCRIBED IN SECTION 4975(g)
OR (3) OF THE CODE) WHICH IS SUBJECT TO SECTION 4975 OF THE CODE, AND NO
ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY SUCH
PLAN'S INVESTMENT IN THE ENTITY (EXCLUDING ANY ENTITY REGISTERED UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED) (EACH, A "PLAN"), MAY PURCHASE
OR HOLD A CERTIFICATE OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASE AND THE
HOLDING OF SUCH CERTIFICATE OR SUCH INTEREST THEREIN WOULD NOT CONSTITUTE
OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION
4975 OF THE CODE AND THE PURCHASER IS ABLE TO MAKE A DEEMED REPRESENTATION
THAT SUCH PURCHASE AND HOLDING WILL NOT CONSTITUTE OR RESULT IN A NON-
EXEMPT PROHIBITED TRANSACTION.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE
INDIVIDUAL CERTIFICATES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.
A-2
<PAGE>
TIERS<service-mark> ASSET-BACKED SECURITIES,
SERIES CHAMT TRUST 1997-7
FLOATING RATE CERTIFICATES,
Class B
evidencing a fractional undivided beneficial ownership interest in the
Series of the Trust, as defined below, the property of which consists of
$363,900,000 aggregate principal amount of Class A Floating Rate Asset
Backed Certificates, Series 1996-4 (the "Term Assets") issued by Chase
Credit Card Master Trust (the "Term Assets Issuer") and deposited in the
Trust by the Depositor, as defined below. The Term Assets will be
purchased by the Trust from Structured Products Corp. (the "Depositor")
with, among other funds, the net proceeds of the sale of the Certificates
to the Depositor by the Trust.
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a
nonassessable, fully-paid, fractional undivided interest in
TIERS<service-mark> Asset-Backed Securities, Series CHAMT Trust 1997-7
formed by the Depositor. Under the Trust Agreement and the related Series
Supplement, there will be distributed on the fifteenth day of each month,
or if such day is not a Business Day, then the next succeeding Business
Day, commencing October 15, 1997 through and including the date the
Certificate Principal Balance hereof has been reduced to zero (each, a
"Distribution Date"), each Holder of the Certificates, to the extent of
Available Funds (as defined below), an amount equal to the Pass Through
Rate (as defined below) for the Interest Accrual Period (as defined below)
related to such Distribution Date on the Certificate Principal Balance of
its respective Certificate. The outstanding Principal Balance shall be
paid on November 15, 2003 (or if such a day is not a Business Day, on the
next succeeding Business Day), subject to mandatory and optional prepayment
as set forth in the Series Supplement (defined below). For the purposes of
this Certificate, (i) "Available Funds" shall mean, as of any Distribution
Date, the aggregate amount received on or with respect to the Term Assets
on or with respect to such Distribution Date (other than Early Amortization
Payments, as defined in the Indenture), any amounts received from the Swap
Counterparty pursuant to the Swap Agreement and all Sale Proceeds (as
defined in the Indenture); (ii) "Interest Accrual Period" shall mean, with
respect to any Distribution Date, the date from and including the
immediately preceding Distribution Date (or, in the case of the first
Interest Accrual Period, from and including the Closing Date) to but
excluding the current Distribution Date; and (iii) "Pass Through Rate"
shall mean, for each Interest Accrual Period, a rate per annum equal to the
sum of (x) 0.20% plus (y) LIBOR (as determined herein) for such Interest
Accrual Period; such rate to be calculated on the basis of the actual
number of days in such Interest Accrual Period divided by 360.
"LIBOR": For each Interest Accrual Period shall be a rate determined
as follows:
(i) On the second London Business Day (as defined below) before
the beginning of each Interest Accrual Period (the "Interest
Determination Date") the Depositor or its designee (either such, the
"Calculation Agent") will determine the offered rate for one-month
A-3
<PAGE>
U.S. Dollar deposits as of 11:00 a.m. (London time) on the applicable
Interest Determination Date. Such offered rate will be that which
appears on the display designated as Telerate Page 3750 on the Dow
Jones Telerate Service (or such other page or service as may replace
it for the purpose of displaying London interbank offered rates of
major banks for U.S. Dollar deposits).
(ii) If for any reason the relevant page is unavailable or such
offered rate does not appear, the rate for such period will be
determined on the basis of the rates at which deposits in U.S. Dollar
amounts are offered by four major banks in the London interbank market
selected by the Calculation Agent (the "Reference Banks") at
approximately 11:00 a.m. (London time) on the Interest Determination
Date to prime banks in the London interbank market for a period of one
month commencing on the first day of the relevant Interest Accrual
Period. The Calculation Agent will request the principal London
office of each of the Reference Banks to provide a quotation of its
rate. If at least two quotations are provided the rate for such
Interest Accrual Period will be the arithmetic mean of the quotations.
If fewer than two quotations are provided as requested, the rate for
that Interest Accrual Period will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Calculation
Agent, at approximately 11:00 a.m. (New York City time) on the first
day of the relevant Interest Accrual Period for loans in U.S. Dollars
to leading European banks for a period of one month commencing on that
date.
As used above, "London Business Day" means a day (other than a
Saturday or Sunday or a day on which banking institutions in London are
authorized or obliged by law or executive order to close) on which dealings
in deposits in U.S. Dollars are transacted in the London interbank market
and commercial banks and foreign exchange markets settle payments in U.S.
Dollars in London.
The Trust was created pursuant to a Base Trust Agreement dated as
of September 15, 1997 (the "Agreement"), between the Depositor and Delaware
Trust Capital Management, Inc., a Delaware banking corporation, not in its
individual capacity but solely as Trustee (the "Trustee"), as supplemented
by the TIERS<service-mark> Asset-Backed Securities, Series CHAMT Trust
1997-7 Supplement dated as of September 15, 1997 (the "Series Supplement"
and, together with the Agreement, the "Trust Agreement"), between the
Depositor and the Trustee. This Certificate does not purport to summarize
the Trust Agreement and reference is hereby made to the Trust Agreement for
information with respect to the interests, rights, benefits, obligations,
proceeds and duties evidenced hereby and the rights, duties and obligations
of the Trustee with respect hereto. A copy of the Trust Agreement may be
obtained from the Trustee by written request sent to the Corporate Trust
Office. Capitalized terms used but not defined herein have the meanings
assigned to them in the Trust Agreement.
This Certificate is one of the duly authorized Certificates
designated as "TIERS<service-mark> Asset-Backed Securities, Series CHAMT
Trust 1997-7 Floating Rate Certificates, Class B" (herein called the
"Certificates"). This Certificate is issued under and is subject to the
terms, provisions and conditions of the Trust Agreement, to which Trust
A-4
<PAGE>
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound. The property of the Trust
consists of the Term Assets and all payments on or collections in respect
of the Term Assets accrued on or after the Closing Date, all as more fully
specified in the Trust Agreement.
Subject to the terms and conditions of the Trust Agreement
(including the availability of funds for distribution) and until the
obligation created by the Trust Agreement shall have terminated in
accordance therewith, distributions will be made on each Distribution Date
to the Person in whose name this Certificate is registered on the
applicable Record Date, in an amount equal to such Certificateholder's
fractional undivided interest in the amount required to be distributed to
the Holders of the Certificates on such Distribution Date. The Record Date
applicable to any Distribution Date is the day immediately preceding such
Distribution Date unless the Certificates are in definitive form, in which
case the Record Date shall be the last Business Day of the month prior to
such Distribution Date.
Distributions made on this Certificate will be made as provided
in the Trust Agreement by the Trustee by wire transfer or credit to the
appropriate account of the Holder in immediately available funds, without
the presentation or surrender of this Certificate or the making of any
notation hereon. Except as otherwise provided in the Trust Agreement and
notwithstanding the above, the final distribution on this Certificate will
be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate
at the office or agency maintained for that purpose by the Trustee.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed
by or on behalf of the Trustee, by manual signature, this Certificate shall
not entitle the holder hereof to any benefit under the Trust Agreement or
be valid for any purpose.
It is the intent of the Depositor and the Certificateholders
that, for purposes of United States federal income, state and local income
and franchise taxes and any other taxes imposed upon, measured by or based
upon gross or net income, the Trust shall be treated as a partnership, or
in the case of only one Certificateholder, an entity disregarded as a
separate entity, and the Trust Agreement shall be interpreted accordingly.
Except as otherwise required by appropriate taxing authorities, the
Depositor and the other Certificateholders by acceptance of a Certificate,
agree to treat, the Certificates for such tax purposes as interests in a
partnership or, in the case of only one Certificateholder, an entity
disregarded as a separate entity. It is also the intent of the Depositor
and the Certificateholders that the Trust will elect out of subchapter K of
the Code beginning with the first taxable year of the Trust.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE HOLDER HEREOF
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-5
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Depositor has caused this Certificate to
be duly executed as of the date set forth below.
STRUCTURED PRODUCTS CORP.,
By:____________________________
Authorized Signatory
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates described in the Trust Agreement
referred to herein.
DELAWARE TRUST CAPITAL MANAGEMENT, INC., not
in its individual capacity but solely as
Trustee
By:_____________________________
Authorized Signatory
Dated: September 15, 1997
<PAGE>
(REVERSE OF TRUST CERTIFICATE)
The Certificates are limited in right of distribution to certain
payments and collections respecting the Trust Agreement, all as more
specifically set forth herein, in the Trust Agreement and the related
Series Supplement. The registered Holder hereof, by its acceptance hereof,
agrees that it will look solely to the Term Assets (to the extent of its
rights therein) for distributions hereunder.
Subject to the next paragraph and to certain exceptions provided
in the Trust Agreement, the Trust Agreement permits the amendment thereof
and the modification of the rights and obligations of the Depositor and the
Trustee and the rights of the Certificateholders under the Trust Agreement
at any time by the Depositor and the Trustee with the consent of the
Holders of Certificates evidencing greater than 66-2/3% of the aggregate
Voting Rights of each Outstanding Class of Certificates subject to certain
provisions set forth in the Trust Agreement. Any such consent by the
Holder of this Certificate (or any predecessor Certificate) shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent
is made upon this Certificate. The Trust Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of
the Holders of any of the Certificates.
The Certificates are issuable in fully registered form only in
minimum original principal amounts of $1,000 and integral multiples
thereof. As provided in the Trust Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same principal amount, class, original issue date and
maturity, in authorized denominations as requested by the Holder
surrendering the same.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is
registrable in the Certificate Register upon surrender of this Certificate
for registration of transfer at the offices or agencies of the Certificate
Registrar duly endorsed by, or accompanied by an assignment in the form
below and by such other documents as required by the Trust Agreement signed
by, the Holder hereof, and thereupon one or more new Certificates of the
same class in authorized denominations evidencing the same principal amount
will be issued to the designated transferee or transferees. The initial
Certificate Registrar appointed under the Trust Agreement is Delaware Trust
Capital Management, Inc.
No service charge will be made for any registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor and the Trustee and any agent of the Depositor or
the Trustee may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Depositor,
the Trustee, nor any such agent shall be effected by any notice to the
contrary.
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE A
DEPOSITED ASSETS SCHEDULE
I. TERM ASSETS
<S> <C>
Term Assets Issuer: Chase Credit Card Master Trust
Term Assets: Class A Floating Rate Asset-Backed
Certificates, Series 1996-4
Dated: November 6, 1996
Original Principal Maturity Date: June 15, 2033
Original Par Value Amount Issued: $1,400,000,000
CUSIP Number: 459200AP6
Stated Interest Rate: LIBOR + 0.13%
Interest Payment Dates: 15th day of each month
Mode of Payment of Term Assets: By credit to the account
of the holder at DTC
Par Value Amount of Term Assets
Deposited Under Trust Agreement: $363,900,000
</TABLE>
The Term Assets will be held by the Trust for the Owners of
Certificates as book-entry credits to an account of the Trustee at DTC.
AVAILABLE INFORMATION
The Term Assets are subject to the information requirements of
the Securities Exchange Act of 1934 and in accordance therewith files
reports and other information with the Commission. Such reports, proxy and
information statements, together with the Term Assets Prospectus and other
information filed by the Term Assets Issuer with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's regional offices at 500 West Madison Street, 14th Floor,
Chicago, Illinois 60661, and 75 Park Place, New York, New York 10007.
Copies of such material can be obtained from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. The Commission maintains a Web site at http:/www.sec.gov
containing reports, proxy statements and other information regarding
registrants that file electronically with the Commission. In addition,
certain material described above and other information will also be
available for inspection at the offices of the New York Stock Exchange at
20 Broad Street, New York, New York, and the Midwest Stock Exchange, 120
South LaSalle Street, Chicago, Illinois.
<PAGE>
II. SWAP AGREEMENT Under the Swap Agreement, the Issuer will pay to the
Swap Counterparty amounts equal to the payments of
interest received on the Term Assets (including any
deferred interest), and the Swap Counterparty will pay
to the Issuer on each Distribution Date amounts equal
to the interest payable on the Notes and Certificates
on such date. If on any Distribution Date the amount
received by the Issuer on the Term Assets and paid to
the Swap Counterparty is less than the scheduled
interest thereon, the Swap Counterparty shall reduce
its payment to the Issuer by the amount of such
deficiency. Such loss shall be borne in the first
instance by the Certificate holders.
In addition, on each Distribution Date on which a
Monthly Prepayment Amount (as defined herein) is due,
the Issuer will pay to the Swap Counterparty an amount
equal to the proceeds received from the sale of Term
Assets or Eligible Investments (as defined herein) or
any combination thereof, at the direction of the Swap
Counterparty, having an aggregate principal balance
equal to that month's Monthly Prepayment Amount and the
Swap Counterparty will pay to the Issuer an amount
equal to the Monthly Prepayment Amount.
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR
TAXPAYER IDENTIFICATION OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
___________________________________________________________________________
(Please print or type name and address, including postal zip code, of
assignee)
___________________________________________________________________________
the within Trust Certificate, and all rights thereunder, hereby irrevocable
constituting and appointing
___________________________________________Attorney to transfer said Trust
Certificate on the books of the Certificate Registrar, with full power
of substitution in the premises.
Dated:
_______________________________*
Signature Guaranteed;
_______________________________*
* NOTICE: The signature to this assignment must correspond with the name as
it appears upon the face of the within Trust Certificate in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Certificate Registrar, which requirements include
membership or participation in STAMP or such other "signature guarantee
program" as may be determined by the Certificate Registrar in addition to,
or in substitution for STAMP, all in accordance with the Securities
Exchange Act of l934, as amended.
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE B
PREPAYMENT CALCULATION TABLE
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
0-100 0.000 142 1.176 184 2.352
101 0.028 143 1.204 185 2.380
102 0.056 144 1.232 186 2.408
103 0.084 145 1.260 187 2.436
104 0.112 146 1.288 188 2.464
105 0.140 147 1.316 189 2.492
106 0.168 148 1.344 190 2.520
107 0.196 149 1.372 191 2.548
108 0.224 150 1.400 192 2.576
109 0.252 151 1.428 193 2.604
110 0.280 152 1.456 194 2.632
111 0.308 153 1.484 195 2.660
112 0.336 154 1.512 196 2.888
113 0.364 155 1.540 197 2.716
114 0.392 156 1.568 198 2.744
115 0.420 157 1.596 199 2.772
116 0.448 158 1.624 200 2.800
117 0.476 159 1.652 201 2.828
118 0.504 160 1.680 202 2.858
119 0.532 161 1.708 203 2.884
120 0.560 162 1.736 204 2.912
121 0.588 163 1.764 205 2.940
122 0.616 164 1.792 206 2.968
123 0.644 165 1.820 207 2.996
124 0.672 166 1.848 208 3.024
125 0.700 167 1.876 209 3.052
126 0.728 168 1.904 210 3.080
127 0.756 169 1.932 211 3.108
128 0.784 170 1.960 212 3.136
129 0.812 171 1.988 213 3.164
130 0.840 172 2.016 214 3.192
131 0.868 173 2.044 215 3.220
132 0.896 174 2.072 216 3.248
133 0.924 175 2.100 217 3.276
134 0.952 176 2.128 218 3.304
135 0.980 177 2.156 219 3.332
136 1.008 178 2.184 220 3.360
137 1.036 179 2.212 221 3.388
138 1.064 180 2.240 222 3.416
139 1.092 181 2.268 223 3.444
140 1.120 182 2.296 224 3.472
141 1.148 183 2.324 225-325 3.500
</TABLE>
B-1
<PAGE>
<TABLE>
<CAPTION>
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
326 3.570 374 6.930 422 10.525
327 3.640 375 7.000 423 10.600
328 3.710 376 7.075 424 10.675
329 3.780 377 7.150 425 10.750
330 3.850 378 7.225 426 10.825
331 3.920 379 7.300 427 10.900
332 3.990 380 7.375 428 10.975
333 4.060 381 7.450 429 11.050
334 4.130 382 7.525 430 11.125
335 4.200 383 7.600 431 11.200
336 4.270 384 7.765 432 11.275
337 4.340 385 7.750 433 11.350
338 4.410 386 7.825 434 11.425
339 4.480 387 7.900 435 11.500
340 4.550 388 7.975 436 11.575
341 4.620 389 8.050 437 11.650
342 4.690 390 8.125 438 11.725
343 4.760 391 8.200 439 11.800
344 4.830 392 8.275 440 11.875
345 4.900 393 8.350 441 11.950
346 4.970 394 8.425 442 12.025
347 5.040 395 8.500 443 12.100
348 5.110 396 8.575 444 12.175
349 5.180 397 8.650 445 12.250
350 5.250 398 8.725 446 12.325
351 5.320 399 8.800 447 12.400
352 5.390 400 8.875 448 12.475
353 5.460 401 8.950 449 12.550
354 5.530 402 9.025 450 12.625
355 5.600 403 9.100 451 12.700
356 5.670 404 9.175 452 12.775
357 5.740 405 9.250 453 12.850
358 5.810 406 9.325 454 12.925
359 5.880 407 9.400 455 13.000
360 5.950 408 9.475 456 13.075
361 6.020 409 9.550 457 13.150
362 6.090 410 9.625 458 13.225
363 6.160 411 9.700 459 13.300
364 6.230 412 9.775 460 13.375
365 6.300 413 9.860 461 13.450
366 6.370 414 9.925 462 13.525
367 6.440 415 10.000 463 13.800
368 6.510 416 10.075 464 13.675
369 6.580 417 10.150 465 13.750
370 6.650 418 10.225 466 13.825
371 6.720 419 10.300 467 13.900
372 6.790 420 10.375 468 13.975
373 6.860 421 10.450 469 14.050
</TABLE>
B-2
<PAGE>
<TABLE>
<CAPTION>
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
470 14.125 518 17.940 558 21.140
471 14.200 519 18.020 559 21.220
472 14.275 520 18.100 560 21.300
473 14.350 521 18.180 561 21.380
474 14.425 522 18.260 562 21.460
475 14.500 523 18.340 563 21.540
476 14.580 524 18.420 564 21.620
477 14.660 525 18.500 565 21.700
478 14.740 526 18.580 566 21.780
479 14.820 527 18.660
480 14.900 528 18.740
481 14.980 529 18.820
482 15.060 530 18.900
483 15.140 531 18.980
484 15.220 532 19.060
485 15.300 533 19.140
486 15.380 534 19.220
487 15.460 535 19.300
488 15.540 536 19.380
489 15.620 537 19.460
490 15.700 538 19.540
491 15.780 539 19.620
492 15.860 540 19.700
493 15.940 541 19.780
494 16.020 542 19.860
495 16.100 543 19.940
496 16.180 544 20.020
497 16.260 545 20.100
498 16.340 546 20.180
499 16.420 547 20.260
500 16.500 548 20.340
501 16.580 549 20.420
502 16.660 550 20.500
503 16.740 551 20.580
504 16.820 552 20.660
505 16.900 553 20.740
506 16.980 554 20.820
507 17.060 555 20.900
508 17.140 556 20.980
509 17.220 557 20.060
510 17.300
511 17.380
512 17.460
513 17.54
514 17.62
515 17.70
516 17.78
517 17.88
</TABLE>
B-3
<PAGE>
<TABLE>
<CAPTION>
PSA INDEX PSA INDEX PSA INDEX
AMORTIZATION AMORTIZATION AMORTIZATION
RATE(%) MONTHLY RATE(%) MONTHLY RATE(%) MONTHLY
------------ ------- ------------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
567 21.860
568 21.940
569 21.020
570 22.100
571 22.180
572 22.260
573 22.340
574 22.420
575 22.500
</TABLE>
B-4
=================================================================
BASE TRUST AGREEMENT
between
STRUCTURED PRODUCTS CORP.
Depositor
and
DELAWARE TRUST CAPITAL MANAGEMENT, INC.
Trustee
Dated as of September 15, 1997
=================================================================
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I.
DEFINITIONS AND ASSUMPTIONS
Section 1.1. DEFINITIONS ................................. 1
Section 1.2. RULES OF CONSTRUCTION ....................... 14
ARTICLE II.
DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES
Section 2.1. CREATION AND DECLARATION OF TRUSTS; ASSIGNMENT
OF DEPOSITED ASSETS........................ 14
Section 2.2. ACCEPTANCE BY TRUSTEE ....................... 17
Section 2.3. RESERVED .................................... 18
Section 2.4. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR
AND REPRESENTATIONS, WARRANTIES AND COVENANTS OF
THE ADMINISTRATOR............................ 18
Section 2.5. BREACH OF REPRESENTATION, WARRANTY OR
COVENANT.................................. 19
Section 2.6. AGREEMENT TO AUTHENTICATE AND DELIVER
CERTIFICATES.............................. 20
ARTICLE III.
ADMINISTRATION
Section 3.1. ADMINISTRATION OF EACH TRUST ................ 20
Section 3.2. ADMINISTRATION AGREEMENTS.................... 21
Section 3.3. SUCCESSOR ADMINISTRATORS..................... 21
Section 3.4. NO CONTRACTUAL RELATIONSHIP BETWEEN
ADMINISTRATORS AND CERTIFICATEHOLDERS...... 22
Section 3.5. COLLECTION OF CERTAIN DEPOSITED ASSET
PAYMENTS................................... 22
Section 3.6. INVESTMENT OF FUNDS IN THE ACCOUNTS ......... 22
Section 3.7. RESERVED .................................... 23
Section 3.8. REALIZATION UPON DEFAULTED DEPOSITED ASSETS . 23
Section 3.9. RESERVED .................................... 25
Section 3.10. ADMINISTRATOR'S COMPENSATION AND
REIMBURSEMENT.............................. 25
Section 3.11. STATEMENT AS TO COMPLIANCE .................. 25
Section 3.12. INDEPENDENT PUBLIC ACCOUNTANTS' ADMINISTRATION
REPORT..................................... 25
Section 3.13. ACCESS TO CERTAIN DOCUMENTATION ............. 26
Section 3.14. DUTIES OF THE ADMINISTRATOR ................. 26
Section 3.15. DEPOSITOR TO FURNISH NAMES AND ADDRESSES OF
HOLDERS TO TRUSTEE......................... 27
Section 3.16. PRESERVATION OF INFORMATION, COMMUNICATIONS TO
HOLDERS ................................... 27
i
<PAGE>
ARTICLE IV.
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS
Section 4.1. DISTRIBUTIONS ............................... 27
Section 4.2. REPORTS TO CERTIFICATEHOLDERS ............... 27
Section 4.3. ADVANCES .................................... 29
Section 4.4. COMPLIANCE WITH WITHHOLDING REQUIREMENTS .... 30
Section 4.5. OPTIONAL EXCHANGE ........................... 30
ARTICLE V.
THE CERTIFICATES
Section 5.1. THE CERTIFICATES ............................ 32
Section 5.2. EXECUTION, AUTHENTICATION AND DELIVERY ...... 36
Section 5.3. TEMPORARY CERTIFICATES ...................... 37
Section 5.4. REGISTRATION; REGISTRATION OF TRANSFER AND
EXCHANGE................................... 38
Section 5.5. MUTILATED, DESTROYED, LOST AND STOLEN
CERTIFICATES............................... 42
Section 5.6. DISTRIBUTION OF INTEREST; INTEREST RIGHTS
PRESERVED.................................. 43
Section 5.7. PERSONS DEEMED OWNERS ....................... 45
Section 5.8. CANCELLATION ................................ 46
Section 5.9. GLOBAL SECURITIES ........................... 46
Section 5.10. NOTICES TO DEPOSITARY ....................... 47
Section 5.11. DEFINITIVE CERTIFICATES ..................... 47
Section 5.12. CURRENCY OF DISTRIBUTIONS IN RESPECT OF
CERTIFICATES............................... 48
Section 5.13. CONDITIONS OF AUTHENTICATION AND DELIVERY OF
NEW SERIES................................. 49
Section 5.14. APPOINTMENT OF PAYING AGENT ................. 50
Section 5.15. AUTHENTICATING AGENT ........................ 51
Section 5.16. EVENTS OF DEFAULT ........................... 52
Section 5.17. CONTROL BY HOLDERS .......................... 52
Section 5.18. WAIVER OF PAST DEFAULTS ..................... 53
ARTICLE VI.
THE DEPOSITOR AND THE ADMINISTRATOR
Section 6.1. THE DEPOSITOR................................ 53
Section 6.2. MERGER OR CONSOLIDATION OF THE DEPOSITOR OR THE
ADMINISTRATOR................................ 56
Section 6.3. LIMITATION ON LIABILITY OF THE DEPOSITOR AND THE
ADMINISTRATOR................................ 57
Section 6.4. LIMITATION ON RESIGNATION OF THE
ADMINISTRATOR................................58
ii
<PAGE>
Section 6.5. RIGHTS OF THE DEPOSITOR IN RESPECT OF THE
ADMINISTRATOR.............................. 58
Section 6.6. DEPOSITOR MAY PURCHASE CERTIFICATES ......... 59
Section 6.7. THE ADMINISTRATOR AND OTHER PARTIES ......... 59
Section 6.8. PREFERENTIAL COLLECTION OF CLAIMS AGAINST
DEPOSITOR.................................. 59
ARTICLE VII.
ADMINISTRATOR TERMINATION EVENTS
Section 7.1. ADMINISTRATOR TERMINATION EVENTS ............ 59
Section 7.2. TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR .... 62
Section 7.3. NOTIFICATION TO CERTIFICATEHOLDERS .......... 63
Section 7.4. WAIVER OF ADMINISTRATOR TERMINATION EVENTS... 63
ARTICLE VIII.
CONCERNING THE TRUSTEE
Section 8.1. AUTHORITY AND DUTIES OF TRUSTEE; NOTICE OF
DEFAULTS................................... 64
Section 8.2. CERTAIN MATTERS AFFECTING THE TRUSTEE ....... 67
Section 8.3. TRUSTEE NOT LIABLE FOR RECITALS IN
CERTIFICATES OR DEPOSITED ASSETS........... 68
Section 8.4. TRUSTEE MAY OWN CERTIFICATES ................ 69
Section 8.5. COMPENSATION OF TRUSTEE ..................... 69
Section 8.6. ELIGIBILITY REQUIREMENTS FOR TRUSTEE ........ 70
Section 8.7. RESIGNATION OR REMOVAL OF THE TRUSTEE ....... 70
Section 8.8. SUCCESSOR TRUSTEE ........................... 71
Section 8.9. MERGER OR CONSOLIDATION OF TRUSTEE .......... 72
Section 8.10. APPOINTMENT OF CO-TRUSTEE OR SEPARATE
TRUSTEE ................................... 72
Section 8.11. APPOINTMENT OF OFFICE OR AGENCY ............. 73
Section 8.12. REPRESENTATIONS AND WARRANTIES OF TRUSTEE ... 73
Section 8.13. TRUSTEE TO ACT ONLY IN ACCORDANCE WITH THIS
AGREEMENT OR PURSUANT TO INSTRUCTIONS OF
CERTIFICATEHOLDERS......................... 74
Section 8.14. ACCOUNTING AND REPORT TO CERTIFICATEHOLDERS,
INTERNAL REVENUE SERVICE AND OTHERS........ 75
Section 8.15. SIGNATURE ON RETURNS ........................ 75
ARTICLE IX.
TERMINATION
Section 9.1. TERMINATION UPON PURCHASE OR LIQUIDATION OF ALL
DEPOSITED ASSETS............................ 76
ARTICLE X.
MISCELLANEOUS PROVISIONS
iii
<PAGE>
Section 10.1. AMENDMENT ................................... 77
Section 10.2. COUNTERPARTS ................................ 79
Section 10.3. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS .. 79
SECTION 10.4. GOVERNING LAW ............................... 80
Section 10.5. NOTICES ..................................... 80
Section 10.6. SEVERABILITY OF PROVISIONS .................. 80
Section 10.7. NOTICE TO RATING AGENCY ..................... 81
Section 10.8. GRANT OF SECURITY INTEREST .................. 81
Section 10.9. NONPETITION COVENANT ........................ 82
Section 10.10. NO RECOURSE ................................. 83
Section 10.11. ARTICLE AND SECTION REFERENCES .............. 83
Section 10.12. CONFLICT WITH TRUST INDENTURE ACT. .......... 83
iv
<PAGE>
BASE TRUST AGREEMENT dated as of September 15, 1997, between
STRUCTURED PRODUCTS CORP., a Delaware corporation, as depositor, and
DELAWARE TRUST CAPITAL MANAGEMENT, a Delaware banking corporation, acting
not in its individual capacity but solely as trustee, (the "Trustee").
PRELIMINARY STATEMENT
The Depositor and the Trustee have duly authorized the execution
and delivery of this Trust Agreement to provide for one or more Series (and
one or more Classes within each such Series) of Trust Certificates,
issuable from time to time as provided in this Agreement. Each such Series
(or each Class within such Series) of Certificates will be issued only
under a separate Series Supplement to this Agreement duly executed and
delivered by the Depositor, the Administrator, if any, specified in
the applicable Series Supplement, and the Trustee. All representations,
covenants and agreements made herein by each of the Depositor, the
Administrator, if any, and the Trustee are for the benefit and
security of the Certificateholders and the Noteholders. The Depositor is
entering into this Agreement, and the Trustee is accepting the trusts
created hereby, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged.
ARTICLE I.
DEFINITIONS AND ASSUMPTIONS
Section 1. DEFINITIONS. Except as otherwise specified herein
or in the applicable Series Supplement or as the context may otherwise
require, the following terms have the respective meanings set forth below
for all purposes of this Agreement.
"Account": As defined in Section 3.10.
"Accounting Date": With respect to any Series, if applicable, as
defined in the related Series Supplement.
"Administrator": With respect to any Series of
Certificates, the Person, if any, specified in the applicable Series
Supplement for such Series (which Person shall have agreed pursuant to such
Series Supplement to assume all the duties, obligations, responsibilities
and liabilities of the Administrator as set forth in this Agreement
and such Series Supplement with respect to such Series), until a successor
Person shall have become the Administrator pursuant to the
applicable provisions of this Agreement and such Series Supplement, and
thereafter "Administrator" shall mean such successor Person.
<PAGE>
"Administrator Termination Event": As defined in Section
7.1.
"Administrative Fee": With respect to any Series, if applicable,
as defined in the related Series Supplement.
"Administration Agreement": The written contract, if any, between
any Administrator specified in the applicable Series Supplement and
the Trustee, relating to the delegation of administrative responsibilities
hereunder and under the related Series Supplement as provided in Section
3.2 and under the Basic Documents for such Series.
"Affiliate": With respect to any specified Person, any other
Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person. For the purposes of
this definition, "control", when used with respect to any specified Person,
means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities,
by contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Agreement": With respect to any Series of Certificates, this
Base Trust Agreement and all amendments hereof and, unless the context
otherwise requires, the related Series Supplement.
"Allowable Expense Amount": With respect to any Series, as
specified in the related Series Supplement.
"Authenticating Agent": As defined in Section 5.15.
"Authorized Newspaper": A newspaper in an official language of
the country of publication customarily published at least once a day, and
customarily published for at least five days in each calendar week, and of
general circulation in such city or cities specified pursuant to Section
5.1 with respect to the Certificates of any Series. Where successive
publications are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in different newspapers
in the same city meeting the foregoing requirements and in each case on any
Business Day in such city.
"Available Funds": The meaning specified in the applicable Series
Supplement.
"Basic Documents": With respect to any Series, if applicable, as
defined in the related Series Supplement.
"Bearer Certificate": Any Certificate (with or without Coupons),
title to which passes by delivery only, but exclusive of any Coupons.
2
<PAGE>
"Board of Directors": Either the Board of Directors of the
Depositor or any executive or committee of such Board duly authorized under
applicable law to act on behalf of such Board.
"Board Resolution": A copy of a resolution certified by the
Secretary or an Assistant Secretary of the Depositor to have been duly
adopted by the Board of Directors and to be in full force and effect on the
date of such certification and delivery to the Trustee.
"Business Day": Any day that is not a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies in
the state of the Corporate Trust Office or Place of Distribution is
authorized or obligated by law, regulation or executive order to close or
any day which is not a business day with respect to the Deposited Assets,
except as otherwise specified pursuant to Section 5.1.
"Call Premium Percentage": With respect to any Series (or Class
within such Series), if applicable, as defined in the related Series
Supplement.
"Certificate Account": As defined in Section 3.9.
"Certificate Owners": As defined in Section 5.9.
"Certificate Principal Balance": With respect to an Outstanding
Certificate, as determined at any time, the maximum amount that the Holder
thereof is entitled to receive as distributions allocable to principal
payments on the Deposited Assets. The Certificate Principal Balance, if
any, of any Class within a given Series (other than those Classes, if any,
specified in the related Series Supplement), as of any date of
determination, shall be equal to the aggregate initial Certificate
Principal Balance thereof less the sum of (i) all amounts allocable to
prior distributions made to such Class in respect of principal of the
Deposited Assets and (ii) any reductions attributable to Certificates
surrendered in exchange for Deposited Assets, as and to the extent provided
in the applicable Series Supplement.
"Certificateholder": Any Holder of a Certificate.
"Certificate Register" and "Certificate Registrar": As
respectively defined in Section 5.4.
"Certificates": Any Trust Certificates authorized by, and
authenticated and delivered under, this Agreement.
"Class": With respect to any Series, any one of the classes of
Certificates of such Series, each consisting of Certificates having
identical terms.
3
<PAGE>
"Closing Date": With respect to any Series, the day on which
Certificates of such Series are first executed, authenticated and
delivered.
"Code": The Internal Revenue Code of 1986, as amended, and
Treasury Regulations promulgated thereunder.
"Collection Period": With respect to any Distribution Date for a
Series (or Class within such Series), the period specified in the related
Series Supplement.
"Commission": The Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act or, if at any time
after the execution and delivery of this Agreement such Commission is not
existing and performing the duties now assigned to it, then the body then
performing such duties.
"Corporate Trust Office": The principal corporate trust office of
the Trustee located at the address set forth in the related Series
Supplement or such other addresses as the Trustee may designate from time
to time by notice to the Holders, the Administrator, if any, and the
Depositor, or the principal corporate trust office of any successor Trustee
(or such other addresses as a successor Trustee may designate from time to
time by notice to the Holders, the Administrator, if any, and the
Depositor).
"Coupon": Any interest coupon appertaining to a Bearer
Certificate.
"Coupon Certificate": Any Bearer Certificate authenticated and
delivered with one or more Coupons appertaining thereto.
"Currency": Dollars or Foreign Currency.
"Cut-off Date": With respect to any Series, the date specified as
such in the related Series Supplement. For purposes of this Agreement, any
Deposited Asset acquired by the Depositor after the applicable Cut-off Date
but prior to the applicable Closing Date and included in the related Trust
as of such Closing Date shall be deemed to have been Outstanding as of such
Cut-off Date and references to the principal balance of such Deposited
Asset as of such Cut-off Date shall be deemed to be to the principal
balance of such Deposited Asset as of the date on which it was acquired by
the Depositor.
"Definitive Certificates": As defined in Section 5.9.
"Depositary": With respect to the Certificates of any Series (or
Class within such Series) issuable in whole or in part in the form of one
or more Global Securities, the Person designated as Depositary by the
Depositor pursuant to Section 5.1 until a successor Depositary shall have
4
<PAGE>
become such pursuant to the applicable provisions of this Agreement, and
thereafter "Depositary" shall mean or include each Person who is then a
Depositary hereunder, and if at any time there is more than one such
Person, "Depositary" as used with respect to the Certificates of any such
Series or Class shall mean the Depositary with respect to the Certificates
of that Series or Class.
"Deposited Assets": With respect to any Series, the asset or
assets Granted as part of the Trust for such Series or acquired (or, in the
case of an agreement, entered into) by the Trust for the benefit of the
Holders of such Series, all as identified in the Deposited Assets Schedule
to the related Series Supplement. The Deposited Assets for any such Series
or the related Trust shall not constitute Deposited Assets for any other
Series or any other Trust.
"Deposited Assets Schedule": With respect to any Series, a
listing of the Deposited Assets for such Series as of the Closing Date,
including, with respect to each Deposited Asset, the obligor and the
principal balance thereof, which shall be attached to such Series
Supplement as Schedule A.
"Depositor": Structured Products Corp., a Delaware corporation,
and, if a successor Person shall have become the Depositor pursuant to any
applicable provisions of this Agreement, "Depositor" shall mean such
successor Person.
"Depositor Order" or "Depositor Request": A written order or
request, respectively, signed in the name of the Depositor by any two of
its Chief Executive Officer, Chief Financial Officer, Chief Operating
Officer, President, a Vice President, its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary and delivered to the
Trustee; provided that (i) any such order or request shall be signed by
either the President or a Vice President and (ii) no person may sign in a
dual capacity.
"Depository Agreement": If applicable, the agreement pursuant to
which the Depositary will agree to act as Depositary with respect to any
Series (or Class within such Series) of Certificates in accordance with
Section 5.9.
"Discount Certificate": Any Certificate that is issued with
"original issue discount" within the meaning of Section 1273(a) of the Code
and any other Certificate designated by the Depositor as issued with
original issue discount for United States Federal income tax purposes.
"Distribution Date": With respect to any Series (or Class within
such Series) of Certificates, each date specified as a "Distribution Date"
for such Series (or Class) in the related Series Supplement.
5
<PAGE>
"Dollar" or "$" or "USD": Such currency of the United States as
at the time of payment is legal tender for the payment of public and
private debts.
"Eligible Account": Either (i) an account or accounts maintained
with a Federal or State chartered depository institution or trust company,
the-long term unsecured debt obligations of which are rated by the Rating
Agency the higher of (x) at least the then current long-term rating of the
Deposited Assets or (y) one of its two highest long-term rating categories
(unless otherwise specified in the Series Supplement) at the time any
amounts are held in deposit therein or (ii) a trust account or accounts
maintained as a segregated account or as segregated accounts and held by a
Federal or State chartered depository institution or trust company in trust
for the benefit of the Certificateholders; provided, however, that such
depositary institution or trust company has a long-term rating in one of
the four highest rating categories by the Rating Agency.
"Eligible Expense": With respect to any Series, as specified in
the related Series Supplement.
"Event of Default": With respect to any Series (or Class within
such Series) of Certificates, as specified in the related Series
Supplement.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Exchange Rate Agent": With respect to any Series (or Class
within such Series) of Certificates, if applicable, the Depositor or its
agent so specified in the related Series Supplement.
"Executive Officer": With respect to any corporation, the Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, any Vice President, the Secretary or the Treasurer of such
corporation; with respect to any partnership, any general partner thereof.
"Extraordinary Trust Expense": With respect to any Series, as
specified in the related Series Supplement.
"Foreign Currency": A currency issued by the government of any
country other than the United States or a composite currency the value of
which is determined by reference to the values of the currencies of any
group of countries.
"Global Security": A Registered Certificate or Bearer Certificate
evidencing all or part of a Series (or Class within such Series) of
Certificates, issued to the Depositary for such Series or Class in
accordance with Section 5.9 and bearing the legend prescribed therein.
6
<PAGE>
"Grant": To sell, convey, assign, transfer, create, grant a lien
upon and a security interest in and right of set-off against, deposit, set
over and confirm to the Trustee pursuant to this Agreement and a related
Series Supplement; and the terms "Granted" and "Granting" have the meanings
correlative to the foregoing. A Grant of any Deposited Assets or of any
other instrument shall include all rights, powers and options (but none of
the obligations) of the Granting party thereunder, including the immediate
and continuing right to claim for, collect, receive and give receipt for
principal, premium, if any, and interest payments in respect of such
Deposited Assets and all other moneys payable thereunder, to give and
receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options, to bring Proceedings in the
name of the Granting party or otherwise, and generally to do and receive
anything that the Granting party is or may be entitled to do or receive
thereunder or with respect thereto.
"Holder": With respect to a Registered Certificate, the
Registered Holder thereof and, with respect to a Bearer Certificate or a
Coupon, the bearer thereof.
"Indenture": With respect to each Series, the Series Trust
Indenture, if any, executed by the Trust in connection with the issuance by
the Trust of Notes in respect of the Deposited Assets for such Series.
"Independent": When used with respect to any specified Person
means that the Person (1) is in fact independent of the Depositor and the
Administrator, if any, and of any Affiliate of any of the foregoing
Persons, (2) does not have any direct or indirect financial interest in the
Depositor or the Administrator, if any, or in any Affiliate of
either of the foregoing Persons which is material with respect to such
Person and (3) is not connected with the Depositor or the Administrator,
if any, as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.
"Independent Certificate" means a certificate of an Independent
Person, as required by the TIA.
"Liquidation Proceeds": The amounts received by the
Administrator, if any, or the Trustee in connection with (i) the
liquidation of a defaulted Deposited Asset or collateral, if any, related
thereto or (ii) the repurchase, substitution or sale of a Deposited Asset.
"Notes": With respect to any Series, the notes issued pursuant to
an Indenture for such Series in respect of the Deposited Assets for such
Series.
"Notional Amount": With respect to any Class of Certificates, if
applicable, the initial notional amount specified in the related Series
Supplement on which distributions of interest may be determined at the
7
<PAGE>
applicable Pass Through Rate, as the same may be adjusted as specified in
such Series Supplement.
"Officer's Certificate": A certificate signed by any one (or, if
specified in this Agreement or any Series Supplement, more than one)
Executive Officer of the Depositor or Administrator, as applicable,
or, in the case of the Trustee, a Responsible Officer.
"Opinion of Counsel": A written opinion of counsel, who may,
except as otherwise expressly provided in this Agreement, be counsel for
the Depositor or the Administrator, if any, acceptable to the
Trustee, except that any opinion of counsel relating to the qualification
of any account required to be maintained pursuant to this Agreement as an
Eligible Account must be an opinion of counsel who is in fact Independent
of the Depositor and the Administrator, if any.
"Optional Exchange Date": With respect to any Series (or Class
with such Series), as defined, if applicable, in the related Series
Supplement.
"Outstanding": With respect to Certificates of a specified Series
(or Class within such Series), as of any date of determination, all such
Certificates theretofore authenticated and delivered under this Agreement
and the related Series Supplement except:
(i) Certificates theretofore cancelled by the Certificate
Registrar or delivered to the Certificate Registrar for cancellation; and
(ii) Certificates in exchange for or in lieu of which other
Certificates have been authenticated and delivered pursuant to this
Agreement, unless proof satisfactory to the Trustee is presented that any
such Certificates are held by a bona fide purchaser in whose hands such
Certificates are valid obligations of the Trust;
provided, however, that in determining whether the Holders of the required
percentage of the aggregate Voting Rights of the Certificates have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Certificates beneficially owned by the Depositor, or any
Affiliate thereof, shall be disregarded and deemed not to be Outstanding,
and the Voting Rights to which its Holder would otherwise be entitled shall
not be taken into account in determining whether the requisite percentage
of aggregate Voting Rights necessary to effect any such consent or take any
such action has been obtained except that, in determining whether the
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates with
respect to which the Depositor has provided the Trustee an Officer's
Certificate stating that such Certificates are so owned shall be so
disregarded. Certificates so owned that have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction
of the Trustee the pledgee's right so to act with respect to such
Certificates and that the pledgee is not, to the knowledge of the Trustee,
the Depositor, the Administrator, if any, or any Affiliate of any
thereof so owned. The principal amount or notional amount, as applicable,
of a Discount Certificate that shall be deemed to be Outstanding for the
8
<PAGE>
determination referred to in the foregoing proviso shall be the Certificate
Principal Balance or Certificate Notional Amount, as applicable, with
respect thereto as of the date of such determination, and the principal
amount or notional amount, as applicable, of a Certificate denominated in a
Foreign Currency that shall be deemed to be Outstanding for purposes of the
determination referred to in the foregoing provision shall be the amount
calculated pursuant to Section 5.12(c).
"Participant": A broker, dealer, bank, other financial
institution or other Person for whom from time to time a Depositary effects
book-entry transfers and pledges of securities deposited with the
Depositary.
"Pass Through Rate": With respect to any Series (or Class within
such Series) of Certificates (except certain Discount Certificates and
Certificates entitled to nominal or no interest distributions) the annual
rate at which interest accrues on the Certificates of such Series (or
Class), which may be a fixed rate or a floating rate of interest,
determined upon the basis and in the manner specified in the related Series
Supplement.
"Paying Agent": As defined in Section 5.14.
"Percentage Interest": With respect to a Certificate of any
Series or Class within a Series, the portion of such Series or Class
evidenced by such Certificate, expressed as a percentage, equal to the
product of (x) a fraction, the numerator of which is the initial
Certificate Principal Balance or Notional Amount, as applicable,
represented by such Certificate and the denominator of which is the
aggregate initial Certificate Principal Balance or Notional Amount, as
applicable, of all the Certificates of such Series or Class and (y) 100.
"Permitted Investments": With respect to any Series, unless
otherwise specified in the related Series Supplement, any one or more of
the following obligations or securities, provided that the total return
specified by the terms of each such obligation or security is at least
equal to the purchase price thereof:
(i) direct obligations of, and obligations fully guaranteed
by, the United States, the Federal Home Loan Mortgage Corporation, the
Federal National Mortgage Association, the Federal Farm Credit System or
any agency or instrumentality of the United States the obligations of which
9
<PAGE>
are backed by the full faith and credit of the United States of America;
provided that obligations of, or guaranteed by, the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association or the
Federal Farm Credit System shall be Permitted Investments only if, at the
time of investment, it has the rating specified in such Series Supplement
for Permitted Investments;
(ii) demand and time deposits in, certificates of deposit
of, or banker's acceptances issued by any depository institution or trust
company (including the Trustee or any agent of the Trustee acting in their
respective commercial capacities) incorporated under the laws of the United
States or any State and subject to supervision and examination by Federal
and/or State banking authorities, so long as the commercial paper and/or
the short-term debt obligations of such depository institution or trust
company (or, in the case of a depository institution which is the principal
subsidiary of a holding company, the commercial paper or other short-term
debt obligations of such holding company) at the time of such investment or
contractual commitment providing for such investment have the rating
specified in such Series Supplement for Permitted Investments; PROVIDED,
however, that such rating shall be no lower than the rating on the
Deposited Assets at the time of purchase of the investments;
(iii) repurchase agreements with respect to (a) any security
described in clause (i) above or (b) any other security issued or
guaranteed by an agency or instrumentality of the United States, with an
entity having the credit rating specified in such Series Supplement for
Permitted Investments;
(iv) securities bearing interest or sold at a discount
issued by any corporation incorporated under the laws of the United States
or any State that have the rating specified in such Series Supplement for
Permitted Investments at the time of such investment or contractual
commitment providing for such investment; provided, however, that such
rating shall be no lower than the rating on the Deposited Assets; provided,
further, that securities issued by any particular corporation will not be
Permitted Investments to the extent that investment therein will cause the
then outstanding principal amount of securities issued by such corporation
and held as part of the Trust for such Series to exceed 10% of the
aggregate outstanding principal balances and amounts of all the Deposited
Assets and Permitted Investments held as part of the Trust for such Series;
(v) commercial paper having at the time of such investment
the rating specified in the Series Supplement for Permitted Investments;
(vi) a Guaranteed Investment Contract if and only if
specified in the related Series Supplement, provided that the Rating Agency
Condition is met; and
10
<PAGE>
(vii) investments in money market funds having a rating from
the Rating Agency in the highest investment category granted thereby
(including funds for which the Trustee or any of its Affiliates is
investment manager or advisor) provided that the Rating Agency Condition is
met.
"Person": Any individual, corporation, partnership, joint
venture, association, joint stock company, limited liability company, trust
(including any beneficiary thereof), unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Distribution": With respect to any Series (or Class
within such Series) of Certificates, the place or places where the
principal of (and premium, if any) and interest on the Certificates of such
Series (or Class) are distributable as specified pursuant to Section 5.1.
"Predecessor Certificate": With respect to any particular
Certificate, every previous Certificate evidencing all or a portion of the
same interest as that evidenced by such particular Certificate; and, for
the purpose of this definition, any Certificate authenticated and delivered
under Section 5.5 in lieu of a lost, destroyed or stolen Certificate shall
be deemed to evidence the same interest as the lost, destroyed or stolen
Certificate.
"Proceeding": Any suit in equity, action at law or other judicial
or administrative proceeding.
"Rating Agency": With respect to any Series (or Class within such
Series), each nationally recognized rating organization specified in the
related Series Supplement that initially rates the Certificates of such
Series (or Class).
"Rating Agency Condition": With respect to any action or
occurrence, unless otherwise specified in the applicable Series Supplement,
that each Rating Agency shall have been given 10 days (or such shorter
period acceptable to each Rating Agency) prior notice thereof and that each
Rating Agency shall have notified the Depositor, the Trustee and the
Administrator, if any, in writing that such action or occurrence
will not result in a reduction or withdrawal of the then current rating of
any Certificate of the applicable Series.
"Record Date": With respect to any Distribution Date for any
Series (or Class within such Series) of Registered Certificates, the date
specified in the related Series Supplement.
"Registered Certificate": Any Certificate registered as to
principal, premium, if any, and interest in the Certificate Register.
11
<PAGE>
"Registered Holder": The Person in whose name a Registered
Certificate is registered in the Certificate Register on the applicable
Record Date.
"Required Interest": Unless otherwise specified in the related
Series Supplement, with respect to the Outstanding Certificates of any
Series or any Class thereof, the accrued and undistributed interest on the
Certificate Principal Balance or Notional Amount of such Outstanding
Certificates (or the amount due under any related Coupons), computed at the
applicable Pass Through Rate.
"Required Percentage-Amendment": Unless otherwise specified in
the related Series Supplement, 66-2/3% of the aggregate Voting Rights of
Certificates of such Series (or of a designated Class or group of Classes
within such Series) (either voting as separate Classes or as a single
Class) applicable to such matter, all as specified in the applicable Series
Supplement.
"Required Percentage-Definitive Certificates": Unless otherwise
specified in the related Series Supplement, greater than 50% of the
aggregate Voting Rights of Certificates of such Series.
"Required Percentage-Direction of Trustee": Unless otherwise
specified in the related Series Supplement, greater than 50% of the
aggregate Voting Rights of Certificates of such Series.
"Required Percentage-Remedies": Unless otherwise specified in the
related Series Supplement, 66-2/3% of the aggregate Voting Rights of
Certificates of such Series.
"Required Percentage-Removal of Trustee": Unless otherwise
specified in the related Series Supplement, greater than 50% of the
aggregate Voting Rights of Certificates of such Series.
"Required Percentage-Waiver": Unless otherwise specified in the
related Series Supplement, 66-2/3% of the aggregate Voting Rights of
Certificates of such Series.
"Required Rating": With respect to any Series (or Class within
such Series), the rating category (or categories) specified in the Series
Supplement that, as a condition to the issuance of such Series or Class, is
(or are) the lowest category (or categories) in which the Certificates of
such Series or Class may be categorized by the Rating Agency.
"Requisite Reserve Amount": As of any date with respect to any
Series (or Class within such Series) of Certificates, the amount, if any,
required to be maintained in the Reserve Account, if any, for such Series
or Class as specified in or determined pursuant to the related Series
Supplement.
"Reserve Account": An Eligible Account, if any, created and
maintained pursuant to Section 3.11.
12
<PAGE>
"Responsible Officer": With respect to the Trustee, any officer
within the Corporate Trust Office of the Trustee, including any Vice
President, Assistant Vice President, Assistant Treasurer, Assistant
Secretary or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer
to whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Scheduled Final Distribution Date": With respect to any
Certificate, the date on which all the unpaid principal of (and premium, if
any, on) such Certificate is scheduled, without giving effect to any
prepayment, exchange or early termination, to become due and payable as
provided therein and in the applicable Series Supplement.
"Series": A separate series of Certificates issued pursuant to
this Agreement and a related Series Supplement, which series may be divided
into two or more Classes, as provided in such Series Supplement.
"Series Supplement": An agreement supplemental to this Agreement
that authorizes the issuance of a particular Series (and each Class within
such Series) of Certificates.
"Specified Currency": As defined in the related Series
Supplement.
"State": Any one of the 50 states of the United States or the
District of Columbia.
"Term Assets Issuer": As defined in the related Series
Supplement.
"TIA": The Trust Indenture Act of 1939, as amended.
"Trust": The TIERS<service-mark> Asset-Backed Securities, Series
CHAMT Trust 1997-7 created hereunder.
"Trustee": With respect to each Series, the Person so specified
in the applicable Series Supplement (which Person shall have agreed
pursuant to such Series Supplement to assume all the duties, obligations,
responsibilities and liabilities of the Trustee as set forth in this
Agreement and such Series Supplement with respect to the related Series of
Certificates) for such Series, acting not in its individual capacity but
solely in its capacity as Trustee, or any co-trustee appointed pursuant to
Section 8.10, until a successor Person shall have become the Trustee
pursuant to the applicable provisions of this Agreement and the applicable
Series Supplement, and thereafter "Trustee" shall mean such successor
Person.
"Uniform Commercial Code": The Uniform Commercial Code as in
effect in the relevant jurisdiction or, with respect to the State of
13
<PAGE>
Louisiana, the equivalent body of statutory and common law.
"United States": The United States of America (including the
States), its territories, its possessions and other areas subject to its
jurisdiction.
"Voting Rights": With respect to any Series (or Class within such
Series) of Certificates, the portion of the aggregate voting rights of the
Certificates of such Series or Class which shall be allocated to any
Certificate as specified in the applicable Series Supplement.
Section 1.2. RULES OF CONSTRUCTION. Unless the context
otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles as in effect in the United States from time to time;
(iii) "or" is not exclusive;
(iv) the words "herein", "hereof", "hereunder" and other
words of similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision;
(v) "including" means including without limitation; and
(vi) words in the singular include the plural and words in
the plural include the singular.
ARTICLE II.
DECLARATION OF TRUSTS; ISSUANCE OF CERTIFICATES
Section 2.1. CREATION AND DECLARATION OF TRUSTS; ASSIGNMENT OF
DEPOSITED ASSETS. (a) The Depositor, concurrently with the execution and
delivery hereof, does hereby agree to (i) Grant to the Trust, for the
benefit of the Certificateholders of each given Series of Certificates and
without recourse, all the right, title and interest of the Depositor,
including any security interest therein for the benefit of the Depositor,
in, to and under the Deposited Assets attributable to each such Series
(except for the Deposited Assets attributable to such Series which are not
Granted by the Depositor, as specified in the Deposited Assets Schedule to
the applicable Series Supplement), now existing or hereafter acquired, in
14
<PAGE>
each case as identified on the applicable Deposited Assets Schedule set
forth in the Series Supplement for such Series, and all other assets
included or to be included in the respective Trust for the benefit of the
Certificateholders of each such Series or (ii) deliver to the Trustee for
deposit in the Certificate Account an amount, in immediately available
funds in a form acceptable to the Trustee, sufficient to acquire the
Deposited Assets attributable to such Series, in each case as identified on
the Deposited Asset Schedule set forth in the Series Supplement for such
Series, and all other assets to be included in the respective trust for the
benefit of the Certificateholders of each such Series. Each such Grant will
include all interest, premium (if any) and principal received by or on
behalf of the Depositor of, on or with respect to any such Deposited Assets
due after the applicable Cut-off Date, and, unless otherwise specified in
the related Series Supplement, will exclude all interest, premium (if any)
and principal of, on or with respect to any such Deposited Assets due on or
before the applicable Cut-off Date.
(b) In connection with each Grant referred to in the preceding
paragraph, the Depositor shall, not later than the applicable Closing Date,
(i) deposit the Deposited Assets for a given Series (except for the
Deposited Assets attributable to such Series which are to be acquired from
a Person other than the Depositor, as specified on the Deposited Assets
Schedule to the applicable Series Supplement) with the Trustee by physical
delivery of such Deposited Assets, duly endorsed, to the Trust or by
causing such Deposited Assets to be registered by book entry in the name of
the Trust and (ii) with respect to each such Deposited Asset, deliver or
cause to be delivered to the Trustee all documents necessary to transfer
ownership of each such Deposited Asset to the Trust.
(c) Unless otherwise specified in the applicable Series
Supplement, the Grant of such Deposited Assets by the Depositor for a given
Series accomplished hereby and by such Series Supplement is absolute and is
intended by the parties hereto as a sale. The Depositor represents and
covenants that the Deposited Assets as of the respective Closing Dates will
be free and clear of any right, charge, security interest or lien or claim
in favor of the Depositor and, with respect to any Grant of Deposited
Assets, that the Depositor will as of such respective Closing Date have the
right to Grant the applicable Deposited Assets to the Trust.
(d) Each Series shall constitute a separate series of the Trust
pursuant to Section 3806(b)(2) of the Delaware Business Trust Act (the
"DBTA"). Separate and distinct records shall be maintained for each such
Series and the assets associated with any such Series shall be held and
accounted for separately from the other assets of the Trust, or any other
Series thereof. Subject to the right of the Trust to allocate general
liabilities, expenses, costs, charges or reserves as herein provided, the
debts, liabilities, obligations and expenses incurred, contracted for or
otherwise existing with respect to a particular Series shall be enforceable
against the assets of such Series only, and not against the assets of any
other Series. Notice of this limitation on inter-Series liabilities shall
be set forth in the certificate of trust of the Trust (whether originally
or by amendment) as filed or to be filed in the Office of the Secretary of
State of the State of Delaware pursuant to the DBTA, and upon the giving of
15
<PAGE>
such notice in the certificate of trust, the statutory provisions of
Section 3804 of the DBTA relating to limitations on inter-Series
liabilities (and the statutory effect under Section 3804 of setting forth
such notice in the certificate of trust) shall become applicable to the
Trust and each Series. Every note, bond, contract or other undertaking
issued by or on behalf of a particular Series shall include a recitation
limiting the obligation represented thereby to that Series and its assets.
(e) The Trust created hereby shall be known as
"TIERS<service-mark> Asset-Backed Securities, Series CHAMT Trust 1997-7,"
in which name the Trustee may conduct the business of the Trust, make and
execute contracts and other instruments on behalf of the Trust and sue and
be sued.
(f) The office of the Trust shall be in care of the Trustee at
the Corporate Trust Office or at such other address as the Trustee may
designate by written notice to the Certificateholders and the Depositor.
(g) The purpose of the Trust is, and the Trust shall have the
power and authority to, engage in the following activities:
(i) to issue Notes pursuant to an Indenture for any Series
and the Certificates pursuant to this Agreement and its related Series
Supplement and to sell such Notes and such Certificates in one or more
transactions;
(ii) with the proceeds of the sale of the Notes and the
Trust Certificates to purchase the Deposited Assets for one or more
Series;
(iii) to assign, grant, transfer, pledge, mortgage and convey
the Deposited Assets for one or more series pursuant to the Indenture
and to hold, manage and distribute to the Certificateholders any
portion of the Deposited Assets for one or more series released from
the Lien of, and remitted to the Trust pursuant to, an Indenture:
(iv) to execute, deliver and perform its obligations under
each Indenture, each Series Supplement and the other documents,
agreements and certificates contemplated thereby.
(v) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish
the foregoing or are incidental thereto or connected therewith; and
(vi) subject to compliance with the Basic Documents in
respect of each Series, to engage in such other activities as may be
16
<PAGE>
required in connection with conservation of the Deposited Assets for
such Series and the making of distributions to the Certificateholders
and the Noteholders.
The Trust shall not engage in any activity other than in connection with
the foregoing or other than as required or authorized by this Agreement or
the Basic Documents in respect of a Series.
(h) The Depositor hereby contributes to the Trustee, as of the
date hereof, the sum of $1.00. The Trustee hereby acknowledges receipt in
trust from the Depositor, as of the date hereof, of the foregoing
contribution. The Depositor shall pay organizational expenses of the Trust
as they may arise or shall, upon the request of the Trustee, reimburse the
Trustee for any such expenses paid by the Trustee pursuant to their
arrangement set forth in a separate agreement. The Trustee hereby declares
that it will hold the Deposited Assets in trust upon and subject to the
conditions set forth herein for the use and benefit of the
Certificateholders, subject to the obligations of the Trust under the Basic
Documents in respect of a Series. It is the intention of the parties
hereto that the Trust constitute a business trust under the DBTA and that
this Agreement constitute the governing instrument of such business trust.
(i) No Certificateholder shall have any personal liability for
any liability or obligation of the Trust.
(j) Legal title to all the Deposited Assets shall be vested at
all times in the Trust as a separate legal entity, except where applicable
law in any jurisdiction requires title to any part of the Deposited Assets
to be vested in a trustee or trustees, in which case title shall be deemed
to be vested in the Trustee, a co-trustee and/or a separate trustee, as the
case may be.
(k) The Trust will be located and administered in the State of
Delaware. All bank accounts maintained by the Trustee on behalf of the
Trust shall be located in the State of Delaware or the State of New York.
The Trust shall not have any employees in any state other than Delaware;
PROVIDED, HOWEVER, that nothing herein shall restrict or prohibit the
Trustee from having employees within or without the State of Delaware.
Section 2.2. ACCEPTANCE BY TRUSTEE.
(a) With respect to each Series, the Trustee on behalf of the
Trust will acknowledge receipt by the Trust, of the related Deposited
Assets and the related documents referred to in Section 2.1, now existing
or hereafter acquired, and declares that it will hold such Deposited Assets
and documents and all other documents delivered to it pursuant to this
Agreement, and that it will hold all such assets and such other assets
(including Deposited Assets acquired from a Person other than the
Depositor) comprising the Trust for a given Series of Certificates, in
17
<PAGE>
trust for the exclusive use and benefit of all present and future
Certificateholders of such Series and for the purposes and subject to the
terms and conditions set forth in this Agreement.
(b) The Trustee, or a custodian or Administrator on its
behalf, shall review all documents received by it pursuant to Section 2.1
within 45 days after receipt thereof. If in the process of reviewing such
documents the Trustee or such custodian or Administrator discovers
any document or documents to be missing or defective, the person
discovering such defect shall promptly (but in any event within 10 Business
Days) so notify the Trustee, the Depositor and each Administrator.
Section 2.3. RESERVED.
Section 2.4. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR
AND REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE ADMINISTRATOR.
(a) The Depositor hereby represents and warrants to the Trustee
that as of the Closing Date or as of such other date specifically provided
herein or in the applicable Series Supplement:
(i) the Depositor is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware;
(ii) with respect to each Series Supplement, to the
Depositor's knowledge, the information set forth in the Deposited Asset
Schedule with respect to each Deposited Asset is true and correct in all
material respects at the date or dates respecting which such information is
furnished;
(iii) the execution and delivery of this Agreement by the
Depositor and its performance of and compliance with the terms of this
Agreement will not violate the Depositor's articles of incorporation or by-
laws or constitute a default (or an event which, with notice or lapse of
time, or both, would constitute a default) under, or result in the breach
or acceleration of, any material contract, agreement or other instrument to
which the Depositor is a party or which may be applicable to the Depositor
or any of its assets;
(iv) the Depositor has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement, has
duly authorized the execution, delivery and performance of this Agreement
and has duly executed and delivered this Agreement. This Agreement, upon
its execution and delivery by the Depositor and assuming due authorization,
execution and delivery by the Trustee, will constitute a valid, legal and
binding obligation of the Depositor, enforceable against it in accordance
18
<PAGE>
with the terms hereof, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, receivership, moratorium or other
laws relating to or affecting the rights of creditors generally, and by
general equity principles (regardless of whether such enforcement is
considered a proceeding in equity or at law);
(v) the Depositor is not in violation, and the execution
and delivery of this Agreement by the Depositor and its performance and
compliance with the terms of this Agreement will not constitute a
violation, of any order or decree of any court or any order or regulation
of any Federal, State, municipal or governmental agency having jurisdiction
over the Depositor or its properties, which violation would reasonably be
expected to have a material and adverse effect on the condition (financial
or otherwise) or operations of the Depositor or its properties or on the
performance of its duties hereunder; and
(vi) any additional representations and warranties, if any,
that may be specified in the applicable Series Supplement.
It is understood and agreed that the representations and
warranties of the Depositor set forth in this Section 2.4(a) shall survive
delivery of the respective documents to the Trustee and shall inure to the
benefit of the Trustee on behalf of the Certificateholders notwithstanding
any restrictive or qualified endorsement or assignment. Upon discovery by
any of the Depositor, the Administrator, if any, or the Trustee of a
breach of any of the foregoing representations and warranties which
materially and adversely affects the interests of the Certificateholders,
the party discovering such breach shall give prompt written notice thereof
to the other parties.
(b) The Administrator, if any, shall make such
representations, warranties, if any, and covenants that may be specified in
the applicable Series Supplement.
Upon discovery by any of the Depositor, the Administrator,
if any, or the Trustee of a breach of any of the foregoing representations,
warranties and covenants which materially and adversely affects the
interests of the Certificateholders, the party discovering such breach
shall give prompt written notice thereof to the other parties.
Section 2.5. BREACH OF REPRESENTATION, WARRANTY OR COVENANT.
(a) Within 90 days of the earlier of discovery by the Depositor or receipt
of notice by the Depositor of a breach of any representation or warranty of
the Depositor set forth in Section 2.4(a) that materially and adversely
affects the interests of the Certificateholders of a given Series of
Certificates, the Depositor shall cure such breach in all material
respects.
(b) With respect to an Administrator appointed pursuant
to the applicable Series Supplement, within 90 days of the earlier of
discovery by such Administrator or receipt of notice by such
Administrator of a breach of any representation, warranty or
covenant of such Administrator set forth in the applicable Series
Supplement that materially and adversely affects the interests of the
19
<PAGE>
Certificateholders, such Administrator shall cure such breach in all
material respects.
Section 2.6. AGREEMENT TO AUTHENTICATE AND DELIVER
CERTIFICATES. With respect to each Series of Certificates and the related
Trust, the Trustee hereby agrees and acknowledges that it will,
concurrently with the Grant to and receipt by it of the related Deposited
Assets and delivery to it by the Depositor of executed Certificates and
Coupons, if any, of such Series, cause to be authenticated and delivered to
or upon the order of the Depositor, in exchange for the Deposited Assets
and such other assets constituting the Trust for a given Series,
Certificates duly authenticated by or on behalf of the Trustee in
authorized denominations evidencing ownership of the entire Trust for such
Series, all in accordance with the terms and subject to the conditions of
Sections 5.2 and 5.13.
ARTICLE III.
ADMINISTRATION
Section 3.1. ADMINISTRATION OF EACH TRUST.
(a) The Trustee shall administer the Deposited Assets for each
Trust for the benefit of the Certificateholders of the related Series. In
engaging in such activities, the Trustee shall, subject to the provisions
of Article VI hereof, follow, or cause to be followed, collection
procedures in accordance with the terms of this Agreement and the
applicable Series Supplement and the respective Deposited Assets. With
respect to each Trust, and subject only to the above-described standards
and the terms of this Agreement, the related Series Supplement and the
respective Deposited Assets, the Trustee (or the Administrator, if
applicable) shall have full power and authority, acting alone or through
any Administrator, to do or cause to be done any and all things in
connection with such administration which it deems necessary to comply with
the terms of this Agreement and the applicable Series Supplement.
(b) Without limiting the generality of the terms of paragraph
(a) of this Section 3.1, with respect to any Series of Certificates, the
Administrator, if any, specified in the applicable Series Supplement
shall, to the extent permitted under its Administration Agreement, be
authorized and empowered, when such Administrator believes it
appropriate in its reasonable judgment and when otherwise required by a
Series Supplement, in its own name (i) to instruct the Trustee to make
20
<PAGE>
distributions or payments from the Certificate Account or any other Account
for such Series, as set forth herein or in the related Series Supplement,
and (ii) to the extent specified in the related Series Supplement, to
execute and deliver, on behalf of the Certificateholders of such Series and
the Trustee or any of them, and upon notice to the Trustee, any and all
instruments of satisfaction or cancellation, or of partial or full release
or discharge, and all other comparable instruments, with respect to any of
the Deposited Assets relating to such Series.
(c) The duties of the Trustee and the Administrator, if
any, shall be performed in accordance with applicable local, State and
Federal law, and the Trustee (or the Administrator) shall make, or
cause to be made, any and all filings, reports, notices or applications
with, and seek any comments and authorizations from, the Commission and any
State securities authority on behalf of the Trust for each Series. If the
applicable Series Supplement appoints an Administrator, the Trustee,
in its capacity as Trustee, shall execute, at the direction of such
Administrator, any powers of attorney and other documents necessary
or appropriate to enable the Administrator to carry out any of its
administrative duties hereunder; PROVIDED, however, that the Trustee, in
its capacity as Trustee, shall, to the extent permitted by law, not be
accountable for the actions of the Administrator under such powers
of attorney.
Section 3.2. ADMINISTRATION AGREEMENTS.
(a) The Trustee may enter into Administration Agreements with
one or more Administrators in order to delegate any or all of its
non-fiduciary obligations hereunder with respect to a related Series under
this Agreement PROVIDED, that (i) the Rating Agency Condition shall have
been satisfied with respect to the entering into of any such agreement and
(ii) such agreements are consistent with the terms of this Agreement and,
with respect to Certificates of any Series, the related Series Supplement.
(b) If the Trustee enters into any Administrative Agreements,
such delegation shall release, to the extent permitted by law, the Trustee,
from the duties, obligations, responsibilities or liabilities delegated
thereunder.
(c) Each Administration Agreement shall impose on the
Administrators requirements conforming to the provisions set forth
in Section 3.1 and provide for administration of the related Trust, the
Indenture, if any, and all or certain specified Deposited Assets for such
Series consistent with the terms of this Agreement and the related Series
Supplement. Additional requirements relating to the scope and contents of
any Administration Agreement may be provided in the applicable Series
Supplement. Copies of each Administration Agreement, together with any
amendments or modifications thereto, shall be promptly delivered to the
Depositor, upon the execution and delivery of any such instruments.
Section 3.3 SUCCESSOR ADMINISTRATORS. An Administrator,
if any, specified in the applicable Series Supplement and the Trustee
shall each be entitled to terminate any Administration Agreement
21
<PAGE>
Agreement to which it is a party and the rights and obligations of any
under such Administration Agreement in accordance with the terms and
conditions of such Administration Agreement. In the event of the
termination of any Administrator, the Trustee may appoint a
successor Administrator meeting the requirements hereof including
that the Rating Agency Condition be satisfied.
Section 3.4. NO CONTRACTUAL RELATIONSHIP BETWEEN ADMINISTRATORS
AND CERTIFICATEHOLDERS. Any Administration Agreement between an
Administrator specified in the applicable Series Supplement and the
Trustee that may be entered into and any transactions or services relating
to the Deposited Assets pursuant to such an agreement shall be deemed to be
between the Administrator and the parties thereto and the
Certificateholders shall not be deemed parties thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to the
Administrator. The Depositor shall be solely liable for all fees
and expenses of any Administrator in accordance with its Administration
Agreement.
Section 3.5. COLLECTION OF CERTAIN DEPOSITED ASSET
PAYMENTS. With respect to any Series or Class of Certificates, the Trustee
may (or may delegate an Administrator to), make reasonable efforts
to collect all payments required to be made pursuant to the terms of the
Deposited Assets in a manner consistent with the terms of this Agreement
and such Deposited Assets.
Section 3.6. INVESTMENT OF FUNDS IN THE ACCOUNTS. The
Depositor (or, if so specified in the applicable Series Supplement, the
Administrator), on behalf of the Trust, may direct the Trustee to
direct any depository institution maintaining the Certificate Account or
the Reserve Account, if any, for the applicable Series and any other
segregated Eligible Account, the contents of which are held for the benefit
of Certificateholders of such Series (each, an "Account"), to invest the
funds maintained therein in one or more Permitted Investments bearing
interest or sold at a discount, which shall be held to maturity unless
payable on demand and which funds shall not be reinvested upon the maturity
or demand for payment of such Permitted Investment. If the Depositor (or
the Administrator, if applicable) does not provide any investment
directions to the Trustee, funds held in any Account will be invested in
the Permitted Investments specified in clause (ii) of the definition
thereof. Investments of such funds shall be invested in Permitted
Investments that will mature so that such funds will be available for
distribution on the Distribution Date on which such amounts are to be
applied as distributions to Certificateholders. In the event amounts on
deposit in an Account are at any time invested in a Permitted Investment
payable on demand, the Trustee shall:
(x) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such Permitted
22
<PAGE>
Investment may otherwise mature hereunder in an amount equal to the lesser
of (1) all amounts then payable thereunder and (2) the amount required to
be withdrawn on such date; and
(y) demand same day payment of all amounts due thereunder upon a
determination by the Trustee that such Permitted Investment would not
constitute a Permitted Investment in respect of funds thereafter on deposit
in any Account.
Section 3.7. RESERVED.
Section 3.8. REALIZATION UPON DEFAULTED DEPOSITED ASSETS. (a)
If:
(i) default is made in the payment of any installment of
interest on any Deposited Asset when the same becomes due and payable, and
such default continues unremedied for the period specified in the indenture
or other authorizing document for such Deposited Asset (or, if no such
period is specified, five days) after receipt by the Term Assets Issuer of
notice thereof from the Trustee or receipt by the Term Assets Issuer and
the Trustee of notice thereof from the Holders of Outstanding Certificates
representing at least 25% of the Voting Rights; or
(ii) default is made in the payment of the principal of or
any installment of the principal of any Deposited Asset when the same
becomes due and payable, and such default continues unremedied for the
period specified in the indenture or other authorizing document for such
Deposited Asset (or, if no such period is specified, thirty (30) days)
after receipt by the Term Assets Issuer of notice thereof from the Trustee
or receipt by the Term Assets Issuer and the Trustee of notice thereof from
the Holders of Outstanding Certificates representing at least 25% of the
Voting Rights;
and the Term Assets Issuer shall, upon demand of the Trustee, fail to pay
forthwith to the Trustee, for the benefit of the Holders, the whole amount
then due and payable on such Deposited Assets for principal and interest,
with interest upon the overdue principal, at the rate borne by the
Deposited Assets and in addition thereto such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the
Trustee and its agents and counsel, to the extent permitted by law (such
event, an "Issuer Payment Default"), then the Trustee, in its own name and
as trustee of an express trust, subject to provision being made for
indemnification against costs, expenses and liabilities in a form
satisfactory to the Trustee, shall institute a Proceeding for the
collection of the sums so due and unpaid, and shall prosecute such
Proceeding to judgment or final decree or settlement, and shall enforce the
same against the Term Assets Issuer or other obligor upon the Deposited
Assets and collect in the manner provided by law out of the property of the
Term Assets Issuer or other obligor upon the Deposited Assets wherever
situated, the moneys adjudged or decreed to be payable, unless otherwise
directed by Holders of the Required Percentage-Direction of the Trustee. In
connection therewith, the Trustee shall use its best reasonable efforts in
accordance with such normal and customary procedures it shall deem
necessary or advisable, and shall have the power and authority, acting
alone, to do any and all things in connection therewith and the
23
<PAGE>
administration of the Trust as it may deem necessary or advisable.
(b) In the event that the Trustee receives money or other
property in respect of the Deposited Assets (other than a scheduled
interest or principal payment or the payment of any redemption premium on
or with respect to the earlier redemption of the Deposited Assets) as a
result of a payment default on the Deposited Assets or actual notice that
such moneys or other property will be paid to the Trustee, the Trustee
shall promptly give notice (as provided in Section 10.5 hereof) to the
Depositary or, if the Certificates are not then held by the Depositary,
directly to the Holders of the Certificates then outstanding and unpaid.
Such notice shall state that, not later than thirty (30) days after the
receipt of such moneys or other property, the Trustee shall allocate and
distribute such moneys or other property to the Holders of the Outstanding
Certificates then unpaid, in proportion to the aggregate Certificate
Principal Balance of all Certificates of each class, and within each class
pro rata by the Certificate Principal Balance of each Certificate within
such class. [pro rata by Accreted Value]. Property received, other than
cash, shall be liquidated by the Trustee in a commercially reasonable
manner and the proceeds thereof, after deduction of all reasonable costs of
such liquidation, shall be distributed in cash, only to the extent
necessary to avoid distribution of fractional securities.
(c) The Trustee or Administrator (to the extent or
required under its Administration Agreement), on behalf of the
Certificateholders, shall assert claims and shall take such reasonable
steps, in addition to those described in Section 3.12(a), as are necessary
to receive payment or to permit recovery thereunder with respect to any
defaulted Deposited Assets, subject in all cases to the provisions of
Article VI hereof in the case of the Administrator and Article VIII
hereof in the case of the Trustee.
(d) Unless otherwise provided in a Series Supplement, if the
Administrator or the Trustee, as applicable, is unable to obtain, or
cause to be obtained, full recovery in respect of a defaulted Deposited
Asset, the Administrator or the Trustee, as applicable, shall follow
or cause to be followed such normal practices and procedures as it deems
necessary or advisable to realize upon such defaulted Deposited Asset,
subject in all cases to the provisions of Article VI hereof in the case of
the Administrator and Article VIII hereof in the case of the
Trustee.
Section 3.9. RESERVED.
Section 3.10. ADMINISTRATOR'S COMPENSATION AND REIMBURSEMENT.
(a) As compensation for its activities, the Administrator,
if any, shall be compensated, by the Depositor.
(b) If, and only to the extent, provided in a Series Supplement,
the Administrator, if any, shall be required to pay, from its
compensation hereunder or otherwise, all expenses incurred in connection
with the Trust for the related Series and its administration of the
Deposited Assets for such related Series, including payment of the fees and
disbursements of the Trustee (including the reasonable fees and expenses of
its counsel and independent accountants allocable to such Series), payment
of expenses incurred in connection with distributions and reports to
Certificateholders of such Series, and expenses specified in such Series
Supplement; PROVIDED, however, that neither the Administrator, if
any, nor the Trustee will be responsible for any Federal, State, local or
foreign income and franchise taxes, if any, and any interest or penalties
with respect thereto, assessed on the Trust for such Series.
Section 3.11. STATEMENT AS TO COMPLIANCE. An Administrator
appointed in respect of any Series of Certificates pursuant to the
applicable Series Supplement, if any, will deliver to the Trustee, the
Depositor and the Rating Agency not later than 90 days following the end of
each fiscal year of the Administrator an Officer's Certificate
executed by two of its Executive Officers stating, as to each signatory
thereof, that in respect of such Series (i) a review of the activities of
the Administrator during the preceding year and of performance under
this Agreement has been made under such officer's supervision and (ii) to
the best of such officer's knowledge, based on such review, the
Administrator has fulfilled all its obligations under this Agreement
throughout such year, or, if there has been a default in the fulfillment of
any such obligation, specifying each such default known to such officer and
the nature and status thereof. Copies of each such statement received by
the Trustee shall be provided by the Trustee to any Certificateholder of
such Series upon written request at the Certificateholder's expense.
Section 3.12. INDEPENDENT PUBLIC ACCOUNTANTS' ADMINISTRATION
REPORT. Unless otherwise specified in the Series Supplement, within four
months after the end of each 12-month period beginning with the period
specified in the Series Supplement for a given Series of Certificates,
either the Administrator, if any, specified in the Series
Supplement, or otherwise the Trustee shall cause a firm of nationally
recognized independent public accountants (who may also render other
services to the Administrator, if any, the Trustee or the Depositor)
to furnish a report addressed to the Trustee, the Depositor, and the Rating
25
<PAGE>
Agency for such Series, if any, to the effect that such firm has examined
certain documents and records relating to the administration of the
Deposited Assets deposited in or held by the applicable Trust during the
preceding 12-month period (or, in the case of the first such report, during
the period from the Closing Date to the date specified in the applicable
Series Supplement) and that, on the basis of certain agreed-upon procedures
considered appropriate under the circumstances, such firm is of the opinion
that such administration was conducted in accordance with the terms of this
Agreement and the related Series Supplement except for (i) such exceptions
as such firm shall believe to be immaterial and (ii) such other exceptions
and qualifications as shall be set forth in such report.
Such report will also indicate that such firm is independent of
the Administrator, if any, and the Trustee within the meaning of the
Code of Professional Ethics of the American Institute of Certified Public
Accountants.
Copies of such report received by the Trustee shall be provided
by the Trustee to any Certificateholder of such Series upon written request
without charge to the requesting Certificateholder.
The firm of independent public accountants shall be entitled to
compensation in consideration for its duties hereunder in the manner
specified in the applicable Series Supplement.
Section 3.13. ACCESS TO CERTAIN DOCUMENTATION. To the extent
required by applicable laws and regulations, the Trustee and the
Administrator, if any, shall provide to any Federal, State or local
regulatory authority that may exercise authority over any Certificateholder
access to the documentation regarding the Deposited Assets in respect of
the applicable Series. Such access shall be afforded without charge, but
only upon reasonable request and during normal business hours at the
offices of the Trustee and Administrator, if any, designated by each
of them. In addition, access to the documentation regarding the Deposited
Assets related to a given Series (or Class within such Series) will be
provided to any Certificateholder of such Series (or Class), upon
reasonable prior written request, during normal business hours at the
offices of the Trustee and Administrator designated by each of them
at the expense of the Certificateholder requesting such access.
Section 3.14. DUTIES OF THE ADMINISTRATOR. Notwithstanding any
other provision of this Agreement, with respect to any Series, the
applicable Series Supplement may provide that any Administrator
appointed pursuant to such Series Supplement shall have no rights and no
duties, obligations or liabilities except as provided in such Series
Supplement and herein.
26
<PAGE>
Section 3.15. DEPOSITOR TO FURNISH NAMES AND ADDRESSES OF
HOLDERS TO TRUSTEE. The Depositor shall furnish or cause to be furnished
to the Trustee (and each Administrator) not more than five days
before each Distribution Date, and at such other times as the Trustee or
Administrator may request in writing, a list, in such form as the
Trustee may reasonably require, to the extent such information is in the
possession or control of the Depositor or any of its paying agents, of the
Holders of Certificates as of the close of business on the applicable
record date of the Deposited Assets; PROVIDED, however, that so long as the
Trustee maintains the Certificate Register, no such list shall be required
to be furnished.
Section 3.16. PRESERVATION OF INFORMATION, COMMUNICATIONS TO
HOLDERS. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of
Certificates contained in the most recent list furnished to the Trustee as
provided in Section 3.19 and the names and addresses of Holders of
Certificates received by the Trustee in its capacity as Certificate
Registrar. The Trustee may destroy any list furnished to it as provided in
such Section 3.19 upon receipt of a new list so furnished.
(b) Holders shall have the right to communicate pursuant to TIA
Section 312(b) with other Holders with respect to their rights under this
Agreement or under the Certificates.
(c) The Depositor, the Trustee and the Certificate Registrar
shall have the protection of TIA Section 312(c).
ARTICLE IV.
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS
Section 4.1. DISTRIBUTIONS. On each Distribution Date for a
given Series of Certificates, the Trustee shall apply Available Funds in
the Certificate Account for such Series in the manner and priority set
forth in the Series Supplement for such Series. Notwithstanding any other
provisions in this Agreement, the right of the Holder of any Certificate to
receive any such distributions in the manner and priority set forth in the
Series Supplement for such Series and to institute suit for the enforcement
of any such payment on or after the date such payment is payable, shall not
be impaired without the consent of such Holder.
Section 4.2. REPORTS TO CERTIFICATEHOLDERS. Unless otherwise
specified in the applicable Series Supplement, on the next Business Day
following each such Distribution Date the Trustee or the Administrator,
if any, as specified in such Series Supplement, shall forward or
27
<PAGE>
cause to be forwarded to the Depositor, each Certificateholder of such
Series and such other Persons as may be specified in such Series
Supplement, a statement setting forth:
(i) the amount of the distribution on such Distribution
Date to Certificateholders of each Class of such Series (or of each Class
within such Series) allocable to principal of and premium, if any, and
interest on the Certificates of each such Series (or Class); and the amount
of aggregate unpaid interest accrued as of such Distribution Date;
(ii) in the case of each Class of Floating Rate Certificates
of such Series, the respective Floating Pass Through Rate applicable to
each such Class on such Distribution Date, as calculated in accordance with
the method specified in such Certificates and the related Series
Supplement;
(iii) the amount of compensation received by any
Administrator and such other customary information as the Trustee
or Administrator, as applicable, deems necessary or desirable, or
that any such Certificateholder reasonably requests, to enable such
Certificateholders to prepare their tax returns;
(iv) if the Series Supplement provides for Advances, the
aggregate amount of Advances in respect of such Series, if any, included in
such distribution, and the aggregate amount of unreimbursed Advances, if
any, at the close of business on such Distribution Date;
(v) the aggregate stated principal amount and, if
applicable, notional amount of the Deposited Assets related to such Series,
the current rating assigned by the Rating Agency thereon and the current
interest rate or rates thereon at the close of business on such
Distribution Date; and
(vi) the aggregate Certificate Principal Balance (or
Notional Amount, if applicable) of each Class of such Series at the close
of business on such Distribution Date.
In the case of information furnished pursuant to subclauses (i) and (iii)
above, the amounts shall be expressed as a Dollar amount (or the equivalent
thereof in any other Specified Currency) per minimum denomination of
Certificates or for such other specified portion thereof. Within a
reasonable period of time after the end of each calendar year, the Trustee
shall furnish to each person who at any time during each such calendar year
was a Certificateholder a statement containing the information set forth in
subclauses (i) and (iii) above, aggregated for such calendar year or the
applicable portion thereof during which such person was a
Certificateholder. Such obligation of the Trustee shall be deemed to have
been satisfied to the extent that substantially comparable information
shall be provided by the Trustee pursuant to any requirements of the Code
as are from time to time in effect.
28
<PAGE>
Section 4.3. ADVANCES. (a) Unless otherwise specified in the
applicable Series Supplement, an Administrator appointed pursuant to
the Series Supplement shall have no obligation to make Advances (as defined
below) with respect to the Deposited Assets or in favor of the Holders of
any Series (or Class within such Series) of Certificates. However, as and
to the extent provided in the Series Supplement for a given Series, and
subject to the terms of paragraphs (b) and (c) of this Section 4.3, on or
prior to each Distribution Date, such Administrator shall advance or
cause to be advanced in immediately available funds to the Trustee for
deposit in the Certificate Account for such Series an advance (each, an
"Advance") in an amount equal, unless otherwise specified in the related
Series Supplement, to the aggregate of distributions of principal, premium
(if any) and interest due on the Deposited Assets for such Series (or
Class) during the related Collection Period, to the extent remaining unpaid
at the time of such Advance. In satisfaction of its obligation to make such
Advances, the Administrator shall make such Advances from either (i)
its own funds or (ii) funds with respect to the Deposited Assets for such
Series or Class on deposit in the Certificate Account for such Series, if
any, that do not constitute Available Funds with respect to such
Distribution Date; PROVIDED, however, that, to the extent the
Administrator shall have made Advances from funds on deposit in the
applicable Certificate Account, the Administrator shall immediately
deposit funds equal to the aggregate amount of such Advances into such
Certificate Account on any subsequent Distribution Date to the extent that
amounts on deposit in such Certificate Account on such Distribution Date
are less than the amount of distributions required to be made on such
Distribution Date pursuant to Section 4.1 and the related Series
Supplement. The Administrator may recover Advances from late
collections received by the Trustee on the applicable Deposited Assets, and
Liquidation Proceeds with respect to the Deposited Assets for such Series
or Class, as specified in the related Series Supplement, as to which any
such unreimbursed Advance was made.
(b) Notwithstanding any provision herein or in any Series
Supplement to the contrary, no Advance shall be required to be made
hereunder if the Administrator reasonably believes that it will be
unable to recover such Advance from related late collections, or
Liquidation Proceeds with respect to the applicable Deposited Assets. It is
further understood and agreed that the Administrator shall not be
obligated to make any Advances in respect of reductions in the amount of
collections on the Deposited Assets of any Series due to bankruptcy
proceedings with respect to such Deposited Assets or the obligors thereof.
(c) Notwithstanding any provision herein to the contrary, unless
otherwise provided in the Series Supplement for a given Series, any
Advances made in respect of any Deposited Assets related to such Series (or
Class within such Series) that are subsequently deemed by the
29
<PAGE>
Administrator to be nonrecoverable from related late collections, if
any, or Liquidation Proceeds may be reimbursed to the Administrator
through the application of amounts on deposit in the Certificate Account
for such Series allocable to any of such Deposited Assets prior to the
distributions of interest, premium (if any) and principal with respect to
the Certificates of such Series or Class.
Section 4.4. COMPLIANCE WITH WITHHOLDING REQUIREMENTS.
Notwithstanding any other provision of this Agreement to the contrary, the
Trustee shall comply with all Federal withholding requirements respecting
distributions to Certificateholders of interest or original issue discount
that the Trustee reasonably believes are applicable under the Code. The
consent of Certificateholders shall not be required for such withholding.
In the event the Trustee does withhold any amount from interest or original
issue discount distributions or Advances thereof to any Certificateholder
pursuant to Federal withholding requirements, the Trustee shall indicate in
the statement required pursuant to Section 4.2 the amount so withheld.
Trustee shall be entitled to rely on advice of any Administrator and
the Depositor with respect to withholding requirements.
Section 4.5. OPTIONAL EXCHANGE. (a) The terms and conditions,
if any, upon which Certificates of any Series (or Class within such Series)
may be exchanged for a pro rata portion of the Deposited Assets of the
related Trust will be specified in the related Series Supplement; PROVIDED
that any right of exchange shall be exercisable only to the extent that the
Depositor provides, upon the Trustee's written request, an Opinion of
Counsel that (i) such exchange would not be inconsistent with the
Depositor's and the Trust's continued satisfaction of the applicable
requirements for exemption under Rule 3a-7 (or other applicable rule or
exemption) under the Investment Company Act of 1940, as amended, and all
applicable rules, regulations and interpretations thereunder and (ii) such
exchange would not affect the characterization of the Trust as a "grantor
trust" for federal income tax purposes. Such terms may relate to, but are
not limited to, the following:
(1) a requirement that the exchanging Holder tender to the
Trustee Certificates of each Class within such Series;
(2) a minimum Certificate Principal Balance or Notional
Amount, as applicable, with respect to Certificates being tendered for
exchange by a single Holder;
(3) a requirement that the Certificate Principal Balance or
Notional Amount, as applicable, of each Certificate tendered for exchange
be an integral multiple of an amount specified in such Series Supplement;
(4) specified dates during which a Holder may effect such
an exchange (each, an "Optional Exchange Date");
30
<PAGE>
(5) limitations on the right of an exchanging Holder to
receive any benefit upon exchange from any Deposited Assets which are not
debt securities; and
(6) adjustments to the value of the proceeds of any
exchange based upon required prepayment of future expense allocations and
if provided for in the applicable Series Supplement the establishment of a
reserve for any anticipated Extraordinary Trust Expenses.
(b) Unless otherwise provided in the applicable Series
Supplement, no Certificate may be exchanged pursuant to the preceding
paragraph unless the Trustee has received at least 30 days but not more
than 45 days prior to an Optional Exchange Date in accordance with delivery
instructions specified in the applicable Series Supplement (i) such
Certificate with the form entitled "Option to Elect Exchange" on the
reverse thereof duly completed, or (ii) in the case of Registered
Certificates, a telegram, telex, facsimile transmission or letter from a
member of a national securities exchange or the National Association of
Securities Dealers, Inc., the Depositary (in accordance with its normal
procedures) or a commercial bank or trust company in the United States
setting forth the name of the Holder of such Registered Certificate, the
Certificate Principal Balance or Notional Amount of such Registered
Certificate to be exchanged and the Certificate number or a description of
the tenor and the terms of such Registered Certificate, a statement that
the option to elect exchange is being exercised thereby and an assurance
that the Registered Certificate to be exchanged with the form entitled
"Option to Elect Exchange" on the reverse of the Registered Certificate
duly completed will be received by such Trustee not later than five
Business Days after the date of such telegram, telex, facsimile
transmission or letter, and such Registered Certificate and form duly
completed must be received by such Trustee by such fifth Business Day. Any
tender of a Certificate by the Holder thereof for exchange shall be
irrevocable. Unless otherwise provided in the applicable Series Supplement,
the exchange option may be exercised pursuant to this Section by the Holder
of a Certificate for less than the Certificate Principal Balance or
Notional Amount of such Certificate as long as the Certificate Principal
Balance or Notional Amount remaining Outstanding after such exchange is an
authorized denomination and all other exchange requirements set forth in
the related Series Supplement are satisfied. Upon such partial exchange,
such Certificate shall be cancelled and a new Certificate or Certificates
for the remaining Certificate Principal Balance or Notional Amount thereof
shall be issued (which, in the case of any Registered Certificate, shall be
in the name of the Holder of such exchanged Certificate).
(c) Upon the completion of any such Optional Exchange, the
Trustee shall give, or cause to be given, prompt written notice thereof to
the Rating Agency.
31
<PAGE>
ARTICLE V.
THE CERTIFICATES
Section 5.1. THE CERTIFICATES. The Certificates of any Series
(or Class within such Series) may be issued in bearer form with or without
Coupons as Bearer Certificates or in fully registered form as Registered
Certificates and shall be substantially in the form of the exhibits with
respect thereto attached to the applicable Series Supplement. The aggregate
Certificate Principal Balance or Notional Amount of Certificates which may
be authenticated and delivered under this Agreement is unlimited.
The Certificates may be issued in one or more Series, each of
which Series may be issued in one or more Classes, with such further
particular designations added or incorporated in such title for the
Certificates of any particular Series or Class within such Series as the
Board of Directors may determine. Each Certificate and Coupon shall bear
upon its face the designation so selected for the Series and Class to which
it belongs. All Certificates and all Coupons of the same Series and Class
shall be identical in all respects except for the denominations thereof.
All Certificates of all Classes within any one Series at any time
Outstanding shall be identical except for differences among the
Certificates of the different Classes within such Series specified in the
applicable Series Supplement. Except as otherwise provided in a Series
Supplement, all Certificates of a particular Series (and all Classes within
such Series) issued under this Agreement shall be in all respects equally
and ratably entitled to the benefits hereof without preference, priority or
distinction on account of the actual time or times of authentication and
delivery, all in accordance with the terms and provisions of this
Agreement.
Each Series (and all Classes within such Series) of Certificates
shall be created by a Series Supplement authorized by the Board of
Directors and establishing the terms and provisions of such Series. The
several Series may differ as between Series and any Class may vary as
between the other Classes within any given Series in respect of any of the
following matters:
(1) designation of such Series and Class;
(2) the dates on which or periods during which the
Certificates of such Series and Class may be issued;
(3) the number of Classes, the maximum Certificate
Principal Balance or Notional Amount of Certificates of each Class that may
be issued and any priorities or subordination among Classes of a Series
with respect to distributions from the Trust;
(4) for each Class of Certificates, the Pass Through Rate
and, in the case of each Class of Floating Rate Certificates, the method
for calculating such Pass Through Rate;
32
<PAGE>
(5) the places, if any, in addition to or instead of the
Corporate Trust Office of the Trustee (in the case of Registered
Certificates) or the principal London office of the Trust (in the case of
Bearer Certificates), where the principal of (and premium, if any) and
interest on Certificates of such Series and Class shall be distributable;
(6) the authorized denominations (if other than $100,000
and integral multiples of $1,000 in excess thereof) with respect to such
Series or Class;
(7) the Collection Periods, the Distribution Dates and the
Scheduled Final Distribution Dates for such Series and Class;
(8) the types of Deposited Assets that will be included in
the Trust for such Series and the manner and priorities of allocating
distributions with respect to collections of principal (and premium, if
any) and interest payments allocable to such Deposited Assets among Holders
of Certificates of different Classes (including whether the Certificates of
any such Class are to be entitled to receive principal distributions with
disproportionate, nominal or no interest distributions, or interest
distributions with disproportionate, nominal or no principal distributions,
and, in each case, the applicable terms thereof);
(9) the amount, if any, to be deposited on the Closing Date
in the Certificate Account for such Series;
(10) the manner in which the Reserve Account, if any, is to
be funded, the amount, if any, to be deposited therein on the Closing Date
and the Requisite Reserve Amount, if any, for such Series or Class;
(11) the terms of any Guaranteed Investment Contract Granted
as part of the related Trust;
(12) the provisions, if any, for the optional exchange of
the Certificates of such Series by the Certificateholders of such Series
and the periods within which or the dates on which, and the terms and
conditions on which, such Certificates may be exchanged in whole or in part
for a pro rata portion of the Deposited Assets related to such Series;
(13) whether the Certificates of such Series or Class are to
be issued as Discount Certificates and the amount of discount with which
such Certificates may be issued;
(14) whether the Certificates of such Series or Class are to
be issued in whole or in part in the form of one or more Global Securities
and, in such case, the Depositary for such Global Security or Securities
33
<PAGE>
and the terms and conditions, if any, upon which interests in such Global
Security or Securities may be exchanged in whole or in part for the
individual Certificates represented thereby;
(15) whether Certificates of such Series or Class are to be
issued as Registered Certificates or Bearer Certificates or both, and, if
Bearer Certificates are issued, whether Coupons will be attached thereto,
whether Bearer Certificates of such Series or Class may be exchanged for
Registered Certificates of such Series or Class, the circumstances under
which and the places at which any such exchanges, if permitted, may be
made;
(16) if any Certificates of such Series or Class are to be
issued as Bearer Certificates or as one or more Global Securities
representing individual Bearer Certificates of such Series or Class, (x)
whether interest in respect of any portion of a temporary Bearer
Certificate of such Series or Class (delivered pursuant to Section 5.3)
distributable on any Distribution Date prior to the exchange of such
temporary Bearer Certificate for definitive Bearer Certificates of such
Series or Class shall be paid to any Depositary with respect to the portion
of such temporary Bearer Certificate held for its account and, in such
event, the terms and conditions (including any certification requirements)
upon which any such interest distribution received by a Depositary will be
credited to the Persons entitled to interest distributable on such
Distribution Date; (y) the terms upon which a temporary Bearer Certificate
may be exchanged for one or more definitive Bearer Certificates of such
Series or Class; and (z) such other terms related to such Bearer
Certificates and Coupons which may be provided in the related Series
Supplement;
(17) if other than Dollars, the Currency in which
Certificates of such Series or Class shall be denominated or in which
distributions of the principal of (and premium, if any) and interest on
such Certificates may be made and any other terms concerning such payment;
(18) if the principal of (and premium, if any) or interest
on Certificates of such Series or Class are to be distributable, at the
election of the Depositor or a Holder thereof, in a Currency other than
that in which such Certificates are denominated or distributable without
such election, the periods within which and the terms and conditions upon
which such election may be made and the time and the manner of determining
the exchange rate between the Currency in which such Certificates are
denominated or distributable without such election and the Currency in
which such Certificates are to be distributed if such election is made;
(19) any additional Administrator Termination Events
or representations, warranties or covenants provided for with respect to
Certificates of such Series;
34
<PAGE>
(20) provisions with respect to the terms for which the
definitions set forth in Article I permit or require further specification
in the related Series Supplement, including:
(a) "Accounting Date";
(b) "Administrator";
(c) "Administrative Fee";
(d) "Reserved
(e) "Allowable Expense Amount";
(f) "Basic Documents";
(g) "Closing Date";
(h) "Cut-off Date";
(i) "Depositary";
(j) "Deposited Asset Provider";
(k) "Deposited Asset Purchase Agreement";
(l) "Deposited Assets";
(m) "Deposited Assets Schedule";
(n) "Depository Agreement";
(o) "Discount Certificates";
(p) "Distribution Date";
(q) "Eligible Expense";
(r) "Extraordinary Trust Expense";
(s) "Fixed Pass Through Rate";
(t) "Floating Pass Through Rate";
(u) "Letter of Credit";
(v) "Limited Guaranty";
(w) "Notional Amount";
(bb) "Optional Exchange Date";
(cc) "Permitted Investments";
(dd) "Place of Distribution";
(ee) "Qualified Substitute Deposited
(ff) "Rating Agency";
(gg) "Rating Agency Condition";
(hh) "Record Date";
(ii) "Required Percentage";
(jj) "Required Rating";
(kk) "Requisite Reserve Amount";
(ll) "Scheduled Final Distribution Date";
(mm) "Specified Currency";
(nn) "Surety Bond";
(oo) "Trustee";
(pp) "Voting Rights";
(21) any restrictions on the sale and transfer of the
Certificates, including restrictions arising out of the Employee Retirement
Income Security Act of 1974, as amended, or the Code; and
(22) any other provisions expressing or referring to the terms
and conditions upon which the Certificates of such Series or Class are to
be issued under this Agreement that do not prevent such Certificates from
receiving the Required Rating.
35
<PAGE>
In the absence of any specification pursuant to this Section 5.1
with respect to Certificates of any Series, the Certificates of such Series
shall be issuable only as Registered Certificates in denominations of
$1,000 and in integral multiples thereof and shall be payable only in
Dollars.
A different Trustee and an Administrator may be appointed
by the Depositor for each Series of Certificates prior to the issuance of
such Series provided that the Rating Agency Condition is met. If the
Trustee for any Series is to be other than Delaware Trust Capital
Management, Inc., or there is to be an Administrator, then such
Series Supplement shall provide for the appointment of such Trustee or such
Administrator or both, as applicable, of such Series and shall add
or change any of the provisions of this Agreement as shall be necessary to
provide for or facilitate the administration of the trusts hereunder and of
the Deposited Assets; it being understood that nothing contained herein or
in such Series Supplement shall constitute the Trustees for different
Series as co-trustees for the same Series or the administrative agents for
different Series as co-administrative agents for the same Series. Upon
final appointment of any new Trustee or Administrator, the Trustee
shall provide, or cause to be provided, a notice of such appointment to the
Rating Agency not later than 15 days following such appointment.
Section 5.2. EXECUTION, AUTHENTICATION AND DELIVERY. (a) The
Certificates and the Coupons, if any, shall be executed by the Depositor by
its President, its Treasurer, or one of its Vice Presidents, under its
corporate seal, which may be in facsimile form and imprinted or otherwise
reproduced thereon and shall be attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers may be manual
or facsimile. Certificates and Coupons bearing the manual or facsimile
signature of individuals who were at any time the proper officers of the
Depositor shall be binding, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or Coupons or did not hold such offices at
the date of such Certificates and Coupons.
(b) Each Certificate shall be dated as of the later of the date
specified in the related Series Supplement and the date of its
authentication.
(c) No Certificate or Coupon appertaining thereto shall be
entitled to any benefit under this Agreement or be valid or obligatory for
any purpose, unless there appears on such Certificate a certificate of
authentication substantially in one of the forms provided for herein
executed by the Trustee by the manual signature of one of its authorized
signatories, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate (and any Coupons
36
<PAGE>
appertaining thereto) has been duly authenticated and delivered hereunder
and is entitled to the benefits of this Agreement. Except as permitted by
Section 5.4, 5.5 or 5.6, the Trustee shall not authenticate and deliver any
Bearer Certificate unless all appurtenant Coupons then matured have been
detached and cancelled.
Section 5.3. TEMPORARY CERTIFICATES. Pending the preparation
of Definitive Certificates of any Series (or Class within such Series), the
Depositor may execute, and upon receipt of a Depositor Order, the Trustee
shall authenticate and deliver temporary Certificates which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the Definitive
Certificates in lieu of which they are issued, in registered form or, if
authorized, in bearer form with one or more Coupons or without Coupons, and
with such appropriate insertions, omissions, substitutions and other
variations as may be authorized by such Depositor Order. Any such temporary
Certificate may be in global form, representing all or a portion of the
Outstanding Certificates of such Series or Class. Every such temporary
Certificate shall be executed by the Depositor and shall be authenticated
and delivered by the Trustee upon the same conditions and in substantially
the same manner, and with the same effect, as the Definitive Certificate or
Definitive Certificates in lieu of which it is issued.
If temporary Certificates of any Series (or Class within such
Series) are issued, the Depositor will cause Definitive Certificates of
such Series or Class to be prepared without unreasonable delay. Except as
otherwise specified in the applicable Series Supplement with respect to a
Series (or Class within such Series) of Certificates issuable as Bearer
Certificates or as one or more Global Securities representing individual
Bearer Certificates of such Series or Class, (a) after the preparation of
Definitive Certificates of such Series or Class, the temporary Certificates
of such Series or Class shall be exchangeable for Definitive Certificates
of such Series or Class upon surrender of the temporary Certificates of
such Series or Class at the office of the Trustee for such Series or Class,
without charge to the Holder, except as provided in Section 5.4 in
connection with a transfer and except that a Person receiving definitive
Bearer Certificates shall bear the cost of insurance, postage,
transportation and the like unless otherwise specified in the applicable
Series Supplement, and (b) upon surrender for cancellation of any one or
more temporary Certificates of any Series or Class within such Series
(accompanied by any unmatured Coupons appertaining thereto), the Depositor
37
<PAGE>
shall execute and the Trustee shall authenticate and deliver in exchange
therefor Definitive Certificates with a like Certificate Principal Balance
or Notional Amount, as applicable, of the same Series (or Class within such
Series) of authorized denominations and of like tenor; PROVIDED, however,
that no definitive Bearer Certificate shall be delivered in exchange for a
temporary Registered Certificate; and provided further that delivery of a
Global Security representing individual Bearer Certificates or a Bearer
Certificate shall occur only outside the United States. Until so exchanged,
temporary Certificates of any Series (or Class within such Series) shall in
all respects be entitled to the same benefits under this Agreement as
Definitive Certificates of such Series or Class, except as otherwise
specified in the applicable Series Supplement with respect to the payment
of interest on Global Securities in temporary form.
Unless otherwise specified pursuant to Section 5.1, the Depositor
will execute and deliver individual Bearer Certificates in exchange for
beneficial interests in the definitive Global Security and each Bearer
Certificate to an authorized agent of the Trust at such other place outside
the United States specified pursuant to Section 5.1.
Upon any exchange of a portion of a temporary Global Security for
a definitive Global Security or for the individual Definitive Certificates
represented thereby pursuant to this Section 5.3 or Section 5.4, the
temporary Global Security shall be endorsed by the Trustee to reflect the
reduction of the aggregate Certificate Principal Balance or Notional
Amount, as applicable, evidenced thereby, whereupon the aggregate
Certificate Principal Balance or Notional Amount, as applicable, of such
temporary Global Security shall be reduced for all purposes by the amount
so exchanged and endorsed.
Section 5.4. REGISTRATION; REGISTRATION OF TRANSFER AND
EXCHANGE. The Trustee shall cause to be kept a register for each Series of
Registered Certificates (the registers maintained in such office and in any
other office or agency of the Trustee being herein sometimes collectively
referred to as the "Certificate Register") in which a transfer agent and
registrar (which may be the Trustee) (the "Certificate Registrar") shall
provide for the registration of Registered Certificates and the
registration of transfers and exchanges of Registered Certificates. The
Trustee is hereby initially appointed Certificate Registrar for the purpose
of registering Registered Certificates and transfers and exchanges of
Registered Certificates as herein provided; PROVIDED, however, that the
Trustee may appoint one or more co-Certificate Registrars. Upon any
resignation of any Certificate Registrar, the Depositor shall promptly
appoint a successor or, in the absence of such appointment, assume the
duties of Certificate Registrar.
If a Person other than the Trustee is appointed by the Depositor
as Certificate Registrar, the Depositor will give the Trustee prompt
written notice of the appointment of a Certificate Registrar and of the
location, and any change in the location, of the Certificate Register, and
the Trustee shall have the right to rely upon a certificate executed on
behalf of the Certificate Registrar by an Executive Officer thereof as to
the names and addresses of the Holders of the Registered Certificates and
the principal amounts and numbers of such Registered Certificates.
Upon surrender for registration of transfer of any Registered
Certificate of any Series (or Class within such Series) at the office or
agency of the Trustee, if the requirements of Section 8-401(1) of the
38
<PAGE>
Uniform Commercial Code are met to the Depositor's satisfaction, the
Depositor shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Registered Certificates of any authorized denominations, of a like Series,
Class and aggregate Certificate Principal Balance or Notional Amount, as
applicable. Except as otherwise specified pursuant to Section 5.1, in no
event may Registered Certificates, including Registered Certificates
received in exchange for Bearer Certificates, be exchanged for Bearer
Certificates.
Notwithstanding any other provision of this Section, unless and
until it is exchanged in whole or in part for the individual Certificates
represented thereby, a Global Security representing all or a portion of the
Certificates of a Series (or Class within such Series) may not be
transferred except as a whole by the Depositary for such Series or Class to
a nominee of such Depositary or by a nominee of such Depositary to such
Depositary or another nominee of such Depositary or by such Depositary or
any such nominee to a successor Depositary for such Series or Class or a
nominee of such successor Depositary.
At the option of the Holder, Registered Certificates of any
Series (or Class within such Series) (other than a Global Security, except
as set forth below) may be exchanged for other Registered Certificates of
the same Series or Class of any authorized denomination or denominations of
like tenor and aggregate Certificate Principal Balance or Notional Amount,
as applicable, upon surrender of the Registered Certificates to be
exchanged at the office or agency of the Trustee maintained for such
purpose.
At the option of the Holder, except as otherwise specified as
contemplated by Section 5.1 with respect to a Global Security representing
Bearer Certificates, Bearer Certificates of any Series (or Class within
such Series) may be exchanged for Registered Certificates (if the
Certificates of such Series or Class are issuable as Registered
Certificates) or Bearer Certificates of the same Series or Class, of any
authorized denomination or denominations, of like tenor and aggregate
Certificate Principal Balance or Notional Amount, as applicable, upon
surrender of the Bearer Certificates to be exchanged at the office or
agency of the Trustee maintained for such purpose, with all unmatured
Coupons and all matured Coupons in default thereto appertaining; PROVIDED,
however, that delivery of a Bearer Certificate shall occur only outside the
United States. If the Holder of a Bearer Certificate is unable to produce
any such unmatured Coupon or Coupons or matured Coupon or Coupons in
39
<PAGE>
default, such exchange may be effected if the Bearer Certificates are
accompanied by payment in funds acceptable to the Depositor and the Trustee
in an amount equal to the face amount of such missing Coupon or Coupons, or
the surrender of such missing Coupon or Coupons may be waived by the
Depositor and the Trustee if there be furnished to each of them such
security or indemnity as they may require to save each of them and any
Paying Agent harmless. If thereafter the Holder of such Bearer Certificate
shall surrender for payment any such missing Coupon in respect of which
such a payment shall have been made, such Holder shall be entitled to
receive the amount of such payment; PROVIDED, however, that, except as
otherwise provided in Section 5.6, interest represented by Coupons shall be
payable only upon presentation and surrender of those Coupons at an office
or agency located outside the United States.
Whenever any Certificates are so surrendered for exchange, the
Depositor shall execute and the Trustee shall authenticate and deliver the
Certificates that the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, the exchange of Bearer
Certificates for Registered Certificates will be subject to the provisions
of United States income tax laws and regulations applicable to Certificates
in effect at the time of such exchange.
If at any time the Depositary for the Certificates of a Series
(or Class within such Series) notifies the Depositor that it is unwilling
or unable to continue as Depositary for the Certificates of such Series or
Class or if at any time the Depositary for the Certificates of such Series
or Class shall no longer be eligible under Section 5.9(b), the Depositor
shall appoint a successor Depositary with respect to the Certificates of
such Series or Class. If a successor Depositary for the Certificates of
such Series or Class is not appointed by the Depositor within 90 days after
the Depositor receives such notice or becomes aware of such ineligibility,
the Depositor's election pursuant to Section 5.1 shall no longer be
effective with respect to the Certificates of such Series or Class and the
Depositor will execute, and the Trustee, upon receipt of a Depositor Order
for the authentication and delivery of individual Certificates of such
Series or Class, will authenticate and deliver individual Certificates of
such Series or Class in an aggregate Certificate Principal Balance or
Notional Amount, as applicable, equal to the aggregate Certificate
Principal Balance or Notional Amount, as applicable, of the Global Security
or Securities representing Certificates of such Series or Class in exchange
for such Global Security or Securities.
The Depositor may at any time and in its sole discretion
determine that individual Certificates of any Series (or Class within such
Series) issued in the form of one or more Global Securities shall no longer
be represented by such Global Security or Securities. In such event the
Depositor shall execute, and the Trustee, upon receipt of a Depositor Order
for the authentication and delivery of individual Certificates of such
40
<PAGE>
Series or Class, shall authenticate and deliver, individual Certificates of
such Series or Class in an aggregate Certificate Principal Balance or
Notional Amount, as applicable, equal to the aggregate Certificate
Principal Balance or Notional Amount, as applicable, of the Global Security
or Securities representing Certificates of such Series or Class in exchange
for such Global Security or Securities.
If specified by the Depositor pursuant to Section 5.1 with
respect to a Series (or Class within such Series) of Certificates, the
Depositary for such Series may surrender a Global Security for such Series
or Class in exchange in whole or in part for individual Certificates of
such Series or Class on such terms as are acceptable to the Depositor and
such Depositary. Thereupon, the Depositor shall execute, and the Trustee,
upon receipt of a Depositor Order, shall authenticate and deliver, without
service charge,
(i) to each Person specified by such Depositary a new
individual Certificate or Certificates of the same Series or Class, of any
authorized denomination as requested by such Person in an aggregate
Certificate Principal Balance or Notional Amount, as applicable, equal to
and in exchange for such Person's beneficial interest in the Global
Security; and
(ii) to such Depositary a new Global Security in a
denomination equal to the difference, if any, between the aggregate
Certificate Principal Balance or Notional Amount, as applicable, of the
surrendered Global Security and the aggregate Certificate Principal Balance
or Notional Amount, as applicable, of individual Certificates delivered to
Holders thereof.
In any exchange provided for in any of the preceding three
paragraphs, the Depositor shall execute, and the Trustee, upon receipt of a
Depositor Order, will authenticate and deliver individual Certificates (a)
in registered form in authorized denominations, if the Certificates of such
Series or Class are issuable as Registered Certificates, (b) in bearer form
in authorized denominations, with or without Coupons attached, if the
Certificates of such Series or Class are issuable as Bearer Certificates or
(c) as either Registered or Bearer Certificates, if the Certificates of
such Series or Class are issuable in either form; PROVIDED, however, that
individual Bearer Certificates shall be delivered in exchange for a Global
Security only in accordance with the procedures specified pursuant to
Section 5.1.
Upon the exchange of a Global Security for individual
Certificates, such Global Security shall be cancelled by the Trustee.
Individual Registered Certificates issued in exchange for a Global Security
pursuant to this Section 5.4 shall be registered in such names and in such
authorized denominations as the Depositary for such Global Security,
pursuant to instructions from its Participants, any indirect participants
or otherwise, shall instruct the Trustee. The Trustee shall deliver such
Registered Certificates to the Persons in whose names such Registered
Certificates are so registered. The Trustee shall deliver individual Bearer
41
<PAGE>
Certificates issued in exchange for a Global Security pursuant to this
Section 5.4 to the Persons and in such authorized denominations as the
Depositary for such Global Security, pursuant to instructions from its
Participants, any indirect participants or otherwise, shall instruct the
Trustee; provided, however, that individual Bearer Certificates shall be
delivered in exchange for a Global Security only in accordance with the
procedures as may be specified pursuant to Section 5.1.
Notwithstanding the foregoing, the exchange of Bearer
Certificates for Registered Certificates will be subject to the provisions
of United States income tax laws and regulations applicable to Certificates
in effect at the time of such exchange.
All Certificates issued upon any registration of transfer or
exchange of Certificates shall constitute complete and indefeasible
evidence of ownership in the Trust related to such Certificates and be
entitled to the same benefits under this Agreement as the Certificates
surrendered upon such registration of transfer or exchange.
Every Registered Certificate presented or surrendered for
registration of transfer or exchange shall (if so required by the
Depositor, the Trustee or the Certificate Registrar) be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to
the Depositor, the Trustee and the Certificate Registrar, duly executed, by
the Holder thereof or his attorney duly authorized in writing, with such
signature guaranteed by a brokerage firm or financial institution that is a
member of a Securities Approved Medallion Program such as Securities
Transfer Agents Medallion Program (STAMP), Stock Exchange Medallion Program
(SEMP) or New York Stock Exchange Inc. Medallion Signature Program (MSP).
No service charge shall be made to a Holder for any registration
of transfer or exchange of Certificates, but the Depositor may require
payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any registration of transfer or
exchange of Certificates, other than exchanges pursuant to Section 5.3 not
involving any transfer.
Section 5.5. MUTILATED, DESTROYED, LOST AND STOLEN
CERTIFICATES. If (i) any mutilated Certificate or any mutilated Coupon
with the Coupon Certificate to which it appertains (and all unmatured
Coupons attached thereto) is surrendered to the Trustee at its Corporate
Trust Office (in the case of Registered Certificates) or at such other
office designated by the Trustee (in the case of Bearer Certificates) or
(ii) the Depositor and the Trustee receive evidence to their satisfaction
of the destruction, loss or theft of any Certificate or any Coupon, and
there is delivered to the Depositor and the Trustee such security or
indemnity as they may require to hold each of them and any Paying Agent
harmless, and neither the Depositor nor the Trustee receives notice that
such Certificate or Coupon has been acquired by a bona fide purchaser, then
the Depositor shall execute and the Trustee, upon receipt of a Depositor
Order, shall authenticate and deliver, in exchange for or in lieu of any
such mutilated, destroyed, lost or stolen Certificate or in exchange for
the Coupon Certificate to which such mutilated, destroyed, lost or stolen
42
<PAGE>
Coupon appertained, a new Certificate of the same Series and Class of like
tenor, form, terms and principal amount, bearing a number not
contemporaneously Outstanding, and, in the case of a Coupon Certificate,
with such Coupons attached thereto so that neither gain nor loss in
interest shall result from such exchange or substitution.
Upon the issuance of any new Certificate under this Section, the
Depositor may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in respect thereto and any
other expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Certificate of any Series or Class, with its Coupons,
if any, issued pursuant to this Section shall constitute complete and
indefeasible evidence of ownership in the Trust related to such Series,
whether or not the destroyed, lost or stolen Certificate or Coupon shall be
at any time enforceable by anyone, and shall be entitled to all the
benefits of this Agreement equally and proportionately with any and all
other Certificates of that Series or Class and their Coupons, if any, duly
issued hereunder.
The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Certificates
or Coupons.
Section 5.6. DISTRIBUTION OF INTEREST; INTEREST RIGHTS
PRESERVED. (a) Interest on any Registered Certificate that is payable and
is punctually paid or duly provided for on any Distribution Date shall be
distributed to the Person in whose name such Registered Certificate (or one
or more Predecessor Certificates) is registered at the close of business on
the related Record Date notwithstanding the cancellation of such Registered
Certificate upon any transfer or exchange subsequent to such related Record
Date. In case a Coupon Certificate of any Series (or Class within such
Series) is surrendered in exchange for a Registered Certificate of such
Series or Class after the close of business (at an office or agency in a
Place of Distribution for such Series or Class) on any Record Date and
before the opening of business (at such office or agency) on the next
succeeding Distribution Date, such Coupon Certificate shall be surrendered
without the Coupon relating to such Distribution Date and interest will not
be payable on such Distribution Date in respect of the Registered
Certificate issued in exchange for such Coupon Certificate, but will be
distributable only to the Holder of such Coupon when due in accordance with
the provisions of this Agreement. The distribution of interest on
Registered Certificates shall be made at the Corporate Trust Office (except
43
<PAGE>
as otherwise specified pursuant to Section 5.1) or, at the option of the
Trustee, by check mailed to the address of the Person entitled thereto as
such address shall appear in the Certificate Register or, if provided
pursuant to Section 5.1 and in accordance with arrangements satisfactory to
the Trustee, at the option of the Registered Holder by wire transfer to an
account designated by the Registered Holder.
(b) Interest on any Coupon Certificate that is distributable and
is punctually distributed or duly provided for on any Distribution Date
shall be distributed to the Holder of the Coupon that has matured on such
Distribution Date upon surrender of such Coupon on such Distribution Date
at the principal London office of the Trustee or at such other Place of
Distribution outside the United States specified pursuant to Section 5.1.
Interest on any Bearer Certificate (other than a Coupon
Certificate) that is distributable and is punctually distributed or duly
provided for on any Distribution Date shall be distributed to the Holder of
the Bearer Certificate upon presentation of such Bearer Certificate and
notation thereon on such Distribution Date at the principal London office
of the Trustee or at such other Place of Distribution outside the United
States specified pursuant to Section 5.1.
Unless otherwise specified pursuant to Section 5.1, at the
direction of the Holder of any Bearer Certificate or Coupon payable in
Dollars, or if there is no such office outside the United States, and
subject to applicable laws and regulations, distributions in respect of
such Bearer Certificate or Coupon will be made by check drawn on a bank in
The City of New York or, in accordance with arrangements satisfactory to
the Trustee, by wire transfer to a Dollar account maintained by such Holder
with a bank outside the United States. If such distribution at the offices
of the Trustee or all Paying Agents, if any, outside the United States
becomes illegal or is effectively precluded because of the imposition of
exchange controls or similar restrictions on the full distribution or
receipt of such amounts in Dollars, the Depositor will appoint an office or
agent in the United States at which such distribution may be made. Unless
otherwise specified pursuant to Section 5.1, at the direction of the Holder
of any Bearer Certificate or Coupon payable in a Foreign Currency,
distributions on such Bearer Certificate or Coupon will be made by a check
drawn on a bank outside the United States or, in accordance with
arrangements satisfactory to the Trustee, by wire transfer to an
appropriate account maintained by such Holder outside the United States.
Except as provided in this paragraph, no distribution on any Bearer
Certificate or Coupon will be made by mail to an address in the United
States or by transfer to an account maintained by the Holder thereof in the
United States.
(c) Subject to the foregoing provisions of this Section 5.6,
each Certificate delivered under this Agreement upon transfer of or in
exchange for or in lieu of any other Certificate shall carry the rights to
interest accrued and undistributed, and to accrue, that were carried by
such other Certificate.
44
<PAGE>
(d) All computations of interest due with respect to any
Certificate of any Series or Class within such Series shall be made as
specified in the Series Supplement applicable to that particular Series or
Class of Certificates.
(e) With respect to any computations or calculations to be made
under this Agreement, the applicable Series Supplement and the
Certificates, except as otherwise provided, (i) all percentages resulting
from any calculation of accrued interest will be rounded, if necessary, to
the nearest 1/100,000 of 1% (.0000001), with five one-millionths of a
percentage point rounded upward, and (ii) all currency amounts will be
rounded to the nearest one-hundredth of a unit (with .005 of a unit being
rounded upward).
(f) Notwithstanding any other provisions in this Agreement, the
right of the Holder of any Certificate to receive any of the payments
described above in this Section 5.6, and to institute suit for the
enforcement of any such payment on or after the date such payment is
payable, shall not be impaired without the consent of such Holder.
Section 5.7. PERSONS DEEMED OWNERS. The Depositor, the Trustee
and the Administrator, if any, and any agent of the Depositor, the
Trustee or the Administrator, if any, may treat the Person in whose
name any Registered Certificate is registered as the owner of such
Registered Certificate for the purpose of receiving distributions of
principal of (and premium, if any) and (subject to Section 5.6) interest,
if any, on such Registered Certificate and for all other purposes
whatsoever, whether or not such Registered Certificate be overdue, and
neither the Depositor, the Trustee, the Administrator, if any, nor
any agent of the Depositor, the Trustee nor the Administrator, if
any, shall be affected by notice to the contrary. The Depositor, the
Trustee and the Administrator, if any, and any agent of the
Depositor, the Trustee or the Administrator, if any, may treat the
Holder of any Bearer Certificate or of any Coupon as the absolute owner of
such Bearer Certificate or Coupon for the purposes of receiving
distributions thereof or on account thereof and for all other purposes
whatsoever, whether or not such Bearer Certificate or Coupon be overdue,
and neither the Depositor, the Trustee, the Administrator, if any,
nor any agent of the Depositor, the Trustee or the Administrator, if
any, shall be affected by notice to the contrary. All distributions made to
any Holder, or upon his order, shall be valid, and, to the extent of the
sum or sums paid, effectual to satisfy and discharge the liability for
moneys distributable upon such Certificate or Coupon.
None of the Depositor, the Trustee, the Administrator, if
any, or any of their agents will have any responsibility or liability for
any aspect of the records relating to or distributions made on account of
beneficial ownership interests in a Global Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
45
<PAGE>
In connection with any notice or other communication to be
provided to Holders pursuant to this Agreement by the Trustee with respect
to any consent or other action to be taken by Holders, the Trustee shall
establish a record date for such consent or other action and in the case of
Global Certificates, give the Depositary notice of such record date not
less than 15 calendar days in advance of such record date to the extent
possible. Such record date shall be the later of thirty (30) days prior to
the first solicitation of such consent or other action or the date of the
most recent list of Holders furnished to the Trustee pursuant to Section
3.19 hereof.
Section 5.8. CANCELLATION. Unless otherwise specified pursuant
to Section 5.1 for Certificates of any Series, all Certificates surrendered
for payment, redemption, transfer or exchange and all Coupons surrendered
for payment or exchange shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee and shall be promptly cancelled by it.
No Certificates or Coupons shall be authenticated in lieu of or in exchange
for any Certificates or Coupons cancelled as provided in this Section,
except as expressly permitted by this Agreement.
Section 5.9. GLOBAL SECURITIES. (a) If the Series Supplement
pursuant to Section 5.1 provides that a Series (or Class within such
Series) of Certificates shall be represented by one or more Global
Securities, then the Depositor shall execute and the Trustee shall
authenticate and deliver one or more Global Securities that (i) shall
represent an aggregate initial Certificate Principal Balance or Notional
Amount, as applicable, equal to the aggregate initial Certificate Principal
Balance or Notional Amount, as applicable, of the Certificates of such
Series or Class to be represented by such one or more Global Securities,
(ii) shall be registered, if in registered form, in the name of the
Depositary for such Global Security or Securities or the nominee of such
Depositary, (iii) shall be delivered by the Trustee to such Depositary or
pursuant to such Depositary's instruction and (iv) shall bear a legend
substantially to the following effect: "Unless and until it is exchanged in
whole or in part for the individual Certificates represented hereby, this
Global Security may not be transferred except as a whole by the Depositary
to a nominee of the Depositary or by a nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary."
No Holder of a Certificate of such Series or Class will receive a
Definitive Certificate representing such Holder's interest in such
Certificate or Certificates, except as provided in Section 5.11. Unless and
until definitive, fully registered Certificates (the "Definitive
Certificates") have been issued to Holders of such Series or Class pursuant
to Section 5.11:
(i) the provisions of this Section 5.9 shall be in full
force and effect;
46
<PAGE>
(ii) the Certificate Registrar and the Trustee shall be
entitled to deal with the Depositary for all purposes of this Agreement
(including the distribution of principal of, and premium, if any, and
interest on the Certificates and the giving of instructions or directions
hereunder) as the sole Holder of the Certificates of such Series or Class,
and shall have no obligation to the owners of beneficial interests in such
Series or Class (collectively, the "Certificate Owners");
(iii) to the extent that the provisions of this Section 5.9
conflict with any other provisions of this Agreement, the provisions of
this Section 5.9 shall control;
(iv) the rights of Certificate Owners of such Series or
Class shall be exercised only through the Depositary and shall be limited
to those established by law and agreements between such Certificate Owners
and the Depositary or its Participants; and
(v) whenever this Agreement requires or permits actions to
be taken based upon instructions or directions of Holders of Certificates
of such Series or Class evidencing a specified percentage of the aggregate
Voting Rights of such Series or Class, the Depositary shall be deemed to
represent such percentage only to the extent that it has received
instructions to such effect from Certificate Owners of such Series or Class
or Participants in such Depositary's system owning or representing,
respectively, such required percentage of the beneficial interest in the
Certificates of such Series or Class and has delivered such instructions to
the Trustee.
(b) Each Depositary designated pursuant to Section 5.1 for a
Global Security in registered form must, at the time of its designation and
at all times while it serves as such Depositary, be a clearing agency
registered under the Exchange Act and any other applicable statute or
regulation.
Section 5.10. NOTICES TO DEPOSITARY. Whenever a notice or other
communication to the Holders of a Series or Class within such Series
represented by one or more Global Securities is required under this
Agreement, unless and until Definitive Certificates for such Series or
Class shall have been issued to such Certificate Owners pursuant to Section
5.11, the Trustee shall give all such notices and communications specified
herein to be given to Holders of the Certificates of such Series to the
Depositary, and shall have no obligation to the Certificate Owners.
Section 5.11. DEFINITIVE CERTIFICATES. If in respect of a
Series (or Class within such Series) represented by one or more Global
Securities (i) the Depositor advises the Trustee in writing that the
Depositary is no longer willing or able to properly discharge its
responsibilities with respect to the Certificates of such Series or Class
and the Depositor is unable to locate a qualified successor, (ii) the
47
<PAGE>
Depositor at its option advises the Trustee in writing that it elects to
terminate the book-entry system for such Series or Class through the
Depositary or (iii) after the occurrence of an Administrator
Termination Event, Certificate Owners representing beneficial interests
aggregating at least a majority (or such other Required Percentage--
Definitive Certificates that may be specified in a Series Supplement) of
the Voting Rights of the Certificates of such Series or Class advise the
Depositary in writing that the continuation of a book-entry system for such
Series or Class through the Depositary is no longer in the best interests
of the Certificate Owners of such Series or Class, then the Depositary
shall notify all Certificate Owners or Participants in the Depositary's
system with respect to such Series or Class and the Trustee of the
occurrence of any such event and of the availability of Definitive
Certificates for such Series or Class to Certificate Owners of such Series
or Class requesting the same. Upon surrender to the Trustee of the Global
Securities of such Series or Class by the Depositary, accompanied by
registration instructions, the Depositor shall execute and the Trustee
shall authenticate the Definitive Certificates of such Series or Class in
accordance with the instructions of the Depositary. None of the Depositor,
the Certificate Registrar or the Trustee shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Certificates of such Series or Class, the Trustee shall recognize the
holders of the Definitive Certificates of such Series or Class as Holders.
Section 5.12. CURRENCY OF DISTRIBUTIONS IN RESPECT OF
CERTIFICATES. (a) Except as otherwise specified pursuant to Section 5.1
for Bearer Certificates of any Series (or Class within such Series),
distributions of the principal of (and premium, if any) and interest on
Bearer Certificates of such Series or Class denominated in any Currency
will be made in such Currency.
(b) Except as otherwise specified pursuant to Section 5.1 for
Registered Certificates of any Series (or Class within such Series),
distributions of the principal of (and premium, if any) and interest on
Registered Certificates of such Series or Class will be made in Dollars.
(c) For purposes of any provision of the Agreement where the
Holders of Outstanding Certificates may perform an act that requires that a
specified percentage of the aggregate Voting Rights of the Certificates of
all Series perform such act and for purposes of any decision or
determination by the Trustee of amounts due and not distributed for the
principal of (and premium, if any) and interest on the Certificates of all
Series in respect of which moneys are to be disbursed ratably, the
principal of (and premium, if any) or notional amount of, as applicable,
and interest on the Outstanding Certificates denominated in a Foreign
Currency will be the amount in Dollars based upon exchange rates,
determined as specified pursuant to Section 5.1 for Certificates of such
Series, as of the date for determining whether the Holders entitled to
perform such act have performed it or as of the date of such decision or
determination by the Trustee, as the case may be.
48
<PAGE>
(d) With respect to Certificates of any Series (or Class within
such Series), any decision or determination to be made regarding exchange
rates shall be made by an Exchange Rate Agent appointed by the Depositor;
PROVIDED that such Exchange Rate Agent shall accept such appointment in
writing and the terms of such appointment shall be acceptable to the
Trustee and shall, in the opinion of the Depositor at the time of such
appointment, require such Exchange Rate Agent to make such determination by
a method consistent with the method provided in the applicable Series
Supplement for the making of such decision or determination. All decisions
and determinations of such Exchange Rate Agent regarding exchange rates
shall be in its sole discretion and, in the absence of manifest error,
shall be conclusive for all purposes and irrevocably binding upon the
Depositor, the Trustee and all Holders of the Certificates of such Series
or Class.
(e) If distributions in respect of a Certificate are required to
be made in a Specified Currency other than Dollars and such currency is
unavailable due to the imposition of exchange controls or other
circumstance beyond the control of the Trustee, the Administrator,
if any, and the Depositor or is no longer used by the government of the
country issuing such Specified Currency or is no longer commonly used for
the settlement of transactions by public institutions of or within the
international banking community, then all distributions in respect of such
Certificate shall be made in Dollars until such Specified Currency is again
so used in the manner specified in the related Series Supplement.
Section 5.13. CONDITIONS OF AUTHENTICATION AND DELIVERY OF NEW
SERIES. Certificates of a new Series may be issued at any time and from
time to time after the execution and delivery of this Agreement and the
related Series Supplement. The Depositor shall execute and deliver
Certificates of such Series to the Trustee, with appropriate Coupons, if
any, appertaining thereto, and the Trustee shall authenticate and deliver
such Certificates upon a Depositor Order and upon delivery by the Depositor
to the Trustee of the following:
(1) BOARD RESOLUTION. A Board Resolution (or action by a
Person authorized by Board Resolution) authorizing the execution,
authentication and delivery of the Certificates and specifying the Series,
the Classes within such Series and their respective Final Scheduled
Distribution Dates, priorities as to distributions of principal, premium
(if any) and interest, aggregate initial Certificate Principal Balances and
Notional Amounts, if any, and Pass Through Rates of, if any, each Class of
such Series of Certificates to be authenticated and delivered and the
method of calculation thereof.
(2) SERIES SUPPLEMENT. A Series Supplement consistent with
the applicable provisions of this Agreement, accompanied by a Board
Resolution (or action by a Person authorized by Board Resolution)
49
<PAGE>
authorizing such Series Supplement (and, in the case of the first Series to
be authenticated and delivered hereunder, authorizing this Agreement).
(3) CERTIFICATES OF THE DEPOSITOR.
(a) An Officer's Certificate of the Depositor, dated
as of the Closing Date for such Series, to the
effect that the Depositor is not in breach of this
Agreement and that the issuance of the
Certificates applied for will not result in any
breach of any of the terms, conditions, or
provisions of, or constitute a default under, the
Depositor's Certificate of Incorporation or
bylaws, or any indenture, mortgage, deed of
transfer or other agreement or instrument to which
the Depositor is a party or by which it or its
property is bound or any order of any court or
administrative agency entered in any Proceeding to
which the Depositor is a party or by which it or
its property may be bound or to which it or its
property may be subject.
(b) An Officer's Certificate of the Depositor, dated
as of the Closing Date, to the effect that
attached thereto are true and correct copies of
letters signed by the Rating Agency (or other
evidence satisfactory to the Trustee) and
confirming that the related Certificates have
received the Required Rating.
(4) REQUIREMENTS OF SERIES SUPPLEMENT. Such other funds,
accounts, documents, certificates, agreements, instruments or opinions as
may be required by the terms of the Series Supplement creating such Series.
If all of the Certificates of a Series are not to be originally
issued at the same time, then the documents required to be delivered
pursuant to this Section 5.13 must be delivered only once, prior to the
authentication and delivery of the first Certificate of such Series;
PROVIDED, however, that any subsequent Depositor Order to the Trustee to
authenticate Certificates of such Series upon original issuance shall
constitute a representation and warranty by the Depositor that, as of the
date of such request, the statements made in the Officer's Certificates
delivered pursuant to this Section 5.13 shall be true and correct as if
made on such date.
Section 5.14. APPOINTMENT OF PAYING AGENT. The Trustee may
appoint one or more paying agents (each, a "Paying Agent") with respect to
50
<PAGE>
the Certificates of any Series. Any such Paying Agent shall be authorized
to make distributions to Certificateholders of such Series from the
Certificate Account for such Series pursuant to the provisions of the
applicable Series Supplement and shall report the amounts of such
distributions to the Trustee. Any Paying Agent shall have the revocable
power to withdraw funds from such Certificate Account for the purpose of
making the distributions referred to above. The Trustee may revoke such
power and remove the Paying Agent if the Trustee determines in its sole
discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect. The Paying Agent
shall initially be the Trustee and any co-paying agent chosen by the
Depositor and acceptable to the Trustee, including, if and so long as any
Series or Class within such Series is listed on the Luxembourg Stock
Exchange and such exchange so requires, a co-paying agent in Luxembourg or
another European city. Any Paying Agent shall be permitted to resign as
Paying Agent upon 30 days' notice to the Trustee. In the event that the
Trustee shall no longer be the Paying Agent, the Trustee shall appoint a
successor or additional Paying Agent. The Trustee shall cause each
successor to act as Paying Agent to execute and deliver to the Trustee an
instrument in which such successor or additional Paying Agent shall agree
with the Trustee that (i) it will hold all sums, if any, held by it for
distribution to the Certificateholders in trust for the benefit of the
Certificateholders entitled thereto until such sums shall be distributed to
such Certificateholders and (ii) it will give the Trustee notice of any
default by any obligor on the applicable Series of Certificates or on the
Deposited Assets. The Paying Agent shall return all unclaimed funds to the
Trustee and upon removal shall also return all funds in its possession to
the Trustee. The provisions of Sections 8.1, 8.2, 8.3 and 8.5 shall apply
to the Trustee also in its role as Paying Agent, for so long as the Trustee
shall act as Paying Agent. Any reference in this Agreement to the Paying
Agent shall include any co-paying agent unless the context requires
otherwise. Notwithstanding anything contained herein to the contrary, the
appointment of a Paying Agent pursuant to this Section 5.14 shall not
release the Trustee from the duties, obligations, responsibilities or
liabilities arising under this Agreement other than with respect to funds
paid to such Paying Agent.
Section 5.15. AUTHENTICATING AGENT. (a) The Trustee may appoint
one or more Authenticating Agents (each, an "Authenticating Agent") with
respect to the Certificates of any Series which shall be authorized to act
on behalf of the Trustee in authenticating such Certificates in connection
with the issuance, delivery and registration of transfer or exchange of
such Certificates. Whenever reference is made in this Agreement to the
authentication of Certificates by the Trustee or the Trustee's certificate
of authentication, such reference shall be deemed to include authentication
on behalf of the Trustee by an Authenticating Agent and a certificate of
51
<PAGE>
authentication executed on behalf of the Trustee by an Authenticating
Agent. Each Authenticating Agent must be acceptable to the Depositor and
the Administrator, if any. Notwithstanding anything contained herein
to the contrary, the appointment of an Authenticating Agent pursuant to
this Section 5.15 shall not release the Trustee from the duties,
obligations, responsibilities or liabilities arising under this Agreement.
(b) Any institution succeeding to the corporate agency business
of any Authenticating Agent shall continue to be an Authenticating Agent
without the execution or filing of any power or any further act on the part
of the Trustee or such Authenticating Agent. An Authenticating Agent may at
any time resign by giving notice of resignation to the Trustee and to the
Depositor. The Trustee may at any time terminate the agency of an
Authenticating Agent by giving notice of termination to such Authenticating
Agent and to the Depositor. Upon receiving such a notice of resignation or
upon such a termination, or in case at any time an Authenticating Agent
shall cease to be acceptable to the Trustee or the Depositor, the Trustee
promptly may appoint a successor Authenticating Agent. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall
become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating
Agent. No successor Authenticating Agent shall be appointed unless
acceptable to the Administrator, if any, and the Depositor. The
Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section. The provisions
of Sections 8.1, 8.2 and 8.3 shall be applicable to any Authenticating
Agent.
(c) Pursuant to an appointment made under this Section 5.15, the
Certificates may have endorsed thereon, in lieu of the Trustee's
certificate of authentication, an alternate certificate of authentication
in substantially the following form:
This is one of the Certificates described in the Trust Agreement
and the related Series Supplement.
_________________________________
as Authenticating Agent
for the Trustee,
By________________________________
Authorized Signatory
Section 5.16. EVENTS OF DEFAULT. If any Event of Default shall
occur and be continuing with respect to any class of Certificates, then,
and in each and every case, the Trustee shall exercise any rights in
respect of the related Deposited Assets as provided in the applicable
Series Supplement.
Section 5.17. CONTROL BY HOLDERS. The Holders of Outstanding
Certificates representing the Required Percentage --Direction of Trustee
shall, subject to provision being made for indemnification against costs,
52
<PAGE>
expenses and liabilities in a form satisfactory to the Trustee, have the
right to direct the time, method and place of conducting any Proceeding for
any remedy available to the Trustee with respect to any Issuer Payment
Default; provided, however, that:
(i) such direction shall not be in conflict with any rule
of law or with this Agreement;
(ii) subject to Section 8.7, the Trustee need not take any
action that it determines might cause it to incur any personal liability.
Section 5.18. WAIVER OF PAST DEFAULTS. The Holders of
Outstanding Certificates representing the Required Percentage -- Direction
of Trustee may waive any past default and its consequences except (i) an
Issuer Payment Default or other default in the payment of principal of or
interest on any of the Certificates or (ii) a default in respect of a
covenant or provision hereof which cannot be modified or amended without
the consent of the Holder of each Certificate. In the case of any such
waiver, the Depositor, the Trustee and the Holders shall be restored to
their former positions and rights hereunder, respectively; but no such
waiver shall extend to any subsequent or other default or impair any right
consequent thereto.
ARTICLE VI.
THE DEPOSITOR AND THE ADMINISTRATOR
Section 6.1. THE DEPOSITOR.
(a) [Reserved].
(b) The Depositor shall deliver to the Trustee, not less often
than annually, an Officer's Certificate signed by an Executive Officer who
is the principal executive officer, principal financial officer or
principal accounting officer of the Depositor, dated as of the date set
forth in the Series Supplement in respect of each Series for such year,
stating that in respect of such Series:
(i) a review of the activities of the Depositor during such
fiscal year and of performance under this Agreement has been made under
such Executive Officer's supervision; and
(ii) to the best of such Executive Officer's knowledge,
based on such review, the Depositor has fulfilled all of its obligations
under this Agreement throughout such year, or, if there has been a default
in the fulfillment of any such obligation, specifying each such default
known to such Executive Officer and the nature and status thereof. A copy
of such certificate in respect of a Series may be obtained by any Holder of
53
<PAGE>
a Certificate in such Series by a request in writing to the Depositor
addressed to the Corporate Trust Office of the Trustee.
(c) If and only if the Series Supplement provides for the pledge
of the Deposited Assets to the Trustee (and not merely the transfer,
assignment, conveyance and sale, without recourse, thereof to the Trustee),
on the Closing Date, the Depositor shall furnish to the Trustee an Opinion
of Counsel either stating that, in the opinion of such counsel, such action
has been taken with respect to the recording and filing of this Agreement,
any agreements supplemental hereto and any other requisite documents, and
with respect to the execution and filing of any financing statements and
continuation statements as are necessary to perfect and make effective the
lien and security interest of this Agreement and reciting the details of
such action, or stating that, in the opinion of such counsel, no such
action is necessary to make such lien and security interest effective.
(d) If and only if the Series Supplement provides for the pledge
of the Deposited Assets to the Trustee (and not merely the transfer,
assignment, conveyance and sale, without recourse, thereof to the Trustee),
at least annually after the Closing Date, the Depositor shall furnish to
the Trustee an Opinion of Counsel either stating that, in the opinion of
such counsel, such action has been taken with respect to the recording,
filing, re-recording and refiling of this Agreement, any agreements
supplemental hereto and any other requisite documents and with respect to
the execution and filing of any financing statements and continuation
statements as is necessary to maintain the lien and security interest
created by this Agreement and reciting the details of such action or
stating that in the opinion of such counsel no such action is necessary to
maintain the lien and security interest created by this Agreement. Such
Opinion of Counsel shall also describe the recording, filing, re-recording
and refiling of this Agreement, any agreements supplemental hereto and any
other requisite documents and the execution and filing of any financing
statements and continuation statements that will, in the opinion of such
counsel, be required to maintain the lien and security interest of this
Agreement until such date in the following calendar year.
(e) If and only if the Series Supplement provides for the pledge
of the Deposited Assets to the Trustee (and not merely the transfer,
assignment, conveyance and sale, without recourse, thereof to the Trustee),
(i) whenever any property or securities are to be released
from the lien of this Agreement, the Depositor shall furnish to the Trustee
an Officer's Certificate of the Depositor certifying or stating the opinion
of each Person signing such certificate as to the fair value (within 90
days of such release) of the property or securities proposed to be released
and stating that in the opinion of such person the proposed release will
not impair the security under this Agreement in contravention of the
provisions hereof.
(ii) whenever the Depositor is required to furnish to the
Trustee an Officer's Certificate of the Depositor certifying or stating the
54
<PAGE>
opinion of any signatory thereof as to the matters described in clause (i)
above, the Depositor shall also furnish to the Trustee an Independent
Certificate as to the same matters if the fair value of the property or
securities and of all other property or securities released from the lien
of this Agreement since the commencement of the then current calendar year,
as set forth in the certificates required by clause (i) above and this
clause (ii), equals 10% or more of the principal amount of the Outstanding
Certificates, but such certificate need not be furnished in the case of any
release of property or securities if the fair value thereof as set forth in
the related Officer's Certificate of the Depositor is less than $25,000 or
less than one percent of the then principal amount of the Outstanding
Certificates.
(iii) prior to the deposit with the Trustee of any securities
that are to be made the basis for the authentication and delivery of
Certificates, the withdrawal of cash constituting a part of the trust
estate or the release of any property or securities subject to the lien of
this Agreement, the Depositor shall furnish to the Trustee an Officer's
Certificate of the Depositor certifying or stating the opinion of each
person signing such certificate as to the fair value (within 90 days of
such deposit) to the Depositor of the securities to be so deposited.
(iv) whenever the Depositor is required to furnish to the
Trustee an Officer's Certificate of the Depositor described in clause (iii)
above, the Depositor shall also deliver to the Trustee an Independent
Certificate as to the same matters, if the fair value to the Depositor of
the securities to be so deposited and of all other such securities made the
basis of any such withdrawal or release since the commencement of the then
current fiscal year of the Depositor, as set forth in the certificates
delivered pursuant to clause (iii) above and this clause (iv), is 10% or
more of the principal amount of the Outstanding Certificates, but such a
certificate need not be furnished with respect to any securities so
deposited, if the fair value thereof to the Depositor as set forth in the
related Officer's Certificate of the Depositor is less than $25,000 or less
than one percent of the principal amount of the Outstanding Certificates.
(v) subject to the payment of its fees and expenses
hereunder, the Trustee may, and when required by the provisions of this
Agreement, shall, execute instruments to release property from the lien of
this Agreement, or convey the Trustee's interest in the same, in a manner
and under circumstances that are consistent with the provisions of this
Agreement. No party relying upon an instrument executed by the Trustee in
connection therewith shall be bound to ascertain the Trustee's authority,
inquire into the satisfaction of any conditions precedent or see to the
application of any moneys.
(vi) the Trustee shall at such time as there are no
Outstanding Certificates and all sums due to the Trustee hereunder have
55
<PAGE>
been paid, upon request release any remaining portion of the trust estate
that secured the Certificates from the lien of this Agreement and release
to the Depositor or any other Person entitled thereto any funds then
included in the trust estate.
(f) Upon any application or request by the Depositor to the
Trustee to take any action under the provisions of this Agreement, which
action is subject to the satisfaction of a condition precedent (including
any covenants the compliance with which constitutes a condition precedent),
the Depositor shall furnish to the Trustee: (i) an Officer's Certificate
stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with, (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with and (iii) (if
required by the TIA) an Independent Certificate from a firm of certified
public accountants meeting the applicable requirements of the TIA, except
that, in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of
this Agreement, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Agreement shall include:
(i) a statement that such signatory of such certificate or
opinion has read or has caused to be read such covenant or condition and
the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the judgment of each such
signatory, such signatory has made such examination or investigations as is
necessary to enable such signatory to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
Section 6.2. MERGER OR CONSOLIDATION OF THE DEPOSITOR OR THE
ADMINISTRATOR. (a) Subject to the following paragraph (b) of this
Section 6.2, the Depositor will keep in full effect its existence, rights
and franchises as a corporation under the laws of the jurisdiction of its
incorporation, and the Administrator, if any, will keep in full
effect its existence, rights and franchises under the laws of the
jurisdiction of its incorporation or association. The Depositor and the
Administrator, if any, each will obtain and preserve its
qualification to do business as a foreign corporation or association in
56
<PAGE>
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, the Certificates
or any of the Deposited Assets and to perform its respective duties under
this Agreement.
(b) The Depositor and an Administrator, if any, may
consolidate or merge with or into any other Person, provided that:
(i) the Person (if other than the Depositor or
Administrator, as applicable) formed by or surviving such
consolidation or merger shall expressly assume, by an agreement
supplemental hereto executed and delivered to the Trustee, in form
satisfactory to the Trustee, the performance or observance of every
agreement and covenant of this Agreement on the part of the Depositor or
Administrator, as applicable, to be performed or observed, all as
provided herein and in the applicable Series Supplement or Supplements;
(ii) immediately after giving effect to such transaction, no
Administrator Termination Event or event which with the passage of
time or notice or both would become an Administrator Termination
Event shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction; and
(iv) the Depositor or Administrator, as applicable,
shall have delivered to the Trustee an Officer's Certificate and an Opinion
of Counsel each stating that such consolidation or merger and such
supplemental assumption agreement comply with this Section 6.2 and that all
conditions precedent herein provided for relating to such transaction have
been satisfied.
Section 6.3. LIMITATION ON LIABILITY OF THE DEPOSITOR AND THE
ADMINISTRATOR. (a) Unless otherwise expressly specified in this
Agreement or a Series Supplement, neither the Administrator, if any,
nor the Depositor shall be under any obligation to expend or risk its own
funds or otherwise incur financial liability in the performance of its
duties hereunder or under a Series Supplement or in the exercise of any of
its rights or powers if reasonable grounds exist for believing that the
repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(b) Neither the Depositor, an Administrator, if any, nor
any of the directors, officers, employees or agents of the Depositor or
such Administrator shall be under any liability to any Trust or the
Certificateholders of any Series for any action taken, or for refraining
from the taking of any action, in good faith pursuant to this Agreement, or
for errors in judgment; PROVIDED, however, that this provision shall not
protect the Depositor, any such Administrator or any such person
against any breach of warranties, representations or covenants made herein,
or against any specific liability imposed on such Administrator
57
<PAGE>
pursuant hereto, or against any liability which would otherwise be imposed
by reason of wilful misfeasance, bad faith or negligence in the performance
of duties or by reason of reckless disregard of obligations and duties
hereunder.
Neither the Depositor nor an Administrator, if any, shall
be under any obligation to appear in, prosecute or defend any legal action
unless such action is related to its respective duties under this Agreement
and, in its opinion, does not involve it in any expense or liability;
PROVIDED, however, that either of the Depositor or such Administrator
may in its discretion undertake any such action which it may deem
necessary or desirable with respect to this Agreement and the rights and
duties of the parties hereto and the interests of the Certificateholders
hereunder. The legal expenses and costs of such action and any liability
resulting (except any loss, liability or expense incurred by reason of
wilful misfeasance, bad faith or negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder) shall be allocated as specified in the applicable Series
Supplement.
Section 6.4. LIMITATION ON RESIGNATION OF THE ADMINISTRATOR.
An Administrator appointed pursuant to the applicable Series
Supplement shall not resign from the obligations and duties hereby imposed
on it except (a) upon appointment by the Trustee of a successor
administrative agent and receipt by the Trustee of a letter from the Rating
Agency that such a resignation and appointment will satisfy the Rating
Agency Condition or (b) upon a determination that its duties hereunder are
no longer permissible under applicable law. Any such determination pursuant
to clause (b) of the preceding sentence permitting the resignation of the
Administrator shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee and the Depositor. No resignation of an
Administrator shall become effective until the Trustee or a
successor administrative agent shall have assumed the Administrator's
responsibilities, duties, liabilities (other than those liabilities
arising prior to the appointment of such successor) and obligations under
this Agreement.
Section 6.5. RIGHTS OF THE DEPOSITOR IN RESPECT OF THE
ADMINISTRATOR. An Administrator appointed pursuant to the
applicable Series Supplement shall afford the Depositor and the Trustee,
upon reasonable notice, during normal business hours, access to all records
maintained by the Administrator in respect of its rights and
obligations hereunder and access to officers of the Administrator
responsible for such obligations. Upon request, the Administrator
shall furnish to the Depositor and the Trustee the Administrator's
most recent financial statements and such other information relating to its
capacity to perform its obligations under this Agreement as the
Administrator possesses. To the extent such information is not
58
<PAGE>
otherwise available to the public, the Depositor and the Trustee shall not
disseminate any information obtained pursuant to the preceding two
sentences without the Administrator's written consent, except as
required pursuant to this Agreement to the extent that it is appropriate to
do so (i) in working with legal counsel, auditors, taxing authorities or
other governmental agencies or (ii) pursuant to any law, rule, regulation,
order, judgment, writ, injunction or decree of any court or governmental
authority having jurisdiction over the Depositor, the Trustee or the Trust,
and in either case, the Depositor or the Trustee, as the case may be, shall
use its best efforts to assure the confidentiality of any such disseminated
nonpublic information. The Depositor may, but is not obligated to, enforce
the obligations of the Administrator under this Agreement and may,
but is not obligated to, perform, or cause a designee to perform, any
defaulted obligation of the Administrator Agent under this Agreement or
exercise the rights of the Administrator under this Agreement;
PROVIDED, however, that the Administrator shall not be relieved of
any of its obligations under this Agreement by virtue of such performance
by the Depositor or its designee. The Depositor shall not have any
responsibility or liability for any action or failure to act by the
Administrator and is not obligated to supervise the performance of
the Administrator under this Agreement or otherwise.
Section 6.6. DEPOSITOR MAY PURCHASE CERTIFICATES. The
Depositor may at any time purchase Certificates in the open market or
otherwise. Certificates so purchased by the Depositor may, at the
discretion of the Depositor, be held or resold. Certificates beneficially
owned by the Depositor will be disregarded for purposes of determining
whether the required percentage of the aggregate Voting Rights has given
any request, demand, authorization, direction, notice, consent or waiver
hereunder.
Section 6.7. THE ADMINISTRATOR AND OTHER PARTIES. The
Person serving as an Administrator, if any, appointed pursuant to
the applicable Series Supplement may be the Depositor, the Trustee or an
Affiliate of either thereof, and may have normal business relationships
with the Depositor, the Trustee or any Affiliates thereof.
Section 6.8. PREFERENTIAL COLLECTION OF CLAIMS AGAINST
DEPOSITOR. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the
extent required by TIA Section 311(a).
ARTICLE VII.
ADMINISTRATOR TERMINATION EVENTS
Section 7.1. ADMINISTRATOR TERMINATION EVENTS. (a) "Administrator
Termination Event", wherever used herein with respect to any Series of
59
<PAGE>
Certificates, means any one of the following events:
(i) a failure by any Administrator specified in the
applicable Series Supplement to remit to the Trustee, pursuant to the terms
of this Agreement, any funds in respect of collections on Deposited Assets,
and collected by the Administrator pursuant to the terms of this
Agreement and the applicable Series Supplement that continues unremedied
for a period of five days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Administrator by the Depositor or the Trustee (in which case notice
shall be provided by telecopy), or to the Administrator, the
Depositor and the Trustee by the Holders of Certificates of such Series
representing at least 25% of the aggregate Voting Rights; or
(ii) a failure on the part of any Administrator
specified in the applicable Series Supplement to observe or perform in any
material respect any other of the covenants or agreements on the part of
the Administrator contained in the Certificates of such Series, in
this Agreement or in the applicable Series Supplement which continues
unremedied for a period of 30 days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been given
to the Administrator by the Depositor or the Trustee, or to the
Administrator, the Depositor and the Trustee by the Holders of
Certificates of such Series representing at least 25% of the aggregate
Voting Rights; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in an involuntary case under any present or
future Federal or State bankruptcy, insolvency or similar law or the
appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceeding, or for the winding up or liquidation of its affairs, shall have
been entered against the Administrator, if any, specified in the
applicable Series Supplement and such decree or order shall have remained
in force undischarged or unstayed for a period of 30 days; or
(iv) any Administrator specified in the applicable
Series Supplement shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshalling
of assets and liabilities or similar proceedings of or relating to the
Administrator or of or relating to all or substantially all its
property; or
(v) any Administrator specified in the applicable
Series Supplement shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its
obligations; or
60
<PAGE>
(vi) if so specified in the related Series Supplement, any
failure of the Administrator, if any, specified in the applicable
Series Supplement to make any Advances required to be made from its own
funds pursuant to Section 4.3 which continues unremedied until twelve
o'clock noon New York City time on the Business Day immediately following
the day on which such Advance was required to have been made; or
(vii) any additional Administrator Termination Event
that may be specified with respect to such Series in the related Series
Supplement.
Each Series Supplement that provides for the appointment of an
Administrator, shall specify as to each of the foregoing clauses
requiring a vote of Holders of different Classes the circumstances and
manner in which the aggregate Voting Rights applicable to each such clause
shall be calculated.
(b) Unless otherwise provided in the applicable Series
Supplement and provided an Administrator shall have been appointed
pursuant to the applicable Series Supplement, so long as an Administrator
Termination Event with respect to the related Series of Certificates
shall have occurred and be continuing, the Depositor or the Trustee may,
and at the written direction of the Holders of Certificates evidencing not
less than the "Required Percentage--Administrator Termination" of
the aggregate Voting Rights, the Trustee shall, by notice in writing to
such Administrator (and to the Depositor if given by the Trustee or
to the Trustee if given by the Depositor) terminate all the rights and
obligations of such Administrator hereunder and under its
Administration Agreement, to the extent permitted by law, and in and to the
Deposited Assets relating to such Series and the proceeds thereof. On or
after the receipt by such Administrator of such written notice, all
authority and power of the Administrator under this Agreement
relating to such Series, whether with respect to the Certificates (other
than as a Holder of any Certificate) of such Series or the Deposited Assets
relating to such Series or otherwise, shall pass to and be vested in the
Trustee or any successor Administrator appointed in accordance with
this Agreement. The Trustee (or any Administrator) is hereby
authorized and empowered, as attorney-in-fact or otherwise, to execute and
deliver, on behalf of and at the expense of the Depositor, any and all
documents and other instruments and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment
61
<PAGE>
of such Deposited Assets and related documents, or otherwise. The
Administrator, if any, specified in the applicable Series Supplement
agrees promptly (and in any event not later than ten Business Days
subsequent to such notice) to provide the Trustee or (any successor
Administrator) with all documents and records requested by it to
enable it to assume the functions of the Administrator under this
Agreement relating to such Series, and to cooperate with the Trustee in
effecting the termination of the Administrator's responsibilities
and rights under this Agreement relating to such Series, including the
transfer within one Business Day to the Trustee for administration by it of
all cash amounts and investments which shall at the time be or should have
been credited by the Administrator to the Certificate Account
relating to such Series or thereafter be received with respect to such
Deposited Assets; provided, however, that the Administrator shall
continue to be entitled to receive all amounts accrued or owing to it under
this Agreement on or prior to the date of such termination, and shall
continue to be entitled to the benefits of Section 6.3 notwithstanding any
such termination.
Section 7.2. TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR. On and
after the time an Administrator, if any, specified in the applicable
Series Supplement, receives a notice of termination pursuant to Section
7.1, the Trustee shall be the successor in all respects to such
Administrator and shall, until a successor Administrator is
appointed in accordance herewith, be subject to all the responsibilities,
duties and liabilities relating thereto and arising thereafter placed on
the Administrator (except for any representations or warranties of
the Administrator under this Agreement and except as otherwise
provided herein or in the applicable Series Supplement) by the terms and
provisions hereof that any failure to perform such duties or
responsibilities caused by the Administrator's failure to provide
information required by Section 7.1 shall not be considered a default by
the Trustee as successor to the Administrator hereunder.
Notwithstanding the above, the Trustee may, if it shall be unwilling to so
act, or shall, if it is unable to so act or if the Holders of Certificates
of such Series evidencing not less than the Required Percentage--
Administrator Termination of the aggregate Voting Rights, so request
in writing to the Trustee, promptly appoint, or petition a court of
competent jurisdiction to appoint, an Administrator acceptable to
the Rating Agency (such acceptance to be evidenced by satisfaction of the
Rating Agency Condition with respect to such appointment) and having a net
worth of not less than $15,000,000, as the successor to such Administrator
under this Agreement with respect to such Series in the assumption of
all or any part of the responsibilities, duties or liabilities of such
Administrator under this Agreement with respect to such Series. The
Trustee, the Depositor and any such successor Administrator may
agree upon the compensation to be paid with respect thereto; PROVIDED,
however, that in no event shall such compensation be greater than the
compensation payable to the Administrator under this Agreement. No
appointment of a successor Administrator under this Agreement shall
be effective until the assumption by the successor Administrator of
all the responsibilities, duties and liabilities placed on the
Administrator hereunder and under the related Series Supplement.
Pending appointment of a successor Administrator under this
Agreement, the Trustee shall act in such capacity as and to the extent
hereinabove provided.
62
<PAGE>
Section 7.3. NOTIFICATION TO CERTIFICATEHOLDERS. (a) Upon any
such termination pursuant to Section 7.2 or appointment of a successor
Administrator and receipt by the Trustee or written notice thereof,
the Trustee shall give prompt written notice thereof to Certificateholders
of the affected Series in the manner provided in Section 10.5.
(b) Within 60 days after the occurrence of any Administrator
Termination Event or event which but for the lack of notice or
passage of time or both would constitute an Administrator
Termination Event with respect to any Series, upon receipt by the Trustee
of written notice thereof, the Trustee shall transmit by mail to all
Certificateholders of such Series notice of each such Administrator
Termination Event or event which but for lack of notice or passage of time
or both would constitute an Administrator Termination Event which is
actually known to the Trustee, unless such Administrator Termination
Event or event which but for lack of notice or passage of time or both
would constitute an Administrator Termination Event shall have been
cured or waived.
Section 7.4. WAIVER OF ADMINISTRATOR TERMINATION EVENTS.
Unless otherwise provided in the applicable Series Supplement, the Holders
of Certificates of the related Series evidencing not less than the Required
Percentage--Waiver of the aggregate Voting Rights may, on behalf of all
Certificateholders of such Series, (i) if so provided in the applicable
Series Supplement, waive compliance by the Depositor, the Trustee or the
Administrator, if any, with certain restrictive provisions of this
Agreement as set forth in such Series Supplement prior to the time such
compliance is required and (ii) waive any Administrator Termination
Event or event which but for lack of notice or passage of time or both
would constitute an Administrator Termination Event with respect to
such Series; provided, however, that an Administrator Termination
Event or event which but for lack of notice or passage of time or both
would constitute an Administrator Termination Event with respect to
such Series regarding the failure to distribute, in accordance with the
terms of this Agreement, amounts received with respect to any Deposited
Asset or any such event with respect to such Series in respect of a
covenant or provision of this Agreement the modification or amendment of
which would require the consent of the Holders of all outstanding
Certificates of such Series, may be waived only by all the
Certificateholders of such Series. Upon any such waiver of an
Administrator Termination Event or event which but for lack of
notice or passage of time or both would constitute an Administrator
Termination Event with respect to such Series, such Administrator
Termination Event or event which but for lack of notice or passage of time
or both would constitute an Administrator Termination Event shall
cease to exist and shall be deemed to have been remedied for every purpose
hereunder. No such waiver shall extend to any subsequent or other
Administrator Termination Event or event which but for lack of
notice or passage of time or both would constitute an Administrator
63
<PAGE>
Termination Event or impair any right consequent thereon except to the
extent expressly so waived.
ARTICLE VIII.
CONCERNING THE TRUSTEE
Section 8.1. AUTHORITY AND DUTIES OF TRUSTEE; NOTICE OF
DEFAULTS. (a) The Trustee is authorized and directed to execute and
deliver the Basic Documents in respect of each Series to which the Trust is
to be a party and each certificate or other document attached as an exhibit
to or contemplated by such Basic Documents, in each case in such form as
the Depositor shall approve as evidenced conclusively by the Trustee's
execution thereof, and, on behalf of the Trust, to direct the Indenture
Trustee in respect of an Indenture for such Series to authenticate and
deliver the Notes in the aggregate principal amount specified in a letter
of instruction from the Depositor to the Trustee. In addition to the
foregoing, the Trustee is authorized, but shall not be obligated, to take
all actions required of the Trust pursuant to the Basic Documents. The
Trustee is further authorized from time to time to take such action as the
Administrator under the Administration Agreement for a Series
requests with respect to the Basic Documents in respect of such Series.
(b) It shall be the duty of the Trustee to discharge (or cause
to be discharged) all of its responsibilities pursuant to this Agreement
and the Basic Documents in respect of each Series to which the Trust is a
party and to administer the Trust in the interest of the Certificateholders
for each Series, subject to the related Basic Documents, and in accordance
with this Agreement. Notwithstanding the foregoing, the Trustee shall be
deemed to have discharged its duties and responsibilities hereunder and
under the Basic Documents in respect of a Series to the extent an
Administrator has agreed in the Administration Agreement for such
Series to perform any act or to discharge any duty of the Trustee hereunder
or under any related Basic Document and the Trustee, to the extent
permitted by law, shall not be liable for any failure of the Administrator
to act or to discharge any such duties delegated under the
Administration Agreement.
(c) The Trustee, prior to the occurrence of an Administrator
Termination Event or Event of Default with respect to any Series and
after the curing of all such Administrator Termination Events or
Events of Default which may have occurred, undertakes to perform such
duties and only such duties as are specifically set forth in this Agreement
and the related Series Supplement. During the period an Administrator
Termination Event or Event of Default with respect to any Series
shall have occurred and be continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Agreement, and shall use the
same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of such person's own
64
<PAGE>
affairs. Any permissive right of the Trustee enumerated in this Agreement
shall not be construed as a duty.
(d) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to
determine whether they conform to the requirements of this Agreement. If
any such instrument is found not to conform to the requirements of this
Agreement, the Trustee shall take action as it deems appropriate to have
the instrument corrected, and if the instrument is not corrected to the
Trustee's satisfaction, the Trustee will provide notice thereof to the
Depositor, Administrator, if any, and Certificateholders.
(e) No provision of this Agreement shall be construed to relieve
the Trustee from liability for its own grossly negligent action, its own
grossly negligent failure to act or its own misconduct; PROVIDED, however,
that:
(i) prior to the occurrence of an Administrator
Termination Event or Event of Default with respect to any Series, and after
the curing of all such Administrator Termination Events or Events of
Default which may have occurred, the duties and obligations of the Trustee
shall be determined solely by the express provisions of this Agreement, the
Trustee shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Agreement, no implied
covenants or obligations shall be read into this Agreement against the
Trustee and, in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee that conform to the requirements of this
Agreement;
(ii) the Trustee shall not be personally liable for an error
of judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
grossly negligent in ascertaining the pertinent facts;
(iii) the Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of the Required Percentage--
Direction of Trustee of the aggregate Voting Rights of a given Series (or
Class or group of Classes within such Series) relating to the time, method
and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee, under
this Agreement;
(iv) the Trustee shall not be required to expend or risk its
own funds or otherwise incur financial liability in the performance of any
65
<PAGE>
of its duties hereunder or in the exercise of any of its rights or powers
if there is reasonable ground for believing that the repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee to perform, or be
responsible for the manner of performance of, any obligations of an
Administrator, if any, appointed pursuant to the applicable Series
Supplement, under this Agreement except during such time, if any, as the
Trustee shall be the successor to, and be vested with the rights, duties,
powers and privileges of, such an Administrator in accordance with
and only to the extent provided in this Agreement;
(v) except for actions expressly authorized by this
Agreement, the Trustee shall take no actions reasonably likely to impair
the interests of the Trust in any Deposited Asset now existing or hereafter
acquired or to impair the value of any Deposited Asset now existing or
hereafter acquired;
(vi) except as expressly provided in this Agreement, the
Trustee shall have no power to vary the corpus of the Trust including by
(A) accepting any substitute obligation or asset for a Deposited Asset
initially assigned to the Trustee under Section 2.1, (B) adding any other
investment, obligation or security to the Trust or (C) withdrawing from the
Trust any Deposited Assets; and
(vii) in the event that the Paying Agent or the Certificate
Registrar shall fail to perform any obligation, duty or agreement in the
manner or on the day required to be performed by the Paying Agent or
Certificate Registrar, as the case may be, under this Agreement, the
Trustee shall be obligated promptly upon its knowledge thereof to perform,
or designate an Administrator meeting the requirements of this
Agreement to perform, such obligation, duty or agreement in the manner so
required.
(f) The Trustee shall have the legal power to exercise all of
the rights, powers and privileges of holders of the Deposited Assets in
which the Certificates evidence an interest. However, neither the Trustee
(except as specifically provided herein or in the TIA) nor the Depositor
shall be under any obligation whatsoever to appear in, prosecute or defend
any action, suit or other proceeding in respect of Deposited Assets or
Certificates.
(g) Neither the Trustee nor the Depositor shall have any
obligation on or with respect to the Deposited Assets, except as provided
in this Article VIII with respect to the Trustee; and their respective
obligations with respect to Certificates shall be solely as set forth in
this Agreement.
(h) If there is an event of default (as defined in the indenture
or other document pursuant to which the Deposited Assets were issued) with
respect to any Deposited Asset and such default is actually known to the
66
<PAGE>
Trustee, the Trustee shall promptly give notice to the Depositary or, if
the Certificates are Definitive Certificates, directly to Holders thereof
as provided in Section 10.5 hereof (and in the manner and to the extent
provided in TIA Section 313(c)) within 90 days after such event of default
occurs. Such notice shall set forth (i) the identity of the Deposited
Assets, (ii) the date and nature of such default, (iii) the face amount of
the obligation to which such default relates, (iv) the identifying numbers
of the Series and Class of Certificates, or any combination, as the case
may be, evidencing the obligations (or portions thereof) described above in
clause (iii), and (v) any other information which the Trustee may deem
appropriate. Except in the case of a default in payment of principal or
interest (including payments pursuant to a redemption of any Certificate),
the Trustee may withhold the notice to Holders if and so long as a
committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of the Holders.
(i) Holders of Certificates shall have no recourse against the
Depositor or the Trustee for payment defaults on the Deposited Assets.
Section 8.2. CERTAIN MATTERS AFFECTING THE TRUSTEE. (a) Except
as otherwise provided in Section 8.1:
(i) the Trustee may request and rely upon and shall be
protected in acting or refraining from acting upon any resolution,
Officer's Certificate, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document reasonably believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(ii) the Trustee may consult with counsel and any written
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such written advice or
Opinion of Counsel;
(iii) the Trustee shall be under no obligation to exercise
any of the trusts or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto, at the
request, order or direction of any of the Certificateholders, pursuant to
the provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or thereby;
PROVIDED, however, that nothing contained herein shall relieve the Trustee
of the obligations, upon the occurrence of an Administrator
Termination Event or Event of Default (which has not been cured or waived),
67
<PAGE>
to exercise such of the rights and powers vested in it by this Agreement,
and to use the same degree of care and skill in their exercise as a prudent
man would exercise or use under the circumstances in the conduct of such
person's own affairs;
(iv) the Trustee shall not be personally liable for any
action taken, suffered or omitted by it in good faith and believed by it to
be authorized or within the discretion or rights or powers conferred upon
it by this Agreement;
(v) prior to the occurrence of an Administrator
Termination Event hereunder and after the curing of all Administrator
Termination Events which may have occurred, the Trustee shall not be
bound to make any investigation into the facts of matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, appraisal, approval, bond or other paper or
document believed by it to be genuine, unless requested in writing to do so
by Holders of the Required Percentage--Direction of Trustee of the
aggregate Voting Rights of the affected Series (or Class or Classes within
any such Series), as specified by the applicable Series Supplement;
provided, however, that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by it
in the making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the
terms of this Agreement, the Trustee may require reasonable indemnity
against such expense or liability as a condition to taking any such action;
(vi) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
one or more Administrators, agents or attorneys or a custodian;
PROVIDED that Trustee shall not be liable for the default or misconduct of
any such persons or entities selected by Trustee, in good faith; and
(vii) the Trustee shall not be personally liable for any loss
resulting from the investment of funds held in any Certificate Account or
Reserve Account at the direction of an Administrator or the
Depositor pursuant to Section 3.10.
(b) All rights of action under this Agreement or under any of
the Certificates, enforceable by the Trustee, may be enforced by it without
the possession of any of the Certificates of any Series (or Class within
such Series), or the production thereof at the trial or other Proceeding
relating thereto, and any such suit, action or proceeding instituted by the
Trustee shall be brought in its name for the benefit of all the Holders of
such Certificates, subject to the provisions of this Agreement.
Section 8.3. TRUSTEE NOT LIABLE FOR RECITALS IN CERTIFICATES OR
DEPOSITED ASSETS. The Trustee assumes no responsibility for the
correctness of the recitals contained herein and in the Certificates or in
any document issued in connection with the sale of the Certificates (other
than the signature and authentication on the Certificates). Except as set
forth in Section 8.12, the Trustee makes no representations or warranties
as to the validity or sufficiency of this Agreement or of the Certificates
of any Series (other than the signature and authentication on the
68
<PAGE>
Certificates) or of any Deposited Asset or related document. The Trustee
shall not be accountable for the use or application by the Depositor or the
Administrator, if any, of any of the Certificates or of the proceeds
of such Certificates.
Section 8.4. TRUSTEE MAY OWN CERTIFICATES. The Trustee in its
individual capacity or any other capacity may become the owner or pledgee
of Certificates with the same rights it would have if it were not Trustee.
Section 8.5. COMPENSATION OF TRUSTEE. (a) The Trustee shall be
entitled to receive from the Depositor or an Affiliate of the Depositor as
compensation for the Trustee's services hereunder, trustee's fees pursuant
to a separate agreement between the Trustee and the Depositor, and shall be
reimbursed for all reasonable expenses, disbursements and advances incurred
or made by the Trustee (including the reasonable compensation,
disbursements and expenses of its counsel and other persons not regularly
in its employ). The Depositor shall indemnify and hold harmless the
Trustee and its successors, assigns, agents and servants and any
Administrator (each an "Indemnified Person") against any and all loss,
liability or reasonable expense (including attorney's fees) incurred
by it in connection with the administration of this Trust and the
performance of its duties thereunder including any Administration
Agreement. An Indemnified Person shall notify the Depositor promptly of
any claim for which it may seek indemnity. Failure by an Indemnified
Person to so notify the Depositor shall not relieve the Depositor of its
obligations hereunder. The Depositor need nor reimburse any expense
or indemnify any Indemnified Person against any loss, liability or expense
incurred through such Indemnified Person's own willful misconduct,
negligence or bad faith. The indemnities contained in this Section 8.5
shall survive the resignation or termination of the Trustee, any
Administrator or the termination of the Agreement or the Series
Supplement.
(b) Failure by the Depositor to pay, reimburse or indemnify any
Indemnified Person (as defined in paragraph (a) above) shall not entitle
such Indemnified Person to any payment, reimbursement or indemnification
from the trust, nor shall such failure release such Indemnified Person
from the duties it is required to perform under the Agreement and this
Series Supplement (or as applicable, its Administration Agreement). Any
unpaid, unreimbursed or unindemnified amounts shall not be borne by the
Trust and shall not constitute a claim against the Trust, and no
Indemnified Person shall have any recourse against the Trust with
respect thereto.
(c) All parties to this Agreement agree, and each Holder of any
Certificate by such Holder's acceptance thereof shall be deemed to have
agreed, that any court may in its discretion require, in any Proceeding for
the enforcement of any right or remedy under this Agreement, or in any
Proceeding against the Trustee for any action taken, suffered or omitted by
it as Trustee, the filing by any party litigant in such Proceeding of an
undertaking to pay the costs of such Proceeding and that such court may in
its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such Proceeding, having due regard to
69
<PAGE>
the merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section 8.5(c) shall not apply to:
(i) any Proceeding instituted by the Trustee;
(ii) any Proceeding instituted by any Holder, or group of
Holders, in each case holding in the aggregate Outstanding Certificates
representing more than 10% of the Voting Rights; or
(iii) any Proceeding instituted by any Holder for the
enforcement of the payment of principal or interest on or after the
respective due dates expressed in such Certificate and in this Agreement
(or, in the case of redemption, on or after the redemption date).
Section 8.6. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. (a) The
Trustee shall at all times satisfy the requirements of TIA Section 310(a).
The Trustee hereunder shall at all times be a corporation which is not an
Affiliate of the Depositor (but may have normal banking relationships with
the Depositor or any obligor with respect to the Deposited Assets with
respect to such Series of Certificates and their respective Affiliates)
organized and doing business under the laws of any State or the United
States, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least $50,000,000 and subject
to supervision or examination by Federal or State authority or otherwise
acceptable to the Rating Agency. If such corporation or association
publishes reports of conditions at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of conditions so published.
Such corporation or association must be rated in one of the four highest
rating categories by the Rating Agency.
(b) The Trustee shall comply with Section 310(b); provided,
however, that there shall be excluded from the operation of TIA Section
310(b)(1), any Series Supplement under which other securities are
outstanding evidencing ownership interest in obligations of the Term Assets
Issuer if the requirements for such exclusion set forth in TIA Section
310(b)(1) are met.
Section 8.7. RESIGNATION OR REMOVAL OF THE TRUSTEE. (a) The
Trustee may, with respect to any Series of Certificates, at any time resign
and be discharged from any trust hereby created by giving written notice
thereof to the Depositor, the Administrator, if any, the Rating
Agency and to all Certificateholders of such Series. Upon receiving such
notice of resignation, the Depositor shall promptly appoint a successor
trustee for such Series by written instrument, in duplicate, which
instrument shall be delivered to the resigning Trustee and to the successor
trustee. A copy of such instrument shall be delivered to such
70
<PAGE>
Certificateholders and the Administrator, if any, by the Depositor.
If no such successor trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation,
the resigning Trustee may petition any court of competent jurisdiction for
the appointment of a successor trustee for such Series.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.6 and shall fail to resign
after written request therefor by the Depositor, or if at any time the
Trustee shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Depositor may remove the Trustee and
appoint a successor trustee by written instrument, in duplicate, which
instrument shall be delivered to the Trustee so removed and to the
successor trustee. A copy of such instrument shall be delivered to the
Certificateholders and the Administrator, if any, by the Depositor.
(c) The Holders of Certificates of any Series representing the
Required Percentage--Removal of Trustee of the aggregate Voting Rights may
at any time remove the Trustee and appoint a successor trustee by written
instrument or instruments, in triplicate, signed by such Holders or their
attorneys-in-fact and duly authorized, one complete set of which
instruments shall be delivered to the Depositor, one complete set to the
Trustee so removed and one complete set to the successor trustee so
appointed. A copy of such instrument shall be delivered to the
Certificateholders and the Administrator, if any, by the Depositor.
(d) Any resignation or removal of the Trustee and appointment of
a successor trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor
trustee as provided in Section 8.8.
Section 8.8. SUCCESSOR TRUSTEE. (a) Any successor trustee
appointed as provided in Section 8.7 shall execute, acknowledge and deliver
to the Depositor and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become fully vested with
all the rights, powers, duties and obligations of its predecessor hereunder
(either with respect to a given Series of Certificates or with respect to
all Certificates issued under this Agreement), with the like effect as if
71
<PAGE>
originally named as trustee herein. The predecessor trustee shall deliver
to the successor trustee all documents and statements held by it hereunder,
and the Depositor and the predecessor trustee shall execute and deliver
such instruments and do such other things as may reasonably be required for
more fully and certainly vesting and confirming in the successor trustee
all such rights, powers, duties and obligations. No successor trustee shall
accept appointment as provided in this Section unless at the time of such
acceptance such successor trustee shall be eligible under the provisions of
Section 8.6.
(b) Upon acceptance of appointment by a successor trustee as
provided in this Section, the Depositor shall transmit notice of the
succession of such trustee hereunder to all Holders of Certificates and to
the Rating Agency in the manner provided in Section 10.5.
Section 8.9. MERGER OR CONSOLIDATION OF TRUSTEE. Any
corporation or association into which the Trustee may be merged or
converted or with which it may be consolidated or any corporation or
association resulting from any merger, conversion or consolidation to which
the Trustee shall be a party, or any corporation or association succeeding
to the business of the Trustee, shall be the successor of the Trustee
hereunder, provided such corporation or association shall be eligible under
the provisions of Section 8.6, without the execution or filing of any paper
or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
Section 8.10. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust for a given Series may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved
by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of
such Trust, and to vest in such Person or Persons, in such capacity, such
title to such Trust, or any part thereof, and, subject to the other
provisions of this Section 8.10, such powers, duties, obligations, rights
and trusts as the Depositor and the Trustee may consider necessary or
desirable. If the Depositor shall not have joined in such appointment
within 15 days after the receipt by it of a request so to do, or in case an
Administrator Termination Event shall have occurred and be
continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee hereunder shall be required
to meet the terms of eligibility as a successor trustee under Section 8.6
hereunder and no notice to Holders of Certificates of the appointment of
co-trustee or co-trustees or separate trustee or trustees shall be required
under Section 8.8 hereof. Notwithstanding anything contained herein to the
contrary, the appointment of a co-trustee pursuant to this Section 8.10
shall not release the Trustee from the duties, obligations,
responsibilities or liabilities arising under this Agreement; PROVIDED,
however, no Trustee or co-Trustee shall be liable for the acts or failures
to act of any other Trustee or co-Trustee.
72
<PAGE>
(b) In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 8.10, all rights, powers, duties and
obligations conferred or imposed upon the Trustee shall be conferred or
imposed upon and exercised or performed by the Trustee and such separate
trustee or co-trustee jointly, except to the extent that under any law of
any jurisdiction in which any particular act or acts are to be performed by
the Trustee (whether as Trustee hereunder or as successor to an
Administrator hereunder), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to such
Trust or any portion thereof in any such jurisdiction) shall be exercised
and performed by such separate trustee or co-trustee at the direction of
the Trustee.
(c) Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees
and co-trustees, as effectively as if given to each of them. Every
instrument appointing any separate trustee or co-trustee shall refer to
this Agreement and the conditions of this Article VIII. Each separate
trustee and co-trustee, upon its acceptance of the trusts conferred, shall
be vested with the estates or property specified in its instrument of
appointment, either jointly with the Trustee or separately, as may be
provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the
conduct of, affecting the liability of, or affording protection to, the
Trustee. Every such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may, at any time,
constitute the Trustee, its agent or attorney-in-fact, with full power and
authority, to the extent not prohibited by law, to do any lawful act under
or in respect of this Agreement on its behalf and in its name. If any
separate trustee or co-trustee shall die, become incapable of acting,
resign or be removed, all its estates, properties, rights, remedies and
trusts shall vest in and be exercised by the Trustee, to the extent
permitted by law, without the appointment of a new or successor trustee.
Section 8.11. APPOINTMENT OF OFFICE OR AGENCY. As specified in
a Series Supplement, the Trustee shall appoint an office or agency where
the Certificates may be surrendered for registration of transfer or
exchange, and presented for the final distribution with respect thereto,
and where notices and demands to or upon the Trustee in respect of the
Certificates of the related Series and this Agreement may be served.
Section 8.12. REPRESENTATIONS AND WARRANTIES OF TRUSTEE. The
Trustee represents and warrants that:
(i) the Trustee is duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation or
association;
73
<PAGE>
(ii) neither the execution nor the delivery by the Trustee
of this Agreement, nor the consummation by it of the transactions
contemplated hereby nor compliance by it with any of the terms or
provisions hereof will violate its charter documents or by-laws;
(iii) the Trustee has full power, authority and right to
execute, deliver and perform its duties and obligations as set forth herein
and in each Series Supplement to which it is a party and has taken all
necessary action to authorize the execution, delivery and performance by it
of this Agreement; and
(iv) this Agreement has been duly executed and delivered by
the Trustee and constitutes the legal, valid and binding obligation of the
Trustee, enforceable in accordance with its terms, except as enforcement
may be limited by the applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights of creditors generally and
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
Section 8.13. TRUSTEE TO ACT ONLY IN ACCORDANCE WITH THIS
AGREEMENT OR PURSUANT TO INSTRUCTIONS OF CERTIFICATEHOLDERS. (a) The
Trustee shall only take such action or shall refrain from taking such
action under this Agreement as directed pursuant to a specific provision
of this Agreement or, if required hereunder, by all the Certificateholders,
and the Trustee shall not otherwise act in respect of the Trust; PROVIDED,
however, that the Trustee shall not be required to take any such action if
it reasonably determines, or receives, at the expense of the
Certificateholders, an Opinion of Counsel (with copies thereof delivered to
the Certificateholders and the Depositor), that such action is inconsistent
with the purpose of the Trust or contrary to the terms hereof.
(b) Whenever the Trustee is unable to decide between alternative
courses of action permitted or required by this Agreement or any Basic
Document, the Trustee shall promptly give notice (in such form as shall be
appropriate under the circumstances) to the Certificateholders requesting
instruction as to the course of action to be adopted, and to the extent the
Trustee acts in good faith in accordance with any written instruction of
the Certificateholders received, the Trustee shall not be liable on account
of such action to any Person. If the Trustee shall not have received
appropriate instruction within 10 days after such notice (or within such
shorter period of time as reasonably may be specified in such notice or may
be necessary under the circumstances) it may, but shall be under no duty
to, take or refrain from taking such action, not inconsistent with this
Agreement or the Basic Documents, as it shall deem to be in the best
interests of the Certificateholders, and shall have no liability to any
Person for such action or inaction.
74
<PAGE>
(c) In the event that the Trustee is unsure as to the
application of any provision of this Agreement or any Basic Document or any
such provision is ambiguous as to its application, or is, or appears to be,
in conflict with any other applicable provision, or in the event that this
Agreement permits any determination by the Trustee or is silent or is
incomplete as to the course of action that the Trustee is required to take
with respect to a particular set of facts, the Trustee may give notice (in
such form as shall be appropriate under the circumstances) to the
Certificateholders requesting instruction and, to the extent that the
Trustee acts or refrains from acting in good faith in accordance with any
such instruction received, the Trustee shall not be liable, on account of
such action or inaction, to any Person. If the Trustee shall not have
received appropriate instruction within 10 days after such notice (or
within such shorter period of time as reasonably may be specified in such
notice or may be necessary under the circumstances) it may, but shall be
under no duty to, take or refrain from taking such action, not inconsistent
with this Agreement or the Basic Documents, as it shall deem to be in the
best interests of the Certificateholders, and shall have no liability to
any Person for such action or inaction.
Section 8.14. ACCOUNTING AND REPORT TO CERTIFICATEHOLDERS,
INTERNAL REVENUE SERVICE AND OTHERS. The Trustee, or an Administrator
on its behalf, shall (a) maintain the books of the Trust on a
calendar year basis on the accrual method of accounting, (b) after the
close of each calendar year, deliver to each Certificateholder, as may be
required by the Code and applicable Treasury Regulations or otherwise, such
information for such year as may be required to enable each
Certificateholder to prepare its federal income tax returns, (c) as
specifically directed in writing by the Depositor, file such tax returns
relating to the Trust and make such elections as may from time to time be
required or appropriate under any applicable state or federal statute or
rule or regulation thereunder so as to maintain the Trust's
characterization as other than an association taxable as a corporation for
federal income tax purposes, (d) cause such tax returns to be signed in the
manner required by law (e) collect or cause to be collected any withholding
tax as described in and in accordance with Section 4.4 with respect to
income or distributions to Certificateholders, (f) treat the Notes as
indebtedness for all federal and state income tax, franchise tax and
transfer and similar tax purposes and (g) make such elections and keep such
records to treat assets of the Trust as a synthetic debt instrument for
purposes of Treasury Regulations, Section 1.1275-6 and elect out of
Subchapter K of the Code for purposes of Section 761 of the Code.
Section 8.15. SIGNATURE ON RETURNS. Except as required by law,
the Trustee shall sign on behalf of the Trust any and all tax returns of
the Trust presented to it by the Depositor in final execution form.
75
<PAGE>
ARTICLE IX.
TERMINATION
Section 9.1. TERMINATION UPON PURCHASE OR LIQUIDATION OF ALL
DEPOSITED ASSETS. (a) The respective obligations and responsibilities
under this Agreement of the Depositor, the Administrator, if any,
and the Trustee (other than the obligations of any such Administrator
to provide for and the Trustee to make distributions to Holders of
the Certificates of any given Series as hereafter set forth) shall
terminate and the Trust shall dissolve, if no Series are outstanding, upon
the election of the Depositor and otherwise, upon the distribution to such
Holders of all amounts held in all the Accounts for such Series or by an
Administrator, if any, and required to be paid to such Holders
pursuant to this Agreement on the Distribution Date coinciding with or
following the earlier to occur of (i) if and as provided in the Series
Supplement for such Series, the purchase by, and at the sole option of, the
Administrator, if any, or the Depositor, as provided in the Series
Supplement for such Series, of all remaining Deposited Assets for each
Series in the Trust for each Series on any Distribution Date, provided that
such option may be exercised only if the aggregate principal amount of such
Deposited Assets at the time of any such purchase is less than 10% (or such
other percentage as may be specified in such Series Supplement) of the
aggregate principal amount of all Deposited Assets deposited in the Trust
as of the applicable Cut-off Date and (ii) the final payment on or other
liquidation (which may include redemption or other purchase thereof by the
applicable Term Assets Issuer) (or any Advance with respect thereto) of the
last Deposited Asset remaining in the Trust or the disposition of all
property acquired upon foreclosure or liquidation of any such Deposited
Asset; PROVIDED, however, that in no event shall the trust created hereby
continue beyond the expiration of 21 years from the death of the last
survivor of the descendants of Joseph P. Kennedy, the late ambassador of
the United States to the Court of St. James, living on the date hereof.
(b) The Depositor or an Administrator, as the case may
be, shall exercise its option to purchase all the Deposited Assets
remaining in the Trust pursuant to clause (i) of Section 9.1(a) not later
than 91 days prior to the anticipated date of purchase of all such
Deposited Assets, at a price as may be specified in the applicable Series
Supplement; provided, however, that such price shall not be less than the
then outstanding aggregate principal amount of such Deposited Assets as
determined on the date of purchase. The proceeds of such purchase will be
deposited into the Certificate Account and applied in the same manner and
priority that collections on Deposited Assets would be applied as provided
in the applicable Series Supplement.
(c) Written notice of any termination shall be provided as set
forth in Section 10.5.
76
<PAGE>
(d) Upon presentation and surrender of the Certificates by the
Certificateholders on the Scheduled Final Distribution Date, or the
Distribution Date coinciding with or next following the earlier to occur of
the occurrences specified in clauses (i) and (ii) of Section 9.1(a), with
respect to the applicable Series of Certificates, the Trustee shall
distribute to each Holder presenting and surrendering its Certificates (i)
the amount otherwise distributable on such Distribution Date in accordance
with Section 4.1 in respect of the Certificates so presented and
surrendered, if not in connection with the purchase by an Administrator
or the Depositor of all the Deposited Assets or (ii) as specified in
the applicable Series Supplement, if in connection with an Administrator's
purchase of all the remaining Deposited Assets. Pursuant to the
DBTA, the Trustee shall, on behalf of the Trust, pay, or make provision
for, all outstanding obligations of the Trust, if any. Any funds not
distributed on such Distribution Date, or used to pay outstanding
obligations of the Trust, shall be set aside and held in trust for the
benefit of Certificateholders not presenting and surrendering their
Certificates in the aforesaid manner, and shall be disposed of in
accordance with this Section 9.1 and Section 4.1 hereof. Immediately
following the deposit of funds in trust hereunder, the Trust for such
Series shall terminate. Upon the termination of the Trust, the Trustee is
hereby authorized to cause the Certificate of Trust to be cancelled in the
Office of the Secretary of State of the State of Delaware.
ARTICLE X.
MISCELLANEOUS PROVISIONS
Section 10.1. AMENDMENT. (a) This Agreement may be amended from
time to time by the Depositor and the Trustee without notice to or the
consent of any of the Certificateholders for any of the following purposes:
(i) to cure any ambiguity or to correct or supplement any provision herein
which may be defective or inconsistent with any other provision herein;
(ii) to add to the covenants, restrictions or obligations of the Depositor,
the Administrator, if any, or the Trustee for the benefit of the
Certificateholders; (iii) to add, change or eliminate any other provisions
with respect to matters or questions arising under this Agreement, so long
as (x) any such amendment described in (i) through (iii) will not, as
evidenced by an opinion of counsel, affect the tax status of the Trust or
result in a sale or exchange of any Certificate for tax purposes and (y)
the Trustee has received written confirmation from each Rating Agency
rating such Certificates that such amendment will not cause such Rating
Agency rating such Certificates to reduce or withdraw the then current
rating thereof; (iv) to comply with any requirements imposed by the Code;
(v) to evidence and provide for the acceptance of appointment hereunder of
a Trustee other than Delaware Trust Capital Management, Inc. as Trustee for
a Series of Certificates, and to add to or change any of the provisions of
this Agreement as shall be necessary to provide for or facilitate the
77
<PAGE>
administration of the separate Trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 5.1 hereof; (vi) to evidence and
provide for the acceptance of appointment hereunder by a successor Trustee
with respect to the Certificates of one or more Series or to add or change
any of the provisions of this Agreement as shall be necessary to provide
for or facilitate the administration of the trusts hereunder; or (vii) to
provide for the issuance of a new Series of Certificates pursuant to a
Series Supplement issued hereunder pursuant to Sections 5.1 and 5.13
hereof.
(b) Without limiting the generality of the foregoing, with
respect to any Series this Agreement may also be modified or amended from
time to time by the Depositor and the Trustee with the consent of the
Holders of Certificates representing the Required Percentage--Amendment of
the aggregate Voting Rights of those Certificates to which such
modification or amendment relates for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in
any manner the amount of, or alter the timing of, payments received on
Deposited Assets which are required to be distributed on any Certificate
without the unanimous consent of the Holders of such Certificates, (ii)
adversely affect in any material respect the interests of the Holders of
any Series (or Class within such Series) of Certificates in a manner other
than as described in (i), without the consent of the Holders of
Certificates of such Series or Class evidencing not less than the Required
Percentage--Amendment of the aggregate Voting Rights of such Series or
Class or (iii) reduce the percentage of aggregate Voting Rights required by
(ii), as described in (ii), without the consent of the Holders of all
Certificates of such Series or Class then Outstanding and provided further
that the Depositor shall furnish to the Trustee an Opinion of Counsel
stating that, in the opinion of such counsel, any such amendment would not
affect the characterization of the Trust as a "grantor trust" for federal
income tax purposes. Notwithstanding any other provision of this Agreement,
for purposes of the giving or withholding of consents pursuant to this
Section 10.1, Certificates registered in the name of the Depositor, or any
Affiliate thereof, shall be entitled to Voting Rights with respect to
matters affecting such Certificates; and provided further that in the event
the Rating Agency Condition is not satisfied with respect to such
modification or amendment, the Required Percentage--Amendment shall be
increased to require an aggregate percentage of the aggregate Voting Rights
in the amount specified in the applicable Series Supplement.
Notwithstanding any other provision of this Agreement, this Section 10.1(b)
shall not be amended without the unanimous consent of the Holders of all
such Certificates. The Trustee shall have no obligation to execute any
amendment which it determines adversely affects its rights hereunder.
78
<PAGE>
(c) Promptly after the execution of any such amendment or
modification, the Trustee shall furnish a copy of such amendment or
modification to each Certificateholder of the affected Series or Class and
to the Rating Agency. It shall not be necessary for the consent of
Certificateholders under this Section to approve the particular form of any
proposed amendment, but it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents and of
evidencing the authorization of the execution thereof by Certificateholders
shall be subject to such reasonable regulations as the Trustee may
prescribe.
Section 10.2. COUNTERPARTS. This Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts
shall be deemed to be an original, and such counterparts shall constitute
but one and the same instrument.
Section 10.3. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. (a)
The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action
or proceeding in any court for a partition or winding up of the applicable
Trust, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
(b) No Certificateholder of a given Series shall have any right
to vote (except as expressly provided for herein) or in any manner
otherwise control the operation and management of any Trust, or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Certificates, be construed so as to
constitute the Certificateholders from time to time as partners or members
of an association; nor shall any Certificateholder be under any liability
to any third person by reason of any action taken by the parties to this
Agreement pursuant to any provision hereof.
(c) No Certificateholder of a given Series shall have any right
by virtue of any provision of this Agreement to institute any suit, action
or proceeding in equity or at law upon or under or with respect to this
Agreement, unless (i) such Holder previously shall have given to the
Trustee a written notice of breach and of the continuance thereof and
unless also the Holders of Certificates of such Series evidencing not less
than the Required Percentage--Remedies of the aggregate Voting Rights of
such Series shall have made written request upon the Trustee to institute
such action, suit or proceeding in its own name as Trustee hereunder and
shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses and liabilities to be incurred therein
or thereby, and the Trustee, for 15 days after its receipt of such notice,
request and offer of indemnity, shall have neglected or refused to
79
<PAGE>
institute any such action, suit or proceeding. It is understood and agreed
that the Trustee shall not be obligated to make any investigation of
matters arising under this Agreement or to institute, conduct or defend any
litigation hereunder or in relation hereto at the request, order or
direction of any Certificateholders unless such Certificateholders have
offered to the Trustee the reasonable indemnity referred to above. It is
further understood and agreed, and expressly covenanted by each
Certificateholder of each Series with every other Certificateholder of such
Series and the Trustee, that no one or more Holders of Certificates of such
Series shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of
the Holders of any other of the Certificates of such Series, or to obtain
or seek to obtain priority over or preference to any other such Holder, or
to enforce any right under this Agreement, except in the manner herein
provided and for the equal, ratable and common benefit of all
Certificateholders of such Series. For the protection and enforcement of
the provisions of this Section, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or
in equity.
SECTION 10.4. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY THEREIN WITHOUT
REFERENCE TO SUCH STATE'S PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED
THEREBY, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 10.5. NOTICES. All directions, demands and notices
hereunder shall be in writing and shall be delivered as set forth in the
applicable Series Supplement. Any notice required to be provided to a
Holder of a Registered Certificate shall be given by first class mail,
postage prepaid, at the last address of such Holder as shown in the
Certificate Register. Any notice so mailed within the time prescribed in
this Agreement shall be conclusively presumed to have been duly given when
mailed, whether or not the Certificateholder receives such notice. Any
notice required to be given to a holder of a Bearer Certificate or Coupon
shall be published in an Authorized Newspaper or Newspapers in such Place
or Places of Distribution as may be specified for a given Series in the
applicable Series Supplement, and such notice shall be deemed sufficient if
published on two separate Business Days within two Business Days of the
time prescribed in this Agreement.
Section 10.6. SEVERABILITY OF PROVISIONS. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall be
for any reason whatsoever held invalid, then such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way
affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
80
<PAGE>
Section 10.7. NOTICE TO RATING AGENCY. The Trustee shall use
its best efforts promptly to provide, or cause to be provided, notice to
the Rating Agency with respect to each of the following of which it has
actual knowledge:
(i) any change or amendment to this Agreement;
(ii) the occurrence of any Administrator Termination
Event;
(iii) the resignation or termination of an Administrator,
if any, or the Trustee;
(iv) the repurchase or substitution of Deposited Assets, if
any, pursuant to Section 2.3;
(v) the final payment to Holders of the Certificates of any
Class;
(vi) any change in the location of the Certificate Account;
and
(vii) any event that would result in the inability of the
Trustee to make Advances.
In addition, the Trustee shall promptly furnish, or cause to be furnished,
to each Rating Agency copies of each report to Certificateholders described
in Section 4.2 and the Administrator, if any, or otherwise the
Trustee shall promptly furnish to each Rating Agency copies of the
following:
(i) each annual statement as to compliance described in
Section 3.15; and
(ii) each annual independent public accountants' servicing
report described in Section 3.16.
Any such notice pursuant to this Section shall be in writing and shall be
deemed to have been duly given if personally delivered or mailed by first
class mail, postage prepaid, or by express delivery service to each Rating
Agency at the address specified in the applicable Series Supplement.
Section 10.8. GRANT OF SECURITY INTEREST. It is the express
intent of the parties hereto that each conveyance of any Deposited Assets
by the Depositor to the Trust be, and be construed as, a sale of the
Deposited Assets by the Depositor and not a pledge of any Deposited Assets
by the Depositor to secure a debt or other obligation of the Depositor.
However, in the event that, notwithstanding the aforementioned intent of
the parties, any Deposited Assets are held to be property of the Depositor,
then, (a) it is the express intent of the parties that such conveyance be
deemed a pledge of such Deposited Assets by the Depositor to the Trustee to
81
<PAGE>
secure a debt or other obligation of the Depositor and (b)(1) this
Agreement shall also be deemed to be a security agreement within the
meaning of Articles 8 and 9 of the Uniform Commercial Code as in effect
from time to time in the State of New York, or such other State as may be
specified in the related Series Supplement; (2) the conveyance provided for
in Section 2.1 hereof shall be deemed to be a grant by the Depositor to the
Trust of a security interest in all the Depositor's right, title and
interest in and to such Deposited Assets and all amounts payable to the
holders of such Deposited Assets in accordance with the terms thereof and
all proceeds of the conversion, voluntary or involuntary, of the foregoing
into cash, instruments, securities or other property, including all amounts
from time to time held or invested in the applicable Certificate Account,
whether in the form of cash, instruments, securities or other property; (3)
the obligations secured by such security agreement shall be deemed to be
all the Depositor's obligations under this Agreement, including the
obligation to provide to the Certificateholders the benefits of this
Agreement relating to such Deposited Assets and the applicable Trust; and
(4) notifications to persons holding such property, and acknowledgements,
receipts or confirmations from persons holding such property, shall be
deemed notifications to, or acknowledgements, receipts or confirmations
from, financial intermediaries, bailees or agents (as applicable) of the
Trustee for the purpose of perfecting such security interest under
applicable law. Accordingly, the Depositor hereby grants to the Trust a
security interest in the Deposited Assets and all other property described
in clause (2) of the preceding sentence, for the purpose of securing to the
Trustee the performance by the Depositor of the obligations described in
clause (3) of the preceding sentence. Notwithstanding the foregoing, the
parties hereto intend the Grant pursuant to Section 2.1 to be a true,
absolute and unconditional sale of the Deposited Assets and assets
constituting the applicable Trust by the Depositor to the Trustee. The
Depositor and the Trust, upon request of the Depositor, shall to the extent
consistent with this Agreement, take such actions as may be necessary to
ensure that, if this Agreement were deemed to create a security interest in
the Deposited Assets, such security interest would be deemed to be a
perfected security interest of first priority under applicable law and will
be maintained as such for so long as any of the Deposited Assets remain
outstanding. Without limiting the generality of the foregoing, the Trustee
or the Administrator shall file, or shall cause to be filed, all
filings necessary to maintain the effectiveness of any original filings
necessary under the Uniform Commercial Code as in effect in any
jurisdiction to perfect the Trustee's security interest in or lien on the
Deposited Assets, including (x) continuation statements and (y) such other
statements as may be occasioned by (1) any change of name of the Depositor
or the Trustee, (2) any change of location of the place of business or the
chief executive office of the Depositor or (3) any transfer of any interest
of the Depositor in any Deposited Asset.
Section 10.9. NONPETITION COVENANT. Notwithstanding any prior
termination of this Agreement, each of the Trustee (including any Co-
82
<PAGE>
Trustee) the Administrator, if any, and any Authenticating
Agent, Calculation Agent, or Paying Agent and the Depositor
agrees that it shall not, until the date which is one year and one
day after the Closing Date acquiesce, petition or otherwise invoke or
cause the Trust to invoke the process of the United States of America, any
State or other political subdivision thereof or any entity exercising
executive, legislative, judicial, regulatory or administrative functions of
or pertaining to government for the purpose of commencing or sustaining a
case by or against the Trust under a Federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Trust or
all or any part of the property or assets of the Trust or ordering the
winding up or liquidation of the affairs of the Trust.
Section 10.10. NO RECOURSE. Provided that there exists no
default on the Deposited Assets, neither the Trustee (including any Co-
Trustee), more any Administrator, Authenticating Agent, Calculation Agent,
or Paying Agent nor the Depositor shall have any recourse to the Deposited
Assets, except as specifically provided in the related Series Supplement.
Section 10.11. ARTICLE AND SECTION REFERENCES. All article and
section references used in this Agreement, unless otherwise provided, are
to articles and sections in this Agreement.
83
<PAGE>
IN WITNESS WHEREOF, the Depositor and the Trustee have caused
their names to be signed hereto by their respective officers thereunto duly
authorized, in each case as of the day and year first above written.
STRUCTURED PRODUCTS CORP.,
as Depositor,
By__________________________
Name:
Title:
DELAWARE TRUST CAPITAL MANAGEMENT, INC.
not in its individual capacity but solely as
Trustee,
By__________________________
Name:
Title:
84
Exhibit 3
ADMINISTRATION AGREEMENT dated as of September 15, 1997 (the
"Closing Date"), among TIERS Asset-Backed Securities, Series CHAMT Trust
1997-7, a Delaware business trust (the "Issuer"), Delaware Trust Capital
Management, Inc., as Trustee under the Trust Agreement referred to below
(the "Owner Trustee") and First Trust of New York, National Association, a
New York banking corporation ("First Trust"), as administrator (the
"Administrator"), and as Indenture Trustee under the Indenture referred to
below (the "Indenture Trustee").
W I T N E S S E T H:
WHEREAS the Issuer is issuing: (i) the TIERS Asset-Backed
Securities Fixed Rate Notes, Class A (the "Notes") pursuant to the Standard
Terms of the Indenture ("Indenture Standard Terms") and the
TIERS<service-mark> Asset-Backed Securities, Series CHAMT Trust 1997-7
Indenture ("Indenture Series Terms"), each dated as of the Closing Date and
each between the Issuer and First Trust of New York, National Association,
as Indenture Trustee thereunder (the "Indenture Trustee"; the Indenture
Standard Terms and the Indenture Series Terms, as amended and supplemented
from time to time (the "Indenture"); and (ii) the TIERS<service-mark>
Asset-Backed Securities, Floating Rate Certificates, Class B (the
"Certificates") pursuant to the Base Trust Agreement and the
TIERS<service-mark> Asset-Backed Securities Series CHAMT Trust 1997-7
Supplement thereto, each dated as of the Closing Date and each between
Structured Products Corp. as Depositor thereunder (the "Depositor") and the
Owner Trustee (as amended and supplemented from time to time, the "Trust
Agreement"). Terms used in this Agreement but not defined herein shall
have the meanings set forth in the Trust Agreement;
WHEREAS the Issuer has entered into certain agreements in
connection with the issuance of the Notes and the Certificates
(collectively, the "Securities") including (a) the Indenture, (b) the Trust
Agreement, (c) a Letter of Representations dated as of the Closing Date,
with respect to the Notes (as amended and supplemented from time to time,
the "Note Depository Agreement"), among the Issuer, the Indenture Trustee
and The Depository Trust Company ("DTC"), (d) a Letter of Representations
dated as of the Closing Date, with respect to the Trust Certificates (as
amended and supplemented from time to time, the "Certificate Depository
Agreement", and, together with the Note Depository Agreement, the
"Depository Agreements") among the Issuer, the Indenture Trustee, the Owner
Trustee and DTC, (e) an ISDA Master Agreement and related schedule and
confirmations dated as of the Closing Date (as amended and supplemented
<PAGE>
from time to time, the "Swap Agreement"), between the Issuer and
Westdeutsche Landesbank Girozentrale, New York Branch, (the Indenture, the
Depository Agreements and the Swap Agreement being hereinafter referred to
collectively as the "Related Agreements");
WHEREAS pursuant to the Related Agreements, the Issuer, the
Indenture Trustee, and the Owner Trustee are required to perform certain
duties in connection with such Related Agreements.
WHEREAS the Issuer and the Owner Trustee desire to have the
Administrator perform certain of such duties for and on behalf of the
Issuer and the Owner Trustee;
WHEREAS the Administrator has the capacity to provide the
services required hereby and is willing to perform such services for the
Issuer, the Indenture Trustee and the Owner Trustee on the terms set forth
herein; and
WHEREAS the Administrator, in its capacity as Indenture Trustee
under the Indenture, has been appointed by the Issuer (a) as the Note
Paying Agent and Note Registrar under the Indenture and (b) as the Paying
Agent for the Certificates and the Certificate Registrar under the Trust
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. DUTIES OF THE ADMINISTRATOR.
(a) DUTIES WITH RESPECT TO THE DEPOSITORY AGREEMENTS, GENERAL.
Subject to paragraph 4 below, the Administrator agrees to perform, on
behalf of the Issuer and the Owner Trustee, the ministerial, non-fiduciary
duties delegated herein with respect to the Depository Agreements in
accordance with the terms hereof. In performing such duties the
Administrator shall be entitled to seek direction from the Owner Trustee,
the Issuer and the Indenture Trustee.
(b) DUTIES WITH RESPECT TO THE INDENTURE. The Administrator
shall request to be prepared for execution by the Issuer, or shall request
the preparation by other appropriate persons of, all such documents,
reports, filings, instruments, certificates and opinions required of the
Issuer pursuant to those provisions of the Indenture and shall file the
2
<PAGE>
same upon receipt thereof, provided the Administrator shall not be
responsible for any determination of the appropriateness of such filings.
Specifically, the Issuer hereby delegates to the Administrator, and the
Administrator hereby accepts and agrees to perform, subject to paragraph 4
below, and provided no Default or Event of Default exists under any of the
related documents, the following express duties and obligations of the
Issuer (references in this Section 1(b) are, except as otherwise indicated,
to sections of the Indenture Standard Terms and no others):
(A) except with respect to the initial issuance of Notes under
the Indenture, preparing for execution by the Issuer and/or requesting
those customary documents and instruments established by the Indenture
and the Trust Agreement required for authentication of Notes,
processing the registration of transfer and exchange of Notes and
delivery of the same to the Indenture Trustee (Section 2.2(f)),
including Temporary Notes, if any (Section 2.3), and the maintenance
of an office in the Borough of Manhattan, City of New York, for
registration of transfer or exchange of Notes (Section 3.2);
(B) if at any time the Indenture Trustee is not the Note
Registrar under the Indenture, delivery of notification to the
Indenture Trustee of the appointment of a new Note Registrar and the
location of the Note Register (Section 2.4);
(C) preparing all customary instruments and certificates
established by the Indenture and the Trust Agreement for review and
execution by the Issuer and requesting all customary opinions
established by the Indenture and the Trust Agreement from Issuer's
Counsel in connection with a release of collateral (Section 2.9);
(D) if at any time the Indenture Trustee is not the Paying Agent
under the Indenture for the Notes and Certificates, instructing such
other Paying Agents to deliver to the Indenture Trustee the instrument
specified in the Indenture regarding funds held in trust (Section
3.3);
(E) if at any time the Indenture Trustee is not the Paying Agent
for the Notes under the Indenture, directing the Indenture Trustee to
deposit moneys with such Paying Agent (Section 3.3);
(F) effecting the filing or recording of all supplements,
amendments, financing statements, continuation statements, instruments
of further assurance and other instruments directed by the Issuer or
its counsel (Section 3.5);
(G) requesting the annual Opinions of Counsel from Issuer's
Counsel, in accordance with Section 3.6 of the Indenture, as to the
Trust Estate, and preparing the annual Officers' Certificate of the
Issuer for review and execution by the Issuer and certain other
statements, in accordance with Sections 3.9 and 3.6 of the Indenture
Standard Terms;
3
<PAGE>
(H) if at any time the Administrator is not also the Indenture
Trustee under the Indenture, preparing an Officers' Certificate of the
Issuer identifying each Person with whom the Issuer has contracted to
perform its duties under the Indenture (Section 3.7);
(I) in connection with the satisfaction and discharge of the
Indenture (x) notifying the Issuer when all Notes have been paid and
cancelled; (y) requesting on behalf of the Issuer that Issuer's
Counsel prepare the Opinion of Counsel and that the Independent
Accountants (as defined below) prepare the Independent Accountant's
Certificate and (z) preparing for review and execution by the Issuer
the Officer's Certificate (Section 4.1);
(J) requesting any Paying Agent other than the Indenture
Trustee, to pay any moneys to the Indenture Trustee, in connection
with the satisfaction and discharge of the Indenture (Section 4.3);
(K) if at any time the Indenture Trustee is not the Note
Registrar, furnishing the Indenture Trustee with the names and
addresses of Noteholders (Section 7.1);
(L) preparing the reports, in the form annexed hereto as Exhibit
A here (other than the initial reports to the Commission in respect of
the closing) to the Commission, the Indenture Trustee, the Noteholders
and the Swap Counterparty as set forth in Sections 7.3 and 7.4 for
review, execution and filing by the Issuer.
(M) preparing an Issuer Request and Officers' Certificate for
review and execution by the Issuer and requesting from Issuer's
counsel an Opinion of Counsel for the release of the Trust Estate,
as set forth in Section 8.5(b), for review by the Issuer;
(N) assisting the Issuer with the delivery of all documentation
with respect to the execution of supplemental indentures and mailing
notices to the Noteholders and the Swap Counterparty with respect to
such supplemental indentures (Sections 9.1, 9.2 and 9.3);
(O) if directed by the Issuer or its counsel, arranging with
Issuer's Counsel for the recording of the Indenture. (Section 11.15);
and
(A) if requested by the Issuer, subject to the direction of the
Indenture Trustee, assisting in any enforcement of the Swap Agreement
(Section 5.3 and 5.4).
(c) DUTIES WITH RESPECT TO THE TRUST AGREEMENT. The
Administrator shall prepare or request to be prepared for review and
execution by the Issuer and Owner Trustee, or shall cause the preparation
by other appropriate persons, all such ministerial documents, reports,
filings, instruments, certificates and opinions required of the Issuer
4
<PAGE>
pursuant to those provisions of the Trust Agreement and shall file the same
upon the receipt thereof, provided the Administrator shall not be
responsible for any determination of the appropriateness of such filings.
Specifically, the Owner Trustee hereby delegates to the Administrator, and
the Administrator hereby accepts and agrees to perform, subject to
paragraph 4 below, the following express duties and obligations of the
Owner Trustee under the Trust Agreement. References in this Section 1(c)
are solely to Sections in the Trust Agreement:
(A) keeping books and records with respect to the Term Assets
and making such books and records available to the Issuer required by
Section 2.3 of the Trust Agreement (Section 2.3);
(B) preparing and delivering reports to Certificateholders for
review by the Owner Trustee (Section 4.2);
(C) if at any time the Indenture Trustee is not the Paying Agent
under the Indenture for the Certificates, instructing such other
Paying Agent to execute and deliver an agreement in accordance with
the terms of Section 5.14 of the Trust Agreement (Section 5.14);
(D) assisting the Owner Trustee with the process of customary
registration, registration of transfer and exchange of customary
Certificates (Sections 5.4 and 5.5);
(E) providing copies of all notices to the Certificate- holders
required under the Trust Agreement to the Depositary (Section 5.10);
(F) forwarding to the Owner Trustee for examination and review
of all items furnished to the Trustee pursuant to Section 8.1(d);
(G) assisting the Owner Trustee's accountants in the preparation
of, and obtaining and delivering, all accounting reports required
under Section 3.16 and 8.14 for the Owner Trustee's review.
(H) effecting on behalf of the Owner Trustee and counsel
retained by the Owner Trustee and identified in Section 3 hereof
regarding the need to impose any withholding on distributions to the
Certificateholders (Section 4.4).
The Administrator shall satisfy its obligations with respect to
clauses (G) and (H) above by furnishing information to the accountants
engaged on behalf of the Trust in accordance with the provisions of the
Trust Agreement referenced in such clauses. The accountants shall be
5
<PAGE>
required to update the letter in each instance that any additional tax
withholding is subsequently required or any previously required tax
withholding shall no longer be required.
2. ADDITIONAL DUTIES. In addition to the duties of the
Administrator set forth above, the Administrator shall at the direction of
the Issuer or the Owner Trustee, perform such other ministerial or
administrative activities or duties arising under or in connection with the
Related Agreements as are not covered by any of the foregoing provisions
and as are expressly requested by the Owner Trustee, reasonably within the
capabilities of the Administrator, and agreed to in writing by the
Administrator.
3. ACCOUNTANTS AND COUNSEL. The Issuer, in consultation with
the Depositor, has engaged the law firm of Richards Layton & Finger
("Issuer's Counsel") and the accounting firm of Arthur Andersen
("Independent Accountants") to provide, respectively, legal and accounting
advice and services as required under the Related Documents. The
Administrator is hereby authorized and instructed to assist each such firm
to provide such services and advice reasonably necessary to enable (a) the
Issuer and the Trustee to comply with their respective obligations
delegated hereunder and (b) the Administrator to comply with the
obligations assumed hereunder.
4. NONMINISTERIAL DUTIES.
(a) The Administrator shall take no action with respect to
matters that in the reasonable judgment of the Administrator are
nonministerial or fiduciary, all of which shall remain with the Issuer,
Indenture Trustee or Owner Trustee as the case may be. For the purpose of
the preceding sentence, "nonministerial matters" shall include, without
limitation:
(i) the amendment of or any supplement to the Indenture;
(ii) the initiation of any claim or lawsuit by the Issuer
and the compromise of any action, claim or lawsuit brought by or
against the Issuer;
(iii) the amendment, change or modification of the Related
Agreements;
(iv) the appointment of successor Note Registrar, successor
Paying Agents and successor Trustees pursuant to the Indenture or the
appointment of successor Administrators, or the consent to the
assignment by the Note Registrar, Paying Agent or Trustee of its
obligations under the Indenture;
(v) the removal of the Indenture Trustee;
6
<PAGE>
(vi) except in its role as Paying Agent under the Indenture,
making any payments to the Noteholders or the Swap Counterparty under
the Related Agreements;
(vii) selling the Trust Estate or portions thereof pursuant
to and in accordance with the procedure set forth in Section 3(b)(iv)
or 3(c)(i) of the Indenture Series Terms.
(b) The Administrator agrees that if it determines that any
duties delegated to it hereunder are not ministerial or are fiduciary in
nature, the Administrator shall, if those duties are not to be performed by
the Indenture Trustee pursuant to the Indenture, promptly so notify the
Issuer, the Depositor, and the Owner Trustee. In addition, the
Administrator agrees that if it determines that any document, instrument or
opinion required to be delivered under the Indenture or the Trust Agreement
is not "customary," it will promptly so notify the Issuer, the Depositor
and the Owner Trustee.
(c) Notwithstanding anything to the contrary in any Depositary
Agreement, the Administrator shall not be required to make determinations
as to the appropriateness of payments, UCC and other security filings,
tax filings, SEC filings, or other similar actions or positions and shall
be entitled, in the event of any question concerning its duties, to
request and seek and receive direction from the party in whose behalf it
is acting.
(d) Notwithstanding anything to the contrary in this Agreement,
the Issuer may at any time assume responsibility to perform any of the
duties delegated to the Administrator hereunder on its own behalf by
advising the Administrator, the Depositor, the Indenture Trustee and the
Owner Trustee in writing that it is assuming such duties and the
Administrator shall have no further obligation with respect to any such
duties.
5. RECORDS. The Administrator shall maintain appropriate books
of account and records relating to services performed hereunder, which
books of account and records shall be accessible for inspection by the
Issuer and the Depositor at any time during normal business hours.
6. COMPENSATION AND INDEMNITY. As compensation for the
performance of the Administrator's obligations under this Agreement and as
reimbursement for its expenses related thereto, the Administrator shall
receive the compensation set forth in the letter agreement dated as of the
date hereof between the Depositor and the Administrator. All fees and
expenses of the accountants and counsel engaged on behalf of the Issuer and
the Trustee shall be for the account of the Depositor. In addition, by its
signature below, the Depositor agrees that it shall indemnify the
Administrator against any and all loss, liability or expense (including
attorney's fees) incurred by it in connection with the performance of its
duties as Administrator hereunder. The Administrator shall notify the
7
<PAGE>
Depositor promptly of any claim for which it may seek indemnity. Failure
by the Administrator to so notify the Depositor shall not relieve the
Depositor of its obligations hereunder. The Depositor shall defend the
claim and the Administrator may have separate counsel and the Depositor
shall pay the fees and expenses of such counsel. The Depositor need not
reimburse any expense or indemnity against any such loss, liability or
expense incurred by the Administrator through the Administrator's own
willful misconduct, negligence or bad faith.
7. ADDITIONAL INFORMATION TO BE FURNISHED TO THE ISSUER. The
Administrator shall furnish to the Issuer from time to time such additional
information in its possession regarding the Collateral as the Issuer shall
reasonably request.
8. ROLE OF ADMINISTRATOR. Unless expressly contemplated by
the Related Documents, the Administrator shall have no authority to
represent the Issuer or the Owner Trustee in any way except as
Administrator as expressly contemplated hereby and shall not
otherwise be deemed an agent of the Issuer or the Owner Trustee.
9. NO JOINT VENTURE. Nothing contained in this Agreement (a)
shall constitute the Administrator and either of the Issuer or the Owner
Trustee as members of any partnership, joint venture, association,
syndicate, unincorporated business or other separate entity or shall be
construed to impose any liability as such on any of them thereby or (b)
shall be deemed to confer on any of them any express, implied or apparent
authority to incur any obligation or liability on behalf of the others;
other than as expressly contemplated hereby.
10. OTHER ACTIVITIES OF ADMINISTRATOR. Nothing herein shall
prevent the Administrator or its affiliates from engaging in other
businesses or, in its sole discretion, from acting in a similar capacity as
an administrator for any other person or entity even though such person or
entity may engage in business activities similar to those of the Issuer,
the Owner Trustee or the Trustee.
11. TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR.
(a) This Agreement shall continue in force until the dissolution of the
Issuer, upon which event this Agreement shall automatically terminate,
except as to surviving rights of indemnity.
(b) Subject to Section 11(e), the Administrator may resign its
duties hereunder by providing the Issuer with at least 60 days' prior
written notice.
(c) Subject to Section 11(e), the Issuer, or the Owner Trustee,
may remove the Administrator without cause by providing the Administrator
with at least 60 days' prior written notice.
8
<PAGE>
(d) Subject to Section 11(e), either or both of the Owner
Trustee or the Issuer may, in its or their sole discretion, remove the
Administrator immediately upon written notice of termination from the
Issuer, or the Owner Trustee, to the Administrator if any of the following
events shall occur:
(i) the Administrator shall materially default in the
performance of any of its duties under this Agreement and, after
notice of such default, shall not cure such default within thirty days
(or, if such default cannot be cured in such time, shall not give
within ten days such assurance of cure as shall be reasonably
satisfactory to the Issuer);
(ii) a court having jurisdiction in the premises shall enter
a decree or order for relief, and such decree or order shall not have
been vacated within 60 days, in respect of the Administrator in any
involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect or appoint a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official for the Administrator or any substantial part of its property
or order the winding-up or liquidation of its affairs; or
(iii) the Administrator shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order for relief
in an involuntary case under any such law, or shall consent to the
appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar official for the Administrator or any
substantial part of its property, shall consent to the taking of
possession by any such official of any substantial part of its
property, shall make any general assignment for the benefit of
creditors or shall fail generally to pay its debts as they become due.
The Administrator agrees that if any of the events specified in
clauses (ii) or (iii) of this Section shall occur, it shall give written
notice thereof to the Issuer, the Owner Trustee, the Depositor and the
Indenture Trustee within seven days after the happening of such event.
(e) No resignation or removal of the Administrator pursuant to
this Section shall be effective until (i) a successor Administrator shall
have been appointed by the Depositor and (ii) such successor Administrator
shall have agreed in writing to be bound by the terms of this Agreement in
the same manner as the Administrator is bound hereunder. If the
Administrator believes in good faith it cannot perform its duties and
9
<PAGE>
resigns, it shall be entitled to petition a court of competent jurisdiction
to appoint a successor and it shall not be required to take any action
hereunder until a final non-appealable determination by such court is made.
(f) The appointment of any successor Administrator shall be
effective only after satisfaction of the Rating Agency Condition (as
defined in the Trust Agreement) with respect to the proposed appointment.
12. ACTION UPON TERMINATION, RESIGNATION OR REMOVAL. Promptly
upon the effective date of termination of this Agreement pursuant to
Section 8(a) or the resignation or removal of the Administrator pursuant to
Section 8(b) or (c), respectively, the successor Administrator shall
automatically become the Administrator under this Agreement.
13. NOTICES. Any notice, report or other communication given
hereunder shall be in writing and addressed as follows:
(a) If to the Issuer, to
TIERS<service-mark> Asset-Backed Securities
Series CHAMT Trust 1997-9
c/o Delaware Trust Capital Management, Inc.
c/o Core States Bank Delaware
5-4-82-12
4th Floor
3 Beaver Valley Road
Wilmington, Delaware 19803
Attention: Corporate Trust Department
Louis Geibel
Richard Smith
Telephone: 302-421-7339
Facsimile: 302-421-7387
(b) If to the Administrator, to
First Trust of New York, National Association
100 Wall Street, Suite 1600
New York, New York 10005
Attention: Marlene Fahey
Facsimile: 212-809-5459
(c) If to the Owner Trustee, to
Delaware Trust Capital Management, Inc., not in its
individual capacity but solely as Owner Trustee
c/o Core States Bank Delaware
5-4-82-12
4th Floor
3 Beaver Valley Road
Wilmington, Delaware 19803
10
<PAGE>
Attention: Corporate Trust Department
Louis Geibel
Richard Smith
Telephone: 302-421-7339
Facsimile: 302-421-7387
or to such other address as any party shall have provided to the other
parties in writing. Any notice required to be in writing hereunder shall
be deemed given if such notice is mailed by certified mail, postage
prepaid, or hand delivered to the address of such party as provided above.
14. AMENDMENTS. This Agreement may be amended from time to time
by a written amendment duly executed and delivered by the Issuer, the
Administrator, the Indenture Trustee, the Owner Trustee and the Depositor,
without the consent of the Noteholders and the Certificateholders, for the
purpose of adding to or amending, modifying or supplementing any provisions
to; PROVIDED that such amendment will not, in the Opinion of Counsel
satisfactory to each such party, materially and adversely affect the
interest of any Noteholder or Certificateholder. This Agreement may also
be amended by the Issuer, the Administrator, the Owner Trustee, the
Indenture Trustee and the Depositor with the written consent of the holders
of Notes evidencing at least a majority in the outstanding principal amount
of the Notes and the holders of Certificates evidencing at least a majority
of the outstanding principal amount thereof for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of
Noteholders or the Certificateholders; PROVIDED, HOWEVER, that no such
amendment may (a) increase or reduce in any manner the amount of, or
accelerate or delay the timing of, distributions that are required to be
made for the benefit of the Noteholders or Certificateholders (b) reduce
the aforesaid percentage of the holders of Notes and Certificates which are
required to consent to any such amendment, without the consent of the
holders of all the outstanding Notes and Certificates or (c) amend or
modify the terms of this Section 14. Notwithstanding the foregoing, the
Administrator may not amend this Agreement without the permission of the
Depositor, which permission shall not be unreasonably withheld.
15. SUCCESSORS AND ASSIGNS. This Agreement may not be assigned
by the Administrator unless such assignment is previously consented to in
writing by the Issuer, the Indenture Trustee, the Owner Trustee, and the
Depositor and subject to the satisfaction of the Rating Agency Condition in
respect thereto, provided however the Administrator may delegate certain of
its duties hereunder to agents selected with reasonable care. An
assignment with such consent and satisfaction it accepted by the assignee,
shall bind the assignee hereunder in the same manner as the Administrator
11
<PAGE>
is bound hereunder. Notwithstanding the foregoing, this Agreement may be
assigned by the Administrator without the consent of the Issuer or the
Owner Trustee to a corporation or other organization that is a successor
(by merger, consolidation or purchase of assets) to the Administrator.
Subject to the foregoing, this Agreement shall bind any successors or
assigns of the parties hereto.
16. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
17. HEADINGS. The section headings hereof have been inserted
for convenience or reference only and shall not be construed to affect the
meaning, construction or effect of this Agreement.
18. COUNTERPARTS. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but
one and the same agreement.
19. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
20. NOT APPLICABLE TO FIRST TRUST OF NEW YORK, NATIONAL
ASSOCIATION IN OTHER CAPACITIES. Nothing in this Agreement shall affect
any obligation First Trust of New York, National Association may have in
any other capacity. The Administrator is authorized to act on behalf of
the party it represents hereunder notwithstanding any potential conflict of
interest and no performance of any duty hereunder shall prevent the
Indenture Trustee from performing its duties. The Administrator shall be
entitled to the same rights, privileges and immunities available to the
parties on whose behalf it is acting hereunder notwithstanding anything
to the contrary herein or elsewhere.
21. LIMITATION OF LIABILITY; INDEMNITY.
(a) Notwithstanding anything contained herein to the contrary,
this instrument has been countersigned by Delaware Trust Capital
Management, Inc. not in its individual capacity but solely in its capacity
as Owner Trustee of the Issuer and in no event shall Delaware Trust Capital
Management, Inc. in its individual capacity or any beneficial owner of the
Issuer have any liability for the representations, warranties, covenants,
agreements or other obligations of the Issuer hereunder, as to all of which
recourse shall be had solely to the assets of the Issuer. For all purposes
of this Agreement, in the performance of any duties or obligations of the
Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Article VIII of the Trust
Agreement.
(b) Notwithstanding anything contained herein to the contrary,
this Agreement has been countersigned by First Trust of New York, National
Association not in its individual capacity but solely as Indenture Trustee
12
<PAGE>
and Administrator and in no event shall First Trust of New York, National
Association have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in
any of the certificates, notices or agreements delivered pursuant hereto,
as to all of which recourse shall be had solely to the asset of the Issuer.
22. REFERENCES TO ADMINISTRATOR IN TRUST AGREEMENT. The parties
hereto agree that notwithstanding any references to the "Administrator" or
the "Administrative Agent" in the Trust Agreement the only duties assumed
by the Administrator are those expressly delegated to and assumed by the
Administrator in this Administration Agreement.
23. APPOINTMENT OF AGENT FOR SERVICE OF PROCESS. The Owner
Trustee appoints First Trust of New York, National Association as agent for
service of process.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first written above.
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
not in its individual capacity but solely as
Trustee,
By:_______________________________
Title:____________________________
TIERS<service-mark> ASSET-BACKED SECURITIES,
SERIES CHAMT 1997-7 TRUST,
a Delaware Business Trust
By: Delaware Trust Capital Management, Inc., not
in its individual capacity but solely as
Trustee,
By:________________________________
Title:_____________________________
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
as Administrator
By:________________________________
Title:_____________________________
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
as Indenture Trustee
By:________________________________
Title:_____________________________
Accepted and Agreed as of
the date first above written:
STRUCTURED PRODUCTS CORP.,
as Depositor
By:__________________________
Title:_______________________
14
SCHEDULE
to the
Master Agreement
dated as of September 15, 1997
between
WESTDEUTSCHE LANDESBANK GIROZENTRALE,
a banking institution organized and existing under the laws
of the State of North Rhine - Westphalia, acting through its New York
Branch ("West LB"),
and
TIERS<service-mark> ASSET-BACKED SECURITIES, SERIES CHAMT TRUST 1997-7,
a business trust organized under the
laws of the State of Delaware pursuant
to the Trust Agreement (as defined herein) (the "Trust").
<PAGE>
PART 1. TERMINATION PROVISIONS
IN THIS AGREEMENT:
(a) "SPECIFIED ENTITY" means in relation to West LB for the
purpose of:
Section 5(a)(v), Not Applicable
Section 5(a)(vi), Not Applicable
Section 5(a)(vii), Not Applicable
Section 5(b)(iv), Not Applicable
and in relation to the Trust for the purpose of:
Section 5(a)(v), Not Applicable
Section 5(a)(vi), Not Applicable
Section 5(a)(vii), Not Applicable
Section 5(b)(iv), Not Applicable
(b) The provisions of Section 5(a) and Section 5(b) will apply
to West LB and to the Trust as follows:-
<TABLE>
<CAPTION>
SECTION 5(A) WEST LB TRUST
- ------------ ------- -----
<S> <C> <C>
(i) "Failure to Pay or Deliver" Applicable Applicable
(ii) "Breach of Agreement" Not Applicable Not Applicable
(iii) "Credit Support Default" Not Applicable Not Applicable
(iv) "Misrepresentation" Not Applicable Not Applicable
(v) "Default under Specified Not Applicable Not Applicable
Transaction"
(vi) "Cross Default" Not Applicable Not Applicable
(vii) "Bankruptcy" Applicable Applicable
(viii)"Merger Without Assumption" Not Applicable Not Applicable
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SECTION 5(A) WEST LB TRUST
- ------------ ------- -----
<S> <C> <C>
(i) "Illegality" Applicable Applicable
(ii) "Tax Event" Not Applicable Not Applicable
(iii) "Tax Event Upon Merger" Not Applicable Not Applicable
(iv) "Credit Event Upon Merger" Not Applicable Not Applicable
(v) "Additional Termination Event" Applicable Applicable
</TABLE>
The following shall constitute "Additional Termination Events"
under this Agreement:
(A) the occurrence of an Optional Redemption of the Notes
pursuant to Part 5 paragraph (9) hereof and to Section 3c of the
Indenture ("Optional Redemption of the Notes"), and
(B) the payment in full of the Note Principal Amount and the
certificate principal balance (a "Prepayment Event").
If an Optional Redemption or a Prepayment Event are to occur, the
Payment Date on which such Optional Redemption of the Notes or,
as applicable, such Prepayment Event shall occur shall be an
Early Termination Date without need for any additional notice by
either party. In addition, notwithstanding Part 1 paragraph (d)
below, in connection with an Early Termination Date because of an
Optional Redemption of the Notes or a Prepayment Event, no
Settlement Amount will be payable by either party and the only
amounts due on the applicable Early Termination Date will be the
amounts set forth in any Confirmation related to a Transaction as
due on such date plus any Unpaid Amounts as of such date.
(c) The "AUTOMATIC EARLY TERMINATION" provision of Section 6(a)
will not apply to West LB or the Trust.
(d) Payments on Early Termination. For the purpose of Section
6(e) of this Agreement.
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(e) "TERMINATION CURRENCY" means United States Dollars.
(f) ADDITIONAL EVENTS OF DEFAULT. In addition to the Events of
Default specified in Section 5(a) of the Master Agreement (as modified by
this Schedule) as being applicable it shall be an Event of Default
hereunder if there is an acceleration of the Notes because of an Indenture
Event of Default, as defined in the Indenture (any such, an "Acceleration
Event"). If an Acceleration Event occurs the Swap Agreement shall
terminate automatically and an Early Termination Date shall be deemed to
have been set on the date set forth in the Indenture for the acceleration
of the Notes. If an Acceleration Event occurs the Trust shall be the
Defaulting Party.
PART 2. TAX REPRESENTATIONS.
(a) PAYER REPRESENTATIONS. None.
(b) PAYEE REPRESENTATIONS. None.
PART 3. AGREEMENT TO DELIVER DOCUMENTS
Documents to be delivered are:
<TABLE>
<CAPTION>
Party
Required to Date by Covered by
Deliver Form/Document/ Which to Section 3(d)
Document Certificate Be Delivered Representation
- ------------ -------------------------- ---------------------- ---------------
<S> <C> <C> <C>
West LB An Internal Revenue Service (i) Before the first Yes
Form 4224 or any successor Payment Date under this
form completed in a manner Agreement, (ii) before
reasonably satisfactory to the first Payment Date
the Trust. under this Agreement in
each successive taxable
year of West LB, (iii)
promptly upon
reasonable demand by
the Trust, and (iv)
promptly upon learning
that any such Form
previously provided by
West LB has become
obsolete or incorrect.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Party
Required to Date by Covered by
Deliver Form/Document/ Which to Section 3(d)
Document Certificate Be Delivered Representation
- ------------ -------------------------- ---------------------- ---------------
<S> <C> <C> <C>
West LB Extracts from West LB's Upon execution of this Yes
Signature Book. Agreement.
West LB Annual Report of West LB As soon as practicable Yes
containing audited following written
consolidated financial request from the Trust.
statements for each fiscal
year certified by independent
public accountants for each
such fiscal year.
West LB Opinion of West LB In-House No
German Counsel reasonably
satisfactory to the Trustee
Trust (with respect Incumbency Certificate with Upon execution of this Yes
to the Trustee) respect to the signatory to Agreement
the Agreement
Trust (with respect A certified copy of the Upon execution of this Yes
to the Trustee) resolution or resolutions Agreement.
(the "Authorizing
Resolution"), certified by a
secretary, or an assistant
secretary of the Trustee,
authorizing the Trustee on
behalf of the Trust, to enter
into this Agreement and each
Transaction and Confirmation
hereunder.
Trust A certified copy of the Trust Upon execution of this Yes
Agreement and each amendment Agreement and on the
thereof. date of each amendment
thereof.
Trust Opinion of Outside Counsel Upon execution of this No
reasonably satisfactory to Agreement
West LB with respect to the
Trust and the Trustee.
</TABLE>
4
<PAGE>
PART 4 - MISCELLANEOUS.
(a) ADDRESSES FOR NOTICES. For the purpose of Section 12(a):
Address for notices or communications to West LB:
Address: Westdeutsche Landesbank Girozentrale
1211 Avenue of the Americas, 25th Floor
New York, New York 10036
Attention: Legal Department
Telex No.: __________ Answerback:
Facsimile No.: 212-768-4781
Address for notices or communications to the Trust:-
TIERS<service-mark> Asset-Backed Securities, Series CHAMT Trust 1997-7,
Address: [ ]
(b) PROCESS AGENT. For the purpose of Section 13(c):
West LB appoints as its Process Agent:
Name: Westdeutsche Landesbank Girozentrale,
New York Branch
Attention: Legal Department
Address: 1211 Avenue of the Americas, 25th Floor,
New York, New York 10036
The Trust appoints as its Process Agent:-
[Identify]
(c) OFFICES. The provisions of Section 10(a) will apply to this
Agreement. Section 10(a) is hereby amended by adding the words "and each
branch thereof" to the end of the first sentence of such section.
(d) MULTIBRANCH PARTY. For the purposes of Section 10(c) of
this Agreement:
The Trust is not a Multibranch Party.
West LB is not a Multibranch Party.
5
<PAGE>
(e) CALCULATION AGENT. The Calculation Agent will be West LB.
(f) CREDIT SUPPORT DOCUMENTS. Not applicable.
(g) CREDIT SUPPORT PROVIDER. Not applicable.
(h) GOVERNING LAW. This Agreement will be governed by, and
construed and enforced in accordance with, the law of the State of New York
without reference to choice of law doctrine.
(i) NETTING OF PAYMENTS. Subparagraph (ii) of Section 2(c) of
this Agreement will not apply to Transactions.
(j) "AFFILIATE" will have the meaning specified in Section 14 for
West LB and will be inapplicable to the Trust.
(k) PAYMENTS.
The account for payments to West LB shall be:
Chase Manhattan Bank, New York
ABA #: 021-100-021
Account #: 001-1-621398
Account Name: Global Derivatives, West LB, N.Y.
The account for payments to the Trust shall be:
[Identify]
or to such other account as the Trust shall have last designated by notice
to West LB in accordance with the terms of Section 2(b).
PART 5. OTHER PROVISIONS
(1) DEFINITIONS.
(a) This Agreement, the Confirmations, and each Transaction are
subject to the 1991 ISDA Definitions (the "Definitions"), as published by
the International Swaps and Derivatives Association, Inc., and will be
governed in all respects by the provisions set forth in the Definitions.
The provisions of the Definitions are incorporated by reference in, and
will be deemed to be part of, this Agreement and the Confirmations as if
set forth in full in this Agreement or in such Confirmations.
6
<PAGE>
(b) In addition as used herein and in any Confirmation:
"Asset Impairment Event" means that on the Termination Date for the
Transactions, the Note Notional Amount (as defined in the Indenture), less
all losses (if any) on Eligible Investments that became defaulted
investments while owned by the Trust, is less than the aggregate Note
Principal Amount (as also defined in the Indenture) on such date.
"Certificates" means the $10,920,000 Floating Rate Certificates, Class
B issued by the Trust on the date hereof pursuant to the Trust Agreement.
"Certificate LIBOR" means, for any Calculation Period, "LIBOR" as
defined and set in accordance with the Trust Agreement.
"Certificate Prepayment Amount" means the "Monthly Prepayment Amount
as defined in Section 1(b) of the Trust Agreement.
"Distribution Date" means the 15th calendar day of each month
commencing October 15, 1997, through and including the Termination Date of
this Transaction, subject to adjustment in accordance with the Following
Business Day Convention.
"Early Amortization Payments" with respect to the Term Assets has the
meaning set forth in the Indenture.
"Eligible Investments" has the meaning set forth in the Indenture.
"Indenture" means the Indenture dated as of September 15, 1997, as
supplemented by a series supplement thereto also dated as of September 15,
1997, each between the Trust and First Trust of New York, National
Association, as Indenture Trustee.
"Indenture Trustee" means First Trust of New York, National
Association, as Indenture Trustee under the Indenture.
"Notes" means the $352,980,000 Fixed Rate Notes, Class A, issued by
the Trust on the date hereof pursuant to the Indenture.
"Note Prepayment Amount" means the "Monthly Prepayment Amount" as
defined in the Indenture.
"Redemption Date" has the meaning set forth in the Indenture.
"Sale Procedures" has the meaning set forth in the Indenture.
"Sale Proceeds" has the meaning set forth in the Indenture.
"Scheduled Interest Payments" with respect to the Term Assets has the
meaning set forth in the Indenture.
7
<PAGE>
"Term Assets" means the "Collateral Obligations" as defined in the
Indenture.
"Trust Agreement" means, the Base Trust Agreement, dated as of
September 15, 1997, as supplemented by the Series CHAMT 1997-7 Supplement,
also dated as of September 15, 1997, each between Structured Products Corp.
and the Trustee.
"Trustee" means Delaware Trust Capital Management, Inc. as trustee
under the Trust Agreement.
(2) INCONSISTENCY. In the event of any inconsistency between the
provisions of this Agreement and the Definitions, this Agreement will
prevail. In the event of any inconsistency between the provisions of a
Confirmation and this Agreement or the Definitions, the Confirmation will
prevail for the purpose of the relevant Transaction. In the event of any
inconsistency between the provisions of this Schedule and the printed form
of agreement of which it forms a part, this Schedule will prevail.
(3) Section 2(d) is hereby deleted in its entirety and amended to provide
that payments under this Agreement may be made with deduction for or on
account of any tax required by applicable laws with respect to such
payment.
(4) Section 7 is hereby deleted in its entirety and amended to provide
that neither the Trust nor West LB shall assign, novate or transfer as a
whole or in part any of its rights, obligations or interests under this
Agreement except that the Trust may assign and pledge to the Indenture
Trustee, for the benefit of the Noteholders, all of the Trust's rights and
interest hereunder, as security for the Trust's obligations to such holders
under the Indenture.
(5) NON-BANKRUPTCY PETITION. Prior to the date that is one year and one
day after the date upon which the Trust is terminated in accordance with
the terms of the Trust Agreement, West LB hereby irrevocably and
unconditionally agrees that it will not institute against, or join any
other person in instituting against, the Trust any bankruptcy,
reorganization, arrangement, insolvency, or liquidation proceeding under
the bankruptcy or similar laws of the United States or any other
jurisdiction.
(6) ACCURACY OF SPECIFIED INFORMATION. Section 3(d) is hereby amended by
adding in the third line thereof after the word "respect" and before the
period the words "or, in the case of audited or unaudited financial
statements or balance sheets, a fair presentation of the financial
condition of the relevant person".
(7) MODIFICATIONS TO THE AGREEMENT.
The words "or any of its Affiliates" shall be deleted from lines 1 and
2 of Section 3(c) of this Agreement.
The words "or there is a substantial likelihood that it will" shall be
deleted from line 4 of Section 5(b)(ii) of this Agreement.
8
<PAGE>
(8) SEVERABILITY. In the event that any one or more of the provisions
contained in this Agreement should be held invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions in the Agreement shall not in any way be affected
or impaired. In the event that any one or more of the provisions contained
in this Agreement should be held invalid, illegal or unenforceable, the
parties will negotiate in good faith to replace the invalid, illegal or
unenforceable provisions with valid provisions which will, as nearly as
possible, give the originally intended legal and economic effect of the
invalid, illegal or enforceable provisions.
(9) OPTIONAL REDEMPTION OF THE NOTES. If on any Payment Date for the
Notes, before giving effect to any distributions to be made on such date,
the aggregate outstanding principal amount of the Term Assets would be less
than 10% of the principal amount of the Term Assets as of the date of
execution of this Agreement, West LB or its designee may, at its option, by
delivering a written notice to the Indenture Trustee (with a copy to the
Issuer), purchase all of the Term Assets and Eligible Investments at an
aggregate purchase price equal to the outstanding principal amount of the
Notes and Certificates and any accrued interest thereon and direct the
redemption of all of the outstanding Notes at their Redemption Price (as
defined in the Indenture). If West LB (or its designee) directs such an
Optional Redemption of the Notes such event shall, as provided in Part 1
above, be a Termination Event and the Early Termination Date shall be the
date set for such redemption in accordance with the Indenture.
(10) CALCULATION OF NOTE AND CERTIFICATE PREPAYMENT AMOUNTS. On the first
Business Day of each month West LB, or its designee, shall determine (i)
the PSA Index Rate (as defined in the Indenture) for such month, (ii) the
Monthly Amortization Rate (as defined in the Indenture) that corresponds to
such PSA Index Rate for the Notes and for the Certificates, (iii) the Note
Prepayment Amount and (iv) the Certificate Prepayment Amount; and West LB
shall notify the Indenture Trustee of its determinations.
(11) SALE PROCEDURES. If West LB receives notice from the Indenture
Trustee pursuant to Section 5 of the Indenture that, in connection with a
mandatory prepayment of the Notes and/or Certificates, the Indenture
Trustee is required to liquidate, in accordance with the Sale Procedures,
an aggregate Par Amount of Eligible Investments and principal amount of
Term Assets in an amount equal to (or as close as practicable, equal to),
the aggregate principal amount of Notes and Certificates then subject to
such mandatory prepayment, West LB shall, at least 5 Business Days before
the Distribution Date on which such prepayment amounts are due the holders
of the Notes and/or Certificates, direct the Indenture Trustee as to which
Eligible Investments, if any, (and the Par Amount thereof) should be
liquidated with the Term Assets.
9
<PAGE>
IN WITNESS WHEREOF, the parties have executed and delivered this
document as of the date specified on the first page of this document.
WESTDEUTSCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH
By:_________________________________
Name:
Title:
By:_________________________________
Name:
Title:
TIERS<service-mark> ASSET BACKED SECURITIES, SERIES
CHAMT TRUST 1997-7
By: Delaware Trust Capital Management Inc., not in its
individual capacity but solely as Trustee under the
Trust Agreement
By:__________________________________
Name:
Title:
<PAGE>
September 15, 1997
Ms. Wendy Bannerman-Clark
Westdeutsche Landesbank Girozentrale, New York Branch
1211 Avenue of the Americas
New York, NY 10036
Facsimile: 212-597-8592
Telephone: 212-597-8583
West LB Ref:
Trust Confirm (Interest Rate Transaction)
TRANSACTION
Dear Ms. Bannerman-Clark:
The purpose of this letter agreement (this "Confirmation") is to set
forth the terms and conditions of the Transaction entered into between
Westdeutsche Landesbank Girozentrale, New York Branch ("West LB") and
Tiers<service-mark> Asset-Backed Securities, Series CHAMT Trust 1997-7 (the
"Trust") on the Trade Date specified below (this "Transaction"). This
Confirmation constitutes a "Confirmation" and this Transaction constitutes
a "Transaction" as referred to in the Master Agreement specified below.
1. GENERAL. The definitions and provisions contained in the 1991 ISDA
Definitions (as published by the International Swaps and Derivatives
Association, Inc. ("ISDA")) (the "Definitions") are incorporated into this
Confirmation. References herein to a "Transaction" shall be deemed to be
references to a "Swap Transaction" for purposes of the Definitions.
This Confirmation supplements, forms a part of, and is subject to, the
ISDA Master Agreement and Schedule thereto dated as of the date hereof, as
amended and supplemented from time to time (the "Master Agreement"),
between West LB and the Trust. All provisions contained in the Master
Agreement govern this Confirmation except as expressly modified below. In
the event of any inconsistency between this Confirmation and the
Definitions or the Master Agreement, this Confirmation will govern.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in (or refrained from engaging in) substantial
financial transactions and has taken other material actions in reliance
upon the parties' entry into the Transaction to which this Confirmation
relates on the terms and conditions set forth below.
<PAGE>
THIS CONFIRMATION WILL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO
CHOICE OF LAW DOCTRINE.
2. TERMS RELATING TO THE TRANSACTION.
Trade Date: As of August 21, 1997
Effective Date: September 15, 1997
Termination Date: November 15, 2003; subject to adjustment
in accordance with the Following
Business Day Convention.
Business Day Convention: Following
Calculation Agent: West LB
I. TRUST PAYMENT AMOUNTS
TRUST FLOATING AMOUNTS:
Payment Dates: Each Distribution Date.
Floating Payments: The Trust will pay to West LB, if and to
the extent received on the Term Assets,
(i) an amount equal to the Scheduled
Interest Payments received by the Trust
on the Term Assets, PLUS (ii) any
amounts received by the Trust
representing Deferred Interest Amounts
(including any penalty interest thereon)
on the Term Assets (any such payments,
"Deferred Payments").
II. WEST LB PAYMENT AMOUNTS
A. WEST LB FIXED PAYMENTS:
Notional Amount: USD 352,980,000, provided that for each
Calculation Period commencing on or
after February 15, 1999, the Notional
2
<PAGE>
Amount for such Calculation Period will
equal the Notional Amount during the
immediately preceding Calculation Period
less the amount, if any, of the Note
Prepayment Amount, if any, due the
Noteholders pursuant to the Indenture on
the Distribution Date relating to such
immediately preceding Calculation
Period.
Payment Dates: Each Distribution Date.
Business Days: Any Business Day under the Indenture.
Fixed Rate: 6.688%
Day Count Fraction: 30/360
Period End Dates: Each Distribution Date, except no
Adjustment.
Adjustment: The West LB Fixed Payments described
herein are subject to adjustment as
provided in paragraph 3(a) and (b) below.
B. WEST LB FLOATING PAYMENTS:
Notional Amount: USD 10,920,000; provided that for each
Calculation Period commencing on or
after February 15, 2000, the Notional
Amount for such Calculation Period will
equal the Notional Amount during the
immediately preceding Calculation Period
less the amount, if any, of the
Certificate Prepayment Amount due the
holders of the Certificates pursuant to
the Trust Agreement on the Distribution
Date relating to such immediately
preceding Calculation Period.
Payment Dates: Each Distribution Date.
Business Days: Any Business Day under the Trust
Agreement.
Floating Rate Option: Certificate LIBOR.
3
<PAGE>
Period End Dates: Each Distribution Date, subject to
adjustment in accordance with the
Following Business Day Convention.
Reset Dates: Each Distribution Date, subject to
adjustment in accordance with the
Following Business Day Convention.
Day Count Fraction: Actual/360.
Spread: Plus 0.20 percent.
Adjustment: The West LB Floating Payments described
herein are subject to adjustment as
provided in paragraph 3(a) and (b) below.
3. SPECIAL PROVISIONS.
(a) DEFICIENCY AMOUNTS. Notwithstanding anything to the contrary
contained herein or in the Master Agreement, if on any Payment Date the
amount received by the Trust on the Term Assets and paid to West LB as
provided herein is less than the Scheduled Interest Payments then due on
the Term Assets (the amount of such deficiency, the "Deficiency Amount"),
West LB shall reduce the amount otherwise payable by West LB to the Trust
on such Payment Date in respect of the West LB Floating Payment by such
Deficiency Amount (but not below zero). If on any Payment Date the
Deficiency Amount is greater than the West LB Floating Payment which would
otherwise be due to the Trust on such Payment Date West LB shall also
reduce the amount otherwise payable by it to the Trust on such Payment Date
in respect of the West LB Fixed Payment by the amount of such excess (but
not below zero).
(b) DEFERRED PAYMENTS. Subject to paragraph 3(a) above,
notwithstanding anything to the contrary contained herein or in the Master
Agreement, if on any Payment Date West LB receives any Deferred Payments,
West LB shall, on such Payment Date, increase the amount otherwise payable
by it to the Trust on such Payment Date in respect of the West LB Fixed
Payment by the amount of such Deferred Payments, provided that if on any
such Payment Date the amount paid to West LB in respect of the Deferred
Payments exceeds the aggregate cumulative Deficiency Amounts subtracted
from the West LB Fixed Payments on prior Payment Dates, and not previously
adjusted to reflect receipt and payment of Deferred Amounts as provided in
this paragraph 3(b), the amount of such excess (up to but not exceeding the
aggregate of the Deficiency Amounts so subtracted from the West LB Floating
Payment) shall be added to the amount of the West LB Floating Payment then
due on such Payment Date.
4
<PAGE>
4. RELATIONSHIP BETWEEN PARTIES. Each party represents to the other
party as follows:
(a) NON-RELIANCE. It is acting for its own account, and it has made
its own independent decisions to enter into this Transaction and as to
whether this Transaction is appropriate or proper for it based upon its own
judgment and upon advice from such advisers as it has deemed necessary. It
is not relying on any communication (written or oral) of the other party as
investment advice or as a recommendation to enter into this Transaction; it
being understood that information and explanations related to the terms and
conditions of this Transaction shall not be considered investment advice or
a recommendation to enter into this Transaction. It has not received from
the other party any assurance or guarantee as to the expected results of
this Transaction.
(b) EVALUATION AND UNDERSTANDING. It is capable of evaluating and
understanding (on its own behalf or through independent professional
advice), and understands and accepts, the terms, conditions and risks of
this Transaction. It is also capable of assuming, and assumes, the
financial and other risks of this Transaction.
(c) STATUS OF PARTIES. The other party is not acting as a fiduciary
or an advisor for it in respect of this Transaction.
(d) RISK MANAGEMENT. It has entered into this Transaction for the
purpose of (i) managing its borrowings or investments, (ii) hedging its
underlying assets or liabilities or (iii) in connection with its line of
business.
5
<PAGE>
Please confirm that the foregoing correctly sets forth the terms of
our agreement by executing the copy of this Confirmation enclosed for that
purpose and returning it
to us.
Very truly yours,
TIERS<service-mark> ASSET-BACKED SECURITIES,
SERIES CHAMT TRUST 1997-7
By: Delaware Trust Capital Management, Inc.,
not in its individual capacity but solely as
Trustee under the Trust Agreement
By:______________________________
Authorized Signatory
Name:
Title:
Accepted and confirmed:
WESTDEUTSCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH
By:_____________________________
Authorized Signatory
Name:
Title:
By:_____________________________
Authorized Signatory
Name:
Title:
6
<PAGE>
September 15, 1997
Ms. Wendy Bannerman-Clark
Westdeutsche Landesbank Girozentrale, New York Branch
1211 Avenue of the Americas
New York, NY 10036
Facsimile: 212-597-8592
Telephone: 212-597-8583
West LB Ref:
Trust Confirm (Take Out Transaction)
TRANSACTION
Dear Ms. Bannerman-Clark:
The purpose of this letter agreement (this "Confirmation") is to set
forth the terms and conditions of the Transaction entered into between
Westdeutsche Landesbank Girozentrale, New York Branch ("West LB") and
Tiers<service-mark> Asset-Backed Securities, Series CHAMT Trust 1997-7 (the
"Trust") on the Trade Date specified below (this "Transaction"). This
Confirmation constitutes a "Confirmation" and this Transaction constitutes
a "Transaction" as referred to in the Master Agreement specified below.
1. GENERAL. The definitions and provisions contained in the 1991 ISDA
Definitions (as published by the International Swaps and Derivatives
Association, Inc. ("ISDA")) (the "Definitions") are incorporated into this
Confirmation. References herein to a "Transaction" shall be deemed to be
references to a "Swap Transaction" for purposes of the Definitions.
This Confirmation supplements, forms a part of, and is subject to, the
ISDA Master Agreement and Schedule thereto dated as of the date hereof, as
amended and supplemented from time to time (the "Master Agreement"),
between West LB and the Trust. All provisions contained in the Master
Agreement govern this Confirmation except as expressly modified below. In
the event of any inconsistency between this Confirmation and the
Definitions or the Master Agreement, this Confirmation will govern.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in (or refrained from engaging in) substantial
financial transactions and has taken other material actions in reliance
upon the parties' entry into the Transaction to which this Confirmation
relates on the terms and conditions set forth below.
<PAGE>
THIS CONFIRMATION WILL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO
CHOICE OF LAW DOCTRINE.
2. TERMS RELATING TO THE TRANSACTION.
Trade Date: As of August 21, 1997
Effective Date: September 15, 1997
Termination Date: November 15, 2003; subject to adjustment
in accordance with the Following
Business Day Convention.
Business Day Convention: Following
Calculation Agent: West LB
I. TRUST PAYMENT AMOUNTS
Payment Dates; Amounts: a) Upon receipt by the Trust of any Sale
Proceeds of Term Assets and Eligible
Investments in connection with the sale
thereof for a mandatory prepayment of
the Notes or Certificates, or in
connection with the outstanding
principal balance of the Notes and
Certificates on the Termination Date
(unless an Asset Impairment Event has
then occurred), the Trust will pay
immediately to West LB the amount of
such Sale Proceeds.
b) Upon receipt by the Trust, the Trust
will immediately pay to West LB any
interest income or other amounts
received on any Eligible Investments
held by the Trust.
Business Day: As specified in the Indenture
II. WEST LB PAYMENT AMOUNTS
Payment Dates; Amounts: On each Distribution Date on which a
Note Prepayment Amount and/or a
Certificate Prepayment Amount is due,
2
<PAGE>
and on the Termination Date (unless an
Asset Impairment Event has occurred),
West LB will pay to the Trust an amount
equal to the sum of such Note Prepayment
Amount and Certificate Prepayment Amount
or, in the case of the Termination Date,
the outstanding principal balance of the
Notes and Certificates.
Business Days: As specified in the Indenture.
3. RELATIONSHIP BETWEEN PARTIES. Each party represents to the other
party as follows:
(a) NON-RELIANCE. It is acting for its own account, and it has made
its own independent decisions to enter into this Transaction and as to
whether this Transaction is appropriate or proper for it based upon its own
judgment and upon advice from such advisers as it has deemed necessary. It
is not relying on any communication (written or oral) of the other party as
investment advice or as a recommendation to enter into this Transaction; it
being understood that information and explanations related to the terms and
conditions of this Transaction shall not be considered investment advice or
a recommendation to enter into this Transaction. It has not received from
the other party any assurance or guarantee as to the expected results of
this Transaction.
(b) EVALUATION AND UNDERSTANDING. It is capable of evaluating and
understanding (on its own behalf or through independent professional
advice), and understands and accepts, the terms, conditions and risks of
this Transaction. It is also capable of assuming, and assumes, the
financial and other risks of this Transaction.
(c) STATUS OF PARTIES. The other party is not acting as a fiduciary
or an advisor for it in respect of this Transaction.
(d) RISK MANAGEMENT. It has entered into this Transaction for the
purpose of (i) managing its borrowings or investments, (ii) hedging its
underlying assets or liabilities or (iii) in connection with its line of
business.
3
<PAGE>
Please confirm that the foregoing correctly sets forth the terms of
our agreement by executing the copy of this Confirmation enclosed for that
purpose and returning it to us.
Very truly yours,
TIERS<service-mark> ASSET-BACKED SECURITIES,
SERIES CHAMT TRUST 1997-7
By: Delaware Trust Capital Management, Inc.,
not in its individual capacity but solely as
Trustee under the Trust Agreement
By:__________________________________
Authorized Signatory
Name:
Title:
Accepted and confirmed:
WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH
By:________________________________
Authorized Signatory
Name:
Title
By:________________________________
Authorized Signatory
Name:
Title:
4
Exhibit 4
(MULTICURRENCY-CROSS BORDER)
ISDA<reg-trade-mark>
INTERNATIONAL SWAPS AND DERIVATIVES ASSOCIATION, INC.
MASTER AGREEMENT
dated as of September 15, 1997
WESTDEUTSCHE LANDESBANK GIROZENTRALE and TIERS ASSET-BACKED
SECURITIES, SERIES CHAMT TRUST 1997-7 have entered and/or anticipate entering
into one or more transactions (each a "Transaction") that are or will be
governed by this Master Agreement, which includes the schedule (the
"Schedule"), and the documents and other confirming evidence (each a
"Confirmation") exchanged between the parties confirming those Transactions.
Accordingly, the parties agree as follows:-
1. INTERPRETATION
(a) DEFINITIONS. The terms defined in Section 14 and in the Schedule will
have the meanings therein specified for the purpose of this Master Agreement.
(b) INCONSISTENCY. In the event of any inconsistency between the provisions
of the Schedule and the other provisions of this Master Agreement, the Schedule
will prevail. In the event of any inconsistency between the provisions of any
Confirmation and this Master Agreement (including the Schedule), such
Confirmation will prevail for the purpose of the relevant Transaction.
(c) SINGLE AGREEMENT. All Transactions are entered into in reliance on the
fact that this Master Agreement and all Confirmations form a single agreement
between the parties (collectively referred to as this "Agreement"), and the
parties would not otherwise enter into any Transactions.
2. OBLIGATIONS
(a) GENERAL CONDITIONS.
(i) Each party will make each payment or delivery specified in each
Confirmation to be made by it, subject to the other provisions of this
Agreement.
(ii) Payments under this Agreement will be made on the due date for
value on that date in the place of the account specified in the relevant
Confirmation or otherwise pursuant to this Agreement, in freely
transferable funds and in the manner customary for payments in the
required currency. Where settlement is by delivery (that is, other than
by payment), such delivery will be made for receipt on the due date in
the manner customary for the relevant obligation unless otherwise
specified in the relevant Confirmation or elsewhere in this Agreement.
Copyright <copyright> 1992 by International Swaps and Derivatives
Association, Inc.
<PAGE>
(iii) Each obligation of each party under Section 2(a)(i) is subject to
(1) the condition precedent that no Event of Default or Potential Event
of Default with respect to the other party has occurred and is
continuing, (2) the condition precedent that no Early Termination Date in
respect of the relevant Transaction has occurred or been effectively
designated and (3) each other applicable condition precedent specified in
this Agreement.
(b) CHANGE OF ACCOUNT. Either party may change its account for receiving a
payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a reasonable
objection to such change.
(c) NETTING. If on any date amounts would otherwise be payable:-
(i) in the same currency; and
(ii) in respect of the same Transaction,
by each party to the other, then, on such date, each party's obligation to make
payment of any such amount will be automatically satisfied and discharged and,
if the aggregate amount that would otherwise have been payable by one party
exceeds the aggregate amount that would otherwise have been payable by the
other party, replaced by an obligation upon the party by whom the larger
aggregate amount would have been payable to pay to the other party the excess
of the larger aggregate amount over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be
made in the Schedule or a Confirmation by specifying that subparagraph (ii)
above will not apply to the Transactions identified as being subject to the
election, together with the starting date (in which case subparagraph (ii)
above will not, or will cease to, apply to such Transactions from such date).
This election may be made separately for different groups of Transactions and
will apply separately to each pairing of Offices through which the parties make
and receive payments or deliveries.
(d) DEDUCTION OR WITHHOLDING FOR TAX.
(i) GROSS-UP. All payments under this Agreement will be made without
any deduction or withholding for or on account of any Tax unless such
deduction or withholding is required by any applicable law, as modified
by the practice of any relevant governmental revenue authority, then in
effect. If a party is so required to deduct or withhold, then that party
("X") will:-
(1) promptly notify the other party ("Y") of such requirement;
(2) pay to the relevant authorities the full amount required to
be deducted or withheld (including the full amount required to be
deducted or withheld from any additional amount paid by X to Y
2
<PAGE>
under this Section 2(d)) promptly upon the earlier of determining
that such deduction or withholding is required or receiving notice
that such amount has been assessed against Y;
(3) promptly forward to Y an official receipt (or a certified
copy), or other documentation reasonably acceptable to Y,
evidencing such payment to such authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to
the payment to which Y is otherwise entitled under this Agreement,
such additional amount as is necessary to ensure that the net
amount actually received by Y (free and clear of Indemnifiable
Taxes, whether assessed against X or Y) will equal the full amount
Y would have received had no such deduction or withholding been
required. However, X will not be required to pay any additional
amount to Y to the extent that it would not be required to be paid
but for:-
(A) the failure by Y to comply with or perform any
agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or
(B) the failure of a representation made by Y pursuant to
Section 3(f) to be accurate and true unless such failure
would not have occurred but for (I) any action taken by a
taxing authority, or brought in a court of competent
jurisdiction, on or after the date on which a Transaction is
entered into (regardless of whether such action is taken or
brought with respect to a party to this Agreement) or (II) a
Change in Tax Law.
(ii) LIABILITY. If:-
(1) X is required by any applicable law, as modified by the
practice of any relevant governmental revenue authority, to make
any deduction or withholding in respect of which X would not be
required to pay an additional amount to Y under Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed directly
against X,
then, except to the extent Y has satisfied or then satisfies the
liability resulting from such Tax, Y will promptly pay to X the amount of
such liability (including any related liability for interest, but
including any related liability for penalties only if Y has failed to
comply with or perform any agreement contained in Section 4(a)(i),
4(a)(iii) or 4(d)).
(e) DEFAULT INTEREST; OTHER AMOUNTS. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party that defaults in the performance of any payment obligation
3
<PAGE>
will, to the extent permitted by law and subject to Section 6(c), be required
to pay interest (before as well as after judgment) on the overdue amount to the
other party on demand in the same currency as such overdue amount, for the
period from (and including) the original due date for payment to (but
excluding) the date of actual payment, at the Default Rate. Such interest will
be calculated on the basis of daily compounding and the actual number of days
elapsed. If, prior to the occurrence or effective designation of an Early
Termination Date in respect of the relevant Transaction, a party defaults in
the performance of any obligation required to be settled by delivery, it will
compensate the other party on demand if and to the extent provided for in the
relevant Confirmation or elsewhere in this Agreement.
3. REPRESENTATIONS
Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered
into and, in the case of the representations in Section 3(f), at all times
until the termination of this Agreement) that:-
(a) BASIC REPRESENTATIONS.
(i) STATUS. It is duly organized and validly existing under the laws
of the jurisdiction of its organization or incorporation and, if relevant
under such laws, in good standing;
(ii) POWERS. It has the power to execute this Agreement and any other
documentation relating to this Agreement to which it is a party, to
deliver this Agreement and any other documentation relating to this
Agreement that it is required by this Agreement to deliver and to perform
its obligations under this Agreement and any obligations it has under any
Credit Support Document to which it is a party and has taken all
necessary action to authorize such execution, delivery and performance;
(iii) NO VIOLATION OR CONFLICT. Such execution, delivery and
performance do not violate or conflict with any law applicable to it, any
provision of its constitutional documents, any order or judgment of any
court or other agency of government applicable to it or any of its assets
or any contractual restriction binding on or affecting it or any of its
assets;
(iv) CONSENTS. All governmental and other consents that are required to
have been obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party have been obtained and are in
full force and effect and all conditions of any such consents have been
complied with; and
(v) OBLIGATIONS BINDING. Its obligations under this Agreement and any
Credit Support Document to which it is a party constitute its legal,
valid and binding obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy, reorganization,
insolvency, moratorium or similar laws affecting creditors' rights
generally and subject, as to enforceability, to equitable principles of
general application (regardless of whether enforcement is sought in a
proceeding in equity or at law)).
4
<PAGE>
(b) ABSENCE OF CERTAIN EVENTS. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has occurred
and is continuing and no such event or circumstance would occur as a result of
its entering into or performing its obligations under this Agreement or any
Credit Support Document to which it is a party.
(c) ABSENCE OF LITIGATION. There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or proceeding
at law or in equity or before any court, tribunal, governmental body, agency or
official or any arbitrator that is likely to affect the legality, validity or
enforceability against it of this Agreement or any Credit Support Document to
which it is a party or its ability to perform its obligations under this
Agreement or such Credit Support Document.
(d) ACCURACY OF SPECIFIED INFORMATION. All applicable information that is
furnished in writing by or on behalf of it to the other party and is identified
for the purpose of this Section 3(d) in the Schedule is, as of the date of the
information, true, accurate and complete in every material respect.
(e) PAYER TAX REPRESENTATION. Each representation specified in the Schedule
as being made by it for the purpose of this Section 3(e) is accurate and true.
(f) PAYEE TAX REPRESENTATIONS. Each representation specified in the Schedule
as being made by it for the purpose of this Section 3(f) is accurate and true.
4. AGREEMENTS
Each party agrees with the other that, so long as either party has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party:-
(a) FURNISH SPECIFIED INFORMATION. It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:-
(i) any forms, documents or certificates relating to taxation specified
in the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any Confirmation;
and
(iii) upon reasonable demand by such other party, any form or document
that may be required or reasonably requested in writing in order to allow
such other party or its Credit Support Provider to make a payment under
this Agreement or any applicable Credit Support Document without any
deduction or withholding for or on account of any Tax or with such
deduction or withholding at a reduced rate (so long as the completion,
execution or submission of such form or document would not materially
prejudice the legal or commercial position of the party in receipt of
such demand), with any such form or document to be accurate and completed
in a manner reasonably satisfactory to such other party and to be
executed and to be delivered with any reasonably required certification,
5
<PAGE>
in each case by the date specified in the Schedule or such Confirmation or, if
none is specified. as soon as reasonably practicable.
(b) MAINTAIN AUTHORIZATIONS. It will use all reasonable efforts to maintain
in full force and effect all consents of any governmental or other authority
that are required to be obtained by it with respect to this Agreement or any
Credit Support Document to which it is a party and will use all reasonable
efforts to obtain any that may become necessary in the future.
(c) COMPLY WITH LAWS. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so to comply
would materially impair its ability to perform its obligations under this
Agreement or any Credit Support Document to which it is a party.
(d) TAX AGREEMENT. It will give notice of any failure of a representation
made by it under Section 3(f) to be accurate and true promptly upon learning of
such failure.
(e) PAYMENT OF STAMP TAX. Subject to Section 11, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or performance of this
Agreement by a jurisdiction in which it is incorporated, organized, managed and
controlled, or considered to have its seat, or in which a branch or office
through which it is acting for the purpose of this Agreement is located ("Stamp
Tax Jurisdiction") and will indemnify the other party against any Stamp Tax
levied or imposed upon the other party or in respect of the other party's
execution or performance of this Agreement by any such Stamp Tax Jurisdiction
which is not also a Stamp Tax Jurisdiction with respect to the other party.
5. EVENTS OF DEFAULT AND TERMINATION EVENTS
(a) EVENTS OF DEFAULT. The occurrence at any time with respect to a party
or, if applicable, any Credit Support Provider of such party or any Specified
Entity of such party of any of the following events constitutes an event of
default (an "Event of Default") with respect to such party:-
(i) FAILURE TO PAY OR DELIVER. Failure by the party to make, when due,
any payment under this Agreement or delivery under Section 2(a)(i) or
2(e) required to be made by it if such failure is not remedied on or
before the third Local Business Day after notice of such failure is given
to the party;
(ii) BREACH OF AGREEMENT. Failure by the party to comply with or
perform any agreement or obligation (other than an obligation to make any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or
to give notice of a Termination Event or any agreement or obligation
under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or
6
<PAGE>
performed by the party in accordance with this Agreement if such failure
is not remedied on or before the thirtieth day after notice of such
failure is given to the party;
(iii) CREDIT SUPPORT DEFAULT.
(1) Failure by the party or any Credit Support Provider of such
party to comply with or perform any agreement or obligation to be
complied with or performed by it in accordance with any Credit
Support Document if such failure is continuing after any applicable
grace period has elapsed;
(2) the expiration or termination of such Credit Support Document
or the failing or ceasing of such Credit Support Document to be in
full force and effect for the purpose of this Agreement (in either
case other than in accordance with its terms) prior to the
satisfaction of all obligations of such party under each
Transaction to which such Credit Support Document relates without
the written consent of the other party; or
(3) the party or such Credit Support Provider disaffirms,
disclaims, repudiates or rejects, in whole or in part, or
challenges the validity of, such Credit Support Document;
(iv) MISREPRESENTATION. A representation (other than a representation
under Section 3(e) or (f)) made or repeated or deemed to have been made
or repeated by the party or any Credit Support Provider of such party in
this Agreement or any Credit Support Document proves to have been
incorrect or misleading in any material respect when made or repeated or
deemed to have been made or repeated;
(v) DEFAULT UNDER SPECIFIED TRANSACTION. The party, any Credit Support
Provider of such party or any applicable Specified Entity of such party
(1) defaults under a Specified Transaction and, after giving effect to
any applicable notice requirement or grace period, there occurs a
liquidation of, an acceleration of obligations under, or an early
termination of, that Specified Transaction, (2) defaults, after giving
effect to any applicable notice requirement or grace period, in making
any payment or delivery due on the last payment, delivery or exchange
date of, or any payment on early termination of, a Specified Transaction
(or such default continues for at least three Local Business Days if
there is no applicable notice requirement or grace period) or (3)
disaffirms, disclaims, repudiates or rejects, in whole or in part, a
Specified Transaction (or such action is taken by any person or entity
appointed or empowered to operate it or act on its behalf);
(vi) CROSS DEFAULT. If "Cross Default" is specified in the Schedule as
applying to the party, the occurrence or existence of (1) a default,
event of default or other similar condition or event (however described)
in respect of such party, any Credit Support Provider of such party or
any applicable Specified Entity of such party under one or more
agreements or instruments relating to Specified Indebtedness of any of
them (individually or collectively) in an aggregate amount of not less
than the applicable Threshold Amount (as specified in the Schedule) which
7
<PAGE>
has resulted in such Specified Indebtedness becoming, or becoming capable
at such time of being declared, due and payable under such agreements or
instruments, before it would otherwise have been due and payable or (2) a
default by such party, such Credit Support Provider or such Specified
Entity (individually or collectively) in making one or more payments on
the due date thereof in an aggregate amount of not less than the
applicable Threshold Amount under such agreements or instruments (after
giving effect to any applicable notice requirement or grace period);
(vii) BANKRUPTCY. The party, any Credit Support Provider of such party
or any applicable Specified Entity of such party:-
(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable to pay
its debts or fails or admits in writing its inability generally to
pay its debts as they become due; (3) makes a general assignment,
arrangement or composition with or for the benefit of its
creditors; (4) institutes or has instituted against it a proceeding
seeking a judgment of insolvency or bankruptcy or any other relief
under any bankruptcy or insolvency law or other similar law
affecting creditors' rights, or a petition is presented for its
winding-up or liquidation, and, in the case of any such proceeding
or petition instituted or presented against it, such proceeding or
petition (A) results in a judgment of insolvency or bankruptcy or
the entry of an order for relief or the making of an order for its
winding-up or liquidation or (B) is not dismissed, discharged,
stayed or restrained in each case within 30 days of the institution
or presentation thereof; (5) has a resolution passed for its
winding-up, official management or liquidation (other than pursuant
to a consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or other
similar official for it or for all or substantially all its assets;
(7) has a secured party take possession of all or substantially all
its assets or has a distress, execution, attachment, sequestration
or other legal process levied, enforced or sued on or against all
or substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged,
stayed or restrained, in each case within 30 days thereafter; (8)
causes or is subject to any event with respect to it which, under
the applicable laws of any jurisdiction, has an analogous effect to
any of the events specified in clauses (1) to (7) (inclusive); or
(9) takes any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the foregoing acts; or
(viii) MERGER WITHOUT ASSUMPTION. The party or any Credit Support
Provider of such party consolidates or amalgamates with, or merges with
or into, or transfers all or substantially all its assets to, another
entity and, at the time of such consolidation, amalgamation, merger or
transfer:-
8
<PAGE>
(1) the resulting, surviving or transferee entity fails to assume
all the obligations of such party or such Credit Support Provider
under this Agreement or any Credit Support Document to which it or
its predecessor was a party by operation of law or pursuant to an
agreement reasonably satisfactory to the other party to this
Agreement; or
(2) the benefits of any Credit Support Document fail to extend
(without the consent of the other party) to the performance by such
resulting, surviving or transferee entity of its obligations under
this Agreement.
(b) TERMINATION EVENTS. The occurrence at any time with respect to a party
or, if applicable, any Credit Support Provider of such party or any Specified
Entity of such party of any event specified below constitutes an Illegality if
the event is specified in (i) below, a Tax Event if the event is specified in
(ii) below or a Tax Event Upon Merger if the event is specified in (iii) below,
and, if specified to be applicable, a Credit Event Upon Merger if the event is
specified pursuant to (iv) below or an Additional Termination Event if the
event is specified pursuant to (v) below:-
(i) ILLEGALITY. Due to the adoption of, or any change in, any
applicable law after the date on which a Transaction is entered into, or
due to the promulgation of, or any change in, the interpretation by any
court, tribunal or regulatory authority with competent jurisdiction of
any applicable law after such date, it becomes unlawful (other than as a
result of a breach by the party of Section 4(b)) for such party (which
will be the Affected Party):-
(1) to perform any absolute or contingent obligation to make a
payment or delivery or to receive a payment or delivery in respect
of such Transaction or to comply with any other material provision
of this Agreement relating to such Transaction; or
(2) to perform, or for any Credit Support Provider of such party
to perform, any contingent or other obligation which the party (or
such Credit Support Provider) has under any Credit Support Document
relating to such Transaction;
(ii) TAX EVENT. Due to (x) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on
which a Transaction is entered into (regardless of whether such action is
taken or brought with respect to a party to this Agreement) or (y) a
Change in Tax Law, the party (which will be the Affected Party) will, or
there is a substantial likelihood that it will, on the next succeeding
Scheduled Payment Date (1) be required to pay to the other party an
additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) or (2) receive a payment from which an amount is required to be
deducted or withheld for or on account of a Tax (except in respect of
interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount
is required to be paid in respect of such Tax under Section 2(d)(i)(4)
(other than by reason of Section 2(d)(i)(4)(A) or (B));
9
<PAGE>
(iii) TAX EVENT UPON MERGER. The party (the "Burdened Party") on the
next succeeding Scheduled Payment Date will either (1) be required to pay
an additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) or (2) receive a payment from which an amount has been deducted or
withheld for or on account of any Indemnifiable Tax in respect of which
the other party is not required to pay an additional amount (other than
by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of
a party consolidating or amalgamating with, or merging with or into, or
transferring all or substantially all its assets to, another entity
(which will be the Affected Party) where such action does not constitute
an event described in Section 5(a)(viii);
(iv) CREDIT EVENT UPON MERGER. If "Credit Event Upon Merger" is
specified in the Schedule as applying to the party, such party ("X"), any
Credit Support Provider of X or any applicable Specified Entity of X
consolidates or amalgamates with, or merges with or into, or transfers
all or substantially all its assets to, another entity and such action
does not constitute an event described in Section 5(a)(viii) but the
creditworthiness of the resulting, surviving or transferee entity is
materially weaker than that of X, such Credit Support Provider or such
Specified Entity, as the case may be, immediately prior to such action
(and, in such event, X or its successor or transferee, as appropriate,
will be the Affected Party); or
(v) ADDITIONAL TERMINATION EVENT. If any "Additional Termination
Event" is specified in the Schedule or any Confirmation as applying, the
occurrence of such event (and, in such event, the Affected Party or
Affected Parties shall be as specified for such Additional Termination
Event in the Schedule or such Confirmation).
(c) EVENT OF DEFAULT AND ILLEGALITY. If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an
Event of Default.
6. EARLY TERMINATION
(a) RIGHT TO TERMINATE FOLLOWING EVENT OF DEFAULT. If at any time an Event
of Default with respect to a party (the "Defaulting Party") has occurred and is
then continuing, the other party (the "Non-defaulting Party") may, by not more
than 20 days notice to the Defaulting Party specifying the relevant Event of
Default, designate a day not earlier than the day such notice is effective as
an Early Termination Date in respect of all outstanding Transactions. If,
however, "Automatic Early Termination" is specified in the Schedule as applying
to a party, then an Early Termination Date in respect of all outstanding
Transactions will occur immediately upon the occurrence with respect to such
party of an Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6)
or, to the extent analogous thereto, (8), and as of the time immediately
preceding the institution of the relevant proceeding or the presentation of the
relevant petition upon the occurrence with respect to such party of an Event of
Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto,
(8).
10
<PAGE>
(b) RIGHT TO TERMINATE FOLLOWING TERMINATION EVENT.
(i) NOTICE. If a Termination Event occurs, an Affected Party will,
promptly upon becoming aware of it, notify the other party, specifying
the nature of that Termination Event and each Affected Transaction and
will also give such other information about that Termination Event as the
other party may reasonably require.
(ii) TRANSFER TO AVOID TERMINATION EVENT. If either an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the
Affected Party, the Affected Party will, as a condition to its right to
designate an Early Termination Date under Section 6(b)(iv), use all
reasonable efforts (which will not require such party to incur a loss,
excluding immaterial, incidental expenses) to transfer within 20 days
after it gives notice under Section 6(b)(i) all its rights and
obligations under this Agreement in respect of the Affected Transactions
to another of its Offices or Affiliates so that such Termination Event
ceases to exist.
If the Affected Party is not able to make such a transfer it will give
notice to the other party to that effect within such 20 day period,
whereupon the other party may effect such a transfer within 30 days after
the notice is given under Section 6(b)(i).
Any such transfer by a party under this Section 6(b)(ii) will be subject
to and conditional upon the prior written consent of the other party,
which consent will not be withheld if such other party's policies in
effect at such time would permit it to enter into transactions with the
transferee on the terms proposed.
(iii) TWO AFFECTED PARTIES. If an Illegality under Section 5(b)(i)(1) or
a Tax Event occurs and there are two Affected Parties, each party will
use all reasonable efforts to reach agreement within 30 days after notice
thereof is given under Section 6(b)(i) on action to avoid that
Termination Event.
(iv) RIGHT TO TERMINATE. If:-
(1) a transfer under Section 6(b)(ii) or an agreement under
Section 6(b)(iii), as the case may be, has not been effected with
respect to all Affected Transactions within 30 days after an
Affected Party gives notice under Section 6(b)(i); or
(2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon
Merger or an Additional Termination Event occurs, or a Tax Event
Upon Merger occurs and the Burdened Party is not the Affected
Party,
either party in the case of an Illegality, the Burdened Party in the case
of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event
or an Additional Termination Event if there is more than one Affected
Party, or the party which is not the Affected Party in the case of a
Credit Event Upon Merger or an Additional Termination Event if there is
only one Affected Party may, by not more than 20 days notice to the other
11
<PAGE>
party and provided that the relevant Termination Event is then
continuing, designate a day not earlier than the day such notice is
effective as an Early Termination Date in respect of all Affected
Transactions.
(c) EFFECT OF DESIGNATION.
(i) If notice designating an Early Termination Date is given under
Section 6(a) or (b), the Early Termination Date will occur on the date so
designated, whether or not the relevant Event of Default or Termination
Event is then continuing.
(ii) Upon the occurrence or effective designation of an Early
Termination Date, no further payments or deliveries under Section 2(a)(i)
or 2(e) in respect of the Terminated Transactions will be required to be
made, but without prejudice to the other provisions of this Agreement.
The amount, if any, payable in respect of an Early Termination Date shall
be determined pursuant to Section 6(e).
(d) CALCULATIONS.
(i) STATEMENT. On or as soon as reasonably practicable following the
occurrence of an Early Termination Date, each party will make the
calculations on its part, if any, contemplated by Section 6(e) and will
provide to the other party a statement (1) showing, in reasonable detail,
such calculations (including all relevant quotations and specifying any
amount payable under Section 6(e)) and (2) giving details of the relevant
account to which any amount payable to it is to be paid. In the absence
of written confirmation from the source of a quotation obtained in
determining a Market Quotation, the records of the party obtaining such
quotation will be conclusive evidence of the existence and accuracy of
such quotation.
(ii) PAYMENT DATE. An amount calculated as being due in respect of any
Early Termination Date under Section 6(e) will be payable on the day that
notice of the amount payable is effective (in the case of an Early
Termination Date which is designated or occurs as a result of an Event of
Default) and on the day which is two Local Business Days after the day on
which notice of the amount payable is effective (in the case of an Early
Termination Date which is designated as a result of a Termination Event).
Such amount will be paid together with (to the extent permitted under
applicable law) interest thereon (before as well as after judgment) in
the Termination Currency, from (and including) the relevant Early
Termination Date to (but excluding) the date such amount is paid, at the
Applicable Rate. Such interest will be calculated on the basis of daily
compounding and the actual number of days elapsed.
(e) PAYMENTS ON EARLY TERMINATION. If an Early Termination Date occurs, the
following provisions shall apply based on the parties' election in the Schedule
of a payment measure, either "Market Quotation" or "Loss," and a payment
method, either the "First Method" or the "Second Method." If the parties fail
12
<PAGE>
to designate a payment measure or payment method in the Schedule, it will be
deemed that "Market Quotation" or the "Second Method," as the case may be,
shall apply. The amount, if any, payable in respect of an Early Termination
Date and determined pursuant to this Section will be subject to any Set-off.
(i) EVENTS OF DEFAULT. If the Early Termination Date results from an
Event of Default:-
(1) FIRST METHOD AND MARKET QUOTATION. If the First Method and
Market Quotation apply, the Defaulting Party will pay to the Non-
defaulting Party the excess, if a positive number, of (A) the sum
of the Settlement Amount (determined by the Non-defaulting Party)
in respect of the Terminated Transactions and the Termination
Currency Equivalent of the Unpaid Amounts owing to the Non-
defaulting Party over (B) the Termination Currency Equivalent of
the Unpaid Amounts owing to the Defaulting Party.
(2) FIRST METHOD AND LOSS. If the First Method and Loss apply,
the Defaulting Party will pay to the Non-defaulting Party, if a
positive number, the Non-defaulting Party's Loss in respect of this
Agreement.
(3) SECOND METHOD AND MARKET QUOTATION. If the Second Method and
Market Quotation apply, an amount will be payable equal to (A) the
sum of the Settlement Amount (determined by the Non-defaulting
Party) in respect of the Terminated Transactions and the
Termination Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party less (B) the Termination Currency Equivalent
of the Unpaid Amounts owing to the Defaulting Party. If that
amount is a positive number, the Defaulting Party will pay it to
the Non-defaulting Party; if it is a negative number, the Non-
defaulting Party will pay the absolute value of that amount to the
Defaulting Party.
(4) SECOND METHOD AND LOSS. If the Second Method and Loss apply,
an amount will be payable equal to the Non-defaulting Party's Loss
in respect of this Agreement. If that amount is a positive number,
the Defaulting Party will pay it to the Non-defaulting Party; if it
is a negative number, the Non-defaulting Party will pay the
absolute value of that amount to the Defaulting Party.
(ii) TERMINATION EVENTS. If the Early Termination Date results from a
Termination Event:-
(1) ONE AFFECTED PARTY. If there is one Affected Party, the
amount payable will be determined in accordance with Section
6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if
Loss applies, except that, in either case, references to the
Defaulting Party and to the Non-defaulting Party will be deemed to
be references to the Affected Party and the party which is not the
Affected Party, respectively, and, if Loss applies and fewer than
all the Transactions are being terminated, Loss shall be calculated
in respect of all Terminated Transactions.
(2) TWO AFFECTED PARTIES. If there are two Affected Parties:-
13
<PAGE>
(A) if Market Quotation applies, each party will determine
a Settlement Amount in respect of the Terminated
Transactions, and an amount will be payable equal to (I) the
sum of (a) one-half of the difference between the Settlement
Amount of the party with the higher Settlement Amount ("X")
and the Settlement Amount of the party with the lower
Settlement Amount ("Y") and (b) the Termination Currency
Equivalent of the Unpaid Amounts owing to X less (II) the
Termination Currency Equivalent of the Unpaid Amounts owing
to Y; and
(B) if Loss applies, each party will determine its Loss in
respect of this Agreement (or, if fewer than all the
Transactions are being terminated, in respect of all
Terminated Transactions) and an amount will be payable equal
to one-half of the difference between the Loss of the party
with the higher Loss ("X") and the Loss of the party with the
lower Loss ("Y").
If the amount payable is a positive number, Y will pay it to X; if
it is a negative number, X will pay the absolute value of that
amount to Y.
(iii) ADJUSTMENT FOR BANKRUPTCY. In circumstances where an Early
Termination Date occurs because "Automatic Early Termination" applies in
respect of a party, the amount determined under this Section 6(e) will be
subject to such adjustments as are appropriate and permitted by law to
reflect any payments or deliveries made by one party to the other under
this Agreement (and retained by such other party) during the period from
the relevant Early Termination Date to the date for payment determined
under Section 6(d)(ii).
(iv) PRE-ESTIMATE. The parties agree that if Market Quotation applies an
amount recoverable under this Section 6(e) is a reasonable pre-estimate
of loss and not a penalty. Such amount is payable for the loss of
bargain and the loss of protection against future risks and except as
otherwise provided in this Agreement neither party will be entitled to
recover any additional damages as a consequence of such losses.
7. TRANSFER
Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of the
other party, except that:-
(a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to
any other right or remedy under this Agreement); and
(b) a party may make such a transfer of all or any part of its interest in
any amount payable to it from a Defaulting Party under Section 6(e).
14
<PAGE>
Any purported transfer that is not in compliance with this Section will be
void.
8. CONTRACTUAL CURRENCY
(a) PAYMENT IN THE CONTRACTUAL CURRENCY. Each payment under this Agreement
will be made in the relevant currency specified in this Agreement for that
payment (the "Contractual Currency"). To the extent permitted by applicable
law, any obligation to make payments under this Agreement in the Contractual
Currency will not be discharged or satisfied by any tender in any currency
other than the Contractual Currency, except to the extent such tender results
in the actual receipt by the party to which payment is owed, acting in a
reasonable manner and in good faith in converting the currency so tendered into
the Contractual Currency, of the full amount in the Contractual Currency of all
amounts payable in respect of this Agreement. If for any reason the amount in
the Contractual Currency so received falls short of the amount in the
Contractual Currency payable in respect of this Agreement, the party required
to make the payment will, to the extent permitted by applicable law,
immediately pay such additional amount in the Contractual Currency as may be
necessary to compensate for the shortfall. If for any reason the amount in the
Contractual Currency so received exceeds the amount in the Contractual Currency
payable in respect of this Agreement, the party receiving the payment will
refund promptly the amount of such excess.
(b) JUDGMENTS. To the extent permitted by applicable law, if any judgment or
order expressed in a currency other than the Contractual Currency is rendered
(i) for the payment of any amount owing in respect of this Agreement, (ii) for
the payment of any amount relating to any early termination in respect of this
Agreement or (iii) in respect of a judgment or order of another court for the
payment of any amount described in (i) or (ii) above, the party seeking
recovery, after recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the Contractual
Currency received by such party as a consequence of sums paid in such other
currency and will refund promptly to the other party any excess of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency if such shortfall or such excess arises or results from any
variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such
party. The term "rate of exchange" includes, without limitation, any premiums
and costs of exchange payable in connection with the purchase of or conversion
into the Contractual Currency.
(c) SEPARATE INDEMNITIES. To the extent permitted by applicable law, these
indemnities constitute separate and independent obligations from the other
obligations in this Agreement, will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the
party to which any payment is owed and will not be affected by judgment being
obtained or claim or proof being made for any other sums payable in respect of
this Agreement.
15
<PAGE>
(d) EVIDENCE OF LOSS. For the purpose of this Section 8, it will be
sufficient for a party to demonstrate that it would have suffered a loss had an
actual exchange or purchase been made.
9. MISCELLANEOUS
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.
(b) AMENDMENTS. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing evidenced by
a facsimile transmission) and executed by each of the parties or confirmed by
an exchange of telexes or electronic messages on an electronic messaging
system.
(c) SURVIVAL OF OBLIGATIONS. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.
(d) REMEDIES CUMULATIVE. Except as provided in this Agreement, the rights,
powers, remedies and privileges provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law.
(e) COUNTERPARTS AND CONFIRMATIONS.
(i) This Agreement (and each amendment, modification and waiver in
respect of it) may be executed and delivered in counterparts (including
by facsimile transmission), each of which will be deemed an original.
(ii) The parties intend that they are legally bound by the terms of each
Transaction from the moment they agree to those terms (whether orally or
otherwise). A Confirmation shall be entered into as soon as practicable
and may be executed and delivered in counterparts (including by facsimile
transmission) or be created by an exchange of telexes or by an exchange
of electronic messages on an electronic messaging system, which in each
case will be sufficient for all purposes to evidence a binding supplement
to this Agreement. The parties will specify therein or through another
effective means that any such counterpart, telex or electronic message
constitutes a Confirmation.
(f) NO WAIVER OF RIGHTS. A failure or delay in exercising any right, power
or privilege in respect of this Agreement will not be presumed to operate as a
waiver, and a single or partial exercise of any right, power or privilege will
not be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other right, power or privilege.
(g) HEADINGS. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.
10. OFFICES; MULTIBRANCH PARTIES
16
<PAGE>
(a) If Section 10(a) is specified in the Schedule as applying, each party
that enters into a Transaction through an Office other than its head or home
office represents to the other party that, notwithstanding the place of booking
office or jurisdiction of incorporation or organization of such party, the
obligations of such party are the same as if it had entered into the
Transaction through its head or home office. This representation will be
deemed to be repeated by such party on each date on which a Transaction is
entered into.
(b) Neither party may change the Office through which it makes and receives
payments or deliveries for the purpose of a Transaction without the prior
written consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule, such
Multibranch Party may make and receive payments or deliveries under any
Transaction through any Office listed in the Schedule, and the Office through
which it makes and receives payments or deliveries with respect to a
Transaction will be specified in the relevant Confirmation.
11. EXPENSES
A Defaulting Party will, on demand, indemnify and hold harmless the other party
for and against all reasonable out-of-pocket expenses, including legal fees and
Stamp Tax, incurred by such other party by reason of the enforcement and
protection of its rights under this Agreement or any Credit Support Document to
which the Defaulting Party is a party or by reason of the early termination of
any Transaction, including, but not limited to, costs of collection.
12. NOTICES
(a) EFFECTIVENESS. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:-
(i) if in writing and delivered in person or by courier, on the date it
is delivered;
(ii) if sent by telex, on the date the recipient's answerback is
received;
(iii) if sent by facsimile transmission, on the date that transmission
is received by a responsible employee of the recipient in legible form
(it being agreed that the burden of proving receipt will be on the sender
and will not be met by a transmission report generated by the sender's
facsimile machine);
(iv) if sent by certified or registered mail (airmail, if overseas) or
the equivalent (return receipt requested), on the date that mail is
delivered or its delivery is attempted; or
17
<PAGE>
(v) if sent by electronic messaging system, on the date that electronic
message is received,
unless the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.
(b) CHANGE OF ADDRESSES. Either party may by notice to the other change the
address, telex or facsimile number or electronic messaging system details at
which notices or other communications are to be given to it.
13. GOVERNING LAW AND JURISDICTION
(a) GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.
(b) JURISDICTION. With respect to any suit, action or proceedings relating
to this Agreement ("Proceedings"), each party irrevocably:-
(i) submits to the jurisdiction of the English courts, if this
Agreement is expressed to be governed by English law, or to the non-
exclusive jurisdiction of the courts of the State of New York and the
United States District Court located in the Borough of Manhattan in New
York City, if this Agreement is expressed to be governed by the laws of
the State of New York; and
(ii) waives any objection which it may have at any time to the laying of
venue of any Proceedings brought in any such court, waives any claim that
such Proceedings have been brought in an inconvenient forum and further
waives the right to object, with respect to such Proceedings, that such
court does not have any jurisdiction over such party.
Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the Civil
Jurisdiction and Judgments Act 1982 or any modification, extension or re-
enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.
(c) SERVICE OF PROCESS. Each party irrevocably appoints the Process Agent
(if any) specified opposite its name in the Schedule to receive, for it and on
its behalf, service of process in any Proceedings. If for any reason any
party's Process Agent is unable to act as such, such party will promptly notify
the other party and within 30 days appoint a substitute process agent
acceptable to the other party. The parties irrevocably consent to service of
process given in the manner provided for notices in Section 12. Nothing in
this Agreement will affect the right of either party to serve process in any
other manner permitted by law.
(d) WAIVER OF IMMUNITIES. Each party irrevocably waives, to the fullest
extent permitted by applicable law, with respect to itself and its revenues and
18
<PAGE>
assets (irrespective of their use or intended use), all immunity on the grounds
of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any
court, (iii) relief by way of injunction, order for specific performance or for
recovery of property, (iv) attachment of its assets (whether before or after
judgment) and (v) execution or enforcement of any judgment to which it or its
revenues or assets might otherwise be entitled in any Proceedings in the courts
of any jurisdiction and irrevocably agrees, to the extent permitted by
applicable law, that it will not claim any such immunity in any Proceedings.
14. DEFINITIONS
As used in this Agreement:-
"ADDITIONAL TERMINATION EVENT" has the meaning specified in Section 5(b).
"AFFECTED PARTY" has the meaning specified in Section 5(b).
"AFFECTED TRANSACTIONS" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.
"AFFILIATE" means, subject to the Schedule, in relation to any person, any
entity controlled, directly or indirectly, by the person, any entity that
controls, directly or indirectly, the person or any entity directly or
indirectly under common control with the person. For this purpose, "control"
of any entity or person means ownership of a majority of the voting power of
the entity or person.
"APPLICABLE RATE" means:-
(a) in respect of obligations payable or deliverable (or which would have
been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;
(b) in respect of an obligation to pay an amount under Section 6(e) of either
party from and after the date (determined in accordance with Section 6(d)(ii))
on which that amount is payable, the Default Rate;
(c) is respect of all other obligations payable or deliverable (or which
would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-
default Rate; and
(d) in all other cases, the Termination Rate.
"BURDENED PARTY" has the meaning specified in Section 5(b).
"CHANGE IN TAX LAW" means the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any law (or in the
application or official interpretation of any law) that occurs on or after the
date on which the relevant Transaction is entered into.
"CONSENT" includes a consent, approval, action, authorization, exemption,
notice, filing, registration or exchange control consent.
"CREDIT EVENT UPON MERGER" has the meaning specified in Section 5(b).
19
<PAGE>
"CREDIT SUPPORT DOCUMENT" means any agreement or instrument that is specified
as such in this Agreement.
"CREDIT SUPPORT PROVIDER" has the meaning specified in the Schedule.
"DEFAULT RATE" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if it
were to fund or of funding the relevant amount plus 1% per annum.
"DEFAULTING PARTY" has the meaning specified in Section 6(a).
"EARLY TERMINATION DATE" means the date determined in accordance with Section
6(a) or 6(b)(iv).
"EVENT OF DEFAULT" has the meaning specified in Section 5(a) and, if
applicable, in the Schedule.
"ILLEGALITY" has the meaning specified in Section 5(b).
"INDEMNIFIABLE TAX" means any Tax other than a Tax that would not be imposed in
respect of a payment under this Agreement but for a present or former
connection between the jurisdiction of the government or taxation authority
imposing such Tax and the recipient of such payment or a person related to such
recipient (including, without limitation, a connection arising from such
recipient or related person being or having been a citizen or resident of such
jurisdiction, or being or having been organized, present or engaged in a trade
or business in such jurisdiction, or having or having had a permanent
establishment or fixed place of business in such jurisdiction, but excluding a
connection arising solely from such recipient or related person having
executed, delivered, performed its obligations or received a payment under, or
enforced, this Agreement or a Credit Support Document).
"LAW" includes any treaty, law, rule or regulation (as modified, in the case of
tax matters, by the practice of any relevant governmental revenue authority)
and "LAWFUL" and "UNLAWFUL" will be construed accordingly.
"LOCAL BUSINESS DAY" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and foreign
currency deposits) (a) in relation to any obligation under Section 2(a)(i), in
the place(s) specified in the relevant Confirmation or, if not so specified, as
otherwise agreed by the parties in writing or determined pursuant to provisions
contained, or incorporated by reference, in this Agreement, (b) in relation to
any other payment, in the place where the relevant account is located and, if
different, in the principal financial centre, if any, of the currency of such
payment, (c) in relation to any notice or other communication, including notice
contemplated under Section 5(a)(i), in the city specified in the address for
notice provided by the recipient and, in the case of a notice contemplated by
Section 2(b), in the place where the relevant new account is to be located and
(d) in relation to Section 5(a)(v)(2), in the relevant locations for
performance with respect to such Specified Transaction.
"LOSS" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
20
<PAGE>
Equivalent of an amount that party reasonably determines in good faith to be
its total losses and costs (or gain, in which case expressed as a negative
number) in connection with this Agreement or that Terminated Transaction or
group of Terminated Transactions, as the case may be, including any loss of
bargain, cost of funding or, at the election of such party but without
duplication, loss or cost incurred as a result of its terminating, liquidating,
obtaining or reestablishing any hedge or related trading position (or any gain
resulting from any of them). Loss includes losses and costs (or gains) in
respect of any payment or delivery required to have been made (assuming
satisfaction of each applicable condition precedent) on or before the relevant
Early Termination Date and not made, except, so as to avoid duplication, if
Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a
party's legal fees and out-of-pocket expenses referred to under Section 11. A
party will determine its Loss as of the relevant Early Termination Date or, if
that is not reasonably practicable, as of the earliest date thereafter as is
reasonably practicable. A party may (but need not) determine its Loss by
reference to quotations of relevant rates or prices from one or more leading
dealers in the relevant markets.
"MARKET QUOTATION" means, with respect to one or more Terminated Transactions
and a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or by
such party (expressed as a positive number) in consideration of an agreement
between such party (taking into account any existing Credit Support Document
with respect to the obligations of such party) and the quoting Reference
Market-maker to enter into a transaction (the "Replacement Transaction") that
would have the effect of preserving for such party the economic equivalent of
any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition
precedent) by the parties under Section 2(a)(i) in respect of such Terminated
Transaction or group of Terminated Transactions that would, but for the
occurrence of the relevant Early Termination Date, have been required after
that date. For this purpose, Unpaid Amounts in respect of the Terminated
Transaction or group of Terminated Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the relevant Early
Termination Date, have been required (assuming satisfaction of each applicable
condition precedent) after that Early Termination Date is to be included. The
Replacement Transaction would be subject to such documentation as such party
and the Reference Market-maker may, in good faith, agree. The party making the
determination (or its agent) will request each Reference Market-maker to
provide its quotation to the extent reasonably practicable as of the same day
and time (without regard to different time zones) on or as soon as reasonably
practicable after the relevant Early Termination Date. The day and time as of
which those quotations are to be obtained will be selected in good faith by the
party obliged to make a determination under Section 6(e), and, if each party is
so obliged, after consultation with the other. If more than three quotations
are provided, the Market Quotation will be the arithmetic mean of the
quotations, without regard to the quotations having the highest and lowest
values. If exactly three such quotations are provided, the Market Quotation
will be the quotation remaining after disregarding the highest and lowest
quotations. For this purpose, if more than one quotation has the same highest
value or lowest value, then one of such quotations shall be disregarded. If
21
<PAGE>
fewer than three quotations are provided, it will be deemed that the Market
Quotation in respect of such Terminated Transaction or group of Terminated
Transactions cannot be determined.
"NON-DEFAULT RATE" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it)
if it were to fund the relevant amount.
"NON-DEFAULTING PARTY" has the meaning specified in Section 6(a).
"OFFICE" means a branch or office of a party, which may be such party's head or
home office.
"POTENTIAL EVENT OF DEFAULT" means any event which, with the giving of notice
or the lapse of time or both, would constitute an Event of Default.
"REFERENCE MARKET-MAKERS" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria
that such party applies generally at the time in deciding whether to offer or
to make an extension of credit and (b) to the extent practicable, from among
such dealers having an office in the same city.
"RELEVANT JURISDICTION" means, with respect to a party, the jurisdictions (a)
in which the party is incorporated organized, managed and controlled or
considered to have its seat, (b) where an Office through which the party is
acting for purposes of this Agreement is located, (c) in which the party
executes this Agreement and (d) in relation to any payment, from or through
which such payment is made.
"SCHEDULED PAYMENT DATE" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.
"SET-OFF" means set-off, offset, combination of accounts, right of retention or
withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or imposed
on, such payer.
"SETTLEMENT AMOUNT" means, with respect to a party and any Early Termination
Date, the sum of:-
(a) the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation is determined; and
(b) such party's Loss (whether positive or negative and without reference to
any Unpaid Amounts) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation cannot be determined or would not (in
the reasonable belief of the party making the determination) produce a
commercially reasonable result.
"SPECIFIED ENTITY" has the meaning specified in the Schedule.
22
<PAGE>
"SPECIFIED INDEBTEDNESS" means, subject to the Schedule, any obligation
(whether present or future, contingent or otherwise, as principal or surety or
otherwise) in respect of borrowed money.
"SPECIFIED TRANSACTION" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter entered
into between one party to this Agreement (or any Credit Support Provider of
such party or any applicable Specified Entity of such party) and the other
party to this Agreement (or any Credit Support Provider of such other party or
any applicable Specified Entity of such other party) which is a rate swap
transaction, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap, equity or equity index option, bond
option, interest rate option, foreign exchange transaction, cap transaction,
floor transaction, collar transaction, currency swap transaction, cross-
currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions),
(b) any combination of these transactions and (c) any other transaction
identified as a Specified Transaction in this Agreement or the relevant
confirmation.
"STAMP TAX" means any stamp, registration, documentation or similar tax.
"TAX" means any present or future tax, levy, impost, duty, charge, assessment
or fee of any nature (including interest, penalties and additions thereto) that
is imposed by any government or other taxing authority in respect of any
payment under this Agreement other than a stamp, registration, documentation or
similar tax.
"TAX EVENT" has the meaning specified in Section 5(b).
"TAX EVENT UPON MERGER" has the meaning specified in Section 5(b).
"TERMINATED TRANSACTIONS" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either case) in effect
immediately before the effectiveness of the notice designating that Early
Termination Date (or, if "Automatic Early Termination" applies, immediately
before that Early Termination Date).
"TERMINATION CURRENCY" has the meaning specified in the Schedule.
"TERMINATION CURRENCY EQUIVALENT" means, in respect of any amount denominated
in the Termination Currency, such Termination Currency amount and, in respect
of any amount denominated in a currency other than the Termination Currency
(the "Other Currency"), the amount in the Termination Currency determined by
the party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or, if
the relevant Market Quotation or Loss (as the case may be), is determined as of
23
<PAGE>
a later date, that later date, with the Termination Currency at the rate equal
to the spot exchange rate of the foreign exchange agent (selected as provided
below) for the purchase of such Other Currency with the Termination Currency at
or about 11:00 a.m. (in the city in which such foreign exchange agent is
located) on such date as would be customary for the determination of such a
rate for the purchase of such Other Currency for value on the relevant Early
Termination Date or that later date. The foreign exchange agent will, if only
one party is obliged to make a determination under Section 6(e), be selected in
good faith by that party and otherwise will be agreed by the parties.
"TERMINATION EVENT" means an Illegality, a Tax Event or a Tax Event Upon Merger
or, if specified to be applicable, a Credit Event Upon Merger or an Additional
Termination Event.
"TERMINATION RATE" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as certified
by such party) if it were to fund or of funding such amounts.
"UNPAID AMOUNTS" owing to any party means, with respect to an Early Termination
Date, the aggregate of (a) in respect of all Terminated Transactions, the
amounts that became payable (or that would have become payable but for Section
2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early
Termination Date and which remain unpaid as at such Early Termination Date and
(b) in respect of each Terminated Transaction, for each obligation under
Section 2(a)(i) which was (or would have been but for Section 2(a)(iii))
required to be settled by delivery to such party on or prior to such Early
Termination Date and which has not been so settled as at such Early Termination
Date, an amount equal to the fair market value of that which was (or would have
been) required to be delivered as of the originally scheduled date for
delivery, in each case together with (to the extent permitted under applicable
law) interest, in the currency of such amounts, from (and including) the date
such amounts or obligations were or would have been required to have been paid
or performed to (but excluding) such Early Termination Date, at the Applicable
Rate. Such amounts of interest will be calculated on the basis of daily
compounding and the actual number of days elapsed. The fair market value of
any obligation referred to in clause (b) above shall be reasonably determined
by the party obliged to make the determination under Section 6(e) or, if each
party is so obliged, it shall be the average of the Termination Currency
Equivalents of the fair market values reasonably determined by both parties.
24
<PAGE>
IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.
WESTDEUTSCHE LANDESBANK TIERS ASSET-BACKED SECURITIES
GIRONZENTRALE SERIES CHAMT TRUST 1997-7
By: DELAWARE TRUST CAPITAL
MANAGEMENT, INC., as Owner Trustee
By:___________________________ By:____________________________
Name: Name:
Title: Title:
25
Exhibit 5
ADMINISTRATION AGREEMENT dated as of September 15, 1997 (the
"Closing Date"), among TIERS Asset-Backed Securities, Series CHAMT Trust
1997-7, a Delaware business trust (the "Issuer"), Delaware Trust Capital
Management, Inc., as Trustee under the Trust Agreement referred to below
(the "Owner Trustee") and Structured Products Corp. as Administrator (in
such capacity, the "Administrator").
W I T N E S S E T H:
WHEREAS the Issuer is issuing: (i) the TIERS Asset-Backed
Securities Fixed Rate Notes, Class A (the "Notes") pursuant to the Standard
Terms of the Indenture ("Indenture Standard Terms") and the
TIERS<service-mark> Asset-Backed Securities, Series CHAMT Trust 1997-7
Indenture ("Indenture Series Terms"), each dated as of the Closing Date and
each between the Issuer and First Trust of New York, National Association
("First Trust"), as Indenture Trustee thereunder (the "Indenture Trustee";
the Indenture Standard Terms and the Indenture Series Terms, as amended and
supplemented from time to time (the "Indenture"); and (ii) the
TIERS<service-mark> Asset-Backed Securities, Floating Rate Certificates,
Class B (the "Certificates") pursuant to the Base Trust Agreement and the
TIERS<service-mark> Asset-Backed Securities Series CHAMT Trust 1997-7
Supplement thereto, each dated as of the Closing Date and each between
Structured Products Corp. as Depositor thereunder (the "Depositor") and the
Owner Trustee (as amended and supplemented from time to time, the "Trust
Agreement"). Terms used in this Agreement but not defined herein shall
have the meanings set forth in the Trust Agreement;
WHEREAS the Issuer has entered into certain agreements in
connection with the issuance of the Notes and the Certificates
(collectively, the "Securities") including (a) the Indenture, (b) the Trust
Agreement, (c) a Letter of Representations dated as of the Closing Date,
with respect to the Notes (as amended and supplemented from time to time,
the "Note Depository Agreement"), among the Issuer, the Indenture Trustee
and The Depository Trust Company ("DTC"), (d) a Letter of Representations
dated as of the Closing Date, with respect to the Trust Certificates (as
amended and supplemented from time to time, the "Certificate Depository
Agreement", and, together with the Note Depository Agreement, the
"Depository Agreements") among the Issuer, the Indenture Trustee, the Owner
Trustee and DTC, (e) an ISDA Master Agreement and related schedule and
confirmations dated as of the Closing Date (as amended and supplemented
from time to time, the "Swap Agreement"), between the Issuer and
<PAGE>
Westdeutsche Landesbank Girozentrale, New York Branch, (the Indenture, the
Depository Agreements and the Swap Agreement being hereinafter referred to
collectively as the "Related Agreements");
WHEREAS pursuant to the Related Agreements, the Issuer and the
Owner Trustee are required to perform certain duties in connection with
such Related Agreements.
WHEREAS the Issuer and the Owner Trustee desire to have the
Administrator perform certain of such duties for and on behalf of the
Issuer and the Owner Trustee; and
WHEREAS the Administrator has the capacity to provide the
services required hereby and is willing to perform such services for the
Issuer and the Owner Trustee on the terms set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. DUTIES OF THE ADMINISTRATOR.
(a) DUTIES WITH RESPECT TO THE DEPOSITORY AGREEMENTS, GENERAL.
Subject to paragraph 4 below, the Administrator agrees to perform, on
behalf of the Issuer and the Owner Trustee, the ministerial, non-fiduciary
duties delegated herein with respect to the Depository Agreements in
accordance with the terms hereof. In performing such duties the
Administrator shall be entitled to seek direction from the Owner Trustee,
the Issuer and the Indenture Trustee.
(b) DUTIES WITH RESPECT TO THE INDENTURE. The Administrator
shall, to the extent permitted by law, perform all those non-fiduciary
duties of the Issuer under the Indenture, other than those duties delegated
to First Trust as Administrator under the Administration Agreement (the
"Other Administration Agreement") dated September 15, 1997 among the
Issuer, the Owner Trustee and First Trust, as acknowledged and agreed to by
Structured Products Corp. as Depositor under the Trust Agreement.
(c) DUTIES WITH RESPECT TO THE TRUST AGREEMENT. The
Administrator shall, to the extent permitted by law, perform all those non-
fiduciary duties of the Issuer and the Owner Trustee under the Trust
Agreement, other than those duties delegated to First Trust as
Administrator under the Other Administration Agreement.
2. ROLE OF ADMINISTRATOR. Unless expressly contemplated by the
Related Documents, the Administrator shall have no authority to represent
the Issuer or the Owner Trustee in any way except as Administrator as
2
<PAGE>
expressly contemplated hereby and shall not otherwise be deemed an agent of
the Issuer or the Owner Trustee.
3. NO JOINT VENTURE. Nothing contained in this Agreement (a)
shall constitute the Administrator and either of the Issuer or the Owner
Trustee as members of any partnership, joint venture, association,
syndicate, unincorporated business or other separate entity or shall be
construed to impose any liability as such on any of them thereby or (b)
shall be deemed to confer on any of them any express, implied or apparent
authority to incur any obligation or liability on behalf of the others;
other than as expressly contemplated hereby.
4. OTHER ACTIVITIES OF ADMINISTRATOR. Nothing herein shall
prevent the Administrator or its affiliates from engaging in other
businesses or, in its sole discretion, from acting in a similar capacity as
an administrator for any other person or entity even though such person or
entity may engage in business activities similar to those of the Issuer,
the Owner Trustee or the Trustee.
5. TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR.
(a) This Agreement shall continue in force until the dissolution
of the Issuer, upon which event this Agreement shall automatically
terminate, except as to surviving rights of indemnity. Subject to Section
5(d) below, the Administrator may resign its duties hereunder by providing
the Issuer with at least 60 days' prior written notice.
(b) Subject to Section 5(d) below, the Issuer or the Owner
Trustee, may remove the Administrator without cause by providing the
Administrator with at least 60 days' prior written notice.
(c) Subject to Section 5(d) below, either or both of the Owner
Trustee or the Issuer may, in its or their sole discretion, remove the
Administrator immediately upon written notice of termination from the
Issuer, or the Owner Trustee, to the Administrator if any of the following
events shall occur:
(i) the Administrator shall materially default in the
performance of any of its duties under this Agreement and, after
notice of such default, shall not cure such default within thirty days
(or, if such default cannot be cured in such time, shall not give
within ten days such assurance of cure as shall be reasonably
satisfactory to the Issuer);
(ii) a court having jurisdiction in the premises shall enter
a decree or order for relief, and such decree or order shall not have
been vacated within 60 days, in respect of the Administrator in any
involuntary case under any applicable bankruptcy, insolvency or other
3
<PAGE>
similar law now or hereafter in effect or appoint a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official for the Administrator or any substantial part of its property
or order the winding-up or liquidation of its affairs; or
(iii) the Administrator shall commence a voluntary case under
any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order for relief
in an involuntary case under any such law, or shall consent to the
appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar official for the Administrator or any
substantial part of its property, shall consent to the taking of
possession by any such official of any substantial part of its
property, shall make any general assignment for the benefit of
creditors or shall fail generally to pay its debts as they become due.
The Administrator agrees that if any of the events specified in
clauses (ii) or (iii) of this Section shall occur, it shall give written
notice thereof to the Issuer, the Owner Trustee, the Depositor and the
Indenture Trustee within seven days after the happening of such event.
(d) No resignation or removal of the Administrator pursuant to
this Section shall be effective until (i) a successor Administrator shall
have been appointed by the Depositor and (ii) such successor Administrator
shall have agreed in writing to be bound by the terms of this Agreement in
the same manner as the Administrator is bound hereunder. If the
Administrator believes in good faith it cannot perform its duties and
resigns, it shall be entitled to petition a court of competent jurisdiction
to appoint a successor and it shall not be required to take any action
hereunder until a final non-appealable determination by such court is made.
(e) The appointment of any successor Administrator shall be
effective only after satisfaction of the Rating Agency Condition (as
defined in the Trust Agreement) with respect to the proposed appointment.
6. ACTION UPON TERMINATION, RESIGNATION OR REMOVAL. Promptly
upon the effective date of termination of this Agreement pursuant to
Section 5(a) or the resignation or removal of the Administrator pursuant to
Section 5(b), respectively, the successor Administrator shall automatically
become the Administrator under this Agreement.
7. NOTICES. Any notice, report or other communication given
hereunder shall be in writing and addressed as follows:
(a) If to the Issuer to:
TIERS<service-mark> Asset-Backed Securities
Series CHAMT Trust 1997-9
c/o Delaware Trust Capital Management, Inc.
4
<PAGE>
c/o Core States Bank Delaware
5-4-82-12
4th Floor
3 Beaver Valley Road
Wilmington, Delaware 19803
Attention: Corporate Trust Department
Louis Geibel
Richard Smith
Telephone: 302-421-7339
Facsimile: 302-421-7387
(b) If to the Administrator, to
Structured Products Corp.
(c) If to the Indenture Trustee, to:
First Trust of New York, National Association
100 Wall Street, Suite 1600
New York, New York 10005
Attention: Marlene Fahey
Facsimile: 212-809-5459
(d) If to the Owner Trustee, to
Delaware Trust Capital Management, Inc., not in its
individual capacity but solely as Owner Trustee
c/o Core States Bank Delaware
5-4-82-12
4th Floor
3 Beaver Valley Road
Wilmington, Delaware 19803
Attention: Corporate Trust Department
Louis Geibel
Richard Smith
Telephone: 302-421-7339
Facsimile: 302-421-7387
or to such other address as any party shall have provided to the other
parties in writing. Any notice required to be in writing hereunder shall
be deemed given if such notice is mailed by certified mail, postage
prepaid, or hand delivered to the address of such party as provided above.
8. AMENDMENTS. This Agreement may be amended from time to time
by a written amendment duly executed and delivered by the Issuer, the
Administrator, and the Owner Trustee, without the consent of the
Noteholders and the Certificateholders, for the purpose of adding to or
amending, modifying or supplementing any provisions to; PROVIDED that such
5
<PAGE>
amendment will not, in the Opinion of Counsel satisfactory to each such
party, materially and adversely affect the interest of any Noteholder or
Certificateholder. This Agreement may also be amended by the Issuer, the
Administrator, the Owner Trustee, the Indenture Trustee and the Depositor
with the written consent of the holders of Notes evidencing at least a
majority in the outstanding principal amount of the Notes and the holders
of Certificates evidencing at least a majority of the outstanding principal
amount thereof for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of Noteholders or the
Certificateholders; PROVIDED, HOWEVER, that no such amendment may (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, distributions that are required to be made for the benefit of
the Noteholders or Certificateholders (b) reduce the aforesaid percentage
of the holders of Notes and Certificates which are required to consent to
any such amendment, without the consent of the holders of all the
outstanding Notes and Certificates or (c) amend or modify the terms of this
Section 14. Notwithstanding the foregoing, the Administrator may not amend
this Agreement without the permission of the Depositor, which permission
shall not be unreasonably withheld.
9. SUCCESSORS AND ASSIGNS. This Agreement may not be assigned
by the Administrator unless such assignment is previously consented to in
writing by the Issuer, the Indenture Trustee, the Owner Trustee, and the
Depositor and subject to the satisfaction of the Rating Agency Condition in
respect thereto, provided however the Administrator may delegate certain of
its duties hereunder to agents selected with reasonable care. An
assignment with such consent and satisfaction, if accepted by the assignee,
shall bind the assignee hereunder in the same manner as the Administrator
is bound hereunder. Notwithstanding the foregoing, this Agreement may be
assigned by the Administrator without the consent of the Issuer or the
Owner Trustee to a corporation or other organization that is a successor
(by merger, consolidation or purchase of assets) to the Administrator.
Subject to the foregoing, this Agreement shall bind any successors or
assigns of the parties hereto.
10. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
11. HEADINGS. The section headings hereof have been inserted
for convenience or reference only and shall not be construed to affect the
meaning, construction or effect of this Agreement.
12. COUNTERPARTS. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but
one and the same agreement.
6
<PAGE>
13. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
14. LIABILITY OF ADMINISTRATOR. As provided in the Trust
Agreement, the Administrator shall be entitled to the same rights,
privileges and immunities available to as applicable, the Issuer or the
Owner Trustee, on whose behalf it is acting hereunder or under the Trust
Agreement or Indenture, notwithstanding anything to the contrary herein or
elsewhere.
15. LIMITATION OF LIABILITY.
(a) Notwithstanding anything contained herein to the contrary,
this instrument has been countersigned by Delaware Trust Capital
Management, Inc. not in its individual capacity but solely in its capacity
as Owner Trustee of the Issuer and in no event shall Delaware Trust Capital
Management, Inc. in its individual capacity or any beneficial owner of the
Issuer have any liability for the representations, warranties, covenants,
agreements or other obligations of the Issuer hereunder, as to all of which
recourse shall be had solely to the assets of the Issuer. For all purposes
of this Agreement, in the performance of any duties or obligations of the
Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Article VIII of the Trust
Agreement.
(b) Notwithstanding anything contained herein to the contrary,
this Agreement has been countersigned by First Trust of New York, National
Association not in its individual capacity but solely as Indenture Trustee
and Administrator and in no event shall First Trust of New York, National
Association have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in
any of the certificates, notices or agreements delivered pursuant hereto,
as to all of which recourse shall be had solely to the asset of the Issuer.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first written above.
DELAWARE TRUST CAPITAL MANAGEMENT, INC.,
not in its individual capacity but solely as
Trustee,
By: _______________________________________
Title: ____________________________________
TIERS<service-mark> ASSET-BACKED SECURITIES,
SERIES CHAMT 1997-7 TRUST,
a Delaware Business Trust
By: Delaware Trust Capital Management, Inc., not
in its individual capacity but solely as
Trustee,
By: _______________________________________
Title: ____________________________________
FIRST TRUST OF NEW YORK, NATIONAL ASSOCIATION,
as Indenture Trustee
By: _______________________________________
Title: ____________________________________
Accepted and Agreed as of the date first above
written:
STRUCTURED PRODUCTS CORP., as Administrator
By: _______________________________________
Title: ____________________________________
8
ng73482.1
Exhibit 6
EXPENSE GUARANTEE OF COLLECTION
OF SALOMON BROTHERS HOLDING COMPANY INC
September 15, 1997
First Trust of New York, National Association
100 Wall Street
New York, NY 10005
Ladies and Gentlemen:
(1) Reference is hereby made to (i) the TIERS Asset-Backed Securities,
Series CHAMT Trust 1997-7 Series Trust Indenture dated September 15,
1997 and to the Standard Terms and Provisions of Trust Indenture dated
as of September 15, 1997 (together, the "Indenture"), each between
First Trust of New York, National Association ("First Trust"), as
Indenture Trustee (the "Indenture Trustee") and TIERS Asset-Backed
Securities, Series CHAMT Trust 1997-7 (the "Issuer"), (ii) the TIERS
Asset-Backed Securities, Series CHAMT Trust 1997-7 Supplement dated as
of September 15, 1997 and to the Base Trust Agreement dated as of
September 15, 1997 (together the "Trust Agreement"), each between
Structured Products Corp. ("SPC"), as Depositor, and Delaware Trust
Capital Management, Inc., as Owner Trustee (the "Owner Trustee"),
(iii) the Administration Agreement dated as of September 15, 1997 (the
"Administration Agreement") among First Trust in its capacity as
Administrator (the "Administrator"), and in its capacity as Indenture
Trustee under the Indenture, and Delaware Trust Capital Management,
Inc., in its capacity as Owner Trustee under the Trust Agreement as
acknowledged and agreed to by SPC.
(2) In consideration of the agreement of First Trust to enter into the
Indenture and the Administration Agreement, on or after the date of
this Guarantee, Salomon Brothers Holding Company Inc (the "Guarantor")
hereby unconditionally and irrevocably, as a continuing obligation,
guarantees to First Trust collection from SPC of all obligations owed
from time to time by SPC to First Trust in connection with the
performance of its duties as Indenture Trustee and Administrator,
subject to a maximum total limit of $40,000 if First Trust okays it.
(3) This Guarantee is a guarantee of collection only and not of payment,
and you shall be obligated to exhaust all remedies against SPC before
demanding payment under this Guarantee from the Guarantor.
(4) The Guarantor's liability under this guarantee shall not be discharged
or impaired by the existence or validity of any other security taken
by you in relation to the relevant agreement with SPC or any
enforcement of (or failure to enforce) or the release of, any such
security.
(5) Any release, compromise or discharge of the obligations of the
Guarantor shall be deemed to be made subject to the condition that it
will be void if any payment of security which you may receive or have
received is set aside for whatever reason.
<PAGE>
(6) Notwithstanding anything herein, the Guarantor shall have no
obligation or liability with respect to the Certificates.
(7) This Guarantee and any and all liability hereunder shall automatically
cease and expire on November 17, 2003 provided that SPC has fully
performed all its obligations in connection with the Trust.
(8) This Guarantee is governed by the laws of the State of New York.
Very truly yours,
SALOMON BROTHERS HOLDING COMPANY INC
____________________________________
Authorized Signature
2
<PAGE>
Exhibit 7
EXPENSE GUARANTEE OF COLLECTION
OF SALOMON BROTHERS HOLDING COMPANY INC
September 15, 1997
Delaware Trust Capital Management, Inc.
c/o Corestates Bank
FC5-4-2-6
3 Beaver Valley Road
Wilmington, DE 19803
Ladies and Gentlemen:
(1) In consideration of Delaware Trust Capital Management, Inc. (the
"Owner Trustee") entering into the TIERS Corporate Bond-Backed
Securities, Series CHAMT Trust 1997-7 Supplement dated September 15,
1997 to the Base Trust Agreement dated as of September 15, 1997 with
Structured Products Corp. ("SPC") relating to the formation of the
TIERS Corporate Bond-Backed Securities Series CHAMT Trust 1997-7 (the
"Trust") and the issuance of a series of TIERS Series CHAMT Trust
1997-7 Floating Rate Certificates, Class B (the "Certificates") on or
after the date of this Guarantee, Salomon Brothers Holding Company Inc
(the "Guarantor") hereby unconditionally and irrevocably, as a
continuing obligation, guarantees collection from SPC of all
obligations owed from time to time by SPC to you in connection with
the Trust, subject to a maximum total limit of $15,000; PROVIDED,
HOWEVER, that this Guarantee is a guarantee of collection only and not
of payment, and you shall be obligated to exhaust all remedies against
SPC before demanding payment under this Guarantee from the Guarantor.
(2) The Guarantor's liability under this guarantee shall not be discharged
or impaired by the existence or validity of any other security taken
by you in relation to the relevant agreement with SPC or any
enforcement of (or failure to enforce) or the release of, any such
security.
(3) Any release, compromise or discharge of the obligations of the
Guarantor shall be deemed to be made subject to the condition that it
will be void if any payment of security which you may receive or have
received is set aside for whatever reason.
(4) Notwithstanding anything herein, the Guarantor shall have no
obligation or liability with respect to the Certificates.
(5) This Guarantee and any and all liability hereunder shall automatically
cease and expire on November 17, 2003 provided that SPC has fully
performed all its obligations in connection with the Trust.
(6) This Guarantee is governed by the laws of the State of New York.
Very truly yours,
SALOMON BROTHERS HOLDING COMPANY INC
___________________________________
Authorized Signature
[EXPENSE GUARANTEE OF COLLECTION SIGNATURE PAGE]
Exhibit 8
TIERS{SM} ASSET-BACKED SECURITIES, SERIES CHAMT TRUST 1997-7
$352,980,000 Fixed Rate Notes, Class A
UNDERWRITING AGREEMENT
September 15, 1997
Salomon Brothers Inc
Seven World Trade Center
New York, New York 10048
Dear Sirs:
1. INTRODUCTION. Structured Products Corp., a Delaware corporation
(the "Depositor"), proposes to cause TIERS{SM} Asset-Backed Securities
Series CHAMT Trust 1997-7 (the "Trust") to issue and sell to you (also
referred to herein as the "Underwriter") $352,980,000 aggregate principal
amount of its Fixed Rate Notes, Class A (the "Notes"). The Trust will also
separately issue and sell $10,920,000 aggregate principal amount of its
Floating Rate Certificates, Class B (the "Certificates"), which are being
offered privately and are not subject to this Agreement. The property of
the Trust will consist of $363,900,000 aggregate principal amount of Class
A Floating Rate Asset Backed Certificates, Series 1996-4, due November 17,
2003 of Chase Credit Card Master Trust (the "Term Assets"). The Term
Assets are being sold to the Trust by the Depositor. The Notes will be
issued pursuant to the Indenture, dated as of September 15, 1997 (as
amended and supplemented from time to time, the "Indenture"), between the
Trust and First Trust of New York, National Association, as Indenture
Trustee (the "Indenture Trustee"). The Certificates will be issued
pursuant to the Trust Agreement, dated as of September 15, 1997 (as amended
and supplemented from time to time, the "Trust Agreement"), between the
Depositor, as depositor, and Delaware Trust Capital Management, Inc, as
trustee (the "Trustee"). Capitalized terms used and not otherwise defined
herein shall have the meanings given to them in the Trust Agreement.
2. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR. The Depositor
represents and warrants to, and agrees with you that:
(a) The Depositor meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act"), and has filed
with the Securities and Exchange Commission (the "Commission") a
registration statement (Registration No. 33-55860) under the Act on such
<PAGE>
Form, including a related preliminary prospectus and prospectus supplement.
The Depositor has filed one or more amendments thereto, including the
related preliminary prospectus, each of which amendments has previously
been furnished to you. The Depositor will next file with the Commission
either (i) prior to the effectiveness of such registration statement, a
further amendment thereto (including the form of final prospectus), (ii) a
final prospectus in accordance with Rules 430A and 424(b)(1) or (4) under
the Act or (iii) a final prospectus in accordance with Rule 415 and
424(b)(2) or (5). In the case of clause (ii), the Depositor has included
in such registration statement, as amended at the Effective Date, all
information (other than Rule 430A Information) required by the Act and the
rules and regulations thereunder to be included in the prospectus with
respect to the offering of the Notes. As filed, such amendment and form
of final prospectus, or such final prospectus, shall include all Rule 430A
Information and, except to the extent that you shall agree in writing to a
modification, shall be in all substantive respects in the form furnished to
you prior to the Execution Time, shall contain only such specific
additional information and other changes (beyond that contained in the
latest Preliminary Prospectus which has previously been furnished to you)
as the Depositor has advised you, prior to the Execution Time, will be
included or made therein. If the Registration Statement contains the
undertaking specified by Item 512(a) of Regulation S-K, the Registration
Statement, at the Execution Time, meets the requirements set forth in Rule
415(a)(1)(x).
For purposes of this Agreement, "Effective Time" means the date and
time as of which such registration statement, or the most recent post-
effective amendment thereto, if any, was declared effective by the
Commission, and "Effective Date" means the date of the Effective Time.
Such registration statement, as amended at the Effective Time, including
all information deemed to be a part of such registration statement as of
the Effective Time pursuant to Rule 430(b) under the Act, and including the
exhibits thereto and any material incorporated by reference therein, is
hereinafter referred to as the "Registration Statement", and the form of
prospectus relating to the Notes, as first filed with the Commission
pursuant to and in accordance with Rule 424(b) under the Act, is
hereinafter referred to as the "Prospectus". "Execution Time" shall mean
the date and time that this Agreement is executed and delivered by the
parties hereto. "Preliminary Prospectus" shall mean the preliminary
prospectus referred to in the preceding paragraph and the preliminary
prospectus, if any, included in the Registration Statement which at the
Effective Date omits Rule 430A Information. "Rule 430A Information" means
information with respect to the Notes and the offering of the Notes
permitted to be omitted from the Registration Statement when it becomes
effective pursuant to Rule 430A. "Rule 415", Rule 424", "Rule 430A" and
Regulation S-K" refer to such rules or regulations under the Act. Any
reference herein to the Registration Statement, a Preliminary Prospectus or
the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 or Form S-3, which
were filed under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), on or before the Effective Act of 1934, as amended (the
"Exchange Act"), on or before the Effective Date of the Registration
Statement or the issue date of such Preliminary Prospectus or the
Prospectus, as the case may be; and any reference herein to the terms
"amend", "amendment" or "supplement" with respect to the Registration
Statement, any Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include the filing of any document under the Exchange Act
after the Effective Date of the Registration Statement, or the issue date
of any Preliminary Prospectus or the Prospectus, as the case may be, deemed
to be incorporated therein by reference.
2
<PAGE>
(b) On the Effective Date and on the date of this Agreement, the
Registration Statement did or will, and, when the Prospectus is first filed
(if required) in accordance with Rule 424(b) and on the Closing Date, the
Prospectus (and any supplements thereto) will, comply in all material
respects with the applicable requirements of the Act and the Exchange Act
and the respective rules and regulations of the Commission thereunder (the
"Rules and Regulations"); on the Effective Date, the Registration Statement
did not or will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; and, on the Effective
Date, the Prospectus, if not filed pursuant to Rule 424(b), did not or will
not, and on the date of any filing pursuant to Rule 424(b) and on the
Closing Date, the Prospectus (together with any supplement thereto) will
not, include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
PROVIDED, HOWEVER, that the Depositor makes no representation or warranty
as to the information contained in or omitted from the Registration
Statement or the Prospectus (or any supplement thereto) in reliance upon
and in conformity with (i) information furnished in writing to the
Depositor by you specifically for use in connection with preparation of the
Registration Statement or the Prospectus (or any supplement thereto) or
(ii) information contained in, or omitted from, the prospectus dated
November 6, 1996, and supplement thereto dated November 6, 1996, in respect
of the Term Assets (collectively the "Term Assets Prospectus") concerning
the Term Assets, the issuer of the Term Assets or the Term Assets
Prospectus. As of the Closing Date, the Depositor's representations and
warranties in the Trust Agreement will be true and correct.
(c) This Agreement has been duly authorized, executed and
delivered by the Depositor.
(d) The assignment and delivery by the Depositor or its
affiliate of the Term Assets to the Trust as of the Closing Date will vest
in the Trust all the right, title and interest of the Depositor or its
affiliate therein, subject to no prior lien, mortgage, security interest,
pledge adverse claim, charge or other encumbrance.
3. PURCHASE, SALE AND DELIVERY OF THE NOTES. On the basis of the
representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Depositor agrees to cause
the Trust to sell to you, and you agree to purchase from the Trust, at a
purchase price of 100% of the principal amount thereof, the entire
$352,980,000 principal amount of the Notes. Delivery of and payment for
the Notes shall be made at the office of Rogers & Wells, 200 Park Avenue,
New York, New York 10166, on September 15, 1997 (the "Closing Date").
Delivery of the Notes shall be made against payment of the purchase price
in immediately available funds drawn to the order of the Depositor. The
Notes to be so delivered will be initially represented by one or more Notes
3
<PAGE>
registered in the name of Cede & Co., the nominee of The Depository Trust
Company ("DTC"). The interests of beneficial owners of the Notes will be
represented by book entries on the records of DTC and participating members
thereof. Definitive Notes will be available only under limited
circumstances.
4. OFFERING BY UNDERWRITER. It is understood that, after the
Registration Statement becomes effective, you propose to offer the Notes
for sale to the public (which may include selected dealers), as set forth
in the Prospectus.
5. COVENANTS OF THE DEPOSITOR. The Depositor covenants and agrees
with you that:
(a) The Depositor will use its best efforts to cause the
Registration Statement, and any amendment thereto, if not effective at the
Execution Time, to become effective. Prior to the termination of the
offering of the Notes, the Depositor will not file any amendment of the
Registration Statement or supplement to the Prospectus unless the Depositor
has furnished you a copy for your review prior to filing and will not file
any such proposed amendment or supplement to which you reasonably object.
Subject to the foregoing sentence, if the Registration Statement has become
or becomes effective pursuant to Rule 430A, or filing of the Prospectus is
otherwise required under Rule 424(b), the Depositor will file the
Prospectus, properly completed, and any supplement thereto, with the
Commission pursuant to and in accordance with the applicable paragraph of
Rule 424(b) within the time period prescribed thereby and will provide
evidence satisfactory to you of such timely filing.
(b) The Depositor will advise you promptly of any proposal to
amend or supplement the Registration Statement as filed or the related
Prospectus and will not effect such amendment or supplement without your
consent, which consent will not unreasonably be withheld; the Depositor
will also advise you promptly of any request by the Commission for any
amendment of or supplement to the Registration Statement or the Prospectus
or for any additional information; and the Depositor will also advise you
promptly of the effectiveness of the Registration Statement, of any
amendment of or supplement to the Registration Statement or the Prospectus
and of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or threat of
any proceeding for that purpose, and the Depositor will use its best
efforts to prevent the issuance of any such stop order and to obtain as
soon as possible the lifting of any issued stop order.
(c) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement or a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if it is necessary at any
time to amend the Registration Statement or supplement the Prospectus to
comply with the Act, the Exchange Act or the Rules and Regulations, the
Depositor promptly will notify you and will prepare and file, or cause to
be prepared and filed, with the Commission, subject to the second sentence
of paragraph (a) of this Section 5, an amendment or supplement which will
correct such statement or omission, or an amendment or supplement which
will effect such compliance. Any such filing shall not operate as a waive
or limitation on any right of the Underwriter hereunder.
(d) As soon as practicable, but not later than sixteen months
after the original Closing Date, the Depositor will cause the Trust to make
generally available to Noteholders an earnings statement of the Trust,
4
<PAGE>
covering a period of at least twelve months beginning after the Effective
Date of the Registration Statement, that will satisfy the provisions of
Section 11(a) of the Act and Rule 158 under the Act.
(e) The Depositor will furnish to you copies of the Registration
Statement (one of which will include all exhibits), each related
Preliminary Prospectus, the Prospectus and all amendments and supplements
to such documents, in each case as soon as available and in such quantities
as you request.
(f) The Depositor will arrange for the qualification of the
Notes for sale under the laws of such jurisdictions in the United States as
you may reasonably designate and will continue such qualifications in
effect so long as required for the distribution.
(g) For a period from the date of this Agreement until the
retirement of the Notes, or until such time as you shall cease to maintain
a secondary market in the Notes, whichever occurs first, the Depositor will
deliver to you the annual statements of compliance and the annual
independent certified public accountants' reports furnished to the Trustee
pursuant to the Trust Agreement, as soon as such statements and reports are
furnished to the Trustee.
(h) So long as any of the Notes are outstanding, the Depositor
will furnish to you (i) as soon as practicable after the end of the fiscal
year all documents required to be distributed to Noteholders or filed with
the Commission pursuant to the Exchange Act, the Rules and Regulations
thereunder or any order of the Commission thereunder and (ii) from time to
time, any other information concerning the Depositor filed with any
government or regulatory authority which is otherwise publicly available,
as you may reasonably request.
(i) On or before the Closing Date, the Depositor shall cause
its records to be marked to show the Trust's absolute ownership of the Term
Assets, and from and after the Closing Date the Depositor shall not take
any action inconsistent with the Trust's ownership of such Term Assets,
other than as permitted by the Trust Agreement.
(j) To the extent, if any, that the rating provided with respect
to the Notes by the rating agency or agencies that initially rate the Notes
is conditional upon the furnishing of documents or the taking of any other
actions by the Depositor, the Depositor shall furnish such documents and
take any such other actions.
6. PAYMENT OF EXPENSES. The Depositor will pay all expenses
incident to the performance of its obligations under this Agreement,
including (i) the printing and filing of the Registration Statement as
originally filed and of each amendment thereto, (ii) the preparation of
this Agreement, (iii) the preparation, issuance and delivery of the Notes
to the Underwriter, (iv) the fees and disbursements of the Depositor's
counsel and accountants, (v) the qualification of the Notes under
securities laws in accordance with the provisions of Section 5(f),
including filing fees and the fees and disbursements of counsel for you in
connection therewith and in connection with the preparation of any blue sky
or legal investment survey, (iv) the printing and delivery to the
5
<PAGE>
Underwriter of copies of the Registration Statement as originally filed and
of each amendment thereto, (vii) the printing and delivery to the
Underwriter of copies of any blue sky or legal investment survey prepared
in connection with the Notes, (viii) any fees charged by rating agencies
for the rating of the Notes and (ix) the fees and expenses of Rogers &
Wells in its role as counsel to the Trust incurred as a result of providing
the opinions required by Section 7(g).
7. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITER. Your
obligation to purchase and pay for the Notes will be subject to the
accuracy of the representations and warranties on the part of the Depositor
herein, to the accuracy of the statements of officers of the Depositor made
pursuant to the provisions hereof, to the performance by the Depositor of
its obligations hereunder and to the following additional conditions
precedent:
(a) If the Registration Statement has not become effective prior
to the Execution Time, unless you agree in writing to a later time, the
Registration Statement shall have become effective not later than (i) 6:00
p.m. New York City time on the date of determination of the public offering
price, if such determination occurred at or prior to 3:00 p.m. New York
City time on the business day following the day on which the public
offering price was determined, if such determination occurred after 3:00
p.m. New York City time on such date.
(b) The Prospectus and any supplements thereto shall have been
filed (if required) with the Commission in accordance with the Rules and
Regulations and Section 5(a) hereof, and prior to the Closing Date, no stop
order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been instituted
or, to the knowledge of the Depositor or you, shall be contemplated by the
Commission or by any authority administering any state securities or blue
sky law.
(c) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development involving
a prospective change, in or affecting particularly the business or
properties of the Trust or the Depositor which, in your judgment,
materially impairs the investment quality of the Notes or makes it
impractical or inadvisable to market the Notes; (ii) any suspension or
limitation of trading in securities generally on the New York Stock
Exchange, or any setting of minimum prices for trading on such exchange;
(iii) any banking moratorium declared by Federal or New York authorities;
or (iv) any outbreak or escalation of major hostilities in which the United
States is involved, any declaration of war by Congress, or any other
substantial national or international calamity or emergency if, in your
judgment, the effect of any such outbreak, escalation, declaration,
calamity or emergency makes it impractical or inadvisable to proceed with
completion of the sale of and payment for the Notes.
(d) You shall have received an opinion of Rogers & Wells,
counsel to the Depositor, addressed to you, dated the Closing Date and in
form and substance satisfactory to you and your counsel.
(e) You shall have received an opinion addressed to you of
Rogers & Wells, in its capacity as special Federal tax and ERISA counsel to
the Trust, to the effect that the statements in the Prospectus Supplement
under the heading "Certain Federal Income Tax Consequences" accurately
6
<PAGE>
describe the material Federal income tax consequences to holders of the
Notes, and the statements in the Prospectus and the Prospectus Supplement
under the heading "ERISA Considerations", to the extent that they
constitute statements of matters of law or legal conclusions with respect
thereto, have been prepared or reviewed by such counsel and accurately
describe the material consequences to holders of the Notes under ERISA.
(f) You shall have received from Rogers & Wells, counsel to the
Underwriter, such opinion or opinions, dated the Closing Date and addressed
to you, with respect to the validity of the Notes and such other related
matters as you shall require and the Depositor shall have furnished or
caused to be furnished to such counsel such documents as they may
reasonably request for the purpose of enabling them to pass upon such
matters.
(g) You shall have received an opinion addressed to you and the
Depositor of Richards, Layton & Finger, counsel to the Trust, dated the
Closing Date and satisfactory in form and substance to you and your
counsel.
(h) You shall have received certificates dated the Closing Date
of such of the principal executive, financial and accounting officers of
the Depositor as you may request, dated the Closing Date, in which such
officers shall state that, to the best of their knowledge after reasonable
investigation, (i) the representations and warranties of the Depositor
contained in this Agreement and the Trust Agreement are true and correct,
that the Depositor has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied under such agreements
at or prior to the Closing Date, that no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are contemplated by
the Commission and (ii) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, no
material adverse change, or any development involving a prospective
material adverse change, in or affecting particularly the business or
properties of the Trust or the Depositor has occurred, whether or not
arising in the ordinary course of business.
(i) You shall have received evidence satisfactory to you that,
on or before the Closing Date, UCC-1 financing statements have been or are
being filed in the office of the Secretary of State of the States of
Delaware and New York reflecting the transfer of the interest of the
Depositor in the Term Assets and the proceeds thereof to the Trust.
(j) The Notes shall have been rated in at least one of the four
highest investment grade rating categories by Moody's Investors Service,
Inc.
(k) Issuance of the Notes shall not have resulted in a reduction
or withdrawal by any Rating Agency of the current rating of any outstanding
securities issued or originated by the Trust or the Depositor.
(l) The Depositor will provide or cause to be provided to you
such conformed copies of such opinions, certificates, letters and documents
as you reasonably request.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Depositor agrees to
indemnify and hold harmless the Underwriter, the directors, officers,
7
<PAGE>
employees and agents of the Underwriter and each person, if any, who
controls the Underwriter within the meaning of the Act or the Exchange Act
against any and all losses, claims, damages or liabilities, Joint or
several, to which they or any of them may become subject under the Act, the
Exchange Act or federal or state statutory law or regulation, at common law
or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, the Prospectus or in any amendment thereof or
supplement thereto or any related Preliminary Prospectus, or arise out of
or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such
loss, claim, damage, liability or action; PROVIDED, HOWEVER, that the
Depositor will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with (i) written
information furnished to the Depositor by or on behalf of the Underwriter
through you specifically for use therein or (ii) information contained in,
or omitted from, the prospectus dated November 6, 1996, and supplement
thereto dated November 6, 1996, in respect of the Term Assets (collectively
the "Term Assets Prospectus") concerning the Term Assets, the issuer of the
Term Assets or the Term Assets Prospectus. This indemnity agreement will
be in addition to any liability which the Depositor may otherwise have.
(b) You agree to indemnify and hold harmless the Depositor, each
of the directors of the Depositor, each of the officers of the Depositor
who shall have signed the Registration Statement, and each other person, if
any, who controls the Depositor within the meaning of the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the
Depositor to the Underwriter, but only with reference to written
information relating to the Underwriter furnished to the Depositor by or on
behalf of the Underwriter specifically for inclusion in the documents
referred to in the foregoing indemnity. This indemnity agreement will be
in addition to any liability which the Underwriter may otherwise have. The
Depositor acknowledges that the statements set forth in the Prospectus
Supplement under the heading "Method of Distribution" constitute the only
information furnished in writing by or on behalf of the Underwriter for
inclusion in the Prospectus or any Prospectus Supplement and you confirm
that such statements are correct.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party
(i) will not relieve it from liability under paragraph (a) or (b) above
unless and to the extent it did not otherwise learn of such action and such
failure results in the forfeiture by the indemnifying party of substantial
rights and defenses and (ii) will not, in any event, relieve the
8
<PAGE>
indemnifying party from any obligations to any indemnified party other than
the indemnification obligation provided in paragraph (a) or (b) above. The
indemnifying party shall be entitled to appoint counsel of the indemnifying
party's choice at the indemnifying party's expense to represent indemnified
party in any action for which indemnification is sought (in which case the
indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or
parties except as set forth below); PROVIDED, HOWEVER, that such counsel
shall be satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have the right
to employ separate counsel (including local counsel), and the indemnifying
party shall bear the reasonable fees, costs and expenses of such separate
counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict
of interest, (ii) the actual or potential defendants in, or targets of, any
such action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded that there may be
legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party,
(iii) the indemnifying party shall not have employed counsel satisfactory
to the indemnified party to represent the indemnified party within a
reasonable time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party
will not, without the prior written consent of the indemnified parties,
settle or compromise or consent to the entry of any judgment with respect
to any pending or threatened claim, action, suit or proceeding in respect
to which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or
(b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Depositor and the Underwriter agree
to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "Losses") to which the
Depositor and the Underwriter may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Depositor and
by the Underwriter from the offering of the Notes; PROVIDED, HOWEVER, that
in no case shall the Underwriter be responsible for any amount in excess of
the underwriting discount or commission applicable to the Notes purchased
by the Underwriter hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Depositor
and the Underwriter shall contribute in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of
the Depositor and the Underwriter. The benefits received by the Depositor
shall be deemed to be equal to the total net proceeds from the offering
(before deducting expenses), and benefits received by the Underwriter shall
be deemed to be equal to the total underwriting discounts and commissions.
Relative fault shall be determined by reference to whether any alleged
untrue statement or omission relates to information provided by the
Depositor or the Underwriter. The Depositor and the Underwriter agree that
it would not be just and equitable if contribution were determined by pro
rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding
the provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person
who controls the Underwriter within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of the
9
<PAGE>
Underwriter shall have the same rights to contribution as the Underwriter,
and each person who controls the Depositor within the meaning of either the
Act or the Exchange Act, each officer of the Depositor who shall have
signed the Registration Statement and each director of the Depositor shall
have the same rights to contribution as the Depositor, subject in each case
to the applicable terms and conditions of this paragraph (d).
9. DEFAULTS OF UNDERWRITER. If the Underwriter defaults in its
obligations to purchase the Notes hereunder on the Closing Date and
arrangements satisfactory to the Depositor for the purchase of such Notes
by other persons are not made within 36 hours after such default, this
Agreement will terminate without liability on the part of the Depositor,
except as provided in Section 11. As used in this Agreement, the term
"Underwriter" includes any person substituted for the Underwriter under
this Section. Nothing herein will relieve a defaulting Underwriter from
liability for its default.
10. NO BANKRUPTCY PETITION. The Underwriter covenants and agrees
that, prior to the date which is one year and one day after the payment in
full all securities issued by the Depositor or by a trust for which the
Depositor was the depositor which securities were rated by any nationally
recognized statistical rating organization, it will not institute against,
or join any other Person in instituting against, the Depositor any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other proceedings under any Federal or state bankruptcy or
similar law.
11. SURVIVAL OF REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements
of the Depositor or any of its officers and the Underwriter set forth in or
made pursuant to this Agreement or contained in certificates of officers of
the Depositor submitted pursuant hereto shall remain operative and in full
force and effect, regardless of any investigation or statement as to the
results thereof, made by or on behalf of the Underwriter or of the
Depositor or any of their respective representatives, officers or directors
or any controlling person, and will survive delivery of and payment for the
Notes. If for any reason the purchase of the Notes by the Underwriter is
not consummated, the Depositor shall remain responsible for the expenses to
be paid or reimbursed by the Depositor pursuant to Section 6 and the
respective obligations of the Depositor and the Underwriter pursuant to
section 8 shall remain in effect. If for any reason the purchase of the
Notes by the Underwriter is not consummated (other than because of a
failure to satisfy the conditions set forth in items (ii), (iii) and (iv)
of Section 7(d)), the Depositor will reimburse the Underwriter, upon
demand, for all out-of-pocket expenses (including fees and disbursements of
counsel) reasonably incurred by it in connection with the offering of the
Notes.
12. NOTICES. All communications hereunder will be in writing and, if
sent to the Underwriter, will be mailed, delivered or telegraphed and
confirmed to it at Seven World Trade Center, New York, NY 10048; if sent to
the Depositor, will be mailed, delivered or telegraphed, and confirmed to
it at Structured Products Corp., Seven World Trade Center, Room 33-130,
10
<PAGE>
33rd Floor, New York, NY 10048, Attention: Secretary; PROVIDED, HOWEVER,
that any notice to the Underwriter pursuant to Section 8 will be mailed,
delivered or telegraphed and confirmed to the Underwriter. Any such notice
will take effect at the time of receipt.
13. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8,
and no other person will have any right or obligations hereunder.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
15. APPLICABLE LAW. This Agreement will be governed by, and
construed in accordance with, the internal laws of the State of New York,
without giving effect to principles of conflict of laws.
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicate hereof,
whereupon it will become a binding agreement among the Depositor and the
Underwriter in accordance with its terms.
Very truly yours,
STRUCTURED PRODUCTS CORP.,
By_________________________
Authorized Signatory
The foregoing Underwriting
Agreement is hereby confirmed
and accepted as of the
date first written above.
SALOMON BROTHERS INC
By________________________
Authorized Signatory
11
Exhibit 9
September 15, 1997
Salomon Brothers Inc
Seven World Trade Center
New York, NY 10048
Structured Products Corp.
Seven World Trade Center
Room 33-130, 33rd Floor
New York, NY 10048
Re: Structured Products Corp. Registration Statement on Form S-3
(No. 33-55860) - TIERS Asset-Backed Securities, Series
CHAMT Trust 1997-7 (the "Series Trust") Fixed Rate Notes,
Class A (the "Series Notes")
---------------------------------------------------------------
Ladies and Gentlemen:
We have advised Structured Products Corp. (the "Company") in
connection with the above captioned registration statement on Form S-3 (as
amended by Post-Effective Amendment No. 4 filed by the Registrant with the
Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Act") on April 22, 1997 (the "Registration
Statement"), with respect to certain federal income tax aspects of the
issuance by the Registrant of its notes (the "Notes"). As described in the
Registration Statement, the Notes are being issued from time to time in
series, with each series being issued by a trust organized under the laws
of Delaware to be formed by the Registrant pursuant to a trust agreement
between the Company and a trustee (the "Trustee"). Capitalized terms
not otherwise defined herein are used as defined in the Registration
Statement.
In that connection, we are familiar with the proceedings taken in
connection with the authorization, issuance and sale of the Series Notes
to be issued by the Series Trust, and we have examined copies of such
documents, corporate records and other instruments as we have deemed
necessary or appropriate for the purposes of this opinion, including the
Registration Statement, the Series Trust Indenture and Standard Terms
and Provisions of Trust Indenture pursuant to which the Series Notes are
issued (together, the "Indenture"), and the prospectus dated September 15,
1997 (the "Base Prospectus") and the prospectus supplement dated
September 15, 1997 with respect to the Series Notes (the "Prospectus
Supplement").
<PAGE>
Salomon Brothers Inc. September 15, 1997
Structured Products Corp.
2
Based on the foregoing and assuming that the transactions
contemplated to occur under the Registration Statement and the Indenture
occur in accordance with the terms thereof, we hereby confirm that the
statements under the heading "Certain Federal Income Tax Consequences"
in the Prospectus Supplement, to the extent that they constitute matters
of federal law or legal conclusions with respect thereto, have been
reviewed by us and are correct in all material respects with respect
to those consequences or aspects that are discussed. We hereby confirm
the opinion set forth in the Prospectus Supplement.
In rendering the foregoing opinions, we have assumed the following:
(a) the authenticity of original documents and genuineness of all
signatures; (b) the conformity to the originals of all documents submitted
to us as copies; (c) the truth, accuracy and completeness of the
information, representations and warranties made in conference or contained
in the records, documents, instruments and certificates we have reviewed;
(d) the corporate power and authority of the respective parties to the
Indenture to enter into and perform all of their obligations thereunder;
(e) the due authorization, execution and delivery of the Indenture on
behalf of the respective parties thereto; (f) the parties' compliance with
all material provisions of the Indenture; and (g) the absence of any
agreements or understandings among the parties other than those contained
in the Indenture or referenced therein (or otherwise called to our
attention).
We express no opinions as to matters of law other than the federal
income tax laws of the United States of America, as in effect on the date
hereof.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name wherever appearing in the
Registration Statement and the Base Prospectus and Prospectus Supplement
contained therein. In giving such consent, we do not consider that we are
"experts," within the meaning of the term as used in the Act or the rules
and regulations of the Commission issued thereunder, with respect to any
part of the Registration Statement, including this opinion as an exhibit or
otherwise. We disclaim any obligation to update this opinion letter for
events occurring or coming to our attention after the date hereof.
Very truly yours,
September 22, 1997
VIA EDGAR
- ---------
Securities and Exchange Commission
450 5th Street, N.W.
Judiciary Plaza
Washington, D.C. 20549
Re: TIERS{sm} Series CHAMT Trust 1997-7
Structured Products Corp.
Registration Statement on Form S-3, No. 33-55860
------------------------------------------------
Ladies and Gentlemen:
On behalf of Structured Products Corp. as the depositor of
TIERS{sm} Asset-Backed Securities Series CHAMT Trust 1997-7, we transmit
for filing a Current Report on Form 8-K dated September 22, 1997 pursuant
to Section 15(d) or Section 13 as promulgated under the Securities Exchange
Act of 1934, as amended.
Should you have any questions, please contact me at (212) 878-
8473 or Richard Vecchiolla at (212) 878-3272.
Very truly yours,
Steven T. Kolyer
ENCS.
- -----
cc: Timothy Beaulac (w/o enclosure)
