on which the
Seller becomes aware of, or receives written notice of such breach or failure,
and such breach or failure materially and adversely affects the interest of the
Trust in a Contract, the Seller shall purchase such Contract from the Depositor
for such contract's Purchase Price on the Business Day preceding the Payment
Date immediately following such Collection Period.
The sole remedy of the
Depositor with respect to a breach or failure to be true of the representations
and warranties made by the Seller pursuant to Section 2.2 shall be to require
the Seller to repurchase Contracts pursuant to this Section 2.3.
ARTICLE III
THE SELLER
SECTION 3.1.
REPRESENTATIONS AND WARRANTIES OF THE SELLER.
The Seller makes the following representations and warranties on which the
Depositor shall be deemed to have relied in accepting the Contributed Property.
The representations and warranties speak as of the execution and delivery of
this Agreement and as of each Additional Contract Purchase Date and shall
survive the conveyance, transfer and absolute contribution of the Contributed
Property to the Depositor pursuant to this Agreement, the sale of the Trust
Property pursuant to the Sale and Allocation Agreement and the pledge of the
Trust Property to the Indenture Trustee pursuant to the Indenture:
(A)
ORGANIZATION AND GOOD STANDING.
THE SELLER HAS BEEN DULY
ORGANIZED AND IS VALIDLY EXISTING AS A CORPORATION IN GOOD STANDING UNDER THE
LAWS OF THE STATE OF TEXAS, HAS THE POWER, AUTHORITY AND LEGAL RIGHT TO OWN ITS
PROPERTIES AND TO CONDUCT ITS BUSINESS AS SUCH PROPERTIES ARE CURRENTLY OWNED
AND SUCH BUSINESS IS CURRENTLY CONDUCTED, AND HAS THE POWER, AUTHORITY AND LEGAL
RIGHT TO ACQUIRE, OWN AND SELL THE CONTRACTS.
9
(B)
DUE QUALIFICATION.
THE SELLER IS DULY QUALIFIED TO DO BUSINESS AS
A FOREIGN CORPORATION IN GOOD STANDING AND HAS OBTAINED ALL NECESSARY LICENSES
AND APPROVALS IN EACH JURISDICTION IN WHICH THE FAILURE TO SO QUALIFY OR TO
OBTAIN SUCH LICENSES AND APPROVALS WOULD, IN THE REASONABLE JUDGMENT OF THE
SELLER, MATERIALLY AND ADVERSELY AFFECT THE PERFORMANCE BY THE SELLER OF ITS
OBLIGATIONS UNDER, OR THE VALIDITY OR ENFORCEABILITY OF, THIS AGREEMENT, ANY OF
THE OTHER TRANSACTION DOCUMENTS, THE CONTRACTS OR THE NOTES.
(C)
POWER AND AUTHORITY.
THE SELLER HAS THE POWER AND AUTHORITY TO
EXECUTE, DELIVER AND PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER
TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY.
THE SELLER HAS THE POWER AND
AUTHORITY TO SELL, ASSIGN, TRANSFER AND CONVEY THE PROPERTY TO BE CONTRIBUTED TO
AND DEPOSITED WITH THE DEPOSITOR AND HAS DULY AUTHORIZED SUCH TRANSFER AND
DEPOSIT BY ALL NECESSARY CORPORATE ACTION, AND THE EXECUTION, DELIVERY AND
PERFORMANCE OF THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS TO WHICH THE
SELLER IS A PARTY HAVE BEEN DULY AUTHORIZED BY THE SELLER BY ALL NECESSARY
CORPORATE ACTION.
(D)
VALID TRANSFER; BINDING OBLIGATION.
THIS AGREEMENT EFFECTS A
VALID CONVEYANCE, TRANSFER AND ABSOLUTE CONTRIBUTION TO THE DEPOSITOR OF THE
CONTRACTS AND THE OTHER CONTRIBUTED PROPERTY ENFORCEABLE AGAINST CREDITORS OF
AND PURCHASERS FROM