<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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) June 30, 1998
Fund America Investors Corporation II
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(Exact name of registrant as specified in charter)
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Delaware 33-73748 84-1218906
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<S> <C> <C>
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
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6400 S. Fiddler's Green Circle, Suite 1200B, Englewood, Colorado 80111
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (303) 290-6025
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(Former name or former address, if changed since last report.)
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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 Accountant.
Not Applicable.
Item 5. Other Events.
On June 30, 1998, the Registrant caused the issuance and sale of
$50,703,106 original principal amount of its Pass-Through Certificates, Series
1998-B, Class 1A and Class 2A (the "Certificates") pursuant to a Pooling
Agreement, dated as of June 1, 1998 (the "Pooling Agreement"), by and between
the Registrant, as seller, and U.S. Bank Trust National Association, as trustee
(the "Trustee"). The Certificates were issued in two Classes, with an Initial
Principal Amount and a Pass-Through Rate as described below:
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Class Initial Pass-Through
Designation Principal Amount Rate
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Class 1A $24,651,553 (1)
Class 2A $26,051,553 (1)
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(1) The effective per annum interest rate borne by either Class of Certificates
during each Interest Accrual Period (as defined in the Prospectus) with respect
to a Distribution Date (as defined in the Prospectus) will equal a fraction,
expressed as a percentage truncated at the fourth decimal place, the numerator
of which is equal to the aggregate amount in respect of interest paid on such
Class of Certificates for the related Interest Accrual Period multiplied by 12,
and the denominator of which is the principal amount of such Class of
Certificates immediately prior to such Distribution Date. Under certain
circumstances, the principal amount of either Class of Certificates could be
paid in full while interest would remain payable, in which case, the calculation
of the effective per annum interest rate borne by such Class of Certificates
would not be meaningful. The effective per annum interest rate borne by such
Class of Certificates would not be meaningful. The effective per annum interest
rate borne by the Class 1A Certificates and the Class 2A Certificates during the
first Interest Accrual Period is projected to be approximately 11.1466% and
10.8958%, respectively.
The Certificates evidence, in the aggregate, the entire beneficial
ownership interest in two groups of underlying securities, each of which
constitute a separate sub-trust, held by a trust (the "Trust"), which consists
primarily of all or a portion of (i) three classes of Guaranteed REMIC
Pass-Through Certificates issued by Fannie Mae, as part of separate series of
such certificates, including two classes of Combinable and Recombinable REMIC
Certificates, (ii) one class of Guaranteed REMIC Pass-Through Securities issued
<PAGE> 3
by Ginnie Mae, (iii) two classes of certificates issued by Freddie Mac,
including one class of Payment Exchange Certificates and one class of Multiclass
Mortgage Participation Certificates, and (iv) a single class of Pass-Through
Certificates, Series 1997-3, which represents a beneficial ownership interest in
a trust established by Bear Stearns Mortgage Securities, Inc. The Certificates
were purchased by the Registrant in a privately-negotiated transaction with
Bear, Stearns & Co. Inc. ("Bear") pursuant to a Purchase Agreement (the
"Purchase Agreement"), dated June 30, 1998, by and between the Registrant, as
Purchaser and Bear, as Seller.
The Certificates have been sold by the Registrant to Bear pursuant to an
Underwriting Agreement, dated as of June 26, 1998, between the Underwriter and
the Registrant and the related Terms Agreement, dated June 26, 1998 (the
"Underwriting Agreement").
Capitalized terms used but not defined herein shall have the meanings
assigned to them in the Pooling Agreement.
Item 6. Resignations of Registrant's Directors.
Not Applicable.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Not Applicable.
Exhibits
1.1 Copy of the Underwriting Agreement and related Terms Agreement,
each dated as of June 26, 1998, by and between the Registrant and
Bear, Stearns & Co. Inc.
4.1 Copy of the Pooling Agreement, dated as of June 1, 1998, by and
between the Registrant and U.S. Bank Trust National Association,
as Trustee (related exhibits available upon request of the
Trustee).
<PAGE> 4
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
June 30, 1998 FUND AMERICA INVESTORS CORPORATION II
By: -----------------------
Name: Steven B. Chotin
Title: President
<PAGE> 5
INDEX TO EXHIBITS
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Page
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1.1 Copy of the Underwriting Agreement and related Terms
Agreement, each dated as of June 26, 1998, by and
among the Registrant and Bear, Stearns & Co. Inc............
4.1 Copy of the Pooling Agreement, dated as of June 1, 1998,
by and between the Registrant and U.S. Bank Trust
National Association, as Trustee (related exhibits
available upon request of the Trustee)......................
</TABLE>
<PAGE> 1
EXHIBIT 1.1
FUND AMERICA INVESTORS CORPORATION II
PASS-THROUGH CERTIFICATES
UNDERWRITING AGREEMENT
----------------------
June 26, 1998
Bear, Stearns & Co. Inc.
245 Park Avenue
New York, New York 10167
Dear Sirs:
1. Introduction. Fund America Investors Corporation II, a
Delaware corporation (the "Company"), from time to time proposes to issue and
sell Pass-Through Certificates ("Certificates") in various series (each a
"Series"), and, within each Series, in various classes, in one or more
offerings on terms determined at the time of sale. The Certificates of each
series will be issued pursuant to a pooling agreement (each, a "Pooling
Agreement") among the Company, as seller, one or more master servicers which
may include the Company and a third-party trustee (the "Trustee"). Upon
issuance, the Certificates of each series will evidence undivided interests
in the Trust Fund (as defined in the Pooling Agreement) established for such
series containing mortgages or mortgage related securities or, in the event
the Trust Fund, or a portion thereof, constitutes the upper tier of a
two-tier real estate mortgage investment conduit ("REMIC"), the Trust Fund
may contain interests issued by a lower tier trust which will contain
mortgages or mortgage related securities, all as described in the Prospectus
(as defined below). Terms not defined herein which are defined in the
Pooling Agreement shall have the meanings ascribed to them in the Pooling
Agreement.
Whenever the Company determines to make an offering of a Series
of Certificates (an "Offering") through you or an underwriting syndicate
managed or co-managed by you, it will offer to enter into an agreement
("Terms Agreement") providing for the sale of such Certificates to, and the
purchase and offering thereof by, you and such other co-managers and
underwriters, if any, which have been selected by you and have authorized you
to enter into such Terms Agreement and other related documentation on their
behalf (the "Underwriters," which term shall include you whether acting alone
in the sale of Certificates or as a co-manager or as a member of
<PAGE> 2
an underwriting syndicate). The Terms Agreement relating to each Offering shall
specify the principal amount of Certificates to be issued and their terms not
otherwise specified in the Pooling Agreement, the price at which the
Certificates are to be purchased by each of the Underwriters from the Company
and the initial public offering price or the method by which the price at which
the Certificates are to be sold will be determined. The Terms Agreement, which
shall be substantially in the form of Exhibit A hereto, may take the form of an
exchange of any standard form of written telecommunication between you and the
Company. Each Offering governed by this Agreement, as supplemented by the
applicable Terms Agreement, shall inure to the benefit of and be binding upon
the Company and each of the Underwriters participating in the Offering of such
Certificates.
The Company hereby agrees with the Underwriters as follows:
2. Representations and Warranties of the Company.
The Company represents and warrants to you as of the date hereof, and to the
Underwriters named in the applicable Terms Agreement as of the date of such
Terms Agreement, as follows:
(a) A registration statement, including a prospectus, and such
amendments thereto as may have been required to the date hereof, relating to
the Certificates and the offering thereof from time to time in accordance
with Rule 415 under the Securities Act of 1933, as amended ("Act"), have been
filed with the Securities and Exchange Commission ("Commission") and such
registration statement as amended has become effective. Such registration
statement as amended and the prospectus relating to the sale of Certificates
constituting a part thereof as from time to time amended or supplemented
(including any prospectus filed with the Commission pursuant to Rule 424 of
the rules and regulations of the Commission ("Rules and Regulations") under
the Act, including any documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the Act which were filed under the Securities
Exchange Act of 1934, as amended (the "Exchange Act") on or before the
Effective Date of the Registration Statement or the date of the Prospectus
Supplement, are respectively referred to herein as the "Registration
Statement" and the "Prospectus"; provided, however, that a supplement to the
Prospectus (a "Prospectus Supplement") prepared pursuant to Section 5(a)
hereof shall be deemed to have supplemented the Prospectus only with respect
to the Offering of the Series of Certificates to which it relates. The
conditions of Rule 415 under the Act have been satisfied with respect to the
Company and the Registration Statement.
(b) On the effective date of the Registration Statement, the
Registration Statement and the Prospectus conformed in all material respects
to the requirements of the Act and the Rules and Regulations, and did not
include any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading, and on the date of each Terms Agreement, the
Registration Statement and the Prospectus will conform in all material
respects to the requirements of the Act and the Rules and Regulations, and
the Prospectus will not include 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, in light of the circumstances under
which they are made, not misleading;
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provided, however, that the foregoing does not apply to (i) statements or
omissions in such documents based upon written information furnished to the
Company by or for the benefit of any Underwriter specifically for use therein or
(ii) any Current Report (as defined in Section 5(b) below) or in any amendment
thereof or supplement thereto, incorporated by reference in such Registration
Statement or such Prospectus (or any amendment thereof or supplement thereto).
(c) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus except as otherwise stated
therein, there has been no material adverse change in the condition,
financial or otherwise, earnings, affairs, regulatory situation or business
prospects of the Company whether or not arising in the ordinary course of
business.
(d) This Agreement has been, and the Pooling Agreement, when
executed and delivered as contemplated hereby and thereby will have been,
duly executed and delivered by the Company and each constitutes, or will
constitute when so executed and delivered, a legal, valid and binding
instrument enforceable against the Company in accordance with its terms,
subject, as to the enforceability of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium and other laws affecting the rights of
creditors generally, and to general principles of equity and the discretion
of the court (regardless of whether enforceability of such remedies is
considered in a proceeding in equity or at law), and except that the
provisions relating to indemnification and contribution may be unenforceable
as against public policy.
(e) At the applicable Closing Date, each applicable Terms
Agreement will have been duly authorized, executed and delivered by the
Company and will be a legal, valid and binding obligation of the Company
enforceable in accordance with its terms, subject to the effect of
bankruptcy, insolvency, moratorium, fraudulent conveyance and other laws
affecting the rights of creditors generally, and to general principles of
equity and the discretion of the court (regardless of whether enforceability
of such remedies is considered in a proceeding in equity or at law), and
except that the provisions relating to indemnification and contribution may
be unenforceable as against public policy.
(f) The issuance of the Certificates has been duly authorized by
the Company and, when such Certificates are executed and authenticated in
accordance with the Pooling Agreement and delivered against payment pursuant
to this Agreement, such Certificates will be validly issued and outstanding;
and the Certificates will be entitled to the benefits provided by the Pooling
Agreement. The Certificates are in all material respects in the form
contemplated by the Pooling Agreement.
(g) Neither the Company nor the Trust Fund is or, as a result of
the offer and sale of the Certificates as contemplated in this Agreement will
become, an "investment company" as defined in the Investment Company Act of
1940, as amended (the "Investment Company Act"), or an "affiliated person" of
any such "investment company" that is registered or is required to be
registered under the Investment Company Act (or an "affiliated person" of any
such "affiliated person"), as such terms are defined in the Investment
Company Act.
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(h) The representations and warranties made by the Company in
the Pooling Agreement and made in any Officer's Certificate of the Company
delivered pursuant to the Pooling Agreement will be true and correct at the
time made and on the Closing Date.
3. Purchase, Sale and Delivery of Certificates. Subject to the
terms and conditions hereof, the delivery of the applicable mortgage loans or
mortgage related securities and in reliance upon the representations and
warranties set forth herein, the Company agrees to sell to the Underwriters
and the Underwriters agree to purchase the Certificates. Delivery of and
payment for the Certificates shall be made at your office or at such other
location as you shall make known at such time as shall be specified in the
applicable Terms Agreement, each such time being herein referred to as a
"Closing Date." Delivery of the Certificates shall be made by the Company to
the Underwriters against payment of the purchase price specified in the
applicable Terms Agreement in Federal Funds by wire or check. Unless
delivery is made through the facilities of the Depository Trust Company, the
Certificates so to be delivered will be in definitive, fully registered form,
in such denominations and registered in such names as you request, and will
be made available for inspection and packaging at your office at least
twenty-four hours prior to the applicable Closing Date.
4. Offering by Underwriters. It is understood that the
Underwriters propose to offer the Certificates for sale to the public as set
forth in the Prospectus.
5. Covenants of the Company. The Company covenants and agrees
with you and the several Underwriters participating in the Offering of any
Series of Certificates that:
(a) In connection with the execution of each Terms Agreement,
the Company will prepare a Prospectus Supplement to be filed under the Act
setting forth the principal amount of Certificates covered thereby and their
terms not otherwise specified in the Prospectus, the price at which the
Certificates are to be purchased by the Underwriters from the Company, either
the initial public offering price or the method by which the price at which
the Certificates are to be sold will be determined, the selling concession
and reallowance, if any, any delayed delivery arrangements, and such other
information as you and the Company deem appropriate in connection with the
offering of the Certificates, but the Company will not file any amendments to
the Registration Statement or any amendments or supplements to the
Prospectus, unless it shall first have delivered copies of such amendments or
supplements to you, and you shall not have objected thereto promptly after
receipt thereof. The Company will advise you or your counsel promptly (i)
when notice is received from the Commission that any post-effective amendment
to the Registration Statement has become or will become effective, and (ii)
of any order or communication suspending or preventing, or threatening to
suspend or prevent, the offer and sale of the Certificates, or of any
proceedings or examinations that may lead to such an order or communication,
whether by or of the Commission or any authority administering any state
securities or Blue Sky law, as soon as the Company is advised thereof, and
will use its best efforts to prevent the issuance of any such order or
communication and to obtain as soon as possible its lifting, if issued.
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<PAGE> 5
(b) The Company will cause any Computational Materials and any
Structural Term Sheets (each as defined in Section 8 below) with respect to
each Series of Certificates that are delivered by the Underwriters to the
Company pursuant to Section 8 to be filed with the Commission on a Current
Report on Form 8-K (a "Current Report") pursuant to Rule 13a-11 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") on the
business day immediately following the day on which such Computational
Materials and Structural Term Sheets are delivered to counsel for the Company
by any of the Underwriters prior to 10:30 a.m. (and will use its best efforts
to cause such Computational Materials and Structural Term Sheets to be so
filed prior to 2:00 p.m., New York time, on such business day), and will
promptly advise you when such Current Report has been so filed. The Company
will cause one Collateral Term Sheet (as defined in Section 9 below) with
respect to an Offering of a Series that is delivered by any of the
Underwriters to the Company in accordance with the provisions of Section 9 to
be filed with the Commission on a Current Report pursuant to Rule 13a-11
under the Exchange Act on the business day immediately following the day on
which such Collateral Term Sheet is delivered to counsel for the Company by
any of the Underwriters prior to 10:30 a.m. In addition, if at any time
prior to the availability of the related Prospectus Supplement, any of the
Underwriters has delivered to any prospective investor a subsequent
Collateral Term Sheet that reflects, in the reasonable judgment of such
Underwriter and the Company, a material change in the characteristics of the
mortgage loans or mortgage related securities for the related Series from
those on which a Collateral Term Sheet with respect to the related Series
previously filed with the Commission was based, the Company will cause any
such Collateral Term Sheet that is delivered by such Underwriter to the
Company in accordance with the provisions of Section 9 to be filed with the
Commission on a Current Report on the business day immediately following the
day on which such Collateral Term Sheet is delivered to counsel for the
Company by such Underwriter prior to 2:00 p.m. In each case, the Company
will promptly advise you when such Current Report has been so filed.
Notwithstanding the four preceding sentences, the Company shall have no
obligation to file any materials provided by any of the Underwriters pursuant
to Sections 8 and 9 which (i) in the reasonable determination of the Company
are not required to be filed pursuant to the Kidder Letters or the PSA Letter
(each as defined in Section 8 below), or (ii) contain erroneous information
or contain any untrue statement of a material fact or, when read in
conjunction with the Prospectus and Prospectus Supplement, omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; it being understood, however, that the
Company shall have no obligation to review or pass upon the accuracy or
adequacy of, or to correct, any Computational Materials or ABS Term Sheets
(as defined in Section 9 below) provided by such Underwriter to the Company
pursuant to Section 8 or Section 9 hereof. The Company shall give notice to
you and such Underwriter of its determination not to file any materials
pursuant to clause (i) of the preceding sentence and agrees to file such
materials if such Underwriter or you reasonably object to such determination
within one business day after receipt of such notice.
(c) If at any time when a prospectus relating to the
Certificates is required to be delivered under the Act any event occurs as a
result of which in the opinion of counsel for the Company or the Underwriters
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state a material fact necessary to
make the
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<PAGE> 6
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 Prospectus
to comply with the Act, the Company promptly will prepare and file with the
Commission an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance; provided, however,
that (i) the Company will not be required to file any such amendment or
supplement with respect to any Computational Materials, Structural Term Sheets
or Collateral Term Sheets incorporated by reference in the Prospectus other than
any amendments or supplements of such Computational Materials or Structural Term
Sheets that are furnished to the Company by the Underwriter pursuant to Section
8(e) hereof or any amendments or supplements of such Collateral Term Sheets that
are furnished to the Company by the Underwriter pursuant to Section 9(d) hereof
which are required to be filed in accordance therewith and (ii) any such
amendment or update prepared at the request of the Underwriters or as required
by applicable securities laws more than nine months after the Closing Date shall
be at the expense of the Underwriters.
(d) With respect to each Series of Certificates, the Company
will make generally available to the holders of the Certificates and will
deliver to you, in each case as soon as practicable, an earnings statement
covering the twelve-month period beginning after the date of the Terms
Agreement in respect of such series of Certificates, which will satisfy the
provisions of Section 11(a) of the Act with respect to the Certificates.
(e) The Company will furnish to you copies of the Registration
Statement (two of which will be signed and will include all documents and
exhibits thereto or incorporated by reference therein), 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 Company will use its best efforts arrange for the
qualification of the Certificates for sale and the determination of their
eligibility for investment under the laws of such jurisdictions as you
reasonably designate and will continue such qualifications in effect so long
as reasonably required for the distribution; provided, however, that the
Company shall not be required to qualify to do business in any jurisdiction
where it is not qualified on the date of the related Terms Agreement or to
take any action which would subject it to general or unlimited service of
process in any jurisdiction in which it is not, on the date of the related
Terms Agreement, subject to such service of process; and provided further
that the Underwriters will pay all costs and expenses associated therewith.
(g) The Company will pay all expenses incidental to the
performance of its obligations under this Agreement and any Terms Agreement
and will reimburse the Underwriters for any expenses (including fees and
disbursements of counsel and accountants) incurred by them in connection with
qualification of the Certificates and determination of their eligibility for
investment under the laws of such jurisdictions as you designate and the
printing of memoranda relating thereto, for any fees charged by the
nationally recognized statistical rating agencies for the rating of the
Certificates, for the filing fee of the National Association of Securities
Dealers,
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Inc. relating to the Certificates, if applicable, and for expenses incurred in
distributing preliminary prospectuses to the Underwriters.
(h) During the period when a prospectus is required by law to be
delivered in connection with the sale of the Certificates pursuant to this
Agreement, the Company will file or cause to be filed, on a timely and
complete basis, all documents that are required to be filed by the Company
with the Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.
(i) So long as the Certificates of a Series shall be
outstanding, the Company will deliver to you the annual statement of
compliance delivered to the Trustee pursuant to the Pooling Agreement and the
annual statement of a firm of independent public accountants furnished to the
Trustee pursuant to the Pooling Agreement as soon as such statements are
furnished to the Trustee.
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters named in any Terms Agreement to purchase and
pay for the Certificates will be subject to the accuracy of the
representations and warranties on the part of the Company as of the date
hereof, the date of the applicable Terms Agreement and the applicable Closing
Date, to the accuracy of the statements made in any officers' certificates
(each an "Officer's Certificate") pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder and to the following
additional conditions precedent:
(a)(i) At the time the applicable Terms Agreement is executed,
Deloitte & Touche and/or any other firm of certified independent public
accountants acceptable to you shall have furnished to you a letter, addressed
to you, and in form and substance satisfactory to you in all respects,
stating in effect that using the assumptions and methodology used by the
Company, all of which shall be described in such letter or the Prospectus
Supplement, they have recalculated such numbers, percentages and weighted
average lives set forth in the Prospectus as you may reasonably request,
compared the results of their calculations to the corresponding items in the
Prospectus, and found each such number, percentage, and weighted average life
set forth in the Prospectus to be in agreement with the results of such
calculations. To the extent historical financial delinquency or related
information is included with respect to one or more master servicers, such
letter or letters shall also relate to such information.
(a)(ii) At the Closing Date, Deloitte & Touche and/or any other
firm of certified independent public accountants acceptable to you shall have
furnished to you a letter, addressed to you, and in form and substance
satisfactory to you in all respects, relating to the extent such information
is not covered in the letter or letters provided pursuant to clause (a)(i),
to a portion of the information set forth on the Schedule attached to the
Pooling Agreement and the characteristics of the mortgage loans or mortgage
related securities, as presented in the Prospectus Supplement or the Form 8-K
relating thereto, or if a letter relating to the same information is provided
to the Trustee, indicating that you are entitled to rely upon its letter to
the Trustee.
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<PAGE> 8
(b) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, there shall not
have been any change, or any development involving a prospective change, in
or affecting the business or properties of the Company or any of its
affiliates the effect of which, in any case, is, in your judgment, so
material and adverse as to make it impracticable or inadvisable to proceed
with the Offering or the delivery of the Certificates as contemplated by the
Registration Statement and the Prospectus. All actions required to be taken
and all filings required to be made by the Company under the Act and the
Exchange Act prior to the sale of the Certificates shall have been duly taken
or made; and prior to the applicable 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 Company or you, shall be contemplated by the Commission or by any
authority administering any state securities or Blue Sky law.
(c) Unless otherwise specified in any applicable Terms Agreement
for a Series, the Certificates shall be rated in one of the four highest
grades by one or more nationally recognized statistical rating agencies
specified in said Terms Agreement.
(d) You shall have received the opinion of counsel, dated the
applicable Closing Date, to the effect that:
1. The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own its assets and conduct
its business as described in the Prospectus. The Company has no subsidiaries.
2. The Underwriting Agreement, the Terms Agreement, and the
Purchase Agreement have been duly authorized, executed and delivered by the
Company and assuming due and valid authorization and execution by the
Underwriter, each constitutes a legal, valid and binding obligation of the
Company.
3. The Pooling Agreement has been duly and validly authorized,
executed and delivered by the Company and assuming due and valid
authorization and execution by the other parties thereto, constitutes the
valid and binding agreement of the Company, enforceable in accordance with
its terms.
4. Upon due execution and authentication by the Trustee of the
Certificates in accordance with the Pooling Agreement, and delivery to, and
payment for the Certificates by the Underwriter, as provided in the
Underwriting Agreement and the Terms Agreement, the Certificates will be
validly issued and entitled to the benefits of the Pooling Agreement.
5. The Registration Statement has become effective under the
Securities Act, and, to our knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the Securities Act.
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<PAGE> 9
6. The statements in the Prospectus under the heading "Certain
Federal Income Tax Consequences" and in the Prospectus Supplement under the
heading "Certain Federal Income Tax Considerations," to the extent that they
constitute matters of law or legal conclusions have been prepared or reviewed
by us and provide a fair summary of such law or conclusions.
7. The Pooling Agreement is not required to be qualified under
the Trust Indenture Act of 1939, as amended, and neither the Company nor the
Trust is required to be registered under the Investment Company Act of 1940,
as amended.
Each opinion also shall relate to such other matters as may be
specified in the related Terms Agreement or as to which you reasonably may
request. In rendering any such opinion, counsel for the Company may rely on
certificates of responsible officers of the Company, the Trustee, and public
officials or, as to matters of law other than Delaware or Federal law, on
opinions of other counsel (copies of which opinions shall be delivered to
you), provided that, in cases of opinions of other counsel, counsel for the
Company shall include in its opinion a statement of its belief that both it
and you are justified in relying on such opinions.
(e) You shall have received from counsel for the Company a
letter, dated as of the Closing Date, stating that you may rely on the
opinions delivered by such firm under the Pooling Agreement and to the rating
agency or agencies rating the Certificates as if such opinions were addressed
directly to you (copies of which opinions shall be delivered to you).
(f) You shall have received from counsel for the Underwriters,
if such counsel is different from counsel to the Company, such opinion or
opinions, dated as of the Closing Date, with respect to the validity of the
Certificates, the Registration Statement, the Prospectus and other related
matters as the Underwriters may require, and the Company shall have furnished
to such counsel such documents as they may have requested from it for the
purpose of enabling them to pass upon such matters.
(g) You shall have received Officer's Certificates signed by
such of the principal executive, financial and accounting officers of the
Company as you may request, dated as of the Closing Date, in which such
officers, to the best of their knowledge after reasonable investigation,
shall state that the representations and warranties of the Company in this
Agreement are true and correct; that the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied 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; that,
subsequent to the respective dates as of which information is given in the
Prospectus, and except as set forth or contemplated in the Prospectus, there
has not been any material adverse change in the general affairs, business,
key personnel, capitalization, financial condition or results of operations
of the Company; and that except as otherwise stated in the Prospectus, there
are no material actions, suits or proceedings pending before any court or
governmental agency, authority or body or, to
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<PAGE> 10
their knowledge, threatened, affecting the Company or the transactions
contemplated by this Agreement.
The Company will furnish you with such conformed copies of such
opinions, certificates, letters and documents as you reasonably request.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects with respect to a particular
Offering when and as provided in this Agreement and the related Terms
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement and the related Terms Agreement shall not be in
all material respects reasonably satisfactory in form and substance to you,
this Agreement (with respect to the related Offering) and the related Terms
Agreement and all obligations of the Underwriters hereunder (with respect to
the related Offering) and thereunder may be canceled at, or at any time prior
to, the related Closing Date by the Underwriter. Notice of such cancellation
shall be given to the Company in writing, or by telephone or telegraph
confirmed in writing.
7. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act against
any and all losses, claims, damages, liabilities and expenses whatsoever
(including but not limited to attorneys' fees and any and all expenses
reasonably incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim whatsoever, and any and all
amounts paid in settlement of any claim or litigation), joint or several, to
which they or any of them may become subject under the Act, the Exchange Act,
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 relating to the applicable Series of Certificates (the
"Applicable Registration Statement") as it became effective or in any
amendment or supplement thereof, or in the Applicable Registration Statement
or the related Prospectus, or in any amendment thereof, or arise out of or
are based upon the omission or alleged omission (in the case of any
Computational Materials or ABS Term Sheets in respect of which the Company
agrees to indemnify the Underwriters, as set forth below, when such are read
in conjunction with the related Prospectus and Prospectus Supplement) to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that (i) the
Company 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 (A) in reliance upon and in conformity with written information
furnished to the Company as herein stated by or on behalf of the Underwriters
specifically for use in connection with the preparation thereof or (B) in any
Current Report or any amendment or supplement thereof, except to the extent
that any untrue statement or alleged untrue statement therein or omission
therefrom results (or is alleged to have resulted) directly from an error (a
"Mortgage Pool Error") in the information concerning the characteristics of
the mortgage loans or mortgage related securities furnished by the Company to
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<PAGE> 11
the Underwriters in writing or by electronic transmission that was used in
the preparation of either (x) any Computational Materials or ABS Term Sheets
(or amendments or supplements thereof) included in such Current Report (or
amendment or supplement thereof) or (y) any written or electronic materials
furnished to prospective investors on which the Computational Materials (or
amendments or supplements) were based, (ii) such indemnity with respect to
any Corrected Statement (as defined below) in such Prospectus (or Prospectus
Supplement thereto) shall not inure to the benefit of the Underwriters (or
any person controlling any Underwriter) from whom the person asserting any
loss, claim, damage or liability purchased the Certificates of the related
Series that are the subject thereof if such person did not receive a copy of
a Prospectus Supplement to such Prospectus at or prior to the confirmation of
the sale of such Certificates and the untrue statement or omission of a
material fact contained in such Prospectus (or Prospectus Supplement thereto)
was corrected (a "Corrected Statement") in such other supplement and such
supplement was furnished by the Company to the Underwriters prior to the
delivery of such confirmation, and (iii) such indemnity with respect to any
Mortgage Pool Error shall not inure to the benefit of the Underwriters (or
any person controlling any Underwriter) from whom the person asserting any
loss, claim, damage or liability received any Computational Materials (or any
written or electronic materials on which the Computational Materials are
based) or ABS Term Sheets that were prepared on the basis of such Mortgage
Pool Error, if, prior to the time of confirmation of the sale of the
applicable Series of Certificates to such person, the Company notified the
Underwriters in writing of the Mortgage Pool Error or provided in written or
electronic form information superseding or correcting such Mortgage Pool
Error (in any such case, a "Corrected Mortgage Pool Error"), and the
Underwriters failed to notify such person thereof or to deliver to such
person corrected Computational Materials (or underlying written or electronic
materials) or ABS Term Sheets. This indemnity agreement will be in addition
to any liability which the Company may otherwise have.
(b) The Underwriters severally, and not jointly, agree to
indemnify and hold harmless the Company, each of the directors of the
Company, each of the officers of the Company who shall have signed the
Registration Statement, and each other person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, against any losses, claims, damages, liabilities and expenses
whatsoever (including but not limited to attorneys' fees and any and all
expenses reasonably incurred in investigating, preparing or defending against
any litigation, commenced or threatened, or any claim whatsoever, and any and
all amounts paid in settlement of any claim or litigation), joint or several,
to which they or any of them may become subject under the Act, the Exchange
Act or otherwise, insofar as such losses, liabilities, claims, damages or
expenses (or actions in respect thereof) arise out of or are based upon (A)
any untrue statement or alleged untrue statement of a material fact contained
in the Applicable Registration Statement, as originally filed or any
amendment thereof, or any related preliminary prospectus or the Prospectus,
or in any amendment thereof or supplement thereto, 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, in each case to the extent, but only to the extent, that any such
loss, claim, damage, liability or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance
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<PAGE> 12
upon and in conformity with written information furnished to the Company, by or
on behalf of such Underwriter expressly for use therein; or (B) any
Computational Materials or ABS Term Sheets (or amendments or supplements
thereof) furnished to the Company by such Underwriter pursuant to Section 8 and
incorporated by reference in such Registration Statement or the related
Prospectus, Prospectus Supplement or any amendment or supplement thereof (except
that no such indemnity shall be available for any losses, claims, damages or
liabilities, or actions in respect thereof resulting from any Mortgage Pool
Error, other than a Corrected Mortgage Pool Error). This indemnity will be in
addition to any liability which the Underwriters may otherwise have. The Company
acknowledges that, unless otherwise set forth in the applicable Terms Agreement,
the statements set forth in the last paragraph of the cover page and under the
caption "Method of Distribution" and the stabilization legend required by Item
502(d)(1) under Regulation S-K of the Act included in the Prospectus Supplement
relating to a Series of Certificates constitute the only information furnished
in writing by or on behalf of any Underwriter expressly for use in the
Applicable Registration Statement or the Prospectus or in any amendment thereof
or supplement thereto, as the case may be (other than any Computational
Materials or ABS Term Sheets (or amendments or supplements thereof) furnished to
the Company by such Underwriter), and each Underwriter confirms, on its behalf,
that such statements are correct.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above 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 such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but
the failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 7 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may elect by written notice delivered to
the indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel satisfactory
to such indemnified party. Notwithstanding the foregoing, the indemnified
party or parties shall have the right to employ its or their own counsel in
any such case, but the fees and expenses of such counsel shall be at the
expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by one of the indemnifying
parties in connection with the defense of such action, (ii) the indemnifying
parties shall not have employed counsel to have charge of the defense of such
action within a reasonable time after notice of commencement of the action,
or (iii) such indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are different from
or additional to those available to one or all of the indemnifying parties
(in which case the indemnifying parties shall not have the right to direct
the defense of such action on behalf of the indemnified party or parties), in
any of which events such fees and expenses shall be borne by the indemnifying
parties. Anything in this subsection to the contrary notwithstanding, an
indemnifying party shall not be liable for any settlement of any claim or
action effected without its written consent; provided, however, that such
consent was not unreasonably withheld.
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<PAGE> 13
(d) In order to provide for contribution in circumstances in
which the indemnification provided for in Section 7 hereof is for any reason
held to be unavailable, on grounds of public policy or otherwise, from the
Company or the Underwriters or is insufficient to hold harmless a party
indemnified thereunder, the Company and the Underwriters shall contribute to
the aggregate losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted, but
after deducting in the case of losses, claims, damages, liabilities and
expenses suffered by the Company any contribution received by the Company
from persons, other than the Underwriters, who may also be liable for
contribution, including persons who control the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, officers of the
Company who signed the Applicable Registration Statement and directors of the
Company) to which the Company and the Underwriters may be subject (i) in the
case of any losses, claims, damages and liabilities (or actions in respect
thereof) which do not arise out of or are not based upon any untrue statement
or omission of a material fact in any Computational Materials or ABS Term
Sheets (or any amendments or supplements thereof), in such proportions as is
appropriate to reflect the relative benefits received by the Company on one
hand and the Underwriters on the other from the Offering of the Certificates
as to which such loss, liability, claim, damage or expense is claimed to
arise or, if such allocation is not permitted by applicable law or
indemnification is not available as a result of the indemnifying party not
having received notice as provided in Section 7(c) hereof, in such proportion
as is appropriate to reflect not only the relative benefits referred to above
but also the relative fault of the Company on one hand and the Underwriters
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations or (ii) in the case of any losses, claims,
damages and liabilities (or actions in respect thereof) which arise out of or
are based upon any untrue statement or omission of a material fact in any
Computational Materials or ABS Term Sheets (or any amendments or supplements
thereof) or in any written or electronic materials distributed to prospective
investors on which the Computational Materials are based, in such proportion
as is appropriate to reflect the relative fault of the Company on the one
hand and the Underwriter that furnished such Computational Materials or ABS
Term Sheets on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in
respect thereof) as well as any other relevant equitable considerations;
provided, however, that in no case shall such Underwriter be responsible
under this subparagraph (ii) for any amount in excess of the aggregate
Purchase Price for the Offered Certificates.
The relative benefits received by the Company on one hand
and the Underwriters on the other shall be deemed to be in the same
proportion as (x) the total proceeds from the Offering (net of underwriting
discounts and commissions but before deducting expenses) received by the
Company and (y) the underwriting discounts and commissions received by the
Underwriters, respectively, in each case as set forth in the Terms Agreement
in respect of the Offering of the Certificates as to which such loss,
liability, claim, damage or expense is claimed to arise. The relative fault
of the Company on one hand and the Underwriters
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<PAGE> 14
on the other shall be determined by reference to, among other things, (A) in the
case of clause (i) of the preceding paragraph, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on one hand or
the Underwriters on the other, (B) in the case of clause (ii) of the preceding
paragraph, whether the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to any untrue
statement or omission of a material fact in any Computational Materials or ABS
Term Sheets (or any amendments or supplements thereof) or in any written or
electronic materials distributed by the applicable Underwriter to prospective
investors on which the Computational Materials are based, and (C) in the case of
either clause (i) or clause (ii) of the preceding paragraph, the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 7(d)
were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this Section 7(d), (x) except as otherwise
provided in Section 7(d)(ii), in no case shall the Underwriters be liable or
responsible for any amount in excess of the underwriting discount set forth in
the Terms Agreement relating to the Certificates as to which such losses,
claims, damages, liabilities or expenses are claimed to arise, and (y) 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 7(d), each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act shall have the same rights to
contribution as such Underwriter, and each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, each officer of the Company who shall have signed the Applicable
Registration Statement and each director of the Company shall have the same
rights to contribution as the Company, subject in each case to clauses (i) and
(ii) of this Section 7(d). Any party entitled to contribution will, promptly
after receipt of notice of commencement of any action, suit or proceeding
against such party in respect of which a claim for contribution may be made
against another party or parties under this Section 7(d), notify such party or
parties from whom contribution may be sought, but the omission to so notify such
party or parties shall not relieve the party or parties from whom contribution
may be sought from any obligation it or they may have under this Section 7(d) or
otherwise. No party shall be liable for contribution with respect to any action
or claim settled without its consent; provided, however, that such consent was
not unreasonably withheld.
8. Computational Materials and Structural Term Sheets. (a) Not
later than 2:00 p.m., New York time, on the business day before the date on
which the Current Report relating to the Certificates of a Series is required
to be filed by the Company with the Commission pursuant to Section 5(b)
hereof, you and any other applicable Underwriter shall deliver to the
Company, and unless otherwise agreed to by the Company, in a form reasonably
convertible to an EDGAR filing format, a copy of all materials provided by
the Underwriters to prospective investors in such Certificates which
constitute (i) "Computational Materials, within the meaning of the no-action
letter dated May 20, 1994 issued by the Division of Corporation Finance of
the Commission to Kidder, Peabody Acceptance Corporation I, Kidder, Peabody &
Co.
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<PAGE> 15
Incorporated, and Kidder Structured Asset Corporation and the no-action letter
dated May 27, 1994 issued by the Division of Corporation Finance of the
Commission to the Public Securities Association (together, the "Kidder Letters")
and the filing of such material is a condition of the relief granted in such
letter (such materials being the "Computational Materials"), and (ii)
"Structural Term Sheets" within the meaning of the no-action letter dated
February 17, 1995 issued by the Division of Corporation Finance of the
Commission to the Public Securities Association (the "PSA Letter") and the
filing of such material is a condition of the relief granted in such letter
(such materials being the "Structural Term Sheets"). Each delivery of
Computational Materials and Structural Term Sheets to the Company by you and any
other applicable Underwriter pursuant to this paragraph (a) shall be effected by
delivering a copy of such materials to counsel for the Company on behalf of the
Company at the address specified by the Company and one copy of such materials
to the Company.
(b) You and each other Underwriter, by virtue of its having
executed and delivered the related Terms Agreement, which shall incorporate
this Section 8(b) by reference, represents and warrants to and agrees with
the Company, as of the date of the related Terms Agreement and as of the
Closing Date, that:
(i) the Computational Materials furnished to the
Company pursuant to Section 8(a) constitute (either in
original, aggregated or consolidated form) all of the
materials furnished to prospective investors by such
Underwriter prior to the time of delivery thereof to the
Company that are required to be filed with the Commission
with respect to the Offering of the Certificates in
accordance with the Kidder Letters, and such Computational
Materials comply with the requirements of the Kidder
Letters;
(ii) the Structural Term Sheets furnished to the
Company pursuant to Section 8(a) constitute all of the
materials furnished to prospective investors by such
Underwriter prior to the time of delivery thereof to the
Company that are required to be filed with the Commission
as "Structural Term Sheets" with respect to the related
Offering of the Certificates in accordance with the PSA
Letter, and such Structural Term Sheets comply with the
requirements of the PSA Letter;
(iii) on the date any such Computational
Materials or Structural Term Sheets with respect to the
Offering of the Certificates (or any written or electronic
materials furnished to prospective investors on which the
Computational Materials are based) were last furnished to
each prospective investor and on the date of delivery
thereof to the Company pursuant to Section 8(a) and on the
related Closing Date, such Computational Materials (or such
other materials) or Structural Term Sheets did not and will
not include any untrue statement of a material fact or,
when read in conjunction with the related Prospectus and
Prospectus
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<PAGE> 16
Supplement, omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; and
(iv) all Computational Materials (or underlying
materials distributed to prospective investors on which the
Computational Materials were based) or Structural Term
Sheets furnished to prospective investors contained and
will contain a legend, prominently displayed on the first
page thereof, to the effect that the Company has not
prepared, reviewed or participated in the preparation of
such materials and is not responsible for the accuracy
thereof.
Notwithstanding the foregoing, you and each such Underwriter make no
representation or warranty as to whether any Computational Materials or
Structural Term Sheets (or any written or electronic materials on which the
Computational Materials are based) included or will include any untrue
statement resulting directly from any Mortgage Pool Error (except any
Corrected Mortgage Pool Error, with respect to materials prepared after the
receipt by the Underwriters from the Company of notice of such Corrected
Mortgage Pool Error or materials superseding or correcting such Corrected
Mortgage Pool Error).
(c) Each Underwriter delivering Computational Materials shall
cause a firm of public accountants to furnish to the Company a letter, dated
as of the date on which such Underwriter delivers any Computational Materials
(which term shall be deemed to include, for purposes of this paragraph (c),
calculated statistical information delivered to prospective investors in the
form of a Structural Term Sheet) to the Company pursuant to Section 8(a), in
form and substance satisfactory to the Company, stating in effect that they
have verified the mathematical accuracy of any calculations performed by such
Underwriter and set forth in such Computational Materials.
(d) The Underwriters acknowledge and agree that the Company has
not authorized and will not authorize the distribution of any Computational
Materials (or any written or electronic materials on which the Computational
Materials are based) or Structural Term Sheets to any particular prospective
investor, and agrees that any Computational Materials or Structural Term
Sheets with respect to any Series of Certificates furnished to prospective
investors shall include a disclaimer in the form described in paragraph (b)
(iv) above. The Underwriters agree that they will not represent to
prospective investors that any Computational Materials or Structural Term
Sheets were prepared or disseminated on behalf of the Company.
(e) If, at any time when a prospectus relating to the
Certificates of a Series is required to be delivered under the Act, it shall
be necessary to amend or supplement the related Prospectus or Prospectus
Supplement as a result of an untrue statement of a material fact contained in
any Computational Materials or Structural Term Sheets provided by an
Underwriter pursuant to this Section 8 or the omission to state therein a
material fact required, when considered in conjunction with the related
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<PAGE> 17
Prospectus and Prospectus Supplement, to be stated therein or necessary to
make the statements therein, when read in conjunction with the related
Prospectus and Prospectus Supplement, not misleading, or if it shall be
necessary to amend or supplement any Current Report relating to any
Computational Materials or Structural Term Sheets to comply with the Act or
the rules thereunder, such Underwriter promptly will prepare and furnish to
the Company for filing with the Commission an amendment or supplement which
will correct such statement or omission or an amendment which will effect
such compliance. Such Underwriter will deliver an Officer's Certificate to
the Company representing and warranting to the Company that, as of the date
of delivery of such amendment or supplement to the Company, such amendment or
supplement will not include any untrue statement of a material fact or, when
read in conjunction with the related Prospectus and Prospectus Supplement,
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that such
Underwriter will make no representation or warranty as to whether any such
amendment or supplement will include any untrue statement resulting directly
from any Mortgage Pool Error (except any Corrected Mortgage Pool Error, with
respect to any such amendment or supplement prepared after the receipt by
such Underwriter from the Company of notice of such Corrected Mortgage Pool
Error or materials superseding or correcting such Corrected Mortgage Pool
Error). The Company shall have no obligation to file such amendment or
supplement if (i) the Company determines that such amendment or supplement
contains any untrue statement of a material fact or, when read in conjunction
with the related Prospectus and Prospectus Supplement, omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; it being understood, however, that the
Company shall have no obligation to review or pass upon the accuracy or
adequacy of, or to correct, any such amendment or supplement provided by such
Underwriter to the Company pursuant to this paragraph (e) or (ii) the Company
reasonably determines that such filing is not required under the Act and such
Underwriter does not object as provided below. The Company shall give notice
to such Underwriter of its determination not to file an amendment or
supplement pursuant to clause (ii) of the preceding sentence and agrees to
file such amendment or supplement if such Underwriter reasonably objects to
such determination within one business day after receipt of such notice.
9. Collateral Term Sheets. (a) Prior to the delivery of any
"Collateral Term Sheet" within the meaning of the PSA Letter, the filing of
which material is a condition of the relief granted in such letter (such
material being the "Collateral Term Sheets"), to a prospective investor in
the Certificates, the applicable Underwriter shall notify the Company and its
counsel by telephone of its intention to deliver such materials and the
approximate date on which the first such delivery of such materials is
expected to occur. Not later than 10:30 a.m., New York time, on the business
day immediately following the date on which any Collateral Term Sheet was
first delivered to a prospective investor in the Certificates of an offered
series, such applicable Underwriter shall deliver to the Company, and unless
otherwise agreed to by the Company, in a form reasonably convertible to an
EDGAR format, a complete copy of all materials provided by such Underwriter
to prospective investors in such Certificates which constitute "Collateral
Term Sheets." Each delivery of a Collateral Term Sheet to the Company
pursuant to this paragraph (a) shall be effected by delivering a copy of such
materials to counsel for the Company on behalf of the Company at the address
specified by the Company and one copy of such materials to the Company.
(Collateral Term Sheets and Structural Term Sheets are, together, referred to
herein
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<PAGE> 18
as "ABS Term Sheets.") At the time of each such delivery, such Underwriter shall
indicate in writing that the materials being delivered constitute Collateral
Term Sheets, and, if there has been any prior such delivery with respect to the
related Series, shall indicate whether such materials differ in any material
respect from any Collateral Term Sheets previously delivered to the Company with
respect to such Series pursuant to this Section 9(a) as a result of the
occurrence of a material change in the characteristics of the related Mortgage
Loans.
(b) You and each other Underwriter, by virtue of its having
executed and delivered the related Terms Agreement, which shall incorporate
this Section 9(b) by reference, represents and warrants to and agrees with
the Company as of the date of the related Terms Agreement and as of the
Closing Date, that:
(i) The Collateral Term Sheets furnished to the Company
pursuant to Section 9(a) constitute all of the materials
furnished to prospective investors by such Underwriter prior to
time of delivery thereof to the Company that are required to be
filed with the Commission as "Collateral Term Sheets" with
respect to the related Offering of the Certificates in accordance
with the PSA Letter, and such Collateral Term Sheets comply with
the requirements of the PSA Letter;
(ii) On the date any such Collateral Term Sheets with
respect to the Offering of the Certificates were last furnished
to each prospective investor and on the date of delivery thereof
to the Company pursuant to Section 9(a) and on the related
Closing Date, such Collateral Term Sheets did not and will not
include any untrue statement of a material fact or, when read in
conjunction with the Prospectus and Prospectus Supplement, omit
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and
(iii) such Underwriter has not represented to any
prospective investor that any Collateral Term Sheets with respect
to any Series were prepared or disseminated on behalf of the
Company, and, except as otherwise disclosed by such Underwriter
to the Company in writing prior to the date hereof, all
Collateral Term Sheets previously furnished to prospective
investors included a disclaimer to the effect set forth in
Section 8(b)(iv).
Notwithstanding the foregoing, you and each such Underwriter make no
representation or warranty as to whether any Collateral Term Sheet included
or will include any untrue statement or material omission resulting directly
from any Mortgage Pool Error (except any Corrected Mortgage Pool Error, with
respect to materials prepared after the receipt by such Underwriter from the
Company of notice of such Corrected Mortgage Pool Error or materials
superseding or correcting such Corrected Mortgage Pool Error).
(c) Each Underwriter delivering Collateral Term Sheets
acknowledges and agrees that any Collateral Term Sheets with respect to any
Series of Certificates furnished to prospective investors from and after the
date hereof shall include a disclaimer to the effect set forth in Section
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<PAGE> 19
8(d) hereof, and to the effect that the information contained in such
materials supersedes the information contained in any prior Collateral Term
Sheet with respect to such Series of Certificates being offered and will be
superseded by the description of the related Mortgage Loans in the related
Prospectus Supplement. The Underwriters agree that they will not represent
to any prospective investors that any Collateral Term Sheets were prepared or
disseminated on behalf of the Company.
(d) If, at any time when a prospectus relating to the
Certificates of a Series is required to be delivered under the Act, it shall
be necessary to amend or supplement the related Prospectus as a result of an
untrue statement of a material fact contained in any Collateral Term Sheets
provided by an Underwriter pursuant to this Section 9 or the omission to
state therein a material fact required, when considered in conjunction with
the related Prospectus and Prospectus Supplement, to be stated therein or
necessary to make the statements therein, when read in conjunction with the
related Prospectus and Prospectus Supplement, not misleading, or if it shall
be necessary to amend or supplement any Current Report relating to any
Collateral Term Sheets to comply with the Act or the rules thereunder, such
Underwriter promptly will prepare and furnish to the Company for filing with
the Commission an amendment or supplement which will correct such statement
or omission or an amendment which will effect such compliance. Such
Underwriter will deliver an Officer's Certificate to the Company representing
and warranting to the Company that, as of the date of delivery of such
amendment or supplement to the Company, such amendment or supplement will not
include any untrue statement of a material fact or, when read in conjunction
with the related Prospectus and Prospectus Supplement, omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, such Underwriter will
make no representation or warranty as to whether any such amendment or
supplement will include any untrue statement resulting directly from any
Mortgage Pool Error (except any Corrected Mortgage Pool Error, with respect
to any such amendment or supplement prepared after the receipt by such
Underwriter from the Company of notice of such Corrected Mortgage Pool Error
or materials superseding or correcting such Corrected Mortgage Pool Error).
The Company shall have no obligation to file such amendment or supplement if
the Company determines that (i) such amendment or supplement contains any
untrue statement of a material fact or, when read in conjunction with the
related Prospectus and Prospectus Supplement, omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; it being understood, however, that the Company shall have no
obligation to review or pass upon the accuracy or adequacy of, or to correct,
any such amendment or supplement provided by such Underwriter to the Company
pursuant to this paragraph (d) or (ii) such filing is not required under the
Act. The Company shall give notice to such Underwriter of its determination
not to file an amendment or supplement pursuant to clause (ii) of the
preceding sentence.
10. Default of Underwriters. If any Underwriter or Underwriters
participating in an Offering of Certificates default in their obligations to
purchase Certificates hereunder and under the Terms Agreement and the
aggregate purchase price of Certificates which such defaulting Underwriter or
Underwriters agreed but failed to purchase does not exceed 10% of the
aggregate purchase price of the Certificates then being purchased, you may
make arrangements
-19-
<PAGE> 20
satisfactory to the Company for the purchase of such Certificates by other
persons, including any of the Underwriters, but if no such arrangements are made
by the Closing Date the non-defaulting Underwriters shall be obligated
severally, in proportion to their respective total commitments as set forth in
the applicable Terms Agreement (for all classes of Certificates), to purchase
the Certificates which such defaulting Underwriter or Underwriters agreed but
failed to purchase. If any Underwriter or Underwriters so default and the
aggregate purchase price of Certificates with respect to which such default or
defaults occur is more than 10% of the aggregate purchase price of Certificates
then being purchased, and arrangements satisfactory to you and the Company for
the purchase of such Certificates by other persons are not made within 36 hours
after such default, the Terms Agreement as to which such offering relates will
terminate without liability on the part of any non-defaulting Underwriter or the
Company, except as provided in Section 11. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
11. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties, and other
statements of the Company or its officers and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the result
thereof, made by or on behalf of any Underwriter or the Company or any of its
officers or directors or any controlling person, and will survive delivery of
and payment for the Certificates and any termination of this Agreement or any
Terms Agreement, including any termination pursuant to Section 10.
12. Termination. You shall have the right to terminate any
Terms Agreement at any time prior to the applicable Closing Date if any
domestic or international event or act or occurrence has materially
disrupted, or in your opinion will in the immediate future materially
disrupt, securities markets; or if trading on the New York or American Stock
Exchanges shall have been suspended, or minimum or maximum prices for trading
shall have been fixed, or maximum ranges for prices for securities shall have
been required on the New York or American Stock Exchanges by the New York or
American Stock Exchanges or by order of the Commission or any other
governmental authority having jurisdiction; or if the United States shall
have become involved in a war or major hostilities; or if a banking
moratorium has been declared by a state or Federal authority, or if a banking
moratorium in foreign exchange trading by major international banks or
persons has been declared; or if any new restriction materially and adversely
affecting the distribution of the Series of Certificates as to which such
Terms Agreement relates shall have become effective; or if there shall have
been such change in the market for securities in general or in political,
financial or economic conditions as in your judgment would be so materially
adverse as to make it inadvisable to proceed with the Offering, sale and
delivery of the Series of Certificates as to which such Terms Agreement
relates on the terms contemplated in such Terms Agreement. Any notice of
termination pursuant to this Section 12 shall be by telephone, telex, or
telegraph, confirmed in writing by letter.
-20-
<PAGE> 21
13. Notices. All communications hereunder will be in writing,
and, if sent to the Underwriters, will be mailed, delivered or telegraphed
and confirmed to you at 245 Park Avenue, New York, New York 10167, Attention:
General Counsel or if sent to the Company, will be mailed, delivered or
telegraphed and confirmed to it at Plaza Tower One, Suite 1200, 6400 South
Fiddler's Green Circle, Englewood, Colorado 80111, Attention: Steven B.
Chotin; provided, however, that any notice to an Underwriter pursuant to
Section 7 will be mailed, delivered or telegraphed to such Underwriter at the
address furnished by it.
14. Successors. This Agreement and the Terms Agreement will
inure to the benefit of and be binding upon the parties hereto and thereto,
and their respective successors and the officers and directors and
controlling persons referred to in Section 7, and no other person will have
any right or obligation hereunder or thereunder.
15. Representation of Underwriters. You will act for the
several Underwriters in connection with each Offering of Certificates
governed by this Agreement, and any action under this Agreement and any Terms
Agreement taken by you will be binding upon all the Underwriters identified
in such Terms Agreement.
16. Construction. This Agreement shall 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.
-21-
<PAGE> 22
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 Company and the
several Underwriters in accordance with its terms.
Very truly yours,
FUND AMERICA INVESTORS CORPORATION II
By: ---------------------------------
Name:
Title:
The foregoing Underwriting Agreement
hereby is confirmed and accepted
as of the date first above written.
BEAR, STEARNS & CO. INC.
By: ----------------------
Title:
-22-
<PAGE> 23
EXHIBIT A
FUND AMERICA INVESTORS CORPORATION II
Pass-Through Certificates
FORM OF TERMS AGREEMENT
-----------------------
Dated: _________, 199_
To: FUND AMERICA INVESTORS CORPORATION II [AND _____________]
Re: Underwriting Agreement dated June __, l998
Series Designation: Series 19 __ - __
Class Designation Schedule:
Terms of the Certificates:
- -------------------------
Original
Principal Interest Price to
Class Amount Rate Public(1)(2)
- ----- --------- -------- ------------
- ----------------------------
(1) Do not include if the Certificates will be offered from time to time by
the Underwriter in negotiated transactions at varying prices to be determined
at the time of sale.
(2) Plus accrued interest, if any, at the applicable rate from _____________ .
Distribution Dates: The __th day of each month or, if such __th day is not a
business day, the next succeeding business day commencing ________________ .
-23-
<PAGE> 24
Certificate Rating:
- ------------------
Mortgage Assets: The initial amounts to be included in any Reserve Fund and
other accounts are as set forth, and the Mortgage Loans to be included in the
Trust Fund are as described, in Annex A hereto.
Purchase Price: The aggregate purchase price payable by the Underwriter for the
Certificates covered by this Agreement will be $_________________. [Purchase
price may also be separately stated by class.]
Credit Enhancement:
[Include pool policies, letters of credit, bonds, subordination and similar
arrangements.]
Closing Date: ______, 19__, ____ a.m., N.Y. Time
- ------------
The undersigned, agrees, subject to the terms and provisions of the
above-referenced Underwriting Agreement, which is incorporated herein in its
entirety and made a part hereof, to purchase the respective principal amounts of
the Classes of the above-referenced Series of Certificates set forth [herein]
[on Schedule I attached hereto].
BEAR, STEARNS & CO. INC.
By:
------------------------
Senior Managing Director
[ADDITIONAL UNDERWRITERS]
By:
--------------------------
--------------------------
Title:
Accepted:
FUND AMERICA INVESTORS CORPORATION II
By:
-------------------------
-2-
<PAGE> 25
Schedule I (for Multiple Underwriters)
--------------------------------------
Underwriters
Name Class Class Class Class Class
- ---- ----- ----- ----- ----- -----
Bear, Stearns $ $ $ $ $
& Co. Inc.
[Other
Underwriters]
----- ----- ----- ----- -----
Total ===== ===== ===== ===== ======
-3-
<PAGE> 26
FUND AMERICA INVESTORS CORPORATION II
Pass-Through Certificates
TERMS AGREEMENT
---------------
Dated: June 26, 1998
To: FUND AMERICA INVESTORS CORPORATION II
Re: Underwriting Agreement dated June 26, 1998
Series Designation: Series 1998-B
Class Designation Schedule: Class 1A, Class 2A
Terms of the Certificates:
- -------------------------
Original Principal Pass-Through
Class Amount Interest Rate
- ----- ------------------ -------------
1A $ 24,651,553 (1)
2A $ 26,051,553 (1)
- ---------------------
(1) The effective per annum interest rate borne by either Class of
Certificates during each Interest Accrual Period with respect to a
Distribution Date will equal a fraction, expressed as a percentage
truncated at the fourth decimal place, the numerator of which is equal to
the aggregate amount in respect of interest paid on the Pooled
Certificates relating to each Class the related Interest Accrual Period
multiplied by 12, and the denominator of which is the principal amount of
such Class of the Certificates immediately prior to such Distribution
Date. Under certain circumstances, the principal amount of either Class of
the Certificates could be paid in full while interest would remain
payable, in which case, the calculation of the effective per annum
interest rate borne by the Certificates would not be meaningful.
<PAGE> 27
Distribution Dates: With respect to each month, beginning in July 1998, the
25th day of such month, or, if such is not a Business Day, then on the first
Business Day (as defined herein) after the 25th day of each month. A
"Business Day" means a day other than a Saturday, a Sunday or a day on which
banking institutions in New York, New York or the city in which the corporate
trust office of the Trustee is located are authorized or obligated by law or
executive order to be closed.
Certificate Rating: "Aaa" by Moody's Investors Service, Inc. and "AAA" by
Fitch IBCA, Inc.
Form of Certificates: Book-entry (The Depository Trust Company).
Trust Fund Assets: The Pooled Certificates to be included in the Trust Fund
are as described in Schedule A hereto.
Purchase Price: The aggregate purchase price payable by the Underwriter for
the Certificates covered by this Agreement will be 110.0% of the principal
balance of the Certificates plus accrued interest from June 1, 1998 to, but
not including, the Closing Date.
Closing Date: June 30, 1998, 9:00 a.m., New York time
Computational Materials and Term Sheets: The Underwriter has not prepared
Computational Materials, ABS Term Sheets, and/or Structural Term Sheets which
would be required to be filed by Fund America Investors Corporation II with
the Securities and Exchange Commission on
Form 8-K.
Expenses: Notwithstanding anything to the contrary in the Underwriting
Agreement, the Underwriter will pay all expenses in connection with the
offering of the Securities, including, but not limited to, all the expenses
included in Section 5(g) of the Underwriting Agreement.
Information Furnished by the Underwriter: The Underwriter confirms that it
has furnished the information set forth in Schedule A hereto for use in the
applicable Prospectus Supplement.
Miscellaneous Matters: (a) The Pooling Agreement and the Schedule referred
to in the Underwriting Agreement shall be deemed to be references to the
Pooling Agreement dated as of June 1, 1998 between Fund America Investors
Corporation II, as seller, and U.S. Bank Trust National Association, as
trustee, and Schedule A (attached thereto), respectively;
(b) Notices to the Underwriter shall be to the attention of Jeffrey
Mayer and notices to the Company shall be to the attention of Steven B.
Chotin.
2
<PAGE> 28
The undersigned, as sole Underwriter, agrees, subject to the terms and
provisions of the above-referenced Underwriting Agreement, which is
incorporated herein in its entirety and made a part hereof, to purchase the
principal amount of the Class of the above-referenced Series of Certificates
set forth herein.
BEAR, STEARNS & CO. INC.
By:
-----------------------------------
Name:
Title:
Accepted:
FUND AMERICA INVESTORS CORPORATION II
By:
-----------------------------------
Name:
Title:
3
<PAGE> 29
SCHEDULE A
POOLED CERTIFICATES
<TABLE>
<CAPTION>
Current Principal or
Full Name of Series % of Class Notional Balance
- --------------------------------------- ---------- --------------------
<S> <C> <C>
POOLED FREDDIE MAC CERTIFICATES
Multiclass Mortgage Securities, 13.00% $10,384,920
Series G063, Class A
Multiclass Mortgage Securities, 100.00% $3,788,841
Series 2008, Class SE
POOLED FANNIE MAE CERTIFICATES
Guaranteed REMIC Pass-Through 100.00% $6,090,962
Certificates, Fannie Mae REMIC
Trust 98-23, Class SG
Guaranteed REMIC Pass-Through 100.00% $1,823,068
Certificates,
Fannie Mae REMIC Trust 1997-78,
Class SK
Guaranteed REMIC Pass-Through 100.00% $5,000,000
Certificates,
Fannie Mae REMIC Trust 1998-42,
Class Z
POOLED GINNIE MAE CERTIFICATES
Guaranteed REMIC Pass-Through 100.00% $6,400,000
Securities, Ginnie Mae REMIC Trust
98-14, Class Z
POOLED NON-AGENCY CERTIFICATES
Bear Stearns Mortgage Securities, 72.56% $33,691,197
Inc.
Pass-Through Certificates, Series
1997-3
</TABLE>
4
<PAGE> 1
EXHIBIT 4.1
================================================================================
FUND AMERICA INVESTORS CORPORATION II,
as Seller
and
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
--------------------------------
POOLING AGREEMENT
Dated as of June 1, 1998
--------------------------------
$50,703,106
Fund America Investors Corporation II
Pass-Through Certificates
Series 1998-B
================================================================================
<PAGE> 2
TABLE OF CONTENTS
ARTICLE I -- DEFINITIONS 1
Section 1.01. Defined Terms..................................................1
ARTICLE II -- CONVEYANCE OF THE POOLED SECURITIES; ORIGINAL ISSUANCE OF
SECURITIES 14
Section 2.01. Conveyance of the Pooled Certificates.........................14
Section 2.02. Acceptance of Trust Fund by Trustee; Initial Issuance of
Securities....................................................15
Section 2.03. Representations and Warranties of the Seller and the Trustee..15
Section 2.04. Substitution of Pooled Certificates...........................19
ARTICLE III -- ADMINISTRATION OF THE POOLED CERTIFICATES; PAYMENTS AND
REPORTS TO CERTIFICATEHOLDERS 20
Section 3.01. Administration of the Trust Fund and the Pooled Certificates..20
Section 3.02. Collection of Monies..........................................21
Section 3.03. Establishment of Asset Proceeds and Trustee Fee Accounts;
Deposits Therein..............................................21
Section 3.04. Permitted Withdrawals From the Asset Proceeds Account.........22
Section 3.05. Distributions.................................................22
Section 3.06. Statements to Certificateholders..............................24
Section 3.07. Access to Certain Documentation and Information...............26
ARTICLE IV -- THE CERTIFICATES 26
Section 4.01. The Certificates..............................................26
Section 4.02. Registration of Transfer and Exchange of Certificates.........28
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates.............29
Section 4.04. Persons Deemed Owners.........................................29
Section 4.05. Exchange of Certificates......................................30
ARTICLE V -- THE TRUSTEE 30
Section 5.01. Duties of Trustee.............................................30
Section 5.02. Certain Matters Affecting the Trustee.........................32
Section 5.03. Trustee Not Liable for Certificates or Pooled Certificates....33
Section 5.04. Trustee May Own Certificates..................................33
Section 5.05. Trustee's Fees; Indemnification of the Trustee................33
Section 5.06. Eligibility Requirements for Trustee..........................34
Section 5.07. Resignation and Removal of the Trustee........................34
Section 5.08. Successor Trustee.............................................35
Section 5.09. Merger or Consolidation of Trustee............................35
Section 5.10. Appointment of Co-Trustee or Separate Trustee.................36
<PAGE> 3
ARTICLE VI -- THE SELLER 37
Section 6.01. Liability of the Seller.......................................37
Section 6.02. Merger, Consolidation or Conversion of the Seller.............37
Section 6.03. Limitation on Liability of the Seller and Others..............37
ARTICLE VII -- TERMINATION 38
Section 7.01. Termination...................................................38
ARTICLE VIII - TAX PROVISIONS 41
Section 8.01 Trust Administration...........................................41
Section 8.02 Prohibited Activities..........................................41
ARTICLE IX -- MISCELLANEOUS PROVISIONS 42
Section 9.01. Amendment.....................................................42
Section 9.02. Counterparts..................................................43
Section 9.03. Limitation on Rights of Certificateholders....................43
Section 9.04. Governing Law.................................................44
Section 9.05. Notices.......................................................44
Section 9.06. Severability of Provisions....................................44
Section 9.07. Successors and Assigns........................................45
Section 9.08. Article and Section Headings..................................45
Section 9.09. Notices to Rating Agencies....................................45
Exhibit A - Form of Class 1A Certificate
Exhibit B - Form of Class 2A Certificate
Exhibit C - Form of Option Exercise Notice
Schedule A - Pooled Certificates
Schedule B - Underlying BSMSI Certificates
(ii)
<PAGE> 4
POOLING AGREEMENT, dated as of June 1, 1998, by and between Fund
America Investors Corporation II, as depositor (the "Seller"), and U.S. Bank
Trust National Association, as trustee (the "Trustee").
PRELIMINARY STATEMENT
The Seller intends to cause the issuance of and to sell its
Pass-Through Certificates, Series 1998-B representing in the aggregate the
entire beneficial ownership of a trust fund (the "Trust Fund"), the primary
assets of which are the Pooled Certificates (defined herein).
All things necessary to make this Agreement a valid declaration
of trust by the Seller in accordance with its terms have been done.
In consideration of the premises and the mutual agreements herein
contained, the Seller and the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Defined Terms
Whenever used in this Agreement, including the Preliminary
Statement, the following words and phrases, unless the context otherwise
requires, shall have the following meanings:
Affiliate: With respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls or is controlled by, or is under common control with, such specified
Person. For the purposes of this definition, "control" when used with
respect to any specified Person means possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of such
Person, whether through the ownership of voting securities, by contract or
otherwise, and the terms "controlling," "controlled by" and "under common
control with" have meanings correlative to the foregoing.
Aggregate Principal Balance: The sum of the Class 1A Balance
plus the Class 2A Balance.
Agreement: This Pooling Agreement and all amendments hereof and
supplements hereto.
Asset Proceeds Account: The trust account or accounts, which
shall at all times be Eligible Accounts, created and maintained by the
Trustee for the benefit of the
<PAGE> 5
Certificateholders pursuant to Section 3.03. Funds deposited in the Asset
Proceeds Account shall be held in trust for the Certificateholders for the uses
and purposes set forth in Article III hereof.
Available Funds: As of any date of determination, the aggregate
amount on deposit in the Asset Proceeds Account as of such date, net of any
portion thereof which represents amounts to be paid to any Person pursuant to
clauses (ii) and (iv) of Section 3.04.
Business Day: Any day other than a Saturday, a Sunday or a day
on which banking institutions in New York or in the city in which the
Corporate Trust Office of the Trustee is located are authorized or obligated
by law or executive order to close.
Certificate or Certificates: Class 1A Certificates and Class 2A
Certificates or, as the context so indicates, either Class 1A Certificates or
Class 2A Certificates.
Certificate Principal Balance: With respect to any Certificate,
as of any date of determination, the then outstanding principal amount of
such Certificate, which is equal to the product of (a) the Class Percentage
Interest evidenced by such Certificate and (b) the then Class Principal
Balance of the Certificate.
Certificate Registrar and Certificate Register: Shall each have
the meanings provided in Section 4.02.
Certificateholder or Holder: As to the Certificates, the person
in whose name a Certificate is registered in the Certificate Register, except
that, solely for the purpose of giving any consent, approval or waiver
pursuant to this Agreement, any Certificate registered in the name of the
Seller or any Affiliate thereof shall be deemed not to be outstanding and
shall not be taken into account for purposes of determining whether the
Holders of Certificates evidencing the requisite aggregate Percentage
Interest necessary to effect any such consent, approval or waiver has been
obtained, unless such Persons collectively own all the Certificates.
Class: Collectively, all of the Certificates bearing the same
designation.
Class 1A Available Distribution: Means, as of any Distribution
Date, all distributions received by the Trustee on the Group 1A Pooled
Certificates and deposited by the Trustee in the Asset Proceeds Account as of
such Distribution Date, minus the pro rata portion of the Trustee Fee paid to
the Trustee, as of such Distribution Date.
Class 1A Balance: The aggregate principal amount of Class 1A
Certificates outstanding as of any date of determination, which is equal to
(i) the Original Class 1A Balance minus all amounts received on the Group 1A
Pooled Certificates and applied to principal on the then outstanding Class 1A
Certificates, plus (ii) all amounts of accreted interested added thereto.
If, on any Distribution Date, the amount by which the accreted interest on
the Pooled Fannie Mae 98-42 Certificate exceeds the aggregate of the amounts
set forth in clause (i) of this definition of
2
<PAGE> 6
Class 1A Balance in respect of such Distribution Date, the Class 1A Balance will
be increased by the amount of such excess.
Class 1A Certificate: Any one of the Class 1A Certificates, as
executed hereunder by the Trustee and authenticated and delivered hereunder
by the Certificate Registrar, substantially in the form of Exhibit A hereto.
Class 1A Certificateholder: As to the Class 1A Certificates, the
person in whose name a Class 1A Certificate is registered in the Certificate
Register.
Class Percentage Interest: With respect to any Certificate of
any Class, the portion of the Certificates of such Class represented by such
Certificate, expressed as a percentage, the numerator of which is the initial
outstanding principal amount of such Certificate as of the Closing Date, as
specified on the face thereof, and the denominator of which is, for a Class
1A Certificate, the Original Class 1A Balance and, for a Class 2A
Certificate, the Original Class 2A Balance.
Class Principal Balance: The Class 1A Balance or the Class 2A
Balance.
Class 2A Available Distribution: Means, as of any Distribution
Date, all distributions received by the Trustee on the Group 2A Pooled
Certificates and deposited by the Trustee in the Asset Proceeds Account as of
such Distribution Date, minus the pro rata portion of the Trustee Fee paid to
the Trustee, as of such Distribution Date.
Class 2A Balance: The aggregate principal amount of Class 2A
Certificates outstanding as of any date of determination, which is equal to
the Original Class 2A Balance (i) minus all amounts received on the Group 2A
Pooled Certificates and applied to principal on the then outstanding Class 2A
Certificates, and (ii) plus all amounts of accreted interest added thereto.
If, on any Distribution Date, the amount by which the accreted interest on
the Pooled Ginnne Mae 98-14 Certificate exceeds the aggregate of the amounts
set forth in clause (i) of this definition of Class 2A Balance in respect of
such Distribution Date, the Class 2A Balance will be increased by the amount
of such excess.
Class 2A Certificate: Any one of the Class 2A Certificates, as
executed hereunder by the Trustee and authenticated and delivered hereunder
by the Certificate Registrar, substantially in the form of Exhibit B hereto.
Class 2A Certificateholder: As to the Class 2A Certificates, the
person in whose name a Class 2A Certificate is registered in the Certificate
Register.
Closing Date: June 30, 1998.
Code: The Internal Revenue Code of 1986, as amended.
3
<PAGE> 7
Corporate Trust Office: The corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of
the execution of this Agreement is located at 180 East 5th Street, St. Paul,
Minnesota 55101, Attention: Structured Finance, telephone no. (612)
244-0011, facsimile no. (612) 244-0711.
Definitive Certificates: The meaning specified in Section
4.01(b) hereof.
Deleted Pooled Certificate: A Pooled Certificate replaced by a
Substitute Pooled Certificate.
Depository: DTC, the nominee of which is Cede & Co., or any
successor thereto.
Depository Agreement: The meaning specified in Subsection
4.01(a) hereof.
Depository Participant: A broker, dealer, bank or other
financial institution or other Person for whom from time to time the
Depository effects book-entry transfers and pledges of securities deposited
with the Depository.
Determination Time: Noon, Eastern Standard Time, on a
Distribution Date.
Distribution Date: With respect to any month, the Distribution
Date shall be the 25th day of such month or, if such day is not a Business
Day, then on the first Business Day after the 25th day of each month. The
first Distribution Date shall occur on July 27, 1998.
DTC: The Depository Trust Company.
Eligible Account: Any of (i) an account maintained with a
federal or state chartered depository institution or trust company, the
short-term unsecured debt obligations of which are rated at least P-1 by
Moody's and A-1+ by S&P (or comparable ratings if Moody's and S&P are not the
Rating Agencies) at any time funds are on deposit therein, (ii) a trust
account or accounts maintained with the trust department of a federally
chartered depository institution or trust company acting in its fiduciary
capacity, or (iii) a trust account or accounts maintained with the trust
department of a state chartered depository institution or trust company
acting in its fiduciary capacity and subject to regulations regarding
fiduciary funds on deposit therein substantially similar to 12 CFR Section
9.10(b).
ERISA: The Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder.
Exchange Date: A date on which Certificates are exchanged for a
pro rata portion of the Pooled Certificates pursuant to Section 4.05.
4
<PAGE> 8
Fannie Mae: Fannie Mae, formerly known as the Federal National
Mortgage Association.
Fannie Mae REMIC Certificates: The REMIC certificates of the
underlying trust established by Fannie Mae that issued the Pooled Fannie Mae
98-42 Certificates.
Freddie Mac: Freddie Mac, formerly known as the Federal Home
Loan Mortgage Corporation.
Final Distribution Date: With respect to the Pooled
Certificates, or the Certificates, as applicable, the Pooled Certificate
Distribution Date or the Distribution Date, as applicable, on which the final
distribution thereon is to be made in accordance with the related Underlying
Agreement or the terms of this Agreement, as the case may be.
Fitch: Fitch IBCA, Inc., or its successor in interest.
FMV Opinion: An opinion of an investment banking firm of
national reputation (other than an Affiliate of the Seller), which may be
obtained in connection with the determination of the Repurchase Price for a
repurchase pursuant to Section 2.03(c).
Ginnie Mae: Ginnie Mae, formerly known as Government National
Mortgage Association.
Group 1A Pool: Means the Group 1A Pooled Certificates.
Group 1A Pooled Certificates: Means (i) $911,534.00 of the
aggregate principal amount of the Pooled Fannie Mae 97-78 Certificate, (ii)
$3,045,481.00 of the aggregate notional amount of the Pooled Fannie Mae 98-23
Certificate, (iii) the $5,000,000 Pooled Fannie Mae 98-42 Certificate, (iv)
$5,192,460.00 in aggregate notional amount of the Pooled Freddie Mac G063
Certificate, (v) $1,894,420.50 in aggregate principal amount of the Pooled
Freddie Mac 2008 Certificate and (vi) $16,845,598.58 in aggregate principal
amount of the Pooled Non-Agency Certificate.
Group 2A Pool: Means the Group 2A Pooled Certificates.
Group 2A Pooled Certificates: Means (i) $911,534 of the
aggregate principal amount of the Pooled Fannie Mae 97-78 Certificate, (ii)
$3,045,481 of the aggregate notional amount of the Pooled Fannie Mae 98-23
Certificate, (iii) the $6,400,000 Pooled Ginnie Mae 98-14 Certificate, (iv)
$5,192,460 in aggregate notional amount of the Pooled Freddie Mac G 063
Certificate, (v) $1,894,420.50 in aggregate principal amount of the Pooled
Freddie Mac 2008 Certificate and (vi) $16,845,598.58 in aggregate principal
amount of the Pooled Non-Agency Certificate.
5
<PAGE> 9
Independent: When used with respect to any specified Person,
such a Person who (i) is in fact independent of the Seller and any Affiliate
of the Seller, (ii) does not have any direct financial interest in the Seller
or in any Affiliate of the Seller, and (iii) is not connected with the Seller
or any Affiliate of the Seller as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar
functions.
Interest Accrual Period: The one month period beginning on the
first day and ending on the last day of the month preceding the month of a
Distribution Date.
Investment Company Act: The Investment Company Act of 1940, as
amended from time to time, and the rules and regulations promulgated
thereunder.
LIBOR: London interbank offered quotations for one month
Eurodollar deposits.
Majority Certificateholders: The Holders of Certificates
evidencing in the aggregate greater than 50% of the Aggregate Principal
Balance of all the Certificates.
Monthly Distribution Amount: With respect to any Distribution
Date, the aggregate of (i) the interest distribution amount for such
Distribution Date, and (ii) the principal distribution amount for such
Distribution Date.
Moody's: Moody's Investors Service, Inc. or its successor in
interest.
Non-Agency Trustee: With respect to the Pooled Non-Agency
Certificate, the trustee under the Underlying Agreement pursuant to which
such Pooled Non-Agency Certificate was issued.
Notice of Final Distribution: With respect to the Pooled
Certificates, any notice provided pursuant to the related Underlying
Agreement to the effect that final distribution on a Pooled Certificate shall
be made only upon presentment and surrender thereof. With respect to the
Certificates, the notice to be provided pursuant to Section 7.01(b) to the
effect that final distribution on the Certificates shall be made only upon
presentment and surrender thereof.
Officers' Certificate: A certificate signed by the Chairman of
the Board, the President, a Senior Vice President, a Vice President or an
Assistant Vice President and by the Treasurer, the Secretary, an Assistant
Treasurer or an Assistant Secretary of the Seller or the Trustee, as required
by this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
counsel for the Seller, which opinion is addressed to the Trustee and is
reasonably acceptable to the Trustee.
Option Exercise Fee: The fee set forth in Section 4.05(c).
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Option Exercise Notice: A notice, substantially in the form of
Exhibit B, delivered by a Holder or Security Owner holding not less than 10%
of the outstanding principal amount of the Certificate of a Class.
Original Class 1A Balance: $24,651,553, minus the initial
principal amount of all Class 1A Certificates exchanged pursuant to Section
4.05 determined as of the respective dates of exchange.
Original Class 2A Balance: $26,051,553 minus the initial
principal amount of all Class 2A Certificates exchanged pursuant to Section
4.05 determined as of the respective dates of exchange.
Original Principal Balance: The sum of the Original Class 1A
Balance and the Original Class 2A Balance.
Percentage Interest: With respect to any Certificate, the
portion of the Certificates represented by such Certificate, expressed as a
percentage, the numerator of which is the initial outstanding principal
amount of such Certificate as of the Closing Date, as specified on the face
thereof, and the denominator of which is the Original Principal Balance.
Permitted Investments: Any one or more of the following
obligations or securities:
(i) direct obligations of, or obligations fully
guaranteed as to timely payment of principal and interest by, the
United States or any agency or instrumentality thereof, provided
such obligations are backed by the full faith and credit of the
United States;
(ii) demand and time deposits in, certificates of deposit
of, or bankers' acceptances (which shall each have an original
maturity of not more than 90 days and, in the case of bankers'
acceptances, shall in no event have an original maturity of more
than 365 days or a remaining maturity of more than 30 days)
denominated in United States dollars issued by, any depository
institution or trust company (including the Trustee or any agent
of the Trustee, acting in its respective commercial capacities)
incorporated under the laws of the United States of America or
any state thereof and subject to supervision and examination by
federal and/or state banking authorities, so long as at the time
of such investment or contractual commitment providing for such
investment the commercial paper or other 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) have a
credit rating of "A-1+" and P-1 from S&P and Moody's,
respectively;
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(iii) repurchase obligations with respect to any security
described in clause (i) above where such security has a remaining
maturity of one year or less and where such repurchase obligation
has been entered into with a depository institution or trust
company (acting as principal) described in clause (ii) above;
(iv) securities bearing interest or sold at a discount
issued by any corporation incorporated under the laws of the
United States of America or any state thereof which securities
are rated "AAA" and "Aaa" by S&P and Moody's, respectively, at
the time of such investment or contractual commitment providing
for such investment; provided, however, 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 Fund to exceed 10% of
the sum of the aggregate outstanding principal balance of all
Pooled Certificates and the aggregate principal amount of all
Permitted Investments in the Asset Proceeds Account;
(v) commercial paper (having original maturities of not
more than 365 days) of any corporation incorporated under the
laws of the United States or any state thereof which on the date
of acquisition has been rated by each Rating Agency in its
highest short-term rating available, provided that such
commercial paper shall have a remaining maturity of not more than
30 days;
(vi) certificates or receipts representing ownership
interests in future principal payments on obligations of the
United States of America or its agencies or instrumentalities
(which obligations are backed by the full faith and credit of the
United States of America) held by a custodian on behalf of the
holders of such receipts; and
(vii) money market funds which are rated by Moody's at the
time at which the investment is made in its highest long-term
rating category, any such money market funds which provide for
demand withdrawals being conclusively deemed to satisfy any
maturity requirements for Permitted Investments set forth in the
Certificates or this Agreement, including money market funds of
the Trustee and any such funds that are managed by the Trustee or
its affiliates or for which the Trustee or any affiliate acts as
advisor (as long as such funds otherwise meet the criteria
described in this clause (vii));
provided, however, that no instrument shall be a Permitted Investment if it
represents, either (1) the right to receive only interest payments with
respect to the underlying debt instrument or (2) the right to receive both
principal and interest payments derived from obligations underlying such
instrument and the principal payments with respect to such instrument provide
a yield to maturity greater than 120% of the yield to maturity at par of such
underlying obligations.
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Person: Any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
Plan: Any employee benefit Plan or retirement arrangement,
including individual retirement accounts and annuities, Keogh Plans and
collective investment funds in which such Plans, accounts, annuities or
arrangements are invested, that are described in or subject to the Plan Asset
Regulations, ERISA or corresponding provisions of the Code.
Plan Asset Regulations: The Department of Labor regulations set
forth in 29 C.F.R. Section 2510.3-101.
Plan Investor: A Plan, persons acting on behalf of a Plan, or
persons using the assets of a Plan.
Pooled Certificate Class Percentage: Means, for each class of
Pooled Certificates, the percentage which the Pooled Certificate constitutes
of its entire class as set forth in Schedule A attached hereto under the
caption "% of Class."
Pooled Certificate Distribution Date: Each of the Pooled Freddie
Mac Certificate Distribution Date, the Pooled Fannie Mae Certificate
Distribution Date, the Pooled Ginnie Mae Certificate Distribution Date and
the Pooled Non-Agency Certificate Payment Date.
Pooled Certificate Distribution Date Information: The
information provided or updated monthly by or on behalf of Freddie Mac,
Fannie Mae, Ginnie Mae and the Non-Agency Trustee in respect of Pooled
Certificates in connection with each Pooled Certificate Distribution Date.
Pooled Certificate Principal Balance: The principal balance or
notional principal balance of any Pooled Certificate.
Pooled Certificates: The Pooled Freddie Mac Certificates, the
Pooled Fannie Mae Certificates, Pooled Ginnie Mae Certificate and the Pooled
Non-Agency Certificate sold by the Seller to, and registered in the name of,
or held for the benefit of, the Trustee pursuant to Section 2.01 or 2.04 and
as more particularly described in Schedule A hereto, minus the original
principal balance of the Pooled Certificates issued to a Certificateholder in
exchange for Certificates pursuant to Section 4.05.
Pooled BSMSI 1997-3 Certificate: Bear Stearns Mortgage
Securities, Inc., Pass-Through Certificates, Series 1997-3.
Pooled Fannie Mae Certificates Distribution Date: With respect
to the Pooled Fannie Mae 98-42 Certificate, the 18th day of each month and
with respect to the Pooled Fannie Mae 97-78 Certificate and the Pooled Fannie
Mae 98-23 Certificate, the 25th day of each month
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<PAGE> 13
or, if any such day is not a business day as defined in the applicable
Underlying Agreement, the next succeeding business day as so defined.
Pooled Fannie Mae Certificates: Guaranteed REMIC Pass-Through
Certificates issued by Fannie Mae and identified as the Pooled Fannie Mae
Certificates in Schedule A hereto.
Pooled Fannie Mae 97-78 Certificate: Fannie Mae Guaranteed REMIC
Pass-Through Certificates, Fannie Mae REMIC Trust 1997-78, Class SK.
Pooled Fannie Mae 98-42 Certificate: Fannie Mae Guaranteed REMIC
Pass-Through Certificates, Fannie Mae REMIC Trust 1998-42, Class Z.
Pooled Fannie Mae 98-23 Certificate: Fannie Mae Guaranteed REMIC
Pass-Through Certificates, Fannie Mae REMIC Trust 98-23, Class SG.
Pooled Freddie Mac Certificate Distribution Date: With respect
to the Pooled Freddie Mac Pooled 2008 Certificate, the 15th day of each month
and with respect to the Pooled Freddie Mac G063 Certificate, the 17th day of
each month, or, if any such day is not a business day as defined in the
applicable Underlying Agreement, the next succeeding business day as so
defined.
Pooled Freddie Mac Certificate: Freddie Mac Multiclass Mortgage
Securities, issued by Freddie Mac and identified as the Pooled Freddie Mac
Certificates in Schedule A hereto.
Pooled Freddie Mac G063 Certificate: Freddie Mac Multiclass
Mortgage Securities Certificates, Series G063, Class A.
Pooled Freddie Mac 2008 Certificate: Freddie Mac Multiclass
Mortgage Securities Certificates, Series 2008, Class SE.
Pooled Ginnie Mae Certificate Distribution Date: With respect to
the Pooled Ginnie Mae Certificate, the 20th day of each month, or, if any
such day is not a business day as defined in the applicable Underlying
Agreement, the next succeeding business day as so defined.
Pooled Ginnie Mae Certificate: Guaranteed REMIC Pass-Through
Securities issued by Ginnie Mae and identified as the Pooled Ginnie Mae
Certificate in Schedule A hereto.
Pooled Ginnie Mae 98-14 Certificate: Ginnie Mae Guaranteed REMIC
Pass-Through Securities, Ginnie Mae REMIC Trust 98-14, Class Z.
Pooled Inverse Floating Rate Certificate: Pooled Fannie Mae
98-23 Certificate, Pooled Fannie Mae 97-78 Certificate and Pooled Freddie Mac
2008 Certificate.
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Pooled Non-Agency Certificate Payment Date: With respect to the
Pooled Non-Agency Certificate, the 25th day of each month or, if any such day
is not a business day as defined in the applicable Underlying Agreement, the
next succeeding business day as so defined.
Pooled Non-Agency Certificate: Pooled BSMSI 1997-3 Certificate.
Pooled PEC/IO Certificate: Pooled Freddie Mac G063 Certificate.
Pooled IO Certificate: Pooled Fannie Mae 98-23 Certificate.
Pooled Certificateholder: The Trustee or its Depository
Participant for the benefit of the Certificateholders.
PTC: Participants Trust Company, or any successors thereto.
Purchase Agreement: The Purchase Agreement dated as of June 26,
1998 between Bear, Stearns & Co., Inc. and the Seller relating to the Pooled
Certificates.
Rating Agency or Rating Agencies: Moody's and Fitch or their
successors. If such agencies or their successors are no longer in existence,
"Rating Agencies" shall be deemed to refer to such nationally recognized
statistical rating agencies, or other comparable Persons, designated by the
Seller, notice of which designation shall be given to the Trustee, and
specific ratings of Moody's and Fitch shall be deemed to refer to the
equivalent ratings of the parties so designated.
RCR Certificates: Pooled Fannie Mae 98-23 Certificate and Pooled
Fannie Mae 97-78 Certiifcate.
Record Date: With respect to any Distribution Date, the last
Business Day of the month preceding the month in which such Distribution Date
occurs; provided, however, that for this purpose the Distribution Date is
deemed to occur on the 26th of each month, without regard to whether such day
is a Business Day.
Remaining Pooled Certificate: With respect to either the Class
1A or Class 2A Certificates, any Pooled Certificate of the Group 1A or Group
2A Pooled Certificates, respectively, following the date on which the
principal balance or notional principal balance of all other classes of the
class of the Group 1A or Group 2A Pooled Certificates, as applicable, is
reduced to zero.
REMIC: A "real estate mortgage investment conduit" for Federal
income tax purposes.
Repurchase Price: In connection with the repurchase of (i) any
Pooled Certificate that is not a Pooled PEC/IO Certificate or a Pooled IO
Certificate pursuant to Section 2.03(c) or
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Section 7.01(a)(i), (ii)(A) or (iii) (A) a price equal to the outstanding Pooled
Certificate principal balance thereof as of the date of repurchase plus accrued
interest thereon in accordance with the applicable Underlying Agreements, (ii)
any Pooled PEC/IO Certificate or a Pooled IO Certificate pursuant to Section
2.03(c), a price equal to the highest bid obtained by the Trustee from three
dealers then active in the market for such Pooled PEC/IO Certificate or a Pooled
IO Certificate (or such lesser number as may then be active); provided, however,
if the Trustee is able to obtain a bid from only one active dealer, then the
Trustee may obtain a FMV Opinion to determine whether such bid is at least equal
to the fair market value of such Pooled PEC/IO Certificate or a Pooled IO
Certificate and the Repurchase Price shall be the higher of the bid or the fair
market value of such Pooled PEC/IO Certificate or a Pooled IO Certificate as
stated in any such FMV Opinion; provided further, however, if the Trustee is
unable to obtain a bid from any active dealer, then the Trustee shall obtain a
FMV Opinion and the Repurchase Price shall be equal to the fair market value of
such Pooled PEC/IO Certificate or a Pooled IO Certificate as stated in such FMV
Opinion, and (iii) any Pooled PEC/IO Certificate or a Pooled IO Certificate
pursuant to Section 7.01(a)(i), (ii)(A) or (iii) (A), a price equal to the
portion of the interest distribution amount allocable to such Pooled PEC/IO
Certificate or a Pooled IO Certificate for such date of repurchase.
Responsible Officer: When used with respect to the Trustee, any
officer of the Trustee assigned to and working in its Corporate Trust Office
or similar group administering the Trust Fund hereunder and also, with
respect to a particular matter, any other officer of the Trustee to whom a
particular matter is referred by the Trustee because of such officer's
knowledge of and familiarity with the particular subject.
S&P: Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc.
Securities Act: The Securities Act of 1933, as amended.
Security Owner: Any Person who is the beneficial owner of a
Certificate registered in the name of the Depository or its nominee.
Seller: Fund America Investment Corporation II, a Delaware
corporation, or its successor in interest.
Single Certificate: A Certificate with an original principal
amount of $1,000.
Substitute Pooled Certificate: One or more mortgage related
securities tendered to the Trustee pursuant to Section 2.04, issued by Ginnie
Mae, Fannie Mae or Freddie Mac, which meet the following criteria: (i) such
substitution shall be (a) in the case of the Pooled Fannie Mae 98-42
Certificate and Pooled Ginnie Mae 98-14 Certificate, with one or more accrual
certificates bearing a coupon no less than the coupon of the certificate
being substituted for or (b) in the case of the Pooled Inverse Floating Rate
Certificates, other than the Pooled IO Certificate, with one or more inverse
floating rate certificates based on LIBOR whose combined coupon will
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be at least equal to the coupon of the Pooled Certificates being substituted for
at all levels of LIBOR, (ii) the sum of the outstanding principal amounts or
notional principal amounts, as applicable, of the Substitute Pooled Certificates
equals the sum of the outstanding principal amounts or notional principal
amounts, as applicable of the Deleted Pooled Certificates being substituted for,
(iii) the Substitute Pooled Certificates as the date of substitution ultimately
are backed by mortgage loans (a) with a weighted average pass-through rate no
more than 50 basis points below and no more than 50 basis points above the
weighted average pass-through rate of the mortgage loans ultimately backing the
Deleted Pooled Certificate and (b) which are conventional, fixed rate, one- to
four-family, fully amortizing, level payment, first mortgage loans with original
maturities of up to 30 years, (iv) the inclusion of which in the Trust Fund will
not result in a withdrawal or downgrading in the rating assigned to the
Certificates by the Rating Agencies, written confirmation of which shall be
provided by the Rating Agencies to the Trustee and (v) will not cause the Trust
Fund to lose its status as a grantor trust for federal income tax purposes as
indicated in an Opinion of Counsel to be provided to the Trustee.
Trustee: U.S. Bank Trust National Association, in its capacity
as trustee, or its successor in interest.
Trustee Fee: With respect to any Distribution Date, the monthly
fee equal to one-twelfth of the product of 0.020% and the Aggregate Principal
Balance immediately prior to such Distribution Date, but not less than
$100.00 with respect to any Distribution Date.
Trust Fund: The segregated pool of assets subject hereto,
constituting the corpus of the trust created hereby and to be administered
hereunder, consisting of:
(i) the Pooled Certificates;
(ii) all amounts payable on the Pooled Certificates following
the Closing Date pursuant to the Underlying Agreements;
(iii) the Asset Proceeds Account and such funds or assets as are
from time to time deposited in the Asset Proceeds Account other than the
amounts described in Section 3.04(iv) hereof;
(iv) the Seller's rights under the Purchase Agreement; and
(v) the income, payments and proceeds of each of the foregoing.
Underlying Agreements: The agreements pursuant to which the
related Pooled Certificates were issued, as in effect on the Closing Date.
Underlying Assets: Any of the assets underlying an Underlying
Series.
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Underlying BSMSI Certificates: The certificates and other
securities described in Schedule B hereto.
Underlying Series: Each series of securities which includes one
of the Pooled Certificates.
ARTICLE II
CONVEYANCE OF THE POOLED SECURITIES;
ORIGINAL ISSUANCE OF SECURITIES
Section 2.01. Conveyance of the Pooled Certificates.
(a) The Seller, concurrently with the execution and delivery
hereof, does hereby sell, transfer, assign, set-over and otherwise convey to
the Trustee, in trust, for the use and benefit of the Certificateholders,
without recourse, all the right, title and interest of the Seller (i) in and
to the Pooled Certificates, (ii) in and to the Purchase Agreement and (iii)
in and to all other assets constituting the Trust Fund. Such assignment
includes, without limitation, all amounts payable on the Pooled Certificates
pursuant to the Underlying Agreements and following the Closing Date.
(b) In connection with such transfer and assignment, and
concurrently with its execution and delivery of this Agreement, the Seller
shall have caused the Pooled Certificates to be registered in the book-entry
records of the Federal Reserve Bank of Minneapolis, PTC or DTC, as
applicable, in the name of the Trustee.
(c) The transfer of the Pooled Certificates and all other
assets constituting the Trust Fund is absolute and is intended by the parties
hereto as a sale.
(d) It is intended that the conveyances by the Seller to the
Trustee of the Pooled Certificates as provided for in this Section 2.01 be
construed as a sale by the Seller to the Trustee of the Pooled Certificates
for the benefit of the Certificateholders. Further, it is not intended that
any such conveyance be deemed to be a pledge of the Pooled Certificates by
the Seller to the Trustee to secure a debt or other obligation of the
Seller. However, in the event that the Pooled Certificates are held to be
property of the Seller, or if for any reason this Agreement is held or deemed
to create a security interest in the Pooled Certificates, then it is intended
that (a) this Agreement shall also be deemed to be a security agreement
within the meaning of Articles 8 and 9 of the New York Uniform Commercial
Code and the Uniform Commercial Code of any other applicable jurisdiction;
(b) the conveyance provided for in Section 2.01 shall be deemed to be a grant
by the Seller to the Trustee of a security interest in all of the Seller's
right (including the power to convey title thereto), title and interest,
whether now owned or hereafter acquired, in and to (1) the Pooled
Certificates, (2) all amounts payable pursuant to the Pooled Certificates in
accordance with the terms thereof and (3) any and all general intangibles
consisting of, arising
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from or relating to any of the foregoing, and all proceeds of the conversion,
voluntary or involuntary, of the foregoing into cash, instruments, securities or
other property, including without limitation all amounts from time to time held
in the Asset Proceeds Account, whether in the form of cash, instruments,
securities or other property, other than the amounts described in Section
3.04(iv) hereof; (c) the possession by the Trustee or any agent of the Trustee
of such items of property as constitute instruments, money, negotiable documents
or chattel paper shall be deemed to be possession, or possession by a purchaser
or a person designated by such secured party, for purposes of perfecting the
security interest pursuant to the New York Uniform Commercial Code and the
Uniform Commercial Code of any other applicable jurisdiction (including, without
limitation, Section 9-305 and 8-301 thereof); and (d) notifications to persons
holding such property, and acknowledgments, receipts or confirmations from
persons holding such property, shall be deemed notifications to, or
acknowledgments, 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.
The Seller and the Trustee, at the Seller's or the Majority
Certificateholders' direction, shall, to the extent consistent with this
Agreement, take such reasonable actions as may be determined to be necessary
to ensure that, if this Agreement were deemed to create a security interest
in the Pooled Certificates, and the other property described above, such
security interest would be deemed to be a perfected security interest of
first priority under applicable law and will be maintained as such throughout
the term of this Agreement.
Section 2.02. Acceptance of Trust Fund by Trustee; Initial Issuance
of Securities.
The Trustee acknowledges receipt of the Underlying Agreements and
the transfer and assignment to it of the Pooled Certificates as evidenced by
the written confirmation of the registration or the crediting of such Pooled
Certificates in the name or for the account of the Trustee, in good faith and
without notice of any adverse claim, and the assignment to it of all other
assets included in the Trust Fund and declares that it holds and will hold
its interest in the Pooled Certificates and all other assets included in the
Trust Fund in trust for the exclusive use and benefit of all present and
future Certificateholders in accordance with the terms of this Agreement.
Concurrently with such transfer and assignment and in exchange therefor,
pursuant to the written request of the Seller executed by an officer of the
Seller, the Trustee has executed and caused to be authenticated and delivered
to or upon the order of the Seller, the Certificates in authorized
denominations evidencing the entire beneficial ownership of the Trust Fund.
Until the Trust Fund is terminated in accordance with Section
7.01, except as provided herein, the Trustee shall not assign, sell, dispose
of or transfer any interest in the Pooled Certificates or any other asset
constituting the Trust Fund or permit the Pooled Certificates or any other
asset constituting the Trust Fund to be subjected to any lien, claim or
encumbrance arising by, through or under the Trustee or any person claiming
by, through or under the Trustee.
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Section 2.03. Representations and Warranties of the Seller and the
Trustee.
(a) The Seller hereby represents and warrants to the Trustee
and for the benefit of the Certificateholders, as of the Closing Date, that:
(i) The Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware, and the Seller is possessed of all licenses necessary
to carry on its business.
(ii) The execution and delivery of this Agreement by the
Seller, and the performance and compliance with the terms of this
Agreement by the Seller, will not violate the Seller's
certificate of incorporation or bylaws 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 of, any
material agreement or other instrument to which it is a party or
which is applicable to it or any of its assets.
(iii) The Seller has the full right, power and authority to
enter into and consummate all transactions contemplated by this
Agreement, including but not limited to selling the Pooled
Certificates to the Trustee, has duly authorized the execution,
delivery and performance of this Agreement, and has duly executed
and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution
and delivery by the Trustee, constitutes a valid, legal and
binding obligation of the Seller, enforceable against the Seller
in accordance with the terms hereof, subject to (A) applicable
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights generally, and (B)
general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(v) The Seller is not in violation of, and its execution
and delivery of this Agreement and its performance and compliance
with the terms of this Agreement will not constitute a violation
of, any law, any order or decree of any court or arbiter, or any
order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation is likely
to affect materially and adversely either the ability of the
Seller to perform its obligations under this Agreement or the
financial condition of the Seller.
(vi) No litigation is pending or, to the best of the
Seller's knowledge, threatened against the Seller which, if
determined adversely to the Seller, would prohibit the Seller
from entering into this Agreement or is likely to materially and
adversely affect either the ability of the Seller to perform its
obligations under this Agreement or the financial condition of
the Seller.
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(vii) The Seller was, immediately prior to the transfer of
the Pooled Certificates to the Trustee, the sole owner thereof
free and clear of any lien, pledge, charge or encumbrance of any
kind (except any lien created by this Agreement).
(viii) The Seller acquired the Pooled Certificates in
good faith without notice of any adverse claim, lien, charge,
encumbrance or security interest (including without limitation,
federal tax liens or liens arising under ERISA).
(ix) The Seller has not assigned any interest in the
Pooled Certificates or any distributions or payments thereon,
except as contemplated herein.
(x) The Trustee, in its capacity as the holder of the
Pooled Certificates, will be entitled to distributions under the
Underlying Agreements equal to all distributions of interest and
principal made on the Pooled Certificates.
(xi) As of the Closing Date, collectively, the Pooled
Certificates which have principal balances, have an aggregate
principal balance greater than or equal to the Original Principal
Balance. As of the Closing Date, collectively, the Group 1A
Pooled Certificates which have principal balances have an
aggregate principal balance, greater than or equal to the
Original Class 1A Balance. As of the Closing Date, collectively,
the Group 2A Pooled Certificates which have principal balances
have an aggregate principal balance greater than or equal to the
Original Class 2A Balance.
(xii) The information relating to the Pooled Certificates
set forth in Schedule A is true and correct in all material
respects.
(xiii) Each Pooled Certificate is an Uncertificated
Security (as such term is defined in Article 8 of the Uniform
Commercial Code) registered on the books of the Federal Reserve
Banks, PTC or the Depository in the name of the Trustee or its
financial intermediary on behalf of the Trustee.
(xiv) The Pooled Fannie Mae 97-78 Certificate, the Pooled
Fannie Mae 98-23 Certificate and the Pooled BSMSI Certificate are
beneficial ownership interests in a grantor trust.
(xv) The Pooled Fannie Mae 98-42 Certificate, the Pooled
Freddie Mac Certificates and the Pooled Ginnie Mae Certificate
are REMIC regular interests.
(xvi) The Seller has no actual knowledge after reasonable
inquiry that (a) each trust issuing a Pooled Certificate was not
duly created and is not validly existing and (b) such Pooled
Certificate (1) was not validly issued by such trust and (2) is
not outstanding, (3) is not the legal, valid, binding and
enforceable obligation of such trust and (4) is not entitled to
the benefits of the pooling and
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<PAGE> 21
servicing agreement, indenture, trust agreement or other document
pursuant to which such Pooled Certificate was issued (except as
limited by bankruptcy, insolvency or other similar laws affecting
the enforcement of creditors' rights generally or to the extent that
such enforceability may be subject to the exercise of judicial
discretion in accordance with general equitable principles).
(b) The Trustee hereby represents and warrants to the Seller
and for the benefit of the Certificateholders, as of the Closing Date, that:
(i) The Trustee is a national banking association duly
organized and validly existing under the laws of the United
States of America.
(ii) The execution and delivery of this Agreement by the
Trustee, and the performance and compliance with the terms of
this Agreement by the Trustee, will not violate the Trustee's
charter or bylaws 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 of, any material
agreement or other instrument to which it is a party or which is
applicable to it or any of its assets which default is likely to
affect materially and adversely either the ability of the Trustee
to perform its obligations hereunder or its financial condition.
(iii) The Trustee 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.
(iv) This Agreement, assuming due authorization, execution
and delivery by the Seller, constitutes a valid, legal and
binding obligation of the Trustee, enforceable against the
Trustee in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights
generally, and (B) general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity
or at law or in an administrative proceeding.
(v) The Trustee is not in violation of, and its execution
and delivery of this Agreement and its performance and compliance
with the terms of this Agreement will not constitute a violation
of, any law, any order or decree of any court or arbiter, or any
order or regulation of any federal, state or local governmental
or regulatory authority, which violation is likely to affect
materially and adversely either the ability of the Trustee to
perform its obligations under this Agreement or the financial
condition of the Trustee.
(vi) No litigation is pending or, to the best of the
Trustee's knowledge, threatened against the Trustee which would
prohibit the Trustee from entering into this Agreement or is
likely to materially and adversely affect either the ability
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of the Trustee to perform its obligations under this Agreement or
the financial condition of the Trustee.
(vii) The Pooled Certificates will be held in the Trustee's
account at the Federal Reserve Bank of Minneapolis, PTC or DTC,
as applicable, as evidenced by the written confirmation of the
registration or the crediting of such Pooled Certificates in the
name or for the account of the Trustee; it has acquired the
Pooled Certificates of the Certificateholders from the Seller in
good faith, for value, and, to the best of the Trustee's
knowledge, without notice or actual knowledge of any adverse
claim, lien, charge, encumbrance or security interest (including,
without limitation, federal tax liens or liens arising under
ERISA); it has not and will not, in any capacity other than as
Trustee, assert any claim or interest in the Pooled Certificates
and will hold its interest in such Pooled Certificates and the
proceeds thereof in trust pursuant to the terms of this
Agreement; and it has not encumbered or transferred its right,
title or interest in the Pooled Certificates.
(c) It is understood and agreed that the representations and
warranties set forth in Section 2.03(a) shall survive the execution and
delivery of this Agreement. Upon discovery by either party hereto of a
breach of any of the foregoing representations and warranties which
materially and adversely affects the interests of the Certificateholders or
either party hereto, the party discovering such breach will give prompt
written notice thereof to the other party hereto and to the
Certificateholders. Within thirty (30) days of the earlier of either
discovery by or notice to the Seller of any breach of a representation or
warranty of the Seller that materially and adversely affects the interests of
the Certificateholders, the Seller shall use its best efforts promptly to
cure such breach in all material respects and, if such breach cannot be
cured, the Seller shall, at the election of the Majority Certificateholders,
repurchase each Pooled Certificate affected by the breach at the Repurchase
Price. If the Seller is to repurchase Pooled Certificates, the Trustee shall
promptly determine the Repurchase Price in accordance with the definition
thereof. Repurchase of any of the Pooled Certificates or pursuant to the
foregoing provisions of this Section 2.03(c) shall be accomplished by (i)
deposit in the Asset Proceeds Account on the Business Day prior to the next
succeeding Distribution Date of the amount of the Repurchase Prices of the
Deleted Pooled Certificates and Deleted Treasury Securities and (ii) amending
Schedule A hereto to remove the related Deleted Pooled Certificates.
Section 2.04. Substitution of Pooled Certificates.
Notwithstanding anything to the contrary in this Agreement, in lieu of
repurchasing a Pooled Certificate that is not a Pooled PEC/I0 Certificate
pursuant to Section 2.03(c), the Seller may, no later than the date by which
such repurchase by the Seller would otherwise be required, cause to be
registered or credited in the book-entry records of the Federal Reserve Bank
of Minneapolis, PTC or DTC, as applicable, in the name or for the account of
the Trustee a Substitute Pooled Certificate accompanied by an Officer's
Certificate of the Seller identifying such Substitute Pooled Certificate and
confirming that it conforms to the requirements set forth in the definition
of "Substitute Pooled Certificate; provided, however, that substitution
pursuant to this Section 2.04 in lieu of repurchase shall not
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be permitted after the termination of the 90 day period beginning on the Closing
Date. Upon receipt of such Officer's Certificate and the written confirmation of
such transfer, such Substitute Pooled Certificate shall thereafter be deemed to
be a Pooled Certificate hereunder. In the event of such a substitution, payments
received on the Substitute Pooled Certificate for the month in which the
substitution occurs shall be the property of the Seller and payments received on
the Deleted Pooled Certificate during such month shall be the property of the
Trust Fund. Upon receipt of the foregoing with respect to the Substitute Pooled
Certificate the Trustee shall release to the Seller and shall execute and
deliver all instruments of transfer or assignment, without recourse, in form as
provided to it as are necessary to vest in the Seller or its designee title to
and rights under the related Deleted Pooled Certificate released pursuant to
this Section 2.04. The Seller shall deliver the documents related to the
Substitute Pooled Certificate in accordance with the provisions of Section 2.02.
The representations and warranties set forth in Section 2.03(a) concerning the
Pooled Certificates shall be deemed to have been made by the Seller with respect
to each Substitute Pooled Certificate as of the date of acceptance of such
Substitute Pooled Certificate by the Trustee. On the date of substitution, the
Trustee shall (i) amend Schedule A hereto, to reflect such substitution and
shall provide a copy of the amended Schedule A to the Seller and the Rating
Agencies and (ii) provide written acknowledgment to the Seller of the transfer
and assignment to it of the related Substitute Pooled Certificate in good faith
and without notice of any adverse claim, and the assignment to it of all other
related assets to be included in the Trust Fund.
ARTICLE III
ADMINISTRATION OF THE POOLED CERTIFICATES AND TREASURY SECURITIES;
PAYMENTS AND REPORTS TO CERTIFICATEHOLDERS
Section 3.01. Administration of the Trust Fund and the Pooled
Certificates.
If at any time the Trustee, as a holder of a Pooled Certificate,
is requested in writing in such capacity, whether by a Certificateholder, a
holder of a certificate of an Underlying Series or a party to the related
Underlying Agreement or any other Person, to take any action or to give any
consent, approval or waiver, including, without limitation, in connection
with an amendment of any Underlying Agreement, the Trustee shall promptly
notify all of the Certificateholders of the Class 1A Certificates or the
Class 2A Certificates, as applicable, and the Seller of such request and of
its planned course of action with respect thereto and shall, in its capacity
as a holder of Pooled Certificates, take such action in connection with the
exercise and/or enforcement of any rights and/or remedies available to it in
such capacity with respect to such request, as the Majority
Certificateholders of the Class 1A Certificates or the Class 2A Certificates,
as applicable, shall direct in writing. The Trustee shall promptly furnish
to the Seller and, upon the written request of a Certificateholder, such
Certificateholder, all notices, statements, reports or other information that
it receives as holder of the Pooled Certificates. Notwithstanding the
foregoing or the provisions of any Underlying Agreement, the Trustee shall
not (i) exchange all or any portion of the RCR Certificates for a related
class or classes of Fannie
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Mae REMIC Certificates or (ii) consent to any modification of any of the terms
of any Underlying Assets.
Section 3.02. Collection of Monies.
(a) In connection with its receipt of any distribution on the
Pooled Certificates on any Pooled Certificate Distribution Date (or such
later date on which the Trustee shall receive the related Pooled Certificate
Distribution Date Information), the Trustee shall review the related Pooled
Certificate Distribution Date Information and shall confirm that the
aggregate amount of such distribution received by the Trustee is consistent
with such information (it being understood that the Trustee shall be entitled
to rely on the accuracy and correctness of such information).
(b) If the Trustee receives a Notice of Final Distribution in
respect of any of the Pooled Certificates, the Trustee shall present and
surrender any related Pooled Certificates which are in certificated form for
final payment thereon in accordance with the terms and conditions of the
related Underlying Agreement and such notice. The Trustee shall promptly
deposit in the Asset Proceeds Account the final distribution received by the
Trustee upon presentation and surrender of such Pooled Certificates for
distribution in accordance with Section 3.05 hereof on the next succeeding
Distribution Date.
Section 3.03. Establishment of Asset Proceeds Account; Deposits
Therein.
(a) The Trustee, for the benefit of the Certificateholders,
shall establish and maintain one or more trust accounts (collectively, the
"Asset Proceeds Account"), each of which shall be an Eligible Account,
entitled "U.S. Bank Trust National Association, as trustee for the registered
holders of Fund America Investment Corporation II Pass-Through Certificates,
Series 1998-B, Asset Proceeds Account," held in trust by the Trustee for the
benefit of the Certificateholders. The Trustee shall cause all distributions
received on the Pooled Certificates by the Trustee in its capacity as holder
of the Pooled Certificates, from whatever source, and all amounts received by
it representing payment of a Repurchase Price pursuant to Section 2.03(c) and
7.01(a)(i), subsequent to the Closing Date to be deposited directly into the
Asset Proceeds Account. The Asset Proceeds Account is initially located at
the Trustee. The Trustee shall give notice to the Seller and to
Certificateholders of any new location of the Asset Proceeds Account prior to
any change thereof.
(b) In the event that payments in respect of the Pooled
Certificates are received by the Trustee prior to the related Distribution
Date, the Trustee may invest such funds deposited in the Asset Proceeds
Account in one or more Permitted Investments held in the name of the Trustee
and shall receive as compensation, in addition to the Trustee Fee, any
interest or investment income earned on such Permitted Investments selected
by the Trustee, which may be withdrawn by the Trustee on each Distribution
Date and shall not constitute Available Funds. Notwithstanding the
foregoing, no such Permitted Investment may mature later than the day before
such related Distribution Date (unless such Permitted Investment is an
obligation of the Trustee, in which case such Permitted Investment may mature
on the Distribution Date) and no
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such investment shall be sold prior to its maturity date. The amount of any
losses incurred in respect of any such investments shall be deposited in the
Asset Proceeds Account by the Trustee out of its own funds immediately as
realized.
(c) The Seller shall cause all distributions received on the
Pooled Certificates by the Seller or any of its Affiliates after the Closing
Date to be deposited directly into the Asset Proceeds Account.
Section 3.04. Permitted Withdrawals From the Asset Proceeds
Account.
The Trustee may from time to time withdraw funds from the Asset
Proceeds Account for the following purposes (without any particular order of
priority):
(i) to make distributions in the amounts and in the
manner provided for in Section 3.05;
(ii) to pay to the Person entitled thereto any amount
deposited in the Asset Proceeds Account in error;
(iii) to clear and terminate the Asset Proceeds Account
upon the termination of this Agreement; and
(iv) to pay itself, as additional compensation, the net
reinvestment income permitted to be paid to it as provided in
Section 3.03(b) and any amounts to which it is entitled to be
paid pursuant to Section 5.05.
On each Distribution Date, the Trustee shall withdraw all funds
from the Asset Proceeds Account and shall use such funds withdrawn from the
Asset Proceeds Account only for the purposes described in this Section 3.04
and in Section 3.05.
Section 3.05. Distributions.
(a) On each Distribution Date, the Trustee shall apply amounts
in the Asset Proceeds Account representing Available Funds in the following
manner and order of priority, in each case to the extent of the remaining
Available Funds:
first, from amounts with respect to interest received
on the Pooled Certificates, to the Trustee, to pay the Trustee
Fee;
second, from amounts remaining in the Asset Proceeds
Account the Class 1A Available Distribution to the Class 1A
Certificateholders and the Class 2A Available Distribution to the
Class 2A Certificateholders in the following manner and order of
priority:
(i) The Class 1A Available Distribution shall be applied
as follows:
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first, as principal, from the Class 1A Available
Distribution, an amount such that the principal
balance of the Class 1A Certificates after such
distribution is equal to the aggregate principal
balance of the Class 1A Pooled Certificates; and
second, from the remaining Class 1A Available
Distribution, to the Class 1A Certificateholders as
payment of interest.
(ii) The Class 2A Available Distribution shall be applied
as follows:
first, as principal, from the Class 2A Available
Distribution, an amount such that the principal
balance of the Class 2A Certificates after such
distribution is equal to the aggregate principal
balance of the Class 2A Pooled Certificates; and
second, from the remaining Class 2A Available
Distribution, to the Class 2A Certificateholders as
payment of interest.
For accounting purposes, each Distribution Date is deemed to
occur in the same month as the concurrent or immediately preceding Pooled
Certificate Distribution Date.
(b) All distributions made to Certificateholders pursuant to
Section 3.05(a) on each Distribution Date shall be allocated pro rata among
the outstanding Certificates based upon their respective Class Percentage
Interests and, except in the case of the final distribution to the
Certificateholders, shall be made to the Holders of record on the related
Record Date. Distributions to any Certificateholder on any Distribution Date
shall be made by wire transfer of immediately available funds to the account
of such Certificateholder at a bank or other entity having appropriate
facilities therefor, if such Certificateholder shall have so notified the
Trustee in writing (which wiring instructions may be in the form of a
standing order applicable to all future Distribution Dates) no less than five
Business Days prior to the related Record Date (or, in the case of the
initial Distribution Date, no later than the related Record Date) and is the
registered owner of Certificates with an aggregate initial Security Principal
Balance of not less than $1,000,000, or otherwise by check mailed by first
class mail to the address of such Certificateholder appearing in the
Certificate Register. Final distribution to each Certificateholder will be
made in like manner, but only upon presentment and surrender of such
Certificate at the Corporate Trust Office or such other location specified in
the notice to Certificateholders of such final distribution.
(c) Notwithstanding any other provision of this Agreement, the
Trustee shall comply with all federal withholding requirements respecting
payments to Certificateholders of interest or, subject to the receipt of such
information with respect to the Pooled Certificates, the
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accrual of 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 payments to any Certificateholder pursuant to federal withholding
requirements, the Trustee shall indicate the amount withheld to such
Certificateholders.
(d) The Trustee may conclusively rely on the Pooled Certificate
Distribution Date Information in making the calculations called for in this
Section 3.05 and in Section 3.06. If the Pooled Certificate Distribution
Date Information is insufficient to make the calculations provided for in
this Section 3.05, the Trustee shall promptly request Freddie Mac, with
respect to the Pooled Freddie Mac Certificates, Fannie Mae, with respect to
the Pooled Fannie Mae Certificates, Ginnie Mae (or its agent), with respect
to the Pooled Ginnie Mae Certificate, and the Non-Agency Trustee, with
respect to the Pooled Non-Agency Certificate, to provide sufficient
information in writing, and after receipt of such information the Trustee
shall make on the following Distribution Date any necessary adjustments in
the application of amounts in the Asset Proceeds Account. If such
information is not received from Freddie Mac, Fannie Mae or Ginnie Mae (or
its agent), or the Non-Agency Trustee, the Trustee shall not be responsible
for making any such adjustment.
Section 3.06. Statements to Certificateholders.
On each Distribution Date, the Trustee shall prepare, to the
extent it receives information regarding the distributions on the Pooled
Certificates on the Distribution Date, and shall forward by mail, a statement
to each Certificateholder, the Seller and the Rating Agencies stating:
(i) the Class 1A Available Distribution and the Class 2A
Available Distribution for such Distribution Date;
(ii) the interest distribution amount and the principal
distribution amount for such Distribution Date for each Class of
Certificates and, with respect to each, the components thereof as
described in the definitions of such terms and as reported in the
related Pooled Certificate Distribution Date Information or other
information received by the Trustee from Freddie Mac, Fannie Mae,
Ginnie Mae (or its agent) or the Non-Agency Trustee pursuant to
Section 3.05(d) with respect to the Pooled Certificates;
(iii) the Class Principal Balance for each Class of
Certificates before and after applying payments on such
Distribution Date;
(iv) the effective interest rate on each Class of the
Certificates for such Distribution Date;
(v) the outstanding principal and/or notional amount, as
the case may be, immediately prior to and after taking into
account distributions made on such
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Distribution Date of, and the current interest rate on, each of the
Pooled Certificates for such Distribution Date;
(vi) the Original Principal Amount of each Class of the
Certificates and the Original Principal Amount of each Class of
the Certificates as reduced to reflect any exchange of the
Certificates pursuant to Section 4.05 for a pro rata portion of
the Group 1A Pooled Certificates or Group 2A Pooled Certificates,
as the case may be, and, with respect to the Class 2A
Certificates; and
(vii) the amount of the Trustee Fee for such Distribution
Date.
In the case of the information furnished pursuant to clauses (ii)
and (iii) above, the amounts shall also be expressed as a dollar amount per
$1000 of principal face amount. The Trustee's responsibility for reporting
the above information is limited to the availability, timeliness of receipt
of, and accuracy of the Pooled Certificate Distribution Date Information and
any additional written information received by the Trustee pursuant to
Section 3.05(d) with respect to the Pooled Certificates.
In addition, the Trustee promptly will furnish to the Seller, and
upon the written request of a Certificateholder, to such Certificateholder,
copies of any notices, statements, reports or other communications, received
by the Trustee in its capacity as the holder of Pooled Certificates.
On or before March 31st of each calendar year, commencing in
1999, the Trustee shall prepare and deliver by first class mail to the Seller
and to each Person who at any time during the prior calendar year was a
Certificateholder of record a statement containing the information required
to be contained in the regular monthly report to Certificateholders, as set
forth in clauses (ii) and (v) above aggregated for such prior calendar year
or in the case of a Certificateholder, 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 and regulations thereunder as from time to time are
in force.
The Trustee shall be responsible for preparing, at its own
expense, signing and filing, on behalf of the Trust Fund, federal income tax
and information returns with the Internal Revenue Service ("IRS") and
Minnesota income tax returns and the returns of any other state taxing
authority the necessity of filing of which shall have been confirmed to the
Trustee in writing either by the delivery of an Opinion of Counsel to such
effect or by the delivery to the Trustee of a written notification to such
effect by the taxing authority of any such state. The Seller shall provide
the Trustee within 10 days of the Closing Date all information deemed
necessary by the Trustee to fulfill its obligations under this paragraph
including the fair market value as of the Closing Date for all of the Pooled
Certificates. The Trustee shall furnish to each Certificateholder at the
time required by law such information reports or returns as are required by
applicable federal, state or local law with respect to the Trust Fund to
enable
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Certificateholders to prepare their tax returns and will furnish comparable
information to the IRS and other taxing authorities as and when required by law
to do so.
The Trustee shall be responsible for preparing, at its own
expense, signing and filing, on behalf of the Trust Fund, all filings with
the Securities and Exchange Commission required to be made on behalf of the
Trust Fund.
Section 3.07. Access to Certain Documentation and Information.
The Trustee shall provide to the Seller access to all reports,
documents and records maintained by the Trustee in respect of its duties
hereunder, such access being afforded without charge but only upon three
Business Days' written request and during normal business hours at offices
designated by the Trustee.
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates.
(a) The Depository, the Seller and the Trustee have entered
into a letter agreement dated as of June 30, 1998 (the "Depository
Agreement"). Except as provided in Subsection 4.01(b), the Certificates
shall at all times remain registered in the name of the Depository or its
nominee and at all times: (i) registration of such Certificates may not be
transferred by the Trustee except to a successor to the Depository; (ii)
ownership and transfers of registration of such Certificates on the books of
the Depository shall be governed by applicable rules established by the
Depository; (iii) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (iv) the Trustee shall
deal with the Depository as representative of the Security Owners for
purposes of exercising the rights of Certificateholders under this Agreement,
and requests and directions for and votes of such representative shall not be
deemed to be inconsistent if they are made with respect to different Security
Owners; and (v) the Trustee may rely and shall be fully protected in relying
upon information furnished by the Depository with respect to its Depository
Participants.
All transfers by Security Owners of Certificates shall be
made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Security Owners. Each
Depository Participant shall only transfer Certificates of Security Owners it
represents or of brokerage firms for which it acts as agent in accordance
with the Depository's normal procedures.
(b) If (i)(A) the Seller advises the Trustee in writing that
the Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Trustee or the Seller is unable to
locate a qualified successor within 30 days or (ii) the Seller at its option
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advises the Trustee in writing that it elects to terminate the book-entry
system through the Depository, the Trustee shall request that the Depository
notify all Security Owners of the occurrence of any such event and of the
availability of definitive, fully registered Certificates (the "Definitive
Certificates") to Security Owners requesting the same. Upon surrender to the
Trustee of the Certificates by the Depository, accompanied by registration
instructions from the Depository for registration, the Trustee shall issue
the Definitive Certificates. Neither the Seller nor 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.
(c) The Certificates shall be substantially in the forms set
forth in Exhibit A and Exhibit B hereto. The Certificates shall be executed
by manual or facsimile signature on behalf of the Trustee in its capacity as
trustee hereunder by an authorized officer. Certificates bearing the manual
or facsimile signatures of individuals who were at any time the proper
officers of the Trustee shall be entitled to all benefits under this
Agreement, subject to the following sentence, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Certificates or did not hold such offices
at the date of such Certificates. No Certificate shall be entitled to any
benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate a certificate of authentication substantially in
the form provided for herein executed by the Certificate Registrar by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the
date of their authentication.
(d) The Certificates will be registered as a single Class 1A
Certificate and a single Class 2A Certificate held by a nominee of the
Depository, and beneficial interests will be held by investors through the
book-entry facilities of the Depository in minimum denominations of $25,000
and increments of $1 in excess thereof, except that (i) one Class 1A
Certificate may be issued in a different amount so that the sum of the
denominations of all outstanding Class 1A Certificates shall equal the
Original Class 1A Balance and (ii) one Class 2A Certificate may be issued in
a different amount so that the sum of the denominations of all Class 2A
Certificates shall equal the Original Class 2A Balance.
(e) If the Trust is terminated pursuant to Section 7.01(a)(iii),
the book-entry system through the Depository shall be terminated by the Seller
and the Trustee and the Trustee shall request that the Depository notify the
applicable Security Owners of the occurrence of such event and that, following
the Final Distribution Date, the applicable Security Owners as of the Record
Date for the Final Distribution Date will be required to hold their pro rata
portion of the Remaining Pooled Certificate in the book-entry records of the
Federal Reserve Banks, PTC or DTC, as applicable, and that the Trustee will not
release any further distributions in respect of the Remaining Pooled Certificate
to a Security Owner until such Security Owner or the Depository has provided the
Trustee with sufficient information to transfer such Security Owner's pro rata
portion of the Remaining Pooled Certificate in the book-entry records of the
Federal Reserve Banks, PTC or DTC, as applicable, from the Trustee to such
Security Owner.
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Section 4.02. Registration of Transfer and Exchange of
Certificates.
(a) At all times during the term of this Agreement, there shall
be maintained at the office of a registrar (the "Certificate Registrar") a
register (the "Certificate Register") in which, subject to such reasonable
regulations as the Certificate Registrar may prescribe, the Certificate
Registrar shall provide for the registration of Certificates and of transfers
and exchanges of Certificates as herein provided. The Trustee is initially
appointed (and hereby agrees to act in accordance with the terms hereof) as
Certificate Registrar for the purpose of registering Certificates and
transfers and exchanges of Certificates as herein provided. For so long as
the Trustee acts as Certificate Registrar, its Corporate Trust Office shall
constitute the offices of the Certificate Registrar maintained for such
purposes. The Certificate Registrar may appoint, by a written instrument
delivered to the Seller, any other bank or trust company in New York to act
as an additional or co-Certificate Registrar under such conditions as the
Certificate Registrar may prescribe, provided that the predecessor
Certificate Registrar shall not be relieved of any of its duties or
responsibilities hereunder by reason of such appointment. If the Trustee
resigns or is removed in accordance with the terms hereof, the successor
trustee shall immediately succeed to its predecessor's duties as Certificate
Registrar. The Seller and the Trustee shall have the right to inspect the
Certificate Register or to obtain a copy thereof at all reasonable times, and
to rely conclusively upon a certificate of the Certificate Registrar as to
the information set forth in the Certificate Register.
Every Certificateholder agrees with the Certificate Registrar and
the Trustee that neither the Certificate Registrar, nor the Trustee shall be
held accountable by reason of the disclosure of any such information as to
the names and addresses of the Certificateholders hereunder, regardless of
the source from which such information was derived.
(b) Subject to the preceding subsections, upon surrender for
registration of transfer of any Certificate at the offices of the Certificate
Registrar maintained for such purpose, the Trustee shall execute and the
Certificate Registrar shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of the
same Class and of a like aggregate Class Percentage Interest.
(c) At the option of any Holder, its Certificates may be
exchanged for other Certificates of the same Class and of authorized
denominations of a like aggregate Class Percentage Interest, upon surrender
of the Certificates to be exchanged at the offices of the Certificate
Registrar maintained for such purpose. Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute and the Certificate
Registrar shall authenticate and deliver the Certificates which the
Certificateholder making the exchange is entitled to receive.
(d) Every Certificate presented or surrendered for transfer or
exchange shall (if so required by the Trustee) be duly endorsed by, or be
accompanied by a written instrument of transfer in the form satisfactory to
the Trustee duly executed by, the Holder thereof or his attorney duly
authorized in writing.
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(e) No service charge shall be made for any transfer or
exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(f) All Certificates surrendered for transfer and exchange
shall be destroyed by the Certificate Registrar without liability on its part.
(g) No transfer of a Certificate may be made to any Plan
Investor unless an exemption granted by the Department of Labor applies to
the acquisition, holding or transfer of such Certificate. Each purchaser of
a Certificate, by virtue of its purchase of such Certificate, will be deemed
to have represented either that (i) it is not a Plan Investor or (ii) such an
exemption exists which exempts the acquisition, holding or transfer of a
Certificate by such purchaser from the prohibited transaction rules of ERISA
and the related excise tax provisions of the Code.
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the
Certificate Registrar, or the Trustee and the Certificate Registrar receive
evidence to their satisfaction of the destruction, loss or theft of any
Certificate, and (ii) (except in the case of a mutilated Certificate) there
is delivered to the Trustee and the Certificate Registrar such agreement,
security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Trustee or the Certificate
Registrar that such Certificate has been acquired by a bona fide purchaser,
the Trustee shall execute and the Certificate Registrar shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed,
lost or stolen Certificate, a new Certificate of like tenor and Percentage
Interest but bearing a number not contemporaneously outstanding. Upon the
issuance of any new Certificate under this Section, the Trustee may require
the payment by the Certificateholder of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto. Any
duplicate Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
Section 4.04. Persons Deemed Owners.
Prior to due presentment of a Certificate for registration of
transfer, the Seller, the Trustee, the Certificate Registrar and any agent of
the Seller, the Trustee or the Certificate Registrar may treat the Person in
whose name any Certificate is registered as the owner of such Certificate for
the purpose of receiving distributions pursuant to Section 3.05 and for all
other purposes whatsoever, and neither the Seller, the Trustee, the
Certificate Registrar nor any agent of the Seller, the Trustee or the
Certificate Registrar shall be affected by notice to the contrary.
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Section 4.05. Exchange of Certificates.
(a) Beginning on the Distribution Date in July 1999 and on any
Distribution Date thereafter, any Holder or Security Owner holding not less
than 10% of the Original Class 1A Balance or 10% of the Original Class 2A
Balance, in each case, as of the Closing Date shall have the option to
exchange not less than 10% of the outstanding principal amount of the
Certificates for a pro rata portion of each of the Group 1A Pooled
Certificates or the Group 2A Pooled Certificates.
(b) Holders or Security Owners may exercise the option set
forth in Section 4.05(a) by delivering an Option Exercise Notice to the
Trustee, accompanied by the Option Exercise Fee, at least five Business Days
prior to the proposed Exchange Date, which must be a Business Day. An Option
Exercise Notice may not be revoked after delivery to the Trustee. The
Trustee may refuse to accept, or give effect to, any Option Exercise Notice
that is incomplete or defective, in its sole judgment, or not accompanied by
the Option Exercise Fee.
(c) The Trustee shall be entitled to charge a fee (the "Option
Exercise Fee"), as compensation, equal to the greater of (i) $500 and (ii)
0.02% of the outstanding principal amount of the Certificates to be exchanged
for the Group 1A Pooled Certificates or the Group 2A Pooled Certificates, as
the case may be.
(d) On the Exchange Date, the Trustee shall cause the transfer
of such Holder's or Security Owner's pro rata portion of each of the Group 1A
Pooled Certificates or the Group 2A Pooled Certificates, as the case may be,
PTC and/or the Depository, as applicable, from the Trustee to such Holder or
Certificate Owner.
ARTICLE V
THE TRUSTEE
Section 5.01. Duties of Trustee.
(a) 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 are in the form required by this Agreement and the Underlying
Agreements; provided, however, that the Trustee shall not be responsible to
determine, confirm or recalculate the accuracy or content of any such
resolution, certificate or other instrument furnished to it pursuant to this
Agreement. The Trustee shall notify the Certificateholders and the Rating
Agencies of any such documents which do not materially conform to the
requirements of this Agreement in the event that the Trustee, after so
requesting of the party required to deliver the same, does not receive
satisfactorily corrected documents or a satisfactory explanation regarding
any such nonconformities.
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The Trustee shall forward or cause to be forwarded to the
Person entitled to receive the same in a timely fashion the notices, reports
and statements required to be forwarded by the Trustee pursuant to Sections
3.01, 3.03, 3.06 and 7.01.
(b) No provision of this Agreement shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct; provided, however,
that:
(i) 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 by the Seller to the Trustee and which on their face,
do not contradict 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 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 the Majority
Certificateholders in accordance with the terms of this
Agreement, as 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) No provision in this Agreement shall require the
Trustee to expend or risk its own funds or otherwise incur any
personal financial liability in the performance of any of its
duties as Trustee hereunder, or in the exercise of any of its
rights or powers, if the Trustee shall have reasonable grounds
for believing that repayment of funds or adequate indemnity
against such risk or liability is not reasonably assured to it;
provided that this provision shall not be deemed to abrogate the
responsibilities undertaken by the Trustee hereunder to perform
routine administrative duties in accordance with the terms
hereof; and
(v) The Trustee shall not be deemed to have notice of any
fact or circumstance upon the occurrence of which it may be
required to take action hereunder unless a Responsible Officer of
the Trustee has actual knowledge of such event, fact or
circumstance or unless written notice of any such event is
received by the Trustee at its Corporate Trust Office.
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Section 5.02. Certain Matters Affecting the Trustee
Except as otherwise provided in Section 5.01:
(i) The Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, Officers' 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 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 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;
(iv) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order or other paper or document, but the Trustee,
in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be
entitled to the extent reasonable under the circumstances to examine
the books, records and premises of such Person, personally or by agent
or attorney;
(v) 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; and
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and shall not be liable for the default or
misconduct of any such agents or attorneys if selected with reasonable
care.
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Section 5.03. Trustee Not Liable for Certificates or Pooled
Certificates .
The recitals contained herein and in the Certificates (other than
the statements attributed to, and the representations and warranties of, the
Trustee in Article II and the signature of the Trustee on each Certificate)
shall be taken as the statements of the Seller, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations
as to the validity or sufficiency of this Agreement (other than as
specifically set forth in Section 2.03(b)) or of the Certificates (other than
that the Certificates shall be duly and validly executed by it as Trustee and
authenticated by it as Certificate Registrar) or of the Pooled Certificates,
the Underlying Agreements or any related document. Except as otherwise
provided herein, the Trustee shall not be accountable for the use or
application by the Seller of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Seller in respect of the assignment and delivery of the Pooled Certificates.
Section 5.04. Trustee May Own Certificates.
The Trustee in its individual 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 5.05. Trustee's Fees; Indemnification of the Trustee.
(a) The Trustee shall withdraw the Trustee Fee, as
compensation, from the Asset Proceeds Account, as provided in 3.05 hereof.
(b) Subject to the provisions of this paragraph, the Trustee
and any director, officer, employee or agent of the Trustee shall be entitled
to be indemnified and held harmless by the Trust Fund against any loss,
liability or expense (including, without limitation, costs and expenses of
litigation, and of investigation, counsel fees and expenses, damages,
judgments, amounts paid in settlement and out-of-pocket expenses) arising out
of, or incurred in connection with, this Agreement, the Certificates, the
exercise and performance of any of the powers and duties of the Trustee
hereunder; provided that neither the Trustee nor any of the other above
specified Persons shall be entitled to indemnification pursuant to this
Section 5.05(b) for (i) allocable overhead, (ii) expenses or disbursements
incurred or made by or on behalf of the Trustee in the normal course of the
Trustee's performing routine administrative duties in accordance with any of
the provisions hereof, (iii) any expense or liability specifically required
to be borne out of the Trustee's own funds pursuant to the terms hereof, or
(iv) any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of the Trustee's
obligations and duties.
The provisions of this Section 5.05(b) shall survive any
resignation or removal of the Trustee and appointment of a successor
trustee.
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Section 5.06. Eligibility Requirements for Trustee .
The Trustee hereunder shall at all times be a trust company or
banking institution organized and doing business under the laws of the United
States of America or any State thereof, authorized under such laws to
exercise corporate trust powers, having a combined capital, surplus and
undivided profits of at least $50,000,000 (or shall be a member of a bank
holding system, the combined capital and surplus of which is at least
$50,000,000) and subject to supervision or examination by federal or state
authority. If such trust company or banking institution publishes reports of
condition 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, surplus and undivided profits of such trust
company or banking institution shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
The Trustee shall at all times meet the requirements for a trustee under
Section 26(a)(1) of the Investment Company Act and shall in no event be an
Affiliate of the Seller or of any Person involved in the organization or
operation of the Seller. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section
5.07.
Section 5.07. Resignation and Removal of the Trustee.
(a) The Trustee may upon 30 days' notice resign and be
discharged from the trusts hereby created by giving written notice thereof to
the Seller and the Certificateholders. Upon receiving such notice of
resignation, the Seller shall promptly appoint a successor trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to
the resigning Trustee and one copy to the successor trustee. If no 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.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 5.06 and shall fail to resign after
written request therefor by the Seller or the Majority Certificateholders, 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 Seller may remove the
Trustee and appoint a successor trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the Trustee so removed and
one copy to the successor trustee.
(c) Majority Certificateholders 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 duly
authorized, one complete set of which instruments shall be delivered to the
Seller, one complete set to the Trustee so removed and one complete set to
the successor so appointed. A copy of such instrument shall be delivered to
the Certificateholders by
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the Seller. All reasonable out-of-pocket costs and expenses incurred in
connection with such removal and replacement of the Trustee, including without
limitation, reasonable attorneys fees and expenses, shall be borne by the party
requesting such action.
(d) Notwithstanding anything to the contrary contained herein,
(i) any resignation or removal of the Trustee and appointment of a successor
trustee pursuant to any of the provisions of this Section shall become
effective only upon acceptance of appointment by the successor trustee as
provided in Section 5.08 and (ii) no entity may be appointed as a successor
trustee if such appointment would result in a withdrawal or downgrading of
any then current rating assigned to the Certificates by a Rating Agency.
Section 5.08. Successor Trustee.
(a) Any successor trustee appointed as provided in Section 5.07
shall execute, acknowledge and deliver to the Seller, the Certificateholders
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 the appointment of such successor 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, with the like effect as
if originally named as trustee herein. The predecessor trustee shall deliver
to the successor trustee the Pooled Certificates and related documents and
statements held by it hereunder, and the Seller, the Trustee and the
predecessor trustee shall execute and deliver such instruments and do such
other things as may be required for more fully and certainly vesting and
confirming in the successor trustee all such rights, powers, duties and
obligations.
(b) 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 5.06.
(c) Upon acceptance of appointment by a successor trustee as
provided in this Section, the Seller shall mail notice of the succession of
such trustee hereunder to all Certificateholders at their addresses as shown
in the Certificate Register. If the Seller fails to mail such notice within
10 days after acceptance of appointment by the successor trustee, the
successor trustee shall cause such notice to be mailed at the expense of the
Seller.
Section 5.09. Merger or Consolidation of Trustee.
Any trust company or banking institution into which the Trustee
may be merged or converted or with which it may be consolidated or any trust
company or banking institution resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any trust company or
banking institution succeeding to all or substantially all of the corporate
trust business of the Trustee, shall be the successor of the Trustee
hereunder, provided such trust company or banking institution shall be
eligible under the provisions of Section 5.06, without the
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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. The Trustee
shall mail notice of any such merger or consolidation to the Seller and to the
Certificateholders at their address as shown in the Certificate Register.
Section 5.10. 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 Fund or property securing the same may at the
time be located, the Trustee 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 the Trust Fund,
and to vest in such Person or Persons, in such capacity, such title to the
Trust Fund, or any part thereof, and, subject to the other provisions of this
Section 5.10, such powers, duties, obligations, rights and trusts as the
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 5.06 hereunder; provided, that if the
co-trustee or separate trustee does not meet such eligibility standards, the
Trustee shall remain liable for its actions hereunder, and no notice to
Certificateholders of the appointment of co-trustee(s) or separate trustee(s)
shall be required under Section 5.08 hereof.
(b) In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 5.10 all rights, powers, duties and
obligations conferred or imposed upon the Trustee shall be conferred or
imposed upon and exercised or performed jointly by the Trustee and such
separate trustee or co-trustee, except to the extent that under any law of
any jurisdiction in which any particular act or acts are to be performed, 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 the Trust Fund 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 V. 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
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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 Trustee, to the extent permitted by law, without
the appointment of a new or successor trustee.
ARTICLE VI
THE SELLER
Section 6.01. Liability of the Seller.
The Seller shall be liable in accordance herewith only to the
extent of the respective obligations specifically imposed upon and undertaken
by the Seller herein.
Section 6.02. Merger, Consolidation or Conversion of the
Seller.
Subject to the following paragraph, the Seller will keep in full
effect its existence, rights and franchises as a corporation under the laws
of the jurisdiction of its incorporation, and will obtain and preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement and the Certificates and to perform its
duties under this Agreement.
The Seller may be merged or consolidated with or into any Person,
or transfer all or substantially all of its assets to any Person, in which
case any Person resulting from any merger or consolidation to which the
Seller shall be a party, or any Person succeeding to the business of the
Seller, shall be the successor of the Seller hereunder, 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 6.03. Limitation on Liability of the Seller and Others.
Neither the Seller nor any of the directors, officers, employees
or agents of the Seller shall be under any liability to the Trust Fund or the
Certificateholders 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 Seller
or any such other Person against any breach of a representation or warranty
made herein, or against any expense or liability specifically required to be
borne thereby pursuant to the terms hereof, or against any liability which
would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of obligations or duties hereunder, or by
reason of reckless disregard of such obligations and duties. The Seller and
any director, officer, employee or agent of the Seller may rely in good faith
on any document of any kind which, prima facie, is properly executed and
submitted by any Person respecting any matters arising hereunder. Provided
that such action is not related to its representations made in or its duties
under this Agreement, the
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Seller shall not be under any obligation to appear in, prosecute or defend any
action or proceeding unless such action in its opinion does not involve it in
any expense or liability.
ARTICLE VII
TERMINATION
Section 7.01. Termination.
(a) The respective obligations and responsibilities of the
Seller and the Trustee created hereby with respect to the Certificates (other
than the obligation to make certain payments and to send certain notices to
Certificateholders as hereinafter set forth) shall terminate upon the earlier
of (i) the repurchase by or at the direction of the Seller on any
Distribution Date of all Pooled Certificates at the Repurchase Price therefor
as of the date of such repurchase; or (ii) with respect to the Class 1A
Certificates, either (A) the repurchase by or at the direction of the Seller
or its designee on any Distribution Date of all of the Group 1A Pooled
Certificates at the Repurchase Price therefor as of the date of such
repurchase or (B) on the Distribution Date following the first Distribution
Date on which the Group 1A Pooled Certificate principal balance or notional
principal balance of all but one of the Group 1A Pooled Certificates has been
reduced to zero; (iii) with respect to the Class 2A Certificates, either (A)
the repurchase by or at the direction of the Seller or its designee on any
Distribution Date of all of the Group 2A Pooled Certificates at the
Repurchase Price therefor as of the date of such repurchase or (B) on the
Distribution Date following the first Distribution Date on which the Group 2A
Pooled Certificate principal balance or notional principal balance of all but
one of the Group 2A Pooled Certificate has been reduced to zero; (iv) the
payment (or provision for payment) to the Class 1A and Class 2A
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them hereunder on the Final Distribution Date
following receipt of the final distribution made on the Group 1A Pooled
Certificates and the Group 2A Pooled Certificates, respectively; or provided,
however, that in no event shall the trust created hereby continue beyond the
expiration of twenty-one 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's, living on the date hereof. The right of the Seller
or its designee to repurchase all Pooled Certificates pursuant to Section
7.01(a)(i) shall be exercisable only on or after the date on which the
aggregate Pooled Certificate Principal Balance and the amount of funds
payable as principal from the Reserve Fund has declined to 10% or less of the
initial aggregate Pooled Certificate Principal Balance, as such sum is
reduced by the original face amount of any Certificates exchanged for a pro
rata portion of the Pooled Certificates. The right of the Seller or its
designee to repurchase the Group 1A Pooled Certificates and the Group 2A
Pooled Certificates pursuant to Sections 7.01(a) (ii) (A) and 7.01 (a) (iii)
(A) shall be exercisable only if (i) in the case of a repurchase of the Group
1A Pooled Certificates, the aggregate Pooled Certificate Principal Balance of
the Group 1A Pooled Certificates has declined
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to 10% or less of the initial aggregate Group 1A Pooled Certificate Principal
Balance and (ii) in the case of a repurchase of the Group 2A Pooled
Certificates, the aggregate Pooled Certificate Principal Balance of the Group 2A
Pooled Certificates has declined to 10% or less of the initial aggregate Group
2A Pooled Certificate Principal Balance on the Closing Date, in both cases as
reduced by the original face amount of any Class 1A or Class 2A Certificates
exchanged pursuant to Section 4.05 for a pro rata portion of the Group 1A Pooled
Certificates or the Group 2A Pooled Certificates, respectively.
(b) The Trustee shall give a Notice of Final Distribution to
the Certificateholders of the affected Class or Classes, the Seller and the
Rating Agencies as soon as practicable prior to the Distribution Date on
which the Trustee anticipates that the final distribution will be made on the
Certificates, which notice shall:
(i) specify the Distribution Date on which the final
distribution is anticipated to be made to
Certificateholders;
(ii) specify the amount of any such final distribution, if
known; and
(iii) state that the final distribution to Certificateholders
will be made only upon presentment
and surrender of Certificates at the office of the
Trustee therein specified.
If the Trust Fund (or a portion thereof) is not terminated pursuant to
Section 7.01(a) on the anticipated Distribution Date for any reason, the
Trustee shall promptly mail notice thereof to each Certificateholder, the
Seller and to the Rating Agencies.
(c) Upon presentment and surrender of the Certificates by the
Certificateholders on the applicable Final Distribution Date, the Trustee
shall distribute to the Certificateholders of the applicable Class the
amounts otherwise distributable on such Distribution Date pursuant to Section
3.05(a). Any funds not distributed on the Final Distribution Date because of
the failure of any Certificateholders to tender their Certificates shall be
set aside and held in trust for the account of the appropriate non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which Notice of Final Distribution has been given pursuant
to this Section 7.01 shall not have been surrendered for cancellation within
six months after the time specified in such notice, the Trustee shall mail a
second notice to the remaining Certificateholders, at their last addresses
shown in the Certificate Register, to surrender their Certificates for
cancellation in order to receive, from such funds held, the final
distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Trustee shall directly or through an agent, take reasonable steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
If within two years after the second notice any Certificates shall not have
been surrendered for cancellation, the Trustee shall segregate all amounts
distributable to the Holders thereof and shall thereafter hold such amounts
for the benefit of such Holders. No interest shall accrue or be payable to
any Certificateholder on any amount held as a result of such
Certificateholder's failure to surrender its Certificate(s) for final payment
thereof in accordance with this Section 7.01. The costs and expenses of
maintaining such funds and of contacting Certificateholders shall be paid out
of the assets which remain held.
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(d) If the option by the Seller or its designee to repurchase
or cause the repurchase of Pooled Certificates, under Section 7.01(a)(i),
(ii) (A) or (iii) (A) above is exercised, the Seller and/or its designee
shall deposit in the Asset Proceeds Account, by 10:00 a.m., New York City
time, on the applicable Distribution Date, an amount equal to the Repurchase
Price for the Pooled Certificates, to be repurchased. Upon the presentation
and surrender of the Certificates, the Trustee, as paying agent, shall
distribute the Repurchase Price as follows to the extent of such amount:
first, to pay the Trustee Fee to the Trustee and any other
amounts then due and owing to the Trustee pursuant to Section
5.05(b);
second, the amount otherwise distributable to the affected Class
or Classes of Certificateholders on such Distribution Date but
for such repurchase;
third, to the Class 1A and Class 2A Certificateholders, as
applicable, as distributions of interest, the interest portion
included in the Repurchase Price in respect of attributable to
the Group 1A and Group 2A Pooled Certificates to be repurchased;
fourth, to the Class 1A and Class 2A Certificateholders, as
applicable, as distributions of principal, the principal portion
included in the Repurchase Price attributable to the Class 1A
Pooled Certificates and the Class 2A Pooled Certificates to be
repurchased, up to the outstanding Class 1A Balance and the Class
2A Balance, as the case may be; and
fifth, to the Class 1A and Class 2A Certificateholders as
applicable, as additional distributions of interest, the balance,
if any, of such Repurchase Price still remaining attributable to
the Class 1A Pooled Certificates and the Class 2A Pooled
Certificates to be repurchased.
Upon deposit of the required Repurchase Price and delivery to the Trustee of
an Officer's Certificate from the Seller certifying that such deposit of the
Repurchase Price in the Asset Proceeds Account has been made, following such
final Distribution Date, the Trustee shall promptly release to the Seller
and/or its designee, the Pooled Certificates, subject to the Trustee's
obligation to hold any amounts payable to Certificateholders in trust without
interest pending final distributions pursuant to Section 7.01(c).
(e) If the principal balance or notional principal balance of
all but one of the Group 1A or Group 2A Pooled Certificates has been reduced
to zero as provided in Section 7.01(a)(ii)(B) or (iii)(B), the Trustee shall
arrange for the distribution in kind based on their respective Class
Percentage Interests to the Class 1A Certificateholders or the Class 2A
Certificateholders, as applicable, of the remaining Group 1A or Group 2A
Pooled Certificate on
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the Distribution Date following the first Distribution Date on which the
principal balance of all but such remaining Pooled Certificate has been reduced
to zero.
ARTICLE VIII
TAX PROVISIONS
Section 8.01 Trust Administration. For federal income tax purposes,
the Trust Fund formed pursuant to this Agreement will be classified as a grantor
trust under Subpart E, Part 1 of Subchapter J of the Code and not as an
association taxable as a corporation. No REMIC election has been or will be made
with respect to the Trust Fund.
(a) The Seller, the Trustee, and the Certificateholders shall take
any action or cause the Trust Fund to take any action necessary to create and
maintain the status of the Trust Fund as a grantor trust for federal income tax
purposes and shall assist each other as necessary to create or maintain such
status.
(b) The Seller, the Trustee, and the Certificateholders shall not
take any action or cause the Trust Fund to take any action that could endanger
the status of the Trust Fund as a grantor trust for federal income tax purposes,
unless the Trustee and the Seller have received an Opinion of Counsel (at the
expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such status.
(c) The Trustee or its designee may employ counsel, accountants and
professional assistance to aid in the performance of the accounting necessary
for federal and state tax reporting and compliance or the performance of the
above powers and duties. The expense incurred by the Trustee or its designee in
connection with the foregoing shall be reimbursed as part of the administrative
expenses of the Trust Fund described in Section 5.05 hereof.
Section 8.02 Prohibited Activities.
(a) Neither the Trustee nor the Seller shall consent to,
approve or enter into any modification of any term of any of the Pooled
Certificates or any of the Underlying Assets (including, but not limited to,
the interest rate, the principal balance, the amortization schedule, the
remaining term to maturity, or any other term affecting the amount or timing
of payments on the Pooled Certificates or the Underlying Assets unless the
Trustee has received an Opinion of Counsel (as the expense of the party
seeking to modify any of the Pooled Certificates or the Underlying Assets) to
the effect that such modification would not be treated as giving rise to a
new debt instrument for federal income tax purposes.
(b) The Trustee shall not consent to the sale or disposition of
any Underlying Asset unless it has received an Opinion of Counsel that such
sale, disposition or acquisition will
41
<PAGE> 45
not affect adversely the status of the Trust Fund as a grantor trust under the
Code. The Trustee shall not sell or dispose of the Pooled Certificates (except
in a disposition pursuant to (i) the default of any Pooled Certificate, (ii) the
bankruptcy of the Trust Fund, (iii) the termination of the Trust Fund (or
portion thereof) as set forth in Section 7.01 hereof, or (iv) a disposition of a
Pooled Certificate pursuant to Section 2.03(c) or 2.04 hereof), nor acquire any
asset for the Trust Fund unless it has received an Opinion of Counsel that such
sale, disposition or acquisition will not affect adversely the status of the
Trust Fund as a grantor trust under the Code.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. Amendment.
(a) This Agreement may be amended from time to time by the
Seller and the Trustee, without the prior consent of any Certificateholder:
(i) to cure any ambiguity;
(ii) to correct or supplement any provisions herein which
may be inconsistent with any other provisions herein;
(iii) to make any other provisions with respect to matters
or questions arising under this Agreement which shall not be
materially inconsistent with the existing provisions of this
Agreement; and
(iv) to make such modifications as may be permitted or
required hereunder in connection with a repurchase or
substitution of a Pooled Certificate pursuant to Section 2.03(c)
or 2.04 hereof.
provided that such amendment shall not, as evidenced by an Opinion of Counsel
(at the expense of the party seeking such amendment) delivered to the Trustee
(the expense of which shall be paid for by the Seller), adversely affect in
any material respect the interests of any Certificateholder. Counsel shall
be entitled to rely on a letter from each Rating Agency that the modification
will not cause the then-existing rating of the Certificates to be downgraded
as conclusive evidence that the modification does not adversely affect in any
material respect the interests of any Certificateholder.
(b) This Agreement may also be amended from time to time by the
Seller and the Trustee with the prior written consent of the Majority
Certificateholders 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 Certificateholders; provided,
however, that no such amendment shall:
42
<PAGE> 46
(i) reduce in any manner the amount of, or delay the
timing of, payments which are required to be distributed on any
Certificate of any Class without the consent of the Holder of
such Certificate;
(ii) modify the provisions of this Section 9.01 without
the consent of the Holders of all Certificates; or
(iii) be made unless and until the Trustee shall have
received an Opinion of Counsel (at the expense of the party
seeking such amendment but in no event at the expense of the
Trust Fund) to the effect that such amendment shall not adversely
affect the status of the Trust as a grantor trust for federal
income tax purposes.
(c) Promptly after the execution of any such amendment the
Trustee shall furnish written notification of the substance of such amendment
to each Certificateholder. It shall not be necessary for the consent of
Certificateholders under this Section 9.01 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 9.02. 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 9.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust Fund, 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 Trust Fund, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.
(b) No Certificateholder shall have any right to vote (except
as expressly provided for herein) or in any manner otherwise control the
operation and management of the Trust Fund, 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 party by reason of any
action taken by the parties to this Agreement pursuant to any provision
hereof.
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<PAGE> 47
(c) No Certificateholder 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 such
Holder previously shall have given to the Trustee and the Seller a written
notice of default hereunder, and of the continuance thereof, as herein-before
provided, and unless the Majority Certificateholders also 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 30 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. For
the prosecution and enforcement of the rights granted under 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 9.04. Governing Law.
This Agreement and the Certificates shall be construed in
accordance with the laws of the State of New York applicable to agreements
made and to be performed in said state (without reference to the conflicts of
law provisions of such state), and the obligations, rights and remedies of
the parties hereunder and the Certificateholders shall be determined in
accordance with such laws.
Section 9.05. Notices.
All communications provided for or permitted hereunder shall be in
writing and shall be deemed to have been duly given when delivered to: (a) in
the case of the Seller, Fund America Investment Corporation II, Plaza Tower One,
Suite 1200B, 6400 South Fiddler's Green Circle, Englewood, CO 80111, Attention:
Steven B. Chotin, or such other address as may hereafter be furnished to the
Trustee in writing by the Seller; (b) in the case of the Trustee, U.S. Bank
Trust National Association, 180 East 5th Street, St. Paul, Minnesota 55101,
Attention: Structured Finance, or such other address as may hereafter be
furnished to the Seller in writing by the Trustee; (c) in the case of Moody's,
Moody's Investors Service, Inc., 99 Church Street, New York, New York 10007,
Attention: Mortgage Pass-Through Monitoring Group; and (d) in the case of Fitch
IBCA, Inc., One State Street Plaza, 34th Floor, New York, New York 10004.
Section 9.06. 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.
44
<PAGE> 48
Section 9.07. Successors and Assigns.
The provisions of this Agreement shall be binding upon and inure
to the benefit of the respective successors and assigns of the parties
hereto, and all such provisions shall inure to the benefit of the
Certificateholders.
Section 9.08. Article and Section Headings.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
Section 9.09. Notices to Rating Agencies.
The Trustee shall notify each Rating Agency at such time as it is
otherwise required pursuant to this Agreement to give notice of the
occurrence of any of the events described in clauses (a), (b), (d), or (f)
below or provide a copy to each Rating Agency at such time as otherwise
required to be delivered pursuant to this Agreement of each of the statements
described in clauses (c) and (e) below:
(a) a material change or amendment to this Agreement,
(b) the termination or appointment of a successor Trustee,
(c) the monthly distribution statement required to be delivered
to the Certificateholders pursuant to Section 3.06,
(d) the non-conformance of any documents pursuant to Section
5.01(a),
(e) the Notice of Final Distribution required to be delivered
pursuant to Section 7.01(b), and
(f) a change in the location of the Asset Proceeds Account.
The Seller shall notify each Rating Agency of any change in its
identity.
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<PAGE> 49
IN WITNESS WHEREOF, the Seller and the Trustee have caused their
names to be signed hereto by their respective duly authorized officers, all
as of the day and year first above written.
FUND AMERICA INVESTORS
CORPORATION II, as Seller
By:
---------------------------------------
Name:
Title:
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By:
--------------------------------------
Name:
Title:
46
<PAGE> 50
STATE OF ___________ )
ss:
COUNTY OF ___________ )
On the ___ day of June __, 1998 before me, a notary public in
and for said State, personally appeared ________________ known to me to be
the __________________ of Fund America Investors Corporation II, the
corporation that executed the within instrument, and also known to me to be
the person who executed it on behalf of said corporation, and acknowledged to
me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
--------------------------------
Notary Public
[Notarial Seal] Commission Expires:
47
<PAGE> 51
STATE OF _____________________ )
: ss:
COUNTY OF __________________ )
On the _____ day of June, 1998 before me, a notary public in and
for said State, personally appeared _________________ known to me to be a
_________________ of U.S. Bank Trust National Association, trust company that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said trust company, and acknowledged to me that such
trust company executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
-------------------------------
Notary Public
[Notarial Seal] Commission Expires:
48
<PAGE> 52
EXHIBIT A
FORM OF CLASS 1A CERTIFICATE
THIS CLASS 1A CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF, OR AN
INTEREST IN, FUND AMERICA INVESTORS CORPORATION II OR THE TRUSTEE REFERRED TO
BELOW OR ANY OF THEIR RESPECTIVE AFFILIATES AND IS NOT GUARANTEED OR INSURED BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THE CURRENT PRINCIPAL BALANCE OF THIS CLASS 1A CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON. ACCORDINGLY, FOLLOWING THE INITIAL
ISSUANCE OF THE CLASS 1A SECURITIES, THE CURRENT PRINCIPAL AMOUNT OF THIS CLASS
1A CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE
ACQUIRING THIS CLASS 1A CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE
BY INQUIRY OF THE TRUSTEE NAMED HEREIN.
UNLESS THIS CLASS 1A CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CLASS 1A SECURITIES
ISSUED ARE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
PASS-THROUGH CERTIFICATES,
NO. 1A-1 SERIES 1998-B
EVIDENCING A BENEFICIAL INTEREST IN A TRUST
CONSISTING PRIMARILY OF THE POOLED CERTIFICATES (AS DEFINED IN THE AGREEMENT)
FUND AMERICA INVESTORS CORPORATION II
CUSIP NO. _________
<TABLE>
<S> <C> <C>
CLASS :
FIRST DISTRIBUTION DATE : ______, 1998 INITIAL PRINCIPAL AMOUNT
ASSUMED FINAL DISTRIBUTION DATE : ______, 2027 OF THIS CLASS 1A CERTIFICATE
("DENOMINATION") : $__________
</TABLE>
APPROXIMATE ORIGINAL CLASS 1A
PRINCIPAL AMOUNT : $__________
PASS-THROUGH RATE:
THE EFFECTIVE PER ANNUM INTEREST RATE
BORNE BY THE CERTIFICATES DURING THE
INTEREST ACCRUAL PERIOD WITH RESPECT TO A
DISTRIBUTION DATE WILL EQUAL A FRACTION,
EXPRESSED AS A PERCENTAGE TRUNCATED AT
THE FOURTH DECIMAL PLACE, THE NUMERATOR
OF WHICH IS EQUAL TO THE AGGREGATE AMOUNT
IN RESPECT OF INTEREST PAID TO THE CLASS
1A CERTIFICATEHOLDERS FOR THE RELATED
INTEREST ACCRUAL PERIOD MULTIPLIED BY 12,
AND THE DENOMINATOR OF WHICH IS THE
PRINCIPAL AMOUNT OF THE CERTIFICATES
IMMEDIATELY PRIOR TO SUCH DISTRIBUTION
DATE. UNDER CERTAIN CIRCUMSTANCES, THE
PRINCIPAL AMOUNT OF THE CLASS 1A
CERTIFICATES COULD BE PAID IN FULL WHERE
INTEREST WOULD REMAIN PAYABLE, IN WHICH
CASE, THE CALCULATION OF THE EFFECTIVE
PER ANNUM INTEREST RATE BORNE BY THE
CLASS 1A CERTIFICATES WOULD NOT BE
MEANINGFUL.
THIS CERTIFIES THAT ______________________________CEDE & CO.____________________
IS THE REGISTERED OWNER OF THE CLASS PERCENTAGE INTEREST EVIDENCED HEREBY IN THE
BENEFICIAL OWNERSHIP INTEREST OF CERTIFICATES OF THE SAME CLASS AS THIS
CERTIFICATE IN A TRUST (THE "TRUST") CONSISTING PRIMARILY OF A PORTION OF
CERTAIN CLASSES OF SECURITIES DESCRIBED IN THE AGREEMENT (THE "POOLED
CERTIFICATES") SOLD BY FUND AMERICA INVESTORS CORPORATION II ("FAIC"). THE TRUST
WAS CREATED PURSUANT TO THE POOLING AGREEMENT DATED AS OF JUNE __, 1998 (THE
"AGREEMENT"), BETWEEN FAIC, AS SELLER, AND U.S. BANK TRUST NATIONAL
ASSOCIATION,, AS TRUSTEE (THE "TRUSTEE"), A SUMMARY OF CERTAIN OF THE PERTINENT
PROVISIONS OF WHICH IS SET FORTH HEREAFTER. TO THE EXTENT NOT DEFINED HEREIN,
CAPITALIZED TERMS USED HEREIN SHALL HAVE THE MEANING ASCRIBED TO THEM IN THE
AGREEMENT. THIS CERTIFICATE IS ISSUED UNDER AND IS SUBJECT TO THE TERMS,
PROVISIONS AND CONDITIONS OF THE AGREEMENT, TO WHICH AGREEMENT THE HOLDER OF
THIS CLASS 1A CERTIFICATE BY VIRTUE OF ITS ACCEPTANCE HEREOF ASSENTS AND BY
WHICH SUCH HOLDER IS BOUND.
INTEREST ON THIS CLASS 1A CERTIFICATE WILL ACCRUE DURING THE ONE MONTH PERIOD
BEGINNING ON THE FIRST DAY AND ENDING ON THE LAST DAY OF THE MONTH PRECEDING THE
MONTH OF THE DISTRIBUTION DATE (AS HEREINAFTER DEFINED) AT A PER ANNUM RATE
EQUAL TO THE PASS-THROUGH RATE AS SET FORTH ABOVE. DISTRIBUTIONS OF PRINCIPAL
AND INTEREST ON THE CLASS 1A CERTIFICATES WITH RESPECT TO A MONTH WILL BE MADE
ON THE 25TH DAY OF EACH MONTH (EACH, A "DISTRIBUTION DATE") OR, IF SUCH 25TH DAY
IS NOT A BUSINESS DAY, THEN ON THE FIRST BUSINESS DAY AFTER THE 25TH DAY OF EACH
MONTH. A "BUSINESS DAY" MEANS A DAY OTHER THAN A SATURDAY, A SUNDAY OR A DAY ON
WHICH BANKING INSTITUTIONS IN NEW YORK, NEW YORK OR THE CITY IN WHICH THE
CORPORATE TRUST OFFICE OF THE TRUSTEE IS LOCATED ARE AUTHORIZED OR OBLIGATED BY
LAW OR EXECUTIVE ORDER TO BE CLOSED. DISTRIBUTIONS WILL BE MADE ON EACH
DISTRIBUTION DATE TO HOLDERS OF RECORD AS OF THE CLOSE OF BUSINESS ON THE LAST
BUSINESS DAY OF THE CALENDAR MONTH PRECEDING THE MONTH IN WHICH SUCH
DISTRIBUTION DATE OCCURS; PROVIDED THAT FOR THIS PURPOSE THE DISTRIBUTION DATE
IS DEEMED TO OCCUR ON THE 25TH OF EACH MONTH, WITHOUT REGARD TO WHETHER SUCH DAY
IS A BUSINESS DAY. THE ASSUMED FINAL DISTRIBUTION DATE IS THE DISTRIBUTION DATE
SET FORTH ABOVE.
DISTRIBUTIONS ON THIS CLASS 1A CERTIFICATE WILL BE MADE BY THE TRUSTEE BY
CHECK MAILED TO THE ADDRESS OF THE PERSON ENTITLED THERETO AS SUCH NAME AND
ADDRESS SHALL APPEAR ON THE CERTIFICATE REGISTER OR, IF SUCH PERSON SO REQUESTS
BY NOTIFYING THE TRUSTEE IN WRITING AS SPECIFIED IN THE AGREEMENT AND IF SUCH
PERSON HOLDS CLASS 1A CERTIFICATES WITH AN INITIAL AGGREGATE CERTIFICATE BALANCE
OF NOT LESS THAN $1,000,000, BY WIRE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO
THE ACCOUNT SPECIFIED IN WRITING BY SUCH PERSON TO THE TRUSTEE. NOTWITHSTANDING
THE ABOVE, THE FINAL DISTRIBUTION ON THIS CLASS 1A CERTIFICATE WILL BE MADE
AFTER DUE NOTICE BY THE TRUSTEE OF THE PENDENCY OF SUCH DISTRIBUTION AND ONLY
UPON PRESENTATION AND SURRENDER OF THIS CLASS 1A CERTIFICATE AT THE OFFICE OR
AGENCY APPOINTED BY THE TRUSTEE FOR THAT PURPOSE AND DESIGNATED IN SUCH NOTICE.
IN WITNESS WHEREOF, THE TRUSTEE HAS CAUSED THIS CLASS 1A CERTIFICATE TO BE
DULY EXECUTED.
DATED: JUNE __, 1998 U.S. BANK TRUST NATIONAL ASSOCIATION,
not in its individual capacity but solely as Trustee
By:
--------------------------------------------
Name:
Title:
THIS IS ONE OF THE CLASS 1A CERTIFICATES REFERRED TO IN THE WITHIN-MENTIONED
AGREEMENT.
U.S. BANK TRUST NATIONAL ASSOCIATION, AS CERTIFICATE REGISTRAR
By:
---------------------------------------------
Name:
Title:
<PAGE> 53
FUND AMERICA INVESTORS CORPORATION II
PASS-THROUGH CERTIFICATES, SERIES 1998-B
THIS CLASS 1A CERTIFICATE IS ONE OF A DULY AUTHORIZED ISSUE OF
PASS-THROUGH CERTIFICATES DESIGNATED AS SET FORTH ON THE FACE HEREOF (THE
"CERTIFICATES"). THE CERTIFICATES, IN THE AGGREGATE, EVIDENCE THE ENTIRE
BENEFICIAL OWNERSHIP INTEREST IN THE TRUST FORMED PURSUANT TO THE AGREEMENT.
THE CERTIFICATEHOLDER, BY ITS ACCEPTANCE OF THIS CLASS 1A CERTIFICATE,
AGREES THAT IT WILL LOOK SOLELY TO THE TRUST FOR PAYMENT HEREUNDER AND THAT THE
TRUSTEE IS NOT LIABLE TO THE CERTIFICATEHOLDERS FOR ANY AMOUNT PAYABLE UNDER
THIS SECURITY OR THE AGREEMENT OR, EXCEPT AS EXPRESSLY PROVIDED IN THE
AGREEMENT, SUBJECT TO ANY LIABILITY UNDER THE AGREEMENT.
THIS CLASS 1A CERTIFICATE DOES NOT PURPORT TO SUMMARIZE THE AGREEMENT
AND REFERENCE IS MADE TO THE AGREEMENT FOR THE INTERESTS, RIGHTS AND LIMITATIONS
OF RIGHTS, BENEFITS, OBLIGATIONS AND DUTIES EVIDENCED HEREBY, AND THE RIGHTS,
DUTIES AND IMMUNITIES OF THE TRUSTEE.
THE AGREEMENT PERMITS, WITH CERTAIN EXCEPTIONS THEREIN PROVIDED, THE
AMENDMENT THEREOF AND THE MODIFICATION OF THE RIGHTS OF THE CERTIFICATEHOLDERS
UNDER THE AGREEMENT FROM TIME TO TIME BY THE SELLER AND THE TRUSTEE WITH THE
CONSENT OF THE HOLDERS OF CERTIFICATES EVIDENCING MORE THAN 50% OF THE AGGREGATE
PRINCIPAL BALANCE OF THE CERTIFICATES. ANY SUCH CONSENT BY THE HOLDER OF THIS
CLASS 1A 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 LIEU HEREOF WHETHER OR NOT NOTATION OF SUCH CONSENT IS
MADE UPON THIS CERTIFICATE. THE AGREEMENT ALSO PERMITS THE AMENDMENT THEREOF, IN
CERTAIN LIMITED CIRCUMSTANCES, WITHOUT THE CONSENT OF THE HOLDERS OF ANY OF THE
CERTIFICATES.
AS PROVIDED IN THE AGREEMENT AND SUBJECT TO CERTAIN LIMITATIONS THEREIN
SET FORTH, THE TRANSFER OF THIS CLASS 1A CERTIFICATE IS REGISTRABLE WITH THE
TRUSTEE UPON SURRENDER OF THIS CERTIFICATE FOR REGISTRATION OF TRANSFER AT THE
OFFICES OR AGENCIES MAINTAINED BY THE TRUSTEE IN ST. PAUL, MINNESOTA, DULY
ENDORSED BY, OR ACCOMPANIED BY A WRITTEN INSTRUMENT OF TRANSFER IN FORM
SATISFACTORY TO THE TRUSTEE DULY EXECUTED BY THE HOLDER HEREOF OR SUCH HOLDER'S
ATTORNEY DULY AUTHORIZED IN WRITING, AND THEREUPON ONE OR MORE NEW CLASS 1A
CERTIFICATES IN AUTHORIZED DENOMINATIONS REPRESENTING A LIKE AGGREGATE PRINCIPAL
AMOUNT WILL BE ISSUED TO THE DESIGNATED TRANSFEREE.
THE CLASS 1A CERTIFICATES ARE ISSUABLE ONLY AS REGISTERED CLASS 1A
CERTIFICATES WITHOUT COUPONS IN THE CLASS AND DENOMINATIONS SPECIFIED IN THE
AGREEMENT. AS PROVIDED IN THE AGREEMENT AND SUBJECT TO CERTAIN LIMITATIONS
THEREIN SET FORTH, THIS CLASS 1A CERTIFICATE IS EXCHANGEABLE FOR ONE OR MORE NEW
CERTIFICATES OF THE SAME CLASS AND EVIDENCING THE SAME AGGREGATE CLASS
PERCENTAGE INTEREST, AS REQUESTED BY THE HOLDER SURRENDERING THE SAME.
NO SERVICE CHARGE WILL BE MADE TO THE CLASS 1A CERTIFICATEHOLDERS FOR
ANY SUCH REGISTRATION OF TRANSFER, BUT THE TRUSTEE MAY REQUIRE PAYMENT OF A SUM
SUFFICIENT TO COVER ANY TAX OR OTHER GOVERNMENTAL CHARGE PAYABLE IN CONNECTION
THEREWITH. THE CERTIFICATE REGISTRAR AND THE TRUSTEE AND ANY AGENT OF ANY OF
THEM MAY TREAT THE PERSON IN WHOSE NAME THIS CLASS 1A CERTIFICATE IS REGISTERED
AS THE OWNER HEREOF FOR ALL PURPOSES, AND NEITHER THE CERTIFICATE REGISTRAR, THE
TRUSTEE NOR ANY SUCH AGENT SHALL BE AFFECTED BY NOTICE TO THE CONTRARY.
BEGINNING ON THE DISTRIBUTION DATE IN DECEMBER 1998, HOLDERS OF A
MINIMUM OF 10% OF THE OUTSTANDING PRINCIPAL AMOUNT OF THE CLASS 1A CERTIFICATES
WILL BE ENTITLED TO EXCHANGE SUCH CERTIFICATES FOR A PRO RATA PORTION OF EACH OF
THE POOLED CERTIFICATES. HOLDERS OF CLASS 1A CERTIFICATES TO BE EXCHANGED WILL
BE CHARGED AN EXCHANGE FEE BY THE TRUSTEE EQUAL TO THE GREATER OF (i) $500 AND
(II) 0.02% OF THE OUTSTANDING PRINCIPAL AMOUNT OF SUCH CERTIFICATES. HOLDERS
WILL BE REQUIRED TO PROVIDE THE TRUSTEE WITH IRREVOCABLE WRITTEN NOTICE AS
PROVIDED IN THE AGREEMENT, ACCOMPANIED BY THE EXCHANGE FEE, OF ANY PROPOSED
EXCHANGE OF CLASS 1A CERTIFICATES AT LEAST FIVE BUSINESS DAYS PRIOR TO THE
PROPOSED DATE OF SUCH EXCHANGE, WHICH MUST BE A BUSINESS DAY.
THE OBLIGATIONS CREATED BY THE AGREEMENT AND THE TRUST CREATED THEREBY
(OTHER THAN THE OBLIGATIONS TO MAKE CERTAIN PAYMENTS AND SEND CERTAIN NOTICES TO
CERTIFICATEHOLDERS WITH RESPECT TO THE TERMINATION OF THE AGREEMENT) SHALL
TERMINATE UPON THE EARLIER OF (i) THE REPURCHASE BY OR AT THE DIRECTION OF THE
SELLER OF ALL POOLED CERTIFICATES, IF ANY, UNDER THE CIRCUMSTANCES SET FORTH IN
THE AGREEMENT; (II) THE PAYMENT (OR PROVISION FOR PAYMENT) TO THE
CERTIFICATEHOLDERS OF ALL AMOUNTS HELD BY OR ON BEHALF OF THE TRUSTEE AND
REQUIRED TO BE PAID TO THEM UNDER THE AGREEMENT ON THE FINAL DISTRIBUTION DATE
FOLLOWING RECEIPT OF THE FINAL DISTRIBUTION TO BE MADE ON THE POOLED
CERTIFICATES; OR (III) THE DISTRIBUTION DATE FOLLOWING THE FIRST DISTRIBUTION
DATE ON WHICH ONLY ONE OF THE POOLED CERTIFICATES REMAINS ENTITLED TO PAYMENTS
OF PRINCIPAL AND/OR INTEREST. IN NO EVENT, HOWEVER, WILL THE TRUST CREATED BY
THE AGREEMENT CONTINUE BEYOND THE EXPIRATION OF 21 YEARS AFTER THE DEATH OF
CERTAIN PERSONS IDENTIFIED IN THE AGREEMENT
<TABLE>
<S> <C>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto_____________________________________________
____________________________________________________________________________________________________________________________________
(Please print or typewriter name and address including postal zip code assignee)
the within Class 1A Certificate and hereby authorizes the transfer of registration of such interest to the assignee on the
Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Class 1A
Certificate of a like denomination and Class, to the above named assignee and deliver such Class 1A Certificate to the following
address:
Dated: -------------------------------------
SIGNATURE BY OR ON BEHALF OF ASSIGNOR
-------------------------------------
SIGNATURE GUARANTEED
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:________________________________________________________
Distributions shall be made, by wire transfer or otherwise, in immediately available funds to ______________________________________
____________________________________________________________________________________________________________________________________
account number __________________________, or, if mailed by check to _______________________________________________________________
Applicable statements should be mailed to __________________________________________________________________________________________
This information is provided by ____________________________________________________________________________________________________
the assignee named above, or ____________________________________________________________________________ as its agent.
</TABLE>
<PAGE> 54
EXHIBIT B
FORM OF CLASS 2A CERTIFICATE
THIS CLASS 2A CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF, OR AN
INTEREST IN, FUND AMERICA INVESTORS CORPORATION II OR THE TRUSTEE REFERRED TO
BELOW OR ANY OF THEIR RESPECTIVE AFFILIATES AND IS NOT GUARANTEED OR INSURED BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THE CURRENT PRINCIPAL BALANCE OF THIS CLASS 2A CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON. ACCORDINGLY, FOLLOWING THE INITIAL
ISSUANCE OF THE CLASS 2A SECURITIES, THE CURRENT PRINCIPAL AMOUNT OF THIS CLASS
2A CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE
ACQUIRING THIS CLASS 2A CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE
BY INQUIRY OF THE TRUSTEE NAMED HEREIN.
UNLESS THIS CLASS 2A CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CLASS 2A SECURITIES
ISSUED ARE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
PASS-THROUGH CERTIFICATES,
NO. 2A-1 SERIES 1998-B
EVIDENCING A BENEFICIAL INTEREST IN A TRUST
CONSISTING PRIMARILY OF THE POOLED CERTIFICATES (AS DEFINED IN THE AGREEMENT)
FUND AMERICA INVESTORS CORPORATION II
CUSIP NO. 36076RCH4
<TABLE>
<S> <C> <C> <C>
CLASS : 2A
FIRST DISTRIBUTION DATE : ______, 1998 INITIAL PRINCIPAL AMOUNT
ASSUMED FINAL DISTRIBUTION DATE : ______, 2027 OF THIS CLASS 2A CERTIFICATE
("DENOMINATION") : $__________
APPROXIMATE ORIGINAL CLASS 2A
PRINCIPAL AMOUNT : $__________
PASS-THROUGH RATE:
THE EFFECTIVE PER ANNUM INTEREST RATE
BORNE BY THE CERTIFICATES DURING THE
INTEREST ACCRUAL PERIOD WITH RESPECT
TO A DISTRIBUTION DATE WILL EQUAL A
FRACTION, EXPRESSED AS A PERCENTAGE
TRUNCATED AT THE FOURTH DECIMAL PLACE,
THE NUMERATOR OF WHICH IS EQUAL TO THE
AGGREGATE AMOUNT IN RESPECT OF
INTEREST PAID TO THE CLASS 2A
CERTIFICATEHOLDERS FOR THE RELATED
INTEREST ACCRUAL PERIOD MULTIPLIED BY
12, AND THE DENOMINATOR OF WHICH IS
THE PRINCIPAL AMOUNT OF THE
CERTIFICATES IMMEDIATELY PRIOR TO SUCH
DISTRIBUTION DATE. UNDER CERTAIN
CIRCUMSTANCES, THE PRINCIPAL AMOUNT OF
THE CLASS 2A CERTIFICATES COULD BE
PAID IN FULL WHERE INTEREST WOULD
REMAIN PAYABLE, IN WHICH CASE, THE
CALCULATION OF THE EFFECTIVE PER ANNUM
INTEREST RATE BORNE BY THE CLASS 2A
CERTIFICATES WOULD NOT BE MEANINGFUL.
</TABLE>
THIS CERTIFIES THAT____________________________________CEDE & CO._______________
IS THE REGISTERED OWNER OF THE CLASS PERCENTAGE INTEREST EVIDENCED HEREBY IN THE
BENEFICIAL OWNERSHIP INTEREST OF CERTIFICATES OF THE SAME CLASS AS THIS
CERTIFICATE IN A TRUST (THE "TRUST") CONSISTING PRIMARILY OF A PORTION OF
CERTAIN CLASSES OF SECURITIES DESCRIBED IN THE AGREEMENT (THE "POOLED
CERTIFICATES") SOLD BY FUND AMERICA INVESTORS CORPORATION II ("FAIC"). THE TRUST
WAS CREATED PURSUANT TO THE POOLING AGREEMENT DATED AS OF JUNE __, 1998 (THE
"AGREEMENT"), BETWEEN FAIC, AS SELLER, AND U.S. BANK TRUST NATIONAL ASSOCIATION,
AS TRUSTEE (THE "TRUSTEE"), A SUMMARY OF CERTAIN OF THE PERTINENT PROVISIONS OF
WHICH IS SET FORTH HEREAFTER. TO THE EXTENT NOT DEFINED HEREIN, CAPITALIZED
TERMS USED HEREIN SHALL HAVE THE MEANING ASCRIBED TO THEM IN THE AGREEMENT. THIS
CERTIFICATE IS ISSUED UNDER AND IS SUBJECT TO THE TERMS, PROVISIONS AND
CONDITIONS OF THE AGREEMENT, TO WHICH AGREEMENT THE HOLDER OF THIS CLASS 2A
CERTIFICATE BY VIRTUE OF ITS ACCEPTANCE HEREOF ASSENTS AND BY WHICH SUCH HOLDER
IS BOUND.
INTEREST ON THIS CLASS 2A CERTIFICATE WILL ACCRUE DURING THE ONE MONTH PERIOD
BEGINNING ON THE FIRST DAY AND ENDING ON THE LAST DAY OF THE MONTH PRECEDING THE
MONTH OF THE DISTRIBUTION DATE (AS HEREINAFTER DEFINED) AT A PER ANNUM RATE
EQUAL TO THE PASS-THROUGH RATE AS SET FORTH ABOVE. DISTRIBUTIONS OF PRINCIPAL
AND INTEREST ON THE CLASS 2A CERTIFICATES WITH RESPECT TO A MONTH WILL BE MADE
ON THE 25TH DAY OF EACH MONTH (EACH, A "DISTRIBUTION DATE") OR, IF SUCH 25TH DAY
IS NOT A BUSINESS DAY, THEN ON THE FIRST BUSINESS DAY AFTER THE 25TH DAY OF EACH
MONTH. A "BUSINESS DAY" MEANS A DAY OTHER THAN A SATURDAY, A SUNDAY OR A DAY ON
WHICH BANKING INSTITUTIONS IN NEW YORK, NEW YORK OR THE CITY IN WHICH THE
CORPORATE TRUST OFFICE OF THE TRUSTEE IS LOCATED ARE AUTHORIZED OR OBLIGATED BY
LAW OR EXECUTIVE ORDER TO BE CLOSED. DISTRIBUTIONS WILL BE MADE ON EACH
DISTRIBUTION DATE TO HOLDERS OF RECORD AS OF THE CLOSE OF BUSINESS ON THE LAST
BUSINESS DAY OF THE CALENDAR MONTH PRECEDING THE MONTH IN WHICH SUCH
DISTRIBUTION DATE OCCURS; PROVIDED THAT FOR THIS PURPOSE THE DISTRIBUTION DATE
IS DEEMED TO OCCUR ON THE 25TH OF EACH MONTH, WITHOUT REGARD TO WHETHER SUCH DAY
IS A BUSINESS DAY. THE ASSUMED FINAL DISTRIBUTION DATE IS THE DISTRIBUTION DATE
SET FORTH ABOVE.
DISTRIBUTIONS ON THIS CLASS 2A CERTIFICATE WILL BE MADE BY THE TRUSTEE BY
CHECK MAILED TO THE ADDRESS OF THE PERSON ENTITLED THERETO AS SUCH NAME AND
ADDRESS SHALL APPEAR ON THE CERTIFICATE REGISTER OR, IF SUCH PERSON SO REQUESTS
BY NOTIFYING THE TRUSTEE IN WRITING AS SPECIFIED IN THE AGREEMENT AND IF SUCH
PERSON HOLDS CLASS 2A CERTIFICATES WITH AN INITIAL AGGREGATE CERTIFICATE BALANCE
OF NOT LESS THAN $1,000,000, BY WIRE TRANSFER IN IMMEDIATELY AVAILABLE FUNDS TO
THE ACCOUNT SPECIFIED IN WRITING BY SUCH PERSON TO THE TRUSTEE. NOTWITHSTANDING
THE ABOVE, THE FINAL DISTRIBUTION ON THIS CLASS 2A CERTIFICATE WILL BE MADE
AFTER DUE NOTICE BY THE TRUSTEE OF THE PENDENCY OF SUCH DISTRIBUTION AND ONLY
UPON PRESENTATION AND SURRENDER OF THIS CLASS 2A CERTIFICATE AT THE OFFICE OR
AGENCY APPOINTED BY THE TRUSTEE FOR THAT PURPOSE AND DESIGNATED IN SUCH NOTICE.
IN WITNESS WHEREOF, THE TRUSTEE HAS CAUSED THIS CLASS 2A CERTIFICATE TO BE
DULY EXECUTED.
DATED: JUNE __, 1998 U.S. BANK TRUST NATIONAL ASSOCIATION,
not in its individual capacity but solely as Trustee
By:
-------------------------------------------------
Name:
Title:
THIS IS ONE OF THE CLASS 2A CERTIFICATES REFERRED TO IN THE WITHIN-MENTIONED
AGREEMENT.
U.S. BANK TRUST NATIONAL ASSOCIATION, AS CERTIFICATE REGISTRAR
By:
--------------------------------------------
Name:
Title:
<PAGE> 55
FUND AMERICA INVESTORS CORPORATION II
PASS-THROUGH CERTIFICATES, SERIES 1998-B
THIS CLASS 2A CERTIFICATE IS ONE OF A DULY AUTHORIZED ISSUE OF
PASS-THROUGH CERTIFICATES DESIGNATED AS SET FORTH ON THE FACE HEREOF (THE
"CERTIFICATES"). THE CERTIFICATES, IN THE AGGREGATE, EVIDENCE THE ENTIRE
BENEFICIAL OWNERSHIP INTEREST IN THE TRUST FORMED PURSUANT TO THE AGREEMENT.
THE CERTIFICATEHOLDER, BY ITS ACCEPTANCE OF THIS CLASS 2A CERTIFICATE,
AGREES THAT IT WILL LOOK SOLELY TO THE TRUST FOR PAYMENT HEREUNDER AND THAT THE
TRUSTEE IS NOT LIABLE TO THE CERTIFICATEHOLDERS FOR ANY AMOUNT PAYABLE UNDER
THIS SECURITY OR THE AGREEMENT OR, EXCEPT AS EXPRESSLY PROVIDED IN THE
AGREEMENT, SUBJECT TO ANY LIABILITY UNDER THE AGREEMENT.
THIS CLASS 2A CERTIFICATE DOES NOT PURPORT TO SUMMARIZE THE AGREEMENT
AND REFERENCE IS MADE TO THE AGREEMENT FOR THE INTERESTS, RIGHTS AND LIMITATIONS
OF RIGHTS, BENEFITS, OBLIGATIONS AND DUTIES EVIDENCED HEREBY, AND THE RIGHTS,
DUTIES AND IMMUNITIES OF THE TRUSTEE.
THE AGREEMENT PERMITS, WITH CERTAIN EXCEPTIONS THEREIN PROVIDED, THE
AMENDMENT THEREOF AND THE MODIFICATION OF THE RIGHTS OF THE CERTIFICATEHOLDERS
UNDER THE AGREEMENT FROM TIME TO TIME BY THE SELLER AND THE TRUSTEE WITH THE
CONSENT OF THE HOLDERS OF CERTIFICATES EVIDENCING MORE THAN 50% OF THE AGGREGATE
PRINCIPAL BALANCE OF THE CERTIFICATES. ANY SUCH CONSENT BY THE HOLDER OF THIS
CLASS 2A 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 LIEU HEREOF WHETHER OR NOT NOTATION OF SUCH CONSENT IS
MADE UPON THIS CERTIFICATE. THE AGREEMENT ALSO PERMITS THE AMENDMENT THEREOF, IN
CERTAIN LIMITED CIRCUMSTANCES, WITHOUT THE CONSENT OF THE HOLDERS OF ANY OF THE
CERTIFICATES.
AS PROVIDED IN THE AGREEMENT AND SUBJECT TO CERTAIN LIMITATIONS THEREIN
SET FORTH, THE TRANSFER OF THIS CLASS 2A CERTIFICATE IS REGISTRABLE WITH THE
TRUSTEE UPON SURRENDER OF THIS CERTIFICATE FOR REGISTRATION OF TRANSFER AT THE
OFFICES OR AGENCIES MAINTAINED BY THE TRUSTEE IN ST. PAUL, MINNESOTA, DULY
ENDORSED BY, OR ACCOMPANIED BY A WRITTEN INSTRUMENT OF TRANSFER IN FORM
SATISFACTORY TO THE TRUSTEE DULY EXECUTED BY THE HOLDER HEREOF OR SUCH HOLDER'S
ATTORNEY DULY AUTHORIZED IN WRITING, AND THEREUPON ONE OR MORE NEW CLASS 2A
CERTIFICATES IN AUTHORIZED DENOMINATIONS REPRESENTING A LIKE AGGREGATE PRINCIPAL
AMOUNT WILL BE ISSUED TO THE DESIGNATED TRANSFEREE.
THE CLASS 2A CERTIFICATES ARE ISSUABLE ONLY AS REGISTERED CLASS 2A
CERTIFICATES WITHOUT COUPONS IN THE CLASS AND DENOMINATIONS SPECIFIED IN THE
AGREEMENT. AS PROVIDED IN THE AGREEMENT AND SUBJECT TO CERTAIN LIMITATIONS
THEREIN SET FORTH, THIS CLASS 2A CERTIFICATE IS EXCHANGEABLE FOR ONE OR MORE NEW
CERTIFICATES OF THE SAME CLASS AND EVIDENCING THE SAME AGGREGATE CLASS
PERCENTAGE INTEREST, AS REQUESTED BY THE HOLDER SURRENDERING THE SAME.
NO SERVICE CHARGE WILL BE MADE TO THE CLASS 2A CERTIFICATEHOLDERS FOR
ANY SUCH REGISTRATION OF TRANSFER, BUT THE TRUSTEE MAY REQUIRE PAYMENT OF A SUM
SUFFICIENT TO COVER ANY TAX OR OTHER GOVERNMENTAL CHARGE PAYABLE IN CONNECTION
THEREWITH. THE CERTIFICATE REGISTRAR AND THE TRUSTEE AND ANY AGENT OF ANY OF
THEM MAY TREAT THE PERSON IN WHOSE NAME THIS CLASS 2A CERTIFICATE IS REGISTERED
AS THE OWNER HEREOF FOR ALL PURPOSES, AND NEITHER THE CERTIFICATE REGISTRAR, THE
TRUSTEE NOR ANY SUCH AGENT SHALL BE AFFECTED BY NOTICE TO THE CONTRARY.
BEGINNING ON THE DISTRIBUTION DATE IN DECEMBER 1998, HOLDERS OF A
MINIMUM OF 10% OF THE OUTSTANDING PRINCIPAL AMOUNT OF THE CLASS 2A CERTIFICATES
WILL BE ENTITLED TO EXCHANGE SUCH CERTIFICATES FOR A PRO RATA PORTION OF EACH OF
THE POOLED CERTIFICATES. HOLDERS OF CLASS 2A CERTIFICATES TO BE EXCHANGED WILL
BE CHARGED AN EXCHANGE FEE BY THE TRUSTEE EQUAL TO THE GREATER OF (i) $500 AND
(II) 0.02% OF THE OUTSTANDING PRINCIPAL AMOUNT OF SUCH CERTIFICATES. HOLDERS
WILL BE REQUIRED TO PROVIDE THE TRUSTEE WITH IRREVOCABLE WRITTEN NOTICE AS
PROVIDED IN THE AGREEMENT, ACCOMPANIED BY THE EXCHANGE FEE, OF ANY PROPOSED
EXCHANGE OF CLASS 2A CERTIFICATES AT LEAST FIVE BUSINESS DAYS PRIOR TO THE
PROPOSED DATE OF SUCH EXCHANGE, WHICH MUST BE A BUSINESS DAY.
THE OBLIGATIONS CREATED BY THE AGREEMENT AND THE TRUST CREATED THEREBY
(OTHER THAN THE OBLIGATIONS TO MAKE CERTAIN PAYMENTS AND SEND CERTAIN NOTICES TO
CERTIFICATEHOLDERS WITH RESPECT TO THE TERMINATION OF THE AGREEMENT) SHALL
TERMINATE UPON THE EARLIER OF (i) THE REPURCHASE BY OR AT THE DIRECTION OF THE
SELLER OF ALL POOLED CERTIFICATES, IF ANY, UNDER THE CIRCUMSTANCES SET FORTH IN
THE AGREEMENT; (II) THE PAYMENT (OR PROVISION FOR PAYMENT) TO THE
CERTIFICATEHOLDERS OF ALL AMOUNTS HELD BY OR ON BEHALF OF THE TRUSTEE AND
REQUIRED TO BE PAID TO THEM UNDER THE AGREEMENT ON THE FINAL DISTRIBUTION DATE
FOLLOWING RECEIPT OF THE FINAL DISTRIBUTION TO BE MADE ON THE POOLED
CERTIFICATES; OR (III) THE DISTRIBUTION DATE FOLLOWING THE FIRST DISTRIBUTION
DATE ON WHICH ONLY ONE OF THE POOLED CERTIFICATES REMAINS ENTITLED TO PAYMENTS
OF PRINCIPAL AND/OR INTEREST. IN NO EVENT, HOWEVER, WILL THE TRUST CREATED BY
THE AGREEMENT CONTINUE BEYOND THE EXPIRATION OF 21 YEARS AFTER THE DEATH OF
CERTAIN PERSONS IDENTIFIED IN THE AGREEMENT
<TABLE>
<S> <C>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto _______________________________________
____________________________________________________________________________________________________________________________________
(Please print or typewriter name and address including postal zip code assignee)
the within Class 2A Certificate and hereby authorizes the transfer of registration of such interest to the assignee on the
Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new Class 2A Certificate of a like denomination and Class, to the
above named assignee and deliver such Class 2A Certificate to the following address:
Dated:
-------------------------------------
SIGNATURE BY OR ON BEHALF OF ASSIGNOR
-------------------------------------
SIGNATURE GUARANTEED
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution: ____________________________________________________
Distributions shall be made, by wire transfer or otherwise, in immediately available funds to ______________________________________
____________________________________________________________________________________________________________________________________
account number __________________________, or, if mailed by check to _______________________________________________________________
____________________________________________________________________________________________________________________________________
Applicable statements should be mailed to __________________________________________________________________________________________
This information is provided by ____________________________________________________________________________________________________
the assignee named above, or ____________________________________________________________________________ as its agent.
</TABLE>
<PAGE> 56
EXHIBIT C
FORM OF OPTION EXERCISE NOTICE
Date:
U.S. Bank Trust National Association
180 East 5th Street
St. Paul, Minnesota 55101
Re: Fund America Investors Corporation II
Pass-Through Certificates
Series 1998-B
CUSIP No.:
Ladies and Gentlemen:
Reference is made to the Pooling Agreement dated as of June __, 1998
between Fund America Investors Corporation II, as Seller, and U.S. Bank Trust
National Association, as Trustee (the "Agreement"). Terms defined in the
Agreement shall have the same meaning when used herein, except as otherwise
provided.
The undersigned desires to exchange Certificates for Pooled Certificates
as provided in Section 4.05 of the Agreement. Set forth below is information
pertinent to the exchange:
Class of Certificates to be Exchanged:
Principal Amount of Certificates Held
by the Undersigned: $
Principal Amount of Certificates to be
Exchanged: $
Participant Number in The Depository
Trust Company:
Federal Reserve Bank Delivery
Instructions:
Participant Number in Participants
Trust Company
Proposed Exchange Date:
[Accompanying this letter is a certified check in the amount of the Option
Exercise Fee.]
<PAGE> 57
[The Option Exercise Fee will be paid by wire transfer of immediately
available funds to the amount of the Trustee at not later than the close of
business on the date hereof.]
A copy of this letter will be delivered to The Depository Trust Company
not later than the close of business on the date hereof.
The undersigned understands that this Option Exercise Notice is
irrevocable.
Very truly yours,
[Name]
By:
-----------------------------------
Title:
--------------------------------
Signature Guaranteed:
2
<PAGE> 58
SCHEDULE A
POOLED CERTIFICATES
<TABLE>
<CAPTION>
Current Principal or
Full Name of Series % of Class Notional Balance
- --------------------------------------------- ---------- --------------------
<S> <C> <C>
POOLED FREDDIE MAC CERTIFICATES
Multiclass Mortgage Securities, Series G063, 13.00% $10,384,920
Class A
Multiclass Mortgage Securities, Series 2008, 100.00% $3,788,841
Class SE
POOLED FANNIE MAE CERTIFICATES
Guaranteed REMIC Pass-Through Certificates, 100.00% $6,090,962
Fannie Mae REMIC Trust 98-23, Class SG
Guaranteed REMIC Pass-Through Certificates, 100.00% $1,823,068
Fannie Mae REMIC Trust 1997-78, Class SK
Guaranteed REMIC Pass-Through Certificates, 100.00% $5,000,000
Fannie Mae REMIC Trust 1998-42, Class Z
POOLED GINNIE MAE CERTIFICATES
Guaranteed REMIC Pass-Through Securities, 100.00% $6,400,000
Ginnie Mae REMIC Trust 98-14, Class Z
POOLED NON-AGENCY CERTIFICATES
Bear Stearns Mortgage Securities, Inc. 72.56% $33,691,197
Pass-Through Certificates, Series 1997-3
</TABLE>
<PAGE> 59
SCHEDULE B
UNDERLYING BSMSI CERTIFICATES
<TABLE>
<CAPTION>
Current Principal
Class % or Notional
Full Name of Series In Trust Principal Balance
- ------------------------------------------------- -------- -----------------
<S> <C> <C>
POOLED FNMA CERTIFICATES
Guaranteed REMIC Pass-Through Certificates, 35.29412% $8,506,983
Fannie Mae REMIC Trust 1992-45, Class 45-Z
Stripped Mortgage Backed Securities 0.30380% $3,519,142
Trust Number 000252-CL, Class 2
Guaranteed REMIC Pass-Through Certificates, 48.89887% $32,709,683
Fannie Mae REMIC Trust, 1993-246, Class
F
POOLED FHLMC CERTIFICATES
Multiclass Mortgage Securities, Series 42.45283% $415,320
6003, Class SA
Multiclass Mortgage Participation Certificates, 23.60248% $2,280,000
Series 1505, Class QB
Multiclass Mortgage Participation Certificates 36.37387% $2,104,653
Series 1603, Class SB
Multiclass Mortgage Participation Certificates, 20.53333% $413,101
Series 1723, Class SB
Multiclass Mortgage Participation Certificates, 47.05265% $6,229,576
Series 1869, Class TG
Multiclass Mortgage Participation Certificates, 100.00000% $30,841,493
Series 1933, Class SA
Modifiable and Combinable REMIC 10.44466% $15,023,653
Certificates,
Series 1933, Class SG
</TABLE>
2
