BEAR STEARNS ASSET BACKED SECURITIES I LLC Depositor, EMC MORTGAGE CORPORATION Seller and Master Servicer and LASALLE BANK NATIONAL ASSOCIATION Trustee POOLING AND SERVICING AGREEMENT Dated as of January 1, 2007 BEAR STEARNS ASSET BACKED SECURITIES I...
BEAR
XXXXXXX ASSET BACKED SECURITIES I LLC
Depositor,
EMC
MORTGAGE CORPORATION
Seller
and Master Servicer
and
LASALLE
BANK NATIONAL ASSOCIATION
Trustee
____________________
Dated
as
of January 1, 2007
________________________________________
BEAR
XXXXXXX ASSET BACKED SECURITIES I TRUST 2007-AQ1
ASSET-BACKED
CERTIFICATES, SERIES 2007-AQ1
TABLE
OF
CONTENTS
ARTICLE
I
DEFINITIONS
|
Section
1.01
|
Defined
Terms.
|
|
Section
1.02
|
Allocation
of Certain Interest Shortfalls.
|
ARTICLE
II
CONVEYANCE
OF TRUST FUND
|
Section
2.01
|
Conveyance
of Trust Fund.
|
|
Section
2.02
|
Acceptance
of the Mortgage Loans.
|
|
Section
2.03
|
Representations,
Warranties and Covenants of the Master Servicer and the Seller.
|
|
Section
2.04
|
Representations
and Warranties of the Depositor.
|
|
Section
2.05
|
Delivery
of Opinion of Counsel in Connection with Substitutions and Repurchases.
|
|
Section
2.06
|
Countersignature
and Delivery of Certificates.
|
|
Section
2.07
|
Purposes
and Powers of the Trust.
|
ARTICLE
III
ADMINISTRATION
AND SERVICING OF THE MORTGAGE LOANS
|
Section
3.01
|
The
Master Servicer to act as Master Servicer.
|
|
Section
3.02
|
Due-on-Sale
Clauses; Assumption Agreements.
|
|
Section
3.03
|
Subservicers.
|
|
Section
3.04
|
Documents,
Records and Funds in Possession of the Master Servicer To Be Held
for
Trustee.
|
|
Section
3.05
|
Maintenance
of Hazard Insurance.
|
|
Section
3.06
|
Presentment
of Claims and Collection of Proceeds.
|
|
Section
3.07
|
Maintenance
of the Primary Mortgage Insurance Policies.
|
|
Section
3.08
|
Fidelity
Bond, Errors and Omissions Insurance.
|
|
Section
3.09
|
Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation
Proceeds and Realized Losses; Repurchases of Certain Mortgage Loans.
|
|
Section
3.10
|
Servicing
Compensation.
|
|
Section
3.11
|
REO
Property.
|
|
Section
3.12
|
Liquidation
Reports.
|
|
Section
3.13
|
Annual
Statement as to Compliance.
|
|
Section
3.14
|
Assessments
of Compliance and Attestation Reports.
|
|
Section
3.15
|
Books
and Records.
|
|
Section
3.16
|
Reports
Filed with Securities and Exchange Commission.
|
|
Section
3.17
|
Intention
of the Parties and Interpretation.
|
|
Section
3.18
|
UCC.
|
|
Section
3.19
|
Optional
Purchase of Certain Mortgage Loans.
|
|
Section
3.20
|
Obligations
of the Master Servicer in Respect of Mortgage Rates and Scheduled
Payments.
|
|
Section
3.21
|
Reserve
Fund; Payments to and from Swap Administrator; Supplemental Interest
Trust.
|
|
Section
3.22
|
Tax
Treatment of Class IO Distribution Amounts in the Event of
Resecuritization of Class A Certificates or Class M Certificates.
|
|
Section
3.23
|
Advancing
Facility.
|
ARTICLE
IV
ACCOUNTS
|
Section
4.01
|
Collection
of Mortgage Loan Payments; Protected Account.
|
|
Section
4.02
|
Permitted
Withdrawals From the Protected Account.
|
|
Section
4.03
|
Collection
of Taxes; Assessments and Similar Items; Escrow Accounts.
|
|
Section
4.04
|
Distribution
Account.
|
|
Section
4.05
|
Permitted
Withdrawals and Transfers from the Distribution Account.
|
|
Section
4.06
|
Class
P Certificate Account.
|
ARTICLE
V
DISTRIBUTIONS
AND ADVANCES
|
Section
5.01
|
Advances.
|
|
Section
5.02
|
Compensating
Interest Payments.
|
|
Section
5.03
|
REMIC
Distributions.
|
|
Section
5.04
|
Distributions.
|
|
Section
5.05
|
Allocation
of Realized Losses.
|
|
Section
5.06
|
Monthly
Statements to Certificateholders.
|
|
Section
5.07
|
REMIC
Designations and REMIC Distributions.
|
ARTICLE
VI
THE
CERTIFICATES
|
Section
6.01
|
The
Certificates.
|
|
Section
6.02
|
Certificate
Register; Registration of Transfer and Exchange of Certificates.
|
|
Section
6.03
|
Mutilated,
Destroyed, Lost or Stolen Certificates.
|
|
Section
6.04
|
Persons
Deemed Owners.
|
|
Section
6.05
|
Access
to List of Certificateholders’ Names and Addresses.
|
|
Section
6.06
|
Book-Entry
Certificates.
|
|
Section
6.07
|
Notices
to Depository.
|
|
Section
6.08
|
Definitive
Certificates.
|
|
Section
6.09
|
Maintenance
of Office or Agency.
|
ARTICLE
VII
THE
DEPOSITOR AND THE MASTER SERVICER
|
Section
7.01
|
Liabilities
of the Depositor and the Master Servicer.
|
|
Section
7.02
|
Merger
or Consolidation of the Depositor or the Master Servicer.
|
|
Section
7.03
|
Indemnification
of the Trustee and the Master Servicer.
|
|
Section
7.04
|
Limitations
on Liability of the Depositor, the Master Servicer and Others.
|
|
Section
7.05
|
Master
Servicer Not to Resign.
|
|
Section
7.06
|
Successor
Master Servicer.
|
|
Section
7.07
|
Sale
and Assignment of Master Servicing.
|
ARTICLE
VIII
DEFAULT;
TERMINATION OF MASTER SERVICER
|
Section
8.01
|
Events
of Default.
|
|
Section
8.02
|
Trustee
to Act; Appointment of Successor.
|
|
Section
8.03
|
Notification
to Certificateholders.
|
|
Section
8.04
|
Waiver
of Defaults.
|
ARTICLE
IX
CONCERNING
THE TRUSTEE
|
Section
9.01
|
Duties
of Trustee.
|
|
Section
9.02
|
Certain
Matters Affecting the Trustee.
|
|
Section
9.03
|
Trustee
Not Liable for Certificates or Mortgage Loans.
|
|
Section
9.04
|
Trustee
May Own Certificates.
|
|
Section
9.05
|
Trustee’s
Fees and Expenses.
|
|
Section
9.06
|
Eligibility
Requirements for Trustee.
|
|
Section
9.07
|
Insurance.
|
|
Section
9.08
|
Resignation
and Removal of Trustee.
|
|
Section
9.09
|
Successor
Trustee.
|
|
Section
9.10
|
Merger
or Consolidation of Trustee.
|
|
Section
9.11
|
Appointment
of Co-Trustee or Separate Trustee.
|
|
Section
9.12
|
Tax
Matters.
|
ARTICLE
X
TERMINATION
|
Section
10.01
|
Termination
upon Liquidation or Repurchase of all Mortgage Loans.
|
|
Section
10.02
|
Final
Distribution on the Certificates.
|
|
Section
10.03
|
Additional
Termination Requirements.
|
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
|
Section
11.01
|
Amendment.
|
|
Section
11.02
|
Recordation
of Agreement; Counterparts.
|
|
Section
11.03
|
Governing
Law.
|
|
Section
11.04
|
Intention
of Parties.
|
|
Section
11.05
|
Notices.
|
|
Section
11.06
|
Severability
of Provisions.
|
|
Section
11.07
|
Assignment.
|
|
Section
11.08
|
Limitation
on Rights of Certificateholders.
|
|
Section
11.09
|
Inspection
and Audit Rights.
|
|
Section
11.10
|
Certificates
Nonassessable and Fully Paid.
|
|
Section
11.11
|
Third
Party Rights.
|
Exhibits
|
Exhibit
A-1
|
Form
of Class A Certificates
|
|
Exhibit
A-2
|
Form
of Class M Certificates
|
|
Exhibit
A-3
|
Form
of Class P Certificates
|
|
Exhibit
A-4
|
Form
of Class CE Certificates
|
|
Exhibit
A-5
|
Form
of Class R Certificates
|
|
Exhibit
B
|
Mortgage
Loan Schedule
|
|
Exhibit
C
|
Form
of Transfer Affidavit
|
|
Exhibit
D
|
Form
of Transferor Certificate
|
|
Exhibit
E
|
Form
of Investment Letter (Non-Rule 144A)
|
|
Exhibit
F
|
Form
of Rule 144A and Related Matters Certificate
|
|
Exhibit
G
|
Form
of Request for Release
|
|
Exhibit
H
|
DTC
Letter of Representations
|
|
Exhibit
I
|
Schedule
of Mortgage Loans with Lost Notes
|
|
Exhibit
J
|
Form
of Custodial Agreement
|
|
Exhibit
K
|
Form
of Back-Up Certification
|
|
Exhibit
L
|
Form
of Mortgage Loan Purchase Agreement
|
|
Exhibit
M
|
Swap
Agreement
|
|
Exhibit
N
|
[Reserved]
|
|
Exhibit
O
|
[Reserved]
|
|
Exhibit
P
|
Servicing
Criteria to Be Addressed in Assessment of Compliance
|
|
Exhibit
Q
|
Form
10-D, Form 8-K and Form 10-K Reporting Responsibility
|
|
Exhibit
R
|
Additional
Disclosure Notification
|
POOLING
AND SERVICING AGREEMENT, dated as of January 1, 2007, among BEAR XXXXXXX
ASSET
BACKED SECURITIES I LLC, a Delaware limited liability company, as depositor
(the
“Depositor”), EMC MORTGAGE CORPORATION, a Delaware corporation, as seller (in
such capacity, the “Seller”) and as master servicer (in such capacity, the
“Master Servicer”), and LASALLE BANK NATIONAL ASSOCIATION, a national banking
association, as trustee (the “Trustee”).
PRELIMINARY
STATEMENT
REMIC
I
The
Depositor is the owner of the Trust Fund that is hereby conveyed to the Trustee
in return for the Certificates.
As
provided herein, the Trustee will elect to treat the segregated pool of assets
consisting of the Mortgage Loans and certain other related assets subject
to
this Agreement (other than the Reserve Fund, any Prepayment Charge Waiver
Amounts and, for the avoidance of doubt, the Supplemental Interest Trust,
the
Swap Agreement, the Swap Account, the Swap Collateral Account and any rights
or
obligations in respect of the Swap Administration Agreement) as a REMIC (as
defined herein) for federal income tax purposes, and such segregated pool
of
assets will be designated as “REMIC I”. The Class R-1 Certificates will be the
sole class of Residual Interests (as defined herein) in REMIC I for purposes
of
the REMIC Provisions (as defined herein). The following table irrevocably
sets
forth the designation, the Uncertificated REMIC I Pass-Through Rate, the
initial
Uncertificated Principal Balance and, for purposes of satisfying Treasury
Regulation Section 1.860G-1(a)(4)(iii), the “latest possible maturity date” for
each of the REMIC I Regular Interests (as defined herein). None of the REMIC
I
Regular Interests will be certificated.
|
Designation
|
Uncertificated
REMIC I Pass-Through Rate
|
Initial
Uncertificated Principal Balance
|
Latest
Possible Maturity Date (1)
|
||
|
I-1-A
|
Variable(2)
|
$
|
2,391,460.53
|
December
25, 2036
|
|
|
I-1-B
|
Variable(2)
|
$
|
2,391,460.53
|
December
25, 2036
|
|
|
I-2-A
|
Variable(2)
|
$
|
2,859,929.15
|
December
25, 2036
|
|
|
I-2-B
|
Variable(2)
|
$
|
2,859,929.15
|
December
25, 2036
|
|
|
I-3-A
|
Variable(2)
|
$
|
3,322,387.45
|
December
25, 2036
|
|
|
I-3-B
|
Variable(2)
|
$
|
3,322,387.45
|
December
25, 2036
|
|
|
I-4-A
|
Variable(2)
|
$
|
3,775,037.63
|
December
25, 2036
|
|
|
I-4-B
|
Variable(2)
|
$
|
3,775,037.63
|
December
25, 2036
|
|
|
I-5-A
|
Variable(2)
|
$
|
4,213,994.78
|
December
25, 2036
|
|
|
I-5-B
|
Variable(2)
|
$
|
4,213,994.78
|
December
25, 2036
|
|
|
I-6-A
|
Variable(2)
|
$
|
4,634,616.62
|
December
25, 2036
|
|
|
I-6-B
|
Variable(2)
|
$
|
4,634,616.62
|
December
25, 2036
|
|
|
I-7-A
|
Variable(2)
|
$
|
5,032,426.58
|
December
25, 2036
|
|
|
I-7-B
|
Variable(2)
|
$
|
5,032,426.58
|
December
25, 2036
|
|
|
I-8-A
|
Variable(2)
|
$
|
5,400,014.14
|
December
25, 2036
|
|
|
I-8-B
|
Variable(2)
|
$
|
5,400,014.14
|
December
25, 2036
|
|
|
I-9-A
|
Variable(2)
|
$
|
5,549,943.84
|
December
25, 2036
|
|
|
I-9-B
|
Variable(2)
|
$
|
5,549,943.84
|
December
25, 2036
|
|
|
I-10-A
|
Variable(2)
|
$
|
5,330,389.25
|
December
25, 2036
|
|
|
I-10-B
|
Variable(2)
|
$
|
5,330,389.25
|
December
25, 2036
|
|
|
I-11-A
|
Variable(2)
|
$
|
5,118,074.78
|
December
25, 2036
|
|
|
I-11-B
|
Variable(2)
|
$
|
5,118,074.78
|
December
25, 2036
|
|
|
I-12-A
|
Variable(2)
|
$
|
4,914,548.18
|
December
25, 2036
|
|
|
I-12-B
|
Variable(2)
|
$
|
4,914,548.18
|
December
25, 2036
|
|
|
I-13-A
|
Variable(2)
|
$
|
4,719,433.64
|
December
25, 2036
|
|
|
I-13-B
|
Variable(2)
|
$
|
4,719,433.64
|
December
25, 2036
|
|
|
I-14-A
|
Variable(2)
|
$
|
4,532,371.74
|
December
25, 2036
|
|
|
I-14-B
|
Variable(2)
|
$
|
4,532,371.74
|
December
25, 2036
|
|
|
I-15-A
|
Variable(2)
|
$
|
4,353,018.91
|
December
25, 2036
|
|
|
I-15-B
|
Variable(2)
|
$
|
4,353,018.91
|
December
25, 2036
|
|
|
I-16-A
|
Variable(2)
|
$
|
4,181,046.59
|
December
25, 2036
|
|
|
I-16-B
|
Variable(2)
|
$
|
4,181,046.59
|
December
25, 2036
|
|
|
I-17-A
|
Variable(2)
|
$
|
4,016,140.61
|
December
25, 2036
|
|
|
I-17-B
|
Variable(2)
|
$
|
4,016,140.61
|
December
25, 2036
|
|
|
I-18-A
|
Variable(2)
|
$
|
3,858,000.57
|
December
25, 2036
|
|
|
I-18-B
|
Variable(2)
|
$
|
3,858,000.57
|
December
25, 2036
|
|
|
I-19-A
|
Variable(2)
|
$
|
3,706,339.16
|
December
25, 2036
|
|
|
I-19-B
|
Variable(2)
|
$
|
3,706,339.16
|
December
25, 2036
|
|
|
I-20-A
|
Variable(2)
|
$
|
3,560,881.64
|
December
25, 2036
|
|
|
I-20-B
|
Variable(2)
|
$
|
3,560,881.64
|
December
25, 2036
|
|
|
I-21-A
|
Variable(2)
|
$
|
3,419,611.36
|
December
25, 2036
|
|
|
I-21-B
|
Variable(2)
|
$
|
3,419,611.36
|
December
25, 2036
|
|
|
I-22-A
|
Variable(2)
|
$
|
3,285,098.89
|
December
25, 2036
|
|
|
I-22-B
|
Variable(2)
|
$
|
3,285,098.89
|
December
25, 2036
|
|
|
I-23-A
|
Variable(2)
|
$
|
3,156,889.63
|
December
25, 2036
|
|
|
I-23-B
|
Variable(2)
|
$
|
3,156,889.63
|
December
25, 2036
|
|
|
I-24-A
|
Variable(2)
|
$
|
3,033,890.86
|
December
25, 2036
|
|
|
I-24-B
|
Variable(2)
|
$
|
3,033,890.86
|
December
25, 2036
|
|
|
I-25-A
|
Variable(2)
|
$
|
2,915,883.07
|
December
25, 2036
|
|
|
I-25-B
|
Variable(2)
|
$
|
2,915,883.07
|
December
25, 2036
|
|
|
I-26-A
|
Variable(2)
|
$
|
2,802,656.28
|
December
25, 2036
|
|
|
I-26-B
|
Variable(2)
|
$
|
2,802,656.28
|
December
25, 2036
|
|
|
I-27-A
|
Variable(2)
|
$
|
2,693,513.96
|
December
25, 2036
|
|
|
I-27-B
|
Variable(2)
|
$
|
2,693,513.96
|
December
25, 2036
|
|
|
I-28-A
|
Variable(2)
|
$
|
2,589,234.30
|
December
25, 2036
|
|
|
I-28-B
|
Variable(2)
|
$
|
2,589,234.30
|
December
25, 2036
|
|
|
I-29-A
|
Variable(2)
|
$
|
2,489,211.15
|
December
25, 2036
|
|
|
I-29-B
|
Variable(2)
|
$
|
2,489,211.15
|
December
25, 2036
|
|
|
I-30-A
|
Variable(2)
|
$
|
2,393,207.60
|
December
25, 2036
|
|
|
I-30-B
|
Variable(2)
|
$
|
2,393,207.60
|
December
25, 2036
|
|
|
I-31-A
|
Variable(2)
|
$
|
2,301,060.21
|
December
25, 2036
|
|
|
I-31-B
|
Variable(2)
|
$
|
2,301,060.21
|
December
25, 2036
|
|
|
I-32-A
|
Variable(2)
|
$
|
2,212,620.79
|
December
25, 2036
|
|
|
I-32-B
|
Variable(2)
|
$
|
2,212,620.79
|
December
25, 2036
|
|
|
I-33-A
|
Variable(2)
|
$
|
2,126,682.62
|
December
25, 2036
|
|
|
I-33-B
|
Variable(2)
|
$
|
2,126,682.62
|
December
25, 2036
|
|
|
I-34-A
|
Variable(2)
|
$
|
2,044,913.31
|
December
25, 2036
|
|
|
I-34-B
|
Variable(2)
|
$
|
2,044,913.31
|
December
25, 2036
|
|
|
I-35-A
|
Variable(2)
|
$
|
1,966,752.74
|
December
25, 2036
|
|
|
I-35-B
|
Variable(2)
|
$
|
1,966,752.74
|
December
25, 2036
|
|
|
I-36-A
|
Variable(2)
|
$
|
1,891,707.59
|
December
25, 2036
|
|
|
I-36-B
|
Variable(2)
|
$
|
1,891,707.59
|
December
25, 2036
|
|
|
I-37-A
|
Variable(2)
|
$
|
1,819,647.85
|
December
25, 2036
|
|
|
I-37-B
|
Variable(2)
|
$
|
1,819,647.85
|
December
25, 2036
|
|
|
I-38-A
|
Variable(2)
|
$
|
1,750,454.28
|
December
25, 2036
|
|
|
I-38-B
|
Variable(2)
|
$
|
1,750,454.28
|
December
25, 2036
|
|
|
I-39-A
|
Variable(2)
|
$
|
1,683,799.61
|
December
25, 2036
|
|
|
I-39-B
|
Variable(2)
|
$
|
1,683,799.61
|
December
25, 2036
|
|
|
I-40-A
|
Variable(2)
|
$
|
1,619,982.31
|
December
25, 2036
|
|
|
I-40-B
|
Variable(2)
|
$
|
1,619,982.31
|
December
25, 2036
|
|
|
I-41-A
|
Variable(2)
|
$
|
1,558,699.03
|
December
25, 2036
|
|
|
I-41-B
|
Variable(2)
|
$
|
1,558,699.03
|
December
25, 2036
|
|
|
I-42-A
|
Variable(2)
|
$
|
1,499,834.19
|
December
25, 2036
|
|
|
I-42-B
|
Variable(2)
|
$
|
1,499,834.19
|
December
25, 2036
|
|
|
I-43-A
|
Variable(2)
|
$
|
1,443,286.75
|
December
25, 2036
|
|
|
I-43-B
|
Variable(2)
|
$
|
1,443,286.75
|
December
25, 2036
|
|
|
I-44-A
|
Variable(2)
|
$
|
1,388,965.96
|
December
25, 2036
|
|
|
I-44-B
|
Variable(2)
|
$
|
1,388,965.96
|
December
25, 2036
|
|
|
I-45-A
|
Variable(2)
|
$
|
1,336,776.17
|
December
25, 2036
|
|
|
I-45-B
|
Variable(2)
|
$
|
1,336,776.17
|
December
25, 2036
|
|
|
I-46-A
|
Variable(2)
|
$
|
1,286,631.94
|
December
25, 2036
|
|
|
I-46-B
|
Variable(2)
|
$
|
1,286,631.94
|
December
25, 2036
|
|
|
I-47-A
|
Variable(2)
|
$
|
1,238,452.79
|
December
25, 2036
|
|
|
I-47-B
|
Variable(2)
|
$
|
1,238,452.79
|
December
25, 2036
|
|
|
I-48-A
|
Variable(2)
|
$
|
28,678,141.68
|
December
25, 2036
|
|
|
I-48-B
|
Variable(2)
|
$
|
28,678,141.68
|
December
25, 2036
|
|
|
I-49-A
|
Variable(2)
|
$
|
143,441.12
|
December
25, 2036
|
|
|
I-49-B
|
Variable(2)
|
$
|
143,441.12
|
December
25, 2036
|
|
|
I-50-A
|
Variable(2)
|
$
|
138,964.26
|
December
25, 2036
|
|
|
I-50-B
|
Variable(2)
|
$
|
138,964.26
|
December
25, 2036
|
|
|
I-51-A
|
Variable(2)
|
$
|
134,626.64
|
December
25, 2036
|
|
|
I-51-B
|
Variable(2)
|
$
|
134,626.64
|
December
25, 2036
|
|
|
I-52-A
|
Variable(2)
|
$
|
130,423.92
|
December
25, 2036
|
|
|
I-52-B
|
Variable(2)
|
$
|
130,423.92
|
December
25, 2036
|
|
|
I-53-A
|
Variable(2)
|
$
|
126,351.93
|
December
25, 2036
|
|
|
I-53-B
|
Variable(2)
|
$
|
126,351.93
|
December
25, 2036
|
|
|
I-54-A
|
Variable(2)
|
$
|
122,406.61
|
December
25, 2036
|
|
|
I-54-B
|
Variable(2)
|
$
|
122,406.61
|
December
25, 2036
|
|
|
I-55-A
|
Variable(2)
|
$
|
118,651.14
|
December
25, 2036
|
|
|
I-55-B
|
Variable(2)
|
$
|
118,651.14
|
December
25, 2036
|
|
|
I-56-A
|
Variable(2)
|
$
|
114,943.73
|
December
25, 2036
|
|
|
I-56-B
|
Variable(2)
|
$
|
114,943.73
|
December
25, 2036
|
|
|
I-57-A
|
Variable(2)
|
$
|
111,440.19
|
December
25, 2036
|
|
|
I-57-B
|
Variable(2)
|
$
|
111,440.19
|
December
25, 2036
|
|
|
I-58-A
|
Variable(2)
|
$
|
108,027.73
|
December
25, 2036
|
|
|
I-58-B
|
Variable(2)
|
$
|
108,027.73
|
December
25, 2036
|
|
|
I-59-A
|
Variable(2)
|
$
|
104,715.76
|
December
25, 2036
|
|
|
I-59-B
|
Variable(2)
|
$
|
104,715.76
|
December
25, 2036
|
|
|
I-60-A
|
Variable(2)
|
$
|
3,220,205.78
|
December
25, 2036
|
|
|
I-60-B
|
Variable(2)
|
$
|
3,220,205.78
|
December
25, 2036
|
|
|
P
|
0.00%
|
$
|
100.00
|
December
25, 2036
|
|
___________________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for each REMIC I Regular
Interest.
|
| (2) | Calculated in accordance with the definition of “Uncertificated REMIC I Pass-Through Rate” herein. |
REMIC
II
As
provided herein, the Trustee will elect to treat the segregated pool of assets
consisting of the REMIC I Regular Interests as a REMIC for federal income
tax
purposes, and such segregated pool of assets will be designated as “REMIC II”.
The Class R-2 Certificates will be the sole class of Residual Interests in
REMIC
II for purposes of the REMIC Provisions. The following table irrevocably
sets
forth the designation, the Uncertificated REMIC II Pass-Through Rate, the
initial Uncertificated Principal Balance and, for purposes of satisfying
Treasury Regulation Section 1.860G-1(a)(4)(iii), the “latest possible maturity
date” for each of the REMIC II Regular Interests (as defined herein). None of
the REMIC II Regular Interests will be certificated.
|
Designation
|
Uncertificated
REMIC II Pass-Through Rate
|
Initial
Uncertificated Principal Balance
|
Latest
Possible Maturity Date (1)
|
|
|
AA
|
Variable(2)
|
$
|
346,276,848.60
|
December
25, 2036
|
|
A-1
|
Variable(2)
|
$
|
1,802,890.00
|
December
25, 2036
|
|
A-2
|
Variable(2)
|
$
|
618,280.00
|
December
25, 2036
|
|
A-3
|
Variable(2)
|
$
|
221,840.00
|
December
25, 2036
|
|
M-1
|
Variable(2)
|
$
|
139,570.00
|
December
25, 2036
|
|
M-2
|
Variable(2)
|
$
|
128,970.00
|
December
25, 2036
|
|
M-3
|
Variable(2)
|
$
|
79,500.00
|
December
25, 2036
|
|
M-4
|
Variable(2)
|
$
|
68,900.00
|
December
25, 2036
|
|
M-5
|
Variable(2)
|
$
|
63,600.00
|
December
25, 2036
|
|
M-6
|
Variable(2)
|
$
|
58,300.00
|
December
25, 2036
|
|
M-7
|
Variable(2)
|
$
|
58,300.00
|
December
25, 2036
|
|
M-8
|
Variable(2)
|
$
|
47,700.00
|
December
25, 2036
|
|
M-9
|
Variable(2)
|
$
|
49,470.00
|
December
25, 2036
|
|
M-10
|
Variable(2)
|
$
|
54,770.00
|
December
25, 2036
|
|
ZZ
|
Variable(2)
|
$
|
3,674,784.46
|
December
25, 2036
|
|
IO
|
(2)
|
$
|
(3)
|
December
25, 2036
|
|
P
|
0.00%
|
$
|
100.00
|
December
25, 2036
|
___________________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for each REMIC II Regular
Interest.
|
|
(2)
|
Calculated
in accordance with the definition of “Uncertificated REMIC II Pass-Through
Rate” herein.
|
|
(3)
|
REMIC
II Regular Interest IO will not have an Uncertificated Principal
Balance
but will accrue interest on its uncertificated notional amount
calculated
in accordance with the definition of “Uncertificated Notional Amount”
herein.
|
REMIC
III
As
provided herein, the Trustee will elect to treat the segregated pool of assets
consisting of the REMIC II Regular Interests as a REMIC for federal income
tax
purposes, and such segregated pool of assets will be designated as “REMIC III”.
The Class R-3 Certificates will represent the sole class of Residual Interests
in REMIC III for purposes of the REMIC Provisions.
The
following table irrevocably sets forth the designation, Pass-Through Rate,
Initial Certificate Principal Balance (or initial Uncertificated Principal
Balance, in the case of the Class CE Interest, Class P Interest and Class
IO
Interest) and, for purposes of satisfying Treasury Regulation Section
1.860G-1(a)(4)(iii), the “latest possible maturity date” for each class of
Certificates and interests that represents ownership of one or more of the
Regular Interests in REMIC III created hereunder.
Each
Certificate, other than the Class P, Class CE and Class R Certificates,
represents ownership of a Regular Interest in REMIC III and also represents
(i)
the right to receive certain amounts specified herein in respect of Basis
Risk
Shortfall Carry Forward Amounts (as defined herein) and (ii) the
obligation to pay Class IO Distribution Amounts (as
defined herein). The entitlement to principal of the Regular Interest which
corresponds to each Certificate shall be equal in amount and timing to the
entitlement to principal of such Certificate.
|
Designation
|
Pass-Through
Rate
|
Initial
Certificate or Uncertificated Principal Balance
|
Latest
Possible Maturity Date(1)
|
|
|
A-1(2)
|
Variable(3)
|
$
|
180,289,000.00
|
December
25, 2036
|
|
A-2(2)
|
Variable(3)
|
$
|
61,828,000.00
|
December
25, 2036
|
|
A-3(2)
|
Variable(3)
|
$
|
22,184,000.00
|
December
25, 2036
|
|
M-1(2)
|
Variable(3)
|
$
|
13,957,000.00
|
December
25, 2036
|
|
M-2(2)
|
Variable(3)
|
$
|
12,897,000.00
|
December
25, 2036
|
|
M-3(2)
|
Variable(3)
|
$
|
7,950,000.00
|
December
25, 2036
|
|
M-4(2)
|
Variable(3)
|
$
|
6,890,000.00
|
December
25, 2036
|
|
M-5(2)
|
Variable(3)
|
$
|
6,360,000.00
|
December
25, 2036
|
|
M-6(2)
|
Variable(3)
|
$
|
5,830,000.00
|
December
25, 2036
|
|
M-7(2)
|
Variable(3)
|
$
|
5,830,000.00
|
December
25, 2036
|
|
M-8(2)
|
Variable(3)
|
$
|
4,770,000.00
|
December
25, 2036
|
|
M-9(2)
|
Variable(3)
|
$
|
4,947,000.00
|
December
25, 2036
|
|
M-10(2)
|
Variable(3)
|
$
|
5,477,000.00
|
December
25, 2036
|
|
Class
CE Interest
|
Variable(3)(4)
|
$
|
14,134,723.06
|
December
25, 2036
|
|
Class
P Interest
|
0.00%(5)
|
$
|
100.00
|
December
25, 2036
|
|
Class
IO Interest
|
(6)
|
(7)
|
December
25, 2036
|
|
___________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for each Regular Interest in REMIC
III.
|
|
(2)
|
This
Class of Certificates represents ownership of a Regular Interest
in REMIC
III. Any amount distributed on this Class of Certificates on any
Distribution Date in excess of the amount distributable on the
related
Regular Interest in REMIC III on such Distribution Date shall be
treated
for federal income tax purposes as having been paid from the Reserve
Fund
or the Supplemental Interest Trust, as applicable, and any amount
distributable on the related Regular Interest in REMIC III on such
Distribution Date in excess of the amount distributable on such
Class of
Certificates on such Distribution Date shall be treated for such
purposes
as having been distributed to the Holders of such Certificates
and then
paid by such Holders to the Supplemental Interest Trust, all pursuant
to
and as further provided in Section 3.21 hereof.
|
|
(3)
|
Calculated
in accordance with the definition of “Pass-Through Rate” herein. Each
Regular Interest in REMIC III which corresponds to a Class A Certificate
or Class M Certificate will have the same Pass-Through Rate as
such
Certificate, except with respect to the Net Rate Cap. The Net Rate
Cap for
each such Regular Interest in REMIC III and Certificate is specified
in
the definition of “Net Rate Cap.”
|
|
(4)
|
The
Class CE Interest will accrue interest at its variable Pass-Through
Rate
on its Uncertificated Notional Amount outstanding from time to
time, which
shall equal the aggregate Uncertificated Principal Balance of the
REMIC II
Regular Interests (other than REMIC II Regular Interest P). The
Class CE
Interest will not accrue interest on its Uncertificated Principal
Balance.
|
|
(5)
|
The
Class P Interest is not entitled to distributions in respect of
interest.
|
|
(6)
|
For
federal income tax purposes, the Class IO Interest will not have
a
Pass-Through Rate, but will be entitled to 100% of the amounts
distributed
on REMIC II Regular Interest IO.
|
|
(7)
|
For
federal income tax purposes, the Class IO Interest will not have
an
Uncertificated Principal Balance, but will have a notional amount
equal to
the Uncertificated Notional Amount of REMIC II Regular Interest
IO.
|
REMIC
IV
As
provided herein, the Trustee shall elect to treat the segregated pool of
assets
consisting of the Class CE Interest as a REMIC for federal income tax purposes,
and such segregated pool of assets will be designated as “REMIC IV”. The Class
R-4 Interest represents the sole class of Residual Interests in REMIC IV
for
purposes of the REMIC Provisions.
The
following table sets forth the Class designation, Pass-Through Rate, Initial
Certificate Principal Balance and, for purposes of satisfying Treasury
Regulation Section 1.860G-1(a)(4)(iii), the “latest possible maturity date” for
the indicated Class of Certificates that represents a Regular Interest in
REMIC
IV created hereunder. The Class CE Certificate represents ownership of a
Regular
Interest in REMIC IV and also represents (i) the obligation to pay certain
amounts specified herein in respect of Basis Risk Shortfall Carry Forward
Amounts and (ii) the right to receive Class IO Distribution
Amounts.
|
Class
Designation
|
Pass-Through
Rate
|
Initial
Certificate Principal Balance
|
Latest
Possible
Maturity
Date(1)
|
|
CE
|
(2)
|
$ 14,134,723.06
|
December
25, 2036
|
_______________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class CE
Certificates.
|
|
(2)
|
The
Class CE Certificates will receive 100% of the amounts received
in respect
of the Class CE Interest.
|
REMIC
V
As
provided herein, the Trustee shall elect to treat the segregated pool of
assets
consisting of the Class P Interest as a REMIC for federal income tax purposes,
and such segregated pool of assets will be designated as “REMIC V”. The Class
R-5 Interest represents the sole class of Residual Interests in REMIC V for
purposes of the REMIC Provisions.
The
following table sets forth the Class designation, Pass-Through Rate, Initial
Certificate Principal Balance and, for purposes of satisfying Treasury
Regulation Section 1.860G-1(a)(4)(iii), the “latest possible maturity date” for
the indicated Class of Certificates that represents a Regular Interest in
REMIC
V created hereunder:
|
Class
Designation
|
Pass-Through
Rate
|
Initial
Certificate Principal Balance
|
Latest
Possible Maturity Date(1)
|
|
P
|
0.00%(2)
|
$100.00
|
December
25, 2036
|
_______________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for
the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class P Certificates.
|
|
(2)
|
The
Class P Certificates will receive 100% of the amounts received
in respect
of the Class P Interest.
|
REMIC
VI
As
provided herein, the Trustee shall elect to treat the segregated pool of
assets
consisting of the Class IO Interest as a REMIC for federal income tax purposes,
and such segregated pool of assets will be designated as “REMIC VI”. The Class
R-6 Interest represents the sole class of Residual Interests in REMIC VI
for
purposes of the REMIC Provisions.
The
following table sets forth the designation, Pass-Through Rate, initial
Uncertificated Principal Balance and, for purposes of satisfying Treasury
Regulation Section 1.860G-1(a)(4)(iii), the “latest possible maturity date” for
the indicated class of interests that represents a Regular Interest in REMIC
VI
created hereunder:
|
Designation
|
Pass-Through
Rate
|
Initial
Uncertificated Principal Balance
|
Latest
Possible Maturity Date(1)
|
|
IO(2)
|
(3)
|
(4)
|
December
25, 2036
|
_______________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the month following the maturity date for the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for REMIC VI Regular Interest
IO.
|
|
(2)
|
REMIC
VI Regular Interest IO will be held as an asset of the Supplemental
Interest Trust.
|
|
(3)
|
REMIC
VI Regular Interest IO will not have a Pass-Through Rate, but will
receive
100% of the amounts received in respect of the Class IO
Interest.
|
|
(4)
|
REMIC
VI Regular Interest IO will not have an Uncertificated Principal
Balance,
but will have a notional amount equal to the Uncertificated Notional
Amount of the Class IO Interest.
|
The
Trust
Fund shall be named, and may be referred to as, the “Bear Xxxxxxx Asset Backed
Securities I Trust 2007-AQ1.” The Certificates issued hereunder may be referred
to as “Asset-Backed Certificates, Series 2007-AQ1” (including for purposes of
any endorsement or assignment of a Mortgage Note or Mortgage).
In
consideration of the mutual agreements herein contained, the Depositor, the
Master Servicer, the Seller and the Trustee agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.01 Defined
Terms.
Whenever
used in this Agreement, the following words and phrases, unless otherwise
expressly provided or unless the context otherwise requires, shall have the
meanings specified in this Article:
10-K
Filing Deadline:
As
defined in Section 3.16(a)(iii).
Accepted
Servicing Practices:
With
respect to each Mortgage Loan, those mortgage servicing practices and
procedures, including prudent collection and loan administration procedures,
and
the standard of care (i) employed by prudent mortgage servicers which service
mortgage loans of the same type as the Mortgage Loans in the jurisdictions
in
which the related Mortgage Properties are located or (ii) in accordance with
the
Xxxxxx Xxx Guide or Xxxxxxx Mac Guide, subject to any variances negotiated
with
Xxxxxx Xxx or Xxxxxxx Mac and subject to the express provisions of this
Agreement. Such standard of care shall not be lower than that the Master
Servicer customarily employs and exercises in servicing and administering
similar mortgage loans for its own account and shall be in full compliance
with
all federal, state, and local laws, ordinances, rules and
regulations.
Account:
The
Distribution Account, the Reserve Fund, the Swap Account, the Class P
Certificate Account, the Swap Collateral Account and the Protected
Account.
Accrual
Period:
With
respect to the Certificates (other than the Class CE, Class P and the Residual
Certificates) and any Distribution Date, the period from and including the
immediately preceding Distribution Date (or with respect to the first Accrual
Period, the Closing Date) to and including the day prior to such Distribution
Date. With respect to the Class CE Certificates and the Class CE Interest
and
any Distribution Date, the calendar month immediately preceding such
Distribution Date. All calculations of interest on the Certificates (other
than
the Class CE, Class P and the Residual Certificates) will be made on the
basis
of the actual number of days elapsed in the related Accrual Period. All
calculations of interest on the Class CE Interest and the Class CE Certificates
will be made on the basis of a 360-day year consisting of twelve 30-day
months.
Additional
Disclosure:
As
defined in Section 3.16(a)(iv).
Additional
Disclosure Notification:
The
form of notice set forth in Exhibit R.
Additional
Form 10-D Disclosure:
As
defined in Section 3.16(a)(i).
Additional
Form 10-K Disclosure:
As
defined in Section 3.16(a)(iii).
Advance:
An
advance of delinquent payments of principal or interest in respect of a Mortgage
Loan required to be made by the Master Servicer as provided in Section 5.01
hereof.
Affected
Party:
An
“Affected Party” as defined in the Swap Agreement.
Agreement:
This
Pooling and Servicing Agreement and any and all amendments or supplements
hereto
made in accordance with the terms herein.
Adjustable
Rate Mortgage Loan:
Each of
the Mortgage Loans identified in the Mortgage Loan Schedule as having a Mortgage
Rate that is subject to adjustment.
Adjustment
Date:
With
respect to each Adjustable Rate Mortgage Loan, the first day of the month
in
which the Mortgage Rate of an Adjustable Rate Mortgage Loan changes pursuant
to
the related Mortgage Note. The first Adjustment Date following the Cut-off
Date
as to each Adjustable Rate Mortgage Loan is set forth in the Mortgage Loan
Schedule.
Amount
Held for Future Distribution:
As to
any Distribution Date, the aggregate amount held in the Protected Account
at the
close of business on the immediately preceding Determination Date on account
of
(i) all Scheduled Payments or portions thereof received in respect of the
Mortgage Loans due after the related Due Period, (ii) Principal Prepayments
received in respect of such Mortgage Loans after the last day of the related
Prepayment Period and (iii) Liquidation Proceeds, Subsequent Recoveries and
Insurance Proceeds received in respect of such Mortgage Loans after the last
day
of the prior calendar month.
Annual
Statement of Compliance:
As
defined in Section 3.13.
Applied
Realized Loss Amount:
With
respect to any Distribution Date and a Class of Class A Certificates and
Class M
Certificates, the sum of the Realized Losses with respect to the Mortgage
Loans
which have been applied in reduction of the Certificate Principal Balance
of a
Class of Certificates pursuant to Section 5.05 of this Agreement which have
not
previously been reimbursed or reduced by any Subsequent Recoveries applied
to
such Applied Realized Loss Amount.
Appraised
Value:
With
respect to any Mortgage Loan originated in connection with a refinancing,
the
appraised value of the Mortgaged Property based upon the appraisal made at
the
time of such refinancing or, with respect to any other Mortgage Loan, the
lesser
of (x) the appraised value of the Mortgaged Property based upon the appraisal
made by a fee appraiser at the time of the origination of the related Mortgage
Loan, and (y) the sales price of the Mortgaged Property at the time of such
origination.
Assessment
of Compliance:
As
defined in Section 3.14.
Attesting
Party:
As
defined in Section 3.14.
Attestation
Report:
As
defined in Section 3.14.
Back-Up
Certification:
As
defined in Section 3.16(a)(iii).
Basis
Risk Shortfall Carry Forward Amount:
With
respect to any Distribution Date and any Class of Class A Certificates and
Class
M Certificates, an amount equal to the sum of (A) if the Pass-Through Rate
for
such Class for such Distribution Date is limited to the Net Rate Cap, the
excess, if any, of (a) the amount of Current Interest that such Class would
have
been entitled to receive on such Distribution Date had the Pass-Though Rate
applicable to such Class been calculated at a per annum rate equal to the
related One-Month LIBOR Pass-Through Rate, over (b) the amount of Current
Interest that such Class received on such Distribution Date at the Net Rate
Cap
for such Distribution Date and (B) the Basis Risk Shortfall Carry Forward
Amount
for the previous Distribution Date not previously paid, together with interest
thereon at a rate equal to the related Pass-Through Rate the current
Distribution Date.
Bankruptcy
Code:
Title
11 of the United States Code.
Book-Entry
Certificates:
Any of
the Certificates that shall be registered in the name of the Depository or
its
nominee, the ownership of which is reflected on the books of the Depository
or
on the books of a person maintaining an account with the Depository (directly,
as a “Depository Participant”, or indirectly, as an indirect participant in
accordance with the rules of the Depository and as described in Section 6.06).
As of the Closing Date, each Class of Regular Certificates (other than the
Class
CE Certificates and Class P Certificates) constitutes a Class of Book-Entry
Certificates.
Business
Day:
Any day
other than (i) a Saturday or a Sunday, or (ii) a day on which banking
institutions in the city of New York, Chicago, Illinois, Minneapolis, Minnesota
or the city in which the Corporate Trust Office of the Trustee or the principal
office of the Master Servicer is located as authorized or obligated by law
or
executive order to be closed.
Certificate:
Any one
of the certificates of any Class executed and authenticated by the Trustee
in
substantially the forms attached hereto as Exhibits A-1 through
A-5.
Certificate
Margin:
With
respect to the Class A-1 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest A-1, 0.110% per
annum.
With
respect to the Class A-2 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest A-2, 0.200% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.400% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class A-3 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest A-3, 0.300% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.600% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-1 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-1, 0.400% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.600% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-2 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-2, 0.440% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.660% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-3 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-3, 0.460% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 0.690% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-4 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-4, 0.850% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 1.275% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-5 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-5, 1.250% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 1.875% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-6 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-6, 1.650% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 2.475% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-7 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-7, 2.250% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 3.375% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-8 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-8, 2.250% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 3.375% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-9 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-9, 2.250% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 3.375% per annum in the case of each
Distribution Date thereafter.
With
respect to the Class M-10 Certificates and, for purposes of the definition
of
“One-Month LIBOR Pass-Through Rate”, REMIC II Regular Interest M-10, 2.250% per
annum in the case of each Distribution Date through and including the first
possible Optional Termination Date and 3.375% per annum in the case of each
Distribution Date thereafter.
Certificate
Notional Amount:
With
respect to the Class CE Certificates and any Distribution Date, an amount
equal
to the Stated Principal Balance of the Mortgage Loans as of the beginning
of the
related Due Period. The
initial Certificate Notional Amount of the Class CE Certificates shall be
$353,343,723.06. For federal income tax purposes, the Certificate Notional
Amount for any Distribution Date shall be an amount equal to the Uncertificated
Notional Amount for the Class CE Interest for such Distribution
Date.
Certificate
Owner:
With
respect to a Book-Entry Certificate, the Person that is the beneficial owner
of
such Book-Entry Certificate.
Certificate
Principal Balance:
As to
any Certificate (other than any Class CE Certificates and any Class R
Certificates) and as of any Distribution Date, the Initial Certificate Principal
Balance of such Certificate plus, in the case of a Class A Certificate and
Class
M Certificate, any Subsequent Recoveries added to the Certificate Principal
Balance of such Certificate pursuant to Section 5.04(a), less the sum of
(i) all
amounts distributed with respect to such Certificate in reduction of the
Certificate Principal Balance thereof on previous Distribution Dates pursuant
to
Section 5.04, and (ii) any Applied Realized Loss Amounts allocated to such
Certificate on previous Distribution Dates. As to the Class CE Certificates
and
as of any Distribution Date, an amount equal to the Uncertificated Principal
Balance of the Class CE Interest.
Certificate
Register:
The
register maintained pursuant to Section 6.02 hereof.
Certificateholder
or Holder:
The
person in whose name a Certificate is registered in the Certificate Register
(initially, Cede & Co., as nominee for the Depository, in the case of any
Book-Entry Certificates).
Certification
Parties:
As
defined in Section 3.16(a)(iii).
Certifying
Person:
As
defined in Section 3.16(a)(iii).
Class:
All
Certificates bearing the same Class designation as set forth in Section 6.01
hereof.
Class
A Certificates:
Any of
the Class A-1, Class A-2 and Class A-3.
Class
A Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the Principal
Distribution Amount for such Distribution Date and (y) the excess, if any,
of
(i) the aggregate Certificate Principal Balance of the Class A Certificates
immediately prior to such Distribution Date, over (ii) the lesser of (a)
the
product of (1) 49.60% and (2) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving
effect
to scheduled payments of principal due during the related Due Period, to
the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period, and after reduction for Realized Losses
incurred during the prior calendar month), and (b) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related
Due
Period (after giving effect to scheduled payments of principal due during
the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month)
minus $1,766,719.
Class
A-1 Certificate:
Any
Certificate designated as a “Class A-1 Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to the Percentage Interest
of
distributions provided for the Class A-1 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
A-2 Certificate:
Any
Certificate designated as a “Class A-2 Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to the Percentage Interest
of
distributions provided for the Class A-2 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
A-3 Certificate:
Any
Certificate designated as a “Class A-3 Certificate” on the face thereof, in the
form of Exhibit A-1 hereto, representing the right to the Percentage Interest
of
distributions provided for the Class A-3 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts
Class
CE Certificate:
Any
Certificate designated as a “Class CE Certificate” on the face thereof, in the
form of Exhibit A-4 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class CE Certificates herein and evidencing
(i) a
Regular Interest in REMIC IV, (ii) the obligation to pay Basis Risk Shortfall
Carry Forward Amounts and (iii) the right to receive Class IO Distribution
Amounts.
Class
CE Distribution Amount:
With
respect to any Distribution Date, the sum of (i) the Current Interest for
the
Class CE Interest for such Distribution Date, (ii) any Overcollateralization
Release Amount for such Distribution Date and (iii) without duplication,
any
Subsequent Recoveries not distributed to the Class A Certificates and Class
M
Certificates on such Distribution Date; provided, however, on any Distribution
Date after the Distribution Date on which the Certificate Principal Balances
of
the Class A Certificates and Class M Certificates have been reduced to zero,
the
Class CE Distribution Amount shall include the Overcollateralization
Amount.
Class
CE Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
Holders of the Class CE Certificates, evidencing a Regular Interest in REMIC
III
for purposes of the REMIC Provisions.
Class
IO Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
holders of REMIC VI Regular Interest IO, evidencing a Regular Interest in
REMIC
III for purposes of the REMIC Provisions.
Class
IO Distribution Amount:
As
defined in Section 3.21 hereof. For purposes of clarity, the Class IO
Distribution Amount for any Distribution Date shall equal the amount payable
to
the Swap Administrator pursuant to the first and second sentences of Section
3.21(c) on such Distribution Date in excess of the amount payable on REMIC
VI
Regular Interest IO on such Distribution Date, all as further provided in
Section 3.21 hereof.
Class
M Certificates:
Any of
the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7,
Class M-8, Class M-9 and Class M-10 Certificates.
Class
M-1 Certificate:
Any
Certificate designated as a “Class M-1 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-1 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-1 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount and (y) the excess, if any, of (a) the sum
of (1)
the aggregate Certificate Principal Balance of the Class A Certificates (after
taking into account the distribution of the Class A Principal Distribution
Amount on such Distribution Date) and (2) the Certificate Principal Balance
of
the Class M-1 Certificates immediately prior to such Distribution Date, over
(b)
the lesser of (1) the product of (x) 57.50% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related
Due
Period (after giving effect to scheduled payments of principal due during
the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month),
and (2) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month) minus $1,766,719.
Class
M-2 Certificate:
Any
Certificate designated as a “Class M-2 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-2 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-2 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount and the Class M-1 Principal Distribution Amount
and (y) the excess, if any, of (a) the sum of (1) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account
the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (2) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date) and (3) the Certificate Principal
Balance of the Class M-2 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 64.80% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month),
and (2) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month) minus $1,766,719.
Class
M-3 Certificate:
Any
Certificate designated as a “Class M-3 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-3 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-3 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount
and
the Class M-2 Principal Distribution Amount and (y) the excess, if any, of
(a)
the sum of (1) the aggregate Certificate Principal Balance of the Class A
Certificates (after taking into account the distribution of the Class A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account
the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date) and (4) the Certificate Principal
Balance of the Class M-3 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 69.30% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month),
and (2) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month) minus $1,766,719.
Class
M-4 Certificate:
Any
Certificate designated as a “Class M-4 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-4 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-4 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount and the Class M-3 Principal Distribution
Amount and (y) the excess, if any, of (a) the sum of (1) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the distribution of the Class A Principal Distribution Amount on
such
Distribution Date), (2) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the distribution of the Class M-1
Principal Distribution Amount on such Distribution Date), (3) the Certificate
Principal Balance of the Class M-2 Certificates (after taking into account
the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (4) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date) and (5) the Certificate Principal
Balance of the Class M-4 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 73.20% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month),
and (2) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month) minus $1,766,719.
Class
M-5 Certificate:
Any
Certificate designated as a “Class M-5 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-5 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-5 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount and the Class M-4 Principal Distribution Amount and (y) the excess,
if
any, of (a) the sum of (1) the aggregate Certificate Principal Balance of
the
Class A Certificates (after taking into account the distribution of the Class
A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account
the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date) and (6) the Certificate Principal
Balance of the Class M-5 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 76.80% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month),
and (2) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month) minus $1,766,719.
Class
M-6 Certificate:
Any
Certificate designated as a “Class M-6 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-6 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-6 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount and the Class M-5 Principal
Distribution Amount and (y) the excess, if any, of (a) the sum of (1) the
aggregate Certificate Principal Balance of the Class A Certificates (after
taking into account the distribution of the Class A Principal Distribution
Amount on such Distribution Date), (2) the Certificate Principal Balance
of the
Class M-1 Certificates (after taking into account the distribution of the
Class
M-1 Principal Distribution Amount on such Distribution Date), (3) the
Certificate Principal Balance of the Class M-2 Certificates (after taking
into
account the distribution of the Class M-2 Principal Distribution Amount on
such
Distribution Date), (4) the Certificate Principal Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount on such Distribution Date), (5) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account
the
distribution of the Class M-4 Principal Distribution Amount on such Distribution
Date), (6) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the distribution of the Class M-5 Principal
Distribution Amount on such Distribution Date) and (7) the Certificate Principal
Balance of the Class M-6 Certificates immediately prior to such Distribution
Date, over (b) the lesser of (1) the product of (x) 80.10% and (y) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month),
and (2) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month) minus $1,766,719.
Class
M-7 Certificate:
Any
Certificate designated as a “Class M-7 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-7 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-7 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount and the Class M-6 Principal Distribution Amount and (y)
the
excess, if any, of (a) the sum of (1) the aggregate Certificate Principal
Balance of the Class A Certificates (after taking into account the distribution
of the Class A Principal Distribution Amount on such Distribution Date),
(2) the
Certificate Principal Balance of the Class M-1 Certificates (after taking
into
account the distribution of the Class M-1 Principal Distribution Amount on
such
Distribution Date), (3) the Certificate Principal Balance of the Class M-2
Certificates (after taking into account the distribution of the Class M-2
Principal Distribution Amount on such Distribution Date), (4) the Certificate
Principal Balance of the Class M-3 Certificates (after taking into account
the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date), (6) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date) (7) the Certificate Principal Balance of the Class M-6 Certificates
(after
taking into account the distribution of the Class M-6 Principal Distribution
Amount on such Distribution Date) and (8) the Certificate Principal Balance
of
the Class M-7 Certificates immediately prior to such Distribution Date, over
(b)
the lesser of (1) the product of (x) 83.40% and (y) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related
Due
Period (after giving effect to scheduled payments of principal due during
the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month),
and (2) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month) minus $1,766,719.
Class
M-8 Certificate:
Any
Certificate designated as a “Class M-8 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-8 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-8 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount, the Class M-6 Principal Distribution Amount and the
Class
M-7 Principal Distribution Amount and (y) the excess, if any, of (a) the
sum of
(1) the aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the distribution of the Class A Principal
Distribution Amount on such Distribution Date), (2) the Certificate Principal
Balance of the Class M-1 Certificates (after taking into account the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date), (6) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date) (7) the Certificate Principal Balance of the Class M-6 Certificates
(after
taking into account the distribution of the Class M-6 Principal Distribution
Amount on such Distribution Date), (8) the Certificate Principal Balance
of the
Class M-7 Certificates (after taking into account the distribution of the
Class
M-7 Principal Distribution Amount on such Distribution Date) and (9) the
Certificate Principal Balance of the Class M-8 Certificates immediately prior
to
such Distribution Date, over (b) the lesser of (1) the product of (x) 86.10%
and
(y) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month), and (2) the aggregate Stated Principal Balance of the Mortgage
Loans as of the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period, to the
extent
received or advanced, and unscheduled collections of principal received during
the related Prepayment Period, and after reduction for Realized Losses incurred
during the prior calendar month) minus $1,766,719.
Class
M-9 Certificate:
Any
Certificate designated as a “Class M-9 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-9 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-9 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount, the Class M-6 Principal Distribution Amount, the Class
M-7
Principal Distribution Amount and the Class M-8 Principal Distribution Amount
and (y) the excess, if any, of (a) the sum of (1) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account
the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (2) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account the distribution of the Class M-1 Principal
Distribution Amount on such Distribution Date), (3) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount on such Distribution
Date), (4) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the distribution of the Class M-3 Principal
Distribution Amount on such Distribution Date), (5) the Certificate Principal
Balance of the Class M-4 Certificates (after taking into account the
distribution of the Class M-4 Principal Distribution Amount on such Distribution
Date), (6) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the distribution of the Class M-5 Principal
Distribution Amount on such Distribution Date) (7) the Certificate Principal
Balance of the Class M-6 Certificates (after taking into account the
distribution of the Class M-6 Principal Distribution Amount on such Distribution
Date), (8) the Certificate Principal Balance of the Class M-7 Certificates
(after taking into account the distribution of the Class M-7 Principal
Distribution Amount on such Distribution Date), (9) the Certificate Principal
Balance of the Class M-8 Certificates (after taking into account the
distribution of the Class M-8 Principal Distribution Amount on such Distribution
Date) and (10) the Certificate Principal Balance of the Class M-9 Certificates
immediately prior to such Distribution Date, over (b) the lesser of (1) the
product of (x) 88.90% and (y) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving
effect
to scheduled payments of principal due during the related Due Period, to
the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period, and after reduction for Realized Losses
incurred during the prior calendar month), and (2) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related
Due
Period (after giving effect to scheduled payments of principal due during
the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month)
minus $1,766,719.
Class
M-10 Certificate:
Any
Certificate designated as a “Class M-10 Certificate” on the face thereof, in the
form of Exhibit A-2 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class M-10 Certificates as set forth herein
and
evidencing (i) a Regular Interest in REMIC III, (ii) the right to receive
Basis
Risk Shortfall Carry Forward Amounts and (iii) the obligation to pay Class
IO
Distribution Amounts.
Class
M-10 Principal Distribution Amount:
For any
Distribution Date, an amount equal to the lesser of (x) the remaining Principal
Distribution Amount for such Distribution Date after distribution of the
Class A
Principal Distribution Amount, the Class M-1 Principal Distribution Amount,
the
Class M-2 Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5 Principal
Distribution Amount, the Class M-6 Principal Distribution Amount, the Class
M-7
Principal Distribution Amount, the Class M-8 Principal Distribution Amount
and
the Class M-9 Principal Distribution Amount and (y) the excess, if any, of
(a)
the sum of (1) the aggregate Certificate Principal Balance of the Class A
Certificates (after taking into account the distribution of the Class A
Principal Distribution Amount on such Distribution Date), (2) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account
the
distribution of the Class M-1 Principal Distribution Amount on such Distribution
Date), (3) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the distribution of the Class M-2 Principal
Distribution Amount on such Distribution Date), (4) the Certificate Principal
Balance of the Class M-3 Certificates (after taking into account the
distribution of the Class M-3 Principal Distribution Amount on such Distribution
Date), (5) the Certificate Principal Balance of the Class M-4 Certificates
(after taking into account the distribution of the Class M-4 Principal
Distribution Amount on such Distribution Date), (6) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the
distribution of the Class M-5 Principal Distribution Amount on such Distribution
Date) (7) the Certificate Principal Balance of the Class M-6 Certificates
(after
taking into account the distribution of the Class M-6 Principal Distribution
Amount on such Distribution Date), (8) the Certificate Principal Balance
of the
Class M-7 Certificates (after taking into account the distribution of the
Class
M-7 Principal Distribution Amount on such Distribution Date), (9) the
Certificate Principal Balance of the Class M-8 (after taking into account
the
distribution of the Class M-8 Principal Distribution Amount on such Distribution
Date), (10) the Certificate Principal Balance of the Class M-9 Certificates
(after taking into account the distribution of the Class M-9 Principal
Distribution Amount on such Distribution Date) and (11) the Certificate
Principal Balance of the Class M-10 Certificates immediately prior to such
Distribution Date, over (b) the lesser of (1) the product of (x) 92.00% and
(y)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month), and (2) the aggregate Stated Principal Balance of the Mortgage
Loans as of the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period, to the
extent
received or advanced, and unscheduled collections of principal received during
the related Prepayment Period, and after reduction for Realized Losses incurred
during the prior calendar month) minus $1,766,719.
Class
P Certificate:
Any
Certificate designated as a “Class P Certificate” on the face thereof, in the
form of Exhibit A-3 hereto, representing the right to its Percentage Interest
of
distributions provided for the Class P Certificates as set forth herein and
evidencing (i) a Regular Interest in REMIC V and (ii) the right to receive
any
Prepayment Charge Waiver Amounts.
Class
P Interest:
An
uncertificated interest in the Trust Fund held by the Trustee on behalf of
the
Holders of the Class P Certificates, evidencing a Regular Interest in REMIC
III
for purposes of the REMIC Provisions.
Class
P Certificate Account:
The
separate Eligible Account created and maintained by the Trustee pursuant
to
Section 4.06 in the name of the Trustee for the benefit of the Class P
Certificateholders.
Class
R Certificate:
Any of
the Class R-1, Class R-2, Class R-3 and Class RX Certificates.
Class
R-1 Certificate:
Any
Certificate designated a “Class R-1 Certificate” on the face thereof, in the
form set forth in Exhibit A-5 hereto, evidencing the Residual Interest in
REMIC
I and representing the right to the Percentage Interest of distributions
provided for the Class R-1 Certificates as set forth herein.
Class
R-2 Certificate:
Any
Certificate designated a “Class R-2 Certificate” on the face thereof, in the
form set forth in Exhibit A-5 hereto, evidencing the Residual Interest in
REMIC
II and representing the right to the Percentage Interest of distributions
provided for the Class R-2 Certificates as set forth herein.
Class
R-3 Certificate:
Any
Certificate designated a “Class R-3 Certificate” on the face thereof, in the
form set forth in Exhibit A-5 hereto, evidencing the Residual Interest in
REMIC
III and representing the right to the Percentage Interest of distributions
provided for the Class R-3 Certificates as set forth herein.
Class
RX Certificate:
Any
Certificate designated a “Class RX Certificate” on the face thereof, in the form
set forth in Exhibit A-5 hereto, evidencing the ownership of the Class R-4,
Class R-5 Interest and Class R-6 Interest and representing the right to the
Percentage Interest of distributions provided for the Class RX Certificates
as
set forth herein.
Class
R-4 Interest:
The
uncertificated Residual Interest in REMIC IV.
Class
R-5 Interest:
The
uncertificated Residual Interest in REMIC V.
Class
R-6 Interest:
The
uncertificated Residual Interest in REMIC VI.
Closing
Date:
January
30, 2007.
Code:
The
Internal Revenue Code of 1986, including any successor or amendatory
provisions.
Commission:
The
U.S. Securities and Exchange Commission.
Compensating
Interest:
An
amount, not to exceed the Servicing Fee, to be deposited in the Protected
Account by the Master Servicer to the payment of a Prepayment Interest Shortfall
on a Mortgage Loan subject to this Agreement.
Corporate
Trust Office:
The
designated office of the Trustee where 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 000 Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx, 00000 Attention: Global
Securities and Trust Services - Bear Xxxxxxx Asset Backed Securities I LLC,
Series 2007-AQ1, or at such other address as the Trustee may designate from
time
to time.
Corresponding
Certificate:
With
respect to each REMIC II Regular Interest (other than REMIC II Regular Interests
AA, ZZ, IO and P), the Certificate with the corresponding designation. With
respect to each REMIC III Regular Interest (other than the Class CE Interest,
the Class P Interest and the Class IO Interest), the related Certificate
representing an ownership therein.
Current
Interest:
As of
any Distribution Date, with respect to the Certificates and interests of
each
class (other than the Class P Certificates, Class P Interest, the Residual
Interests and the Residual Certificates), (i) the interest accrued on the
Certificate Principal Balance or Certificate Notional Amount or Uncertificated
Notional Amount, as applicable, during the related Accrual Period at the
applicable Pass-Through Rate, plus any amount previously distributed with
respect to interest for such Certificate or interest that has been recovered
as
a voidable preference by a trustee in bankruptcy minus (ii) the sum of (a)
any
Prepayment Interest Shortfall for such Distribution Date, to the extent not
covered by Compensating Interest and (b) any Relief Act Interest Shortfalls
during the related Due Period, provided, however, that for purposes of
calculating Current Interest for any such class, amounts specified in clause
(ii) hereof for any such Distribution Date shall be allocated first to the
Class
CE Certificates and the Class CE Interest in reduction of amounts otherwise
distributable to such Certificates and interest on such Distribution Date
and
then any excess shall be allocated to each Class of Class A Certificates
and
Class M Certificates on a pro
rata
basis
based on the respective amounts of interest accrued pursuant to clause (i)
hereof for each such Class on such Distribution Date.
Current
Specified Enhancement Percentage:
With
respect to any Distribution Date, the percentage obtained by dividing (x)
the
sum of (i) the aggregate Certificate Principal Balance of the Class M
Certificates and (ii) the Overcollateralization Amount, in each case prior
to
the distribution of the Principal Distribution Amount on such Distribution
Date,
by (y) the aggregate Stated Principal Balance of the Mortgage Loans as of
the
end of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period, and after reduction for Realized Losses incurred during the prior
calendar month).
Custodial
Agreement:
An
agreement, dated as of January 30, 2007, among the Depositor, EMC, as a seller
and as Master Servicer, Master Funding as a seller, the Trustee and the
Custodian in substantially the form of Exhibit J hereto.
Custodian:
LaSalle
Bank National Association, or any successor custodian appointed pursuant
to the
provisions hereof and the Custodial Agreement.
Cut-off
Date:
January
1, 2007.
Cut-off
Date Principal Balance:
As to
any Mortgage Loan, the unpaid principal balance thereof on the Cut-off Date
after application of all Principal Prepayments received prior to the Cut-off
Date and scheduled payments of principal due on or before the Cut-off Date,
whether or not received, but without giving effect to any installments of
principal received in respect of Due Dates after the Cut-off Date. The aggregate
Cut-off Date Principal Balance of the Mortgage Loans is $353,343,723.06.
Debt
Service Reduction:
With
respect to any Mortgage Loan, a reduction by a court of competent jurisdiction
in a proceeding under the Bankruptcy Code in the Scheduled Payment for such
Mortgage Loan that became final and non-appealable, except such a reduction
resulting from a Deficient Valuation or any other reduction that results
in a
permanent forgiveness of principal.
Defaulting
Party:
A
“Defaulting Party” as defined in the Swap Agreement.
Deficient
Valuation:
With
respect to any Mortgage Loan, a valuation by a court of competent jurisdiction
of the Mortgaged Property in an amount less than the then outstanding
indebtedness under such Mortgage Loan, or any reduction in the amount of
principal to be paid in connection with any Scheduled Payment that results
in a
permanent forgiveness of principal, which valuation or reduction results
from an
order of such court that is final and non-appealable in a proceeding under
the
Bankruptcy Code.
Definitive
Certificates:
As
defined in Section 6.06.
Deleted
Mortgage Loan:
A
Mortgage Loan replaced or to be replaced by a Replacement Mortgage
Loan.
Delinquency
Event:
A
Delinquency Event shall have occurred and be continuing if at any time, (x)
the
percent equivalent of a fraction, the numerator of which is the aggregate
Stated
Principal Balance of the Mortgage Loans that are 60 days or more Delinquent
(including for this purpose any such Mortgage Loans in bankruptcy or foreclosure
and Mortgage Loans with respect to which the related Mortgaged Property is
REO
Property), and the denominator of which is the aggregate Stated Principal
Balance of all of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during
the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month)
exceeds (y) 41.00% of the Current Specified Enhancement Percentage.
Delinquent:
A
Mortgage Loan is “delinquent” if any payment due thereon is not made pursuant to
the terms of such Mortgage Loan by the close of business on the day such
payment
is scheduled to be due. A Mortgage Loan is “30 days delinquent” if such payment
has not been received by the close of business on the corresponding day of
the
month immediately succeeding the month in which such payment was due, or,
if
there is no such corresponding day (e.g., as when a 30-day month follows
a
31-day month in which a payment was due on the 31st day of such month), then
on
the last day of such immediately succeeding month. Similarly for “60 days
delinquent,” “90 days delinquent” and so on.
Denomination:
With
respect to each Certificate, the amount set forth on the face thereof as
the
“Initial Principal Balance or Initial Notional Amount of this
Certificate”.
Depositor:
Bear
Xxxxxxx Asset Backed Securities I LLC, a Delaware limited liability company,
or
its successor in interest.
Depository:
The
initial Depository shall be The Depository Trust Company (“DTC”), the nominee of
which is Cede & Co., or any other organization registered as a “clearing
agency” pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. The Depository shall initially be the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a “clearing
corporation” as defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of New York.
Depository
Agreement:
With
respect to the Class of Book-Entry Certificates, the agreement among the
Depositor, the Trustee and the initial Depository, dated as of the Closing
Date,
substantially in the form of Exhibit H.
Depository
Participant:
A
broker, dealer, bank or other financial institution or other Person for whom
from time to time a Depository effects book-entry transfers and pledges of
securities deposited with the Depository.
Determination
Date:
With
respect to any Distribution Date, the 15th day of the month of such Distribution
Date or, if such 15th day is not a Business Day, the immediately preceding
Business Day.
Distribution
Account:
The
separate Eligible Account created and maintained by the Trustee pursuant
to
Section 4.04 in the name of the Trustee for the benefit of the
Certificateholders designated “LaSalle Bank National Association, in trust for
registered holders of Bear Xxxxxxx Asset Backed Securities I LLC, Asset-Backed
Certificates, Series 2007-AQ1”. Funds in the Distribution Account shall be held
in trust for the Certificateholders for the uses and purposes set forth in
this
Agreement.
Distribution
Account Deposit Date:
Two
Business Days prior to each Distribution Date.
Distribution
Date:
The
25th day of each calendar month after the initial issuance of the Certificates,
or if such 25th day is not a Business Day, the next succeeding Business Day,
commencing in February 2007.
Due
Date:
As to
any Mortgage Loan, the date in each month on which the related Scheduled
Payment
is due, as set forth in the related Mortgage Note.
Due
Period:
With
respect to any Distribution Date, the period from the second day of the calendar
month preceding the calendar month in which such Distribution Date occurs
through close of business on the first day of the calendar month in which
such
Distribution Date occurs.
Eligible
Account:
Any of
(i) an account or accounts maintained with a federal or state chartered
depository institution or trust company, the long-term unsecured debt
obligations and short-term unsecured debt obligations of which (or, in the
case
of a depository institution or trust company that is the principal subsidiary
of
a holding company, the debt obligations of such holding company, so long
as
Xxxxx’x is not a Rating Agency) are rated by each Rating Agency in one of its
two highest long-term and its highest short-term rating categories,
respectively, at the time any amounts are held on deposit therein, or (ii)
an
account or accounts in a depository institution or trust company in which
such
accounts are insured by the FDIC (to the limits established by the FDIC)
and the
uninsured deposits in which accounts are otherwise secured such that, as
evidenced by an Opinion of Counsel delivered to the Trustee and to each Rating
Agency, the Certificateholders have a claim with respect to the funds in
such
account or a perfected first priority security interest against any collateral
(which shall be limited to Permitted Investments) securing such funds that
is
superior to claims of any other depositors or creditors of the depository
institution or trust company in which such account is maintained, or (iii)
a
trust account or accounts maintained with the corporate trust department
of a
federal or state chartered depository institution or trust company having
capital and surplus of not less than $50,000,000, acting in its fiduciary
capacity or (iv) any other account acceptable to the Rating Agencies, as
evidenced in writing. Eligible Accounts may bear interest, and may include,
if
otherwise qualified under this definition, accounts maintained with the
Trustee.
EMC:
EMC
Mortgage Corporation, a Delaware corporation, and its successors and
assigns.
EMC
Flow Loans:
The
Mortgage Loans purchased by EMC pursuant to a flow loan purchase
agreement.
EMC
Mortgage Loans:
The
Mortgage Loans identified as such on the Mortgage Loan Schedule for which
EMC is
the applicable seller.
ERISA:
The
Employee Retirement Income Security Act of 1974, as amended.
ERISA
Restricted Certificates:
Any of
the Class CE, Class P and Residual Certificates.
Event
of Default:
As
defined in Section 8.01 hereof.
Excess
Cashflow:
With
respect to any Distribution Date, an amount, if any, equal to the sum of
(a) the
Remaining Excess Spread for such Distribution Date and (b) the
Overcollateralization Release Amount for such Distribution Date.
Excess
Liquidation Proceeds:
To the
extent not required by law to be paid to the related Mortgagor, the excess,
if
any, of any Liquidation Proceeds with respect to a Mortgage Loan over the
Stated
Principal Balance of such Mortgage Loan and accrued and unpaid interest at
the
related Mortgage Rate through the last day of the month in which the Mortgage
Loan has been liquidated.
Excess
Spread:
With
respect to any Distribution Date, the excess, if any, of (i) the Interest
Funds
for such Distribution Date over (ii) the sum of the Current Interest on the
Class A Certificates and Class M Certificates and Interest Carry Forward
Amounts
on the Class A Certificates (other than Interest Carry Forward Amounts paid
pursuant to Section 5.04(a)(3)(A)), in each case for such Distribution
Date.
Exchange
Act:
Securities Exchange Act of 1934, as amended.
Exemption:
Prohibited Transaction Exemption 90-30, as amended from time to
time.
Extra
Principal Distribution Amount:
With
respect to any Distribution Date, the lesser of (i) the excess, if any, of
the
Overcollateralization Target Amount for such Distribution Date over the
Overcollateralization Amount for such Distribution Date (after giving effect
to
distributions of principal on the Certificates other than any Extra Principal
Distribution Amount) and (ii) the related Excess Spread for such Distribution
Date.
Xxxxxx
Xxx:
Xxxxxx
Xxx (formerly, Federal National Mortgage Association), or any successor
thereto.
FDIC:
The
Federal Deposit Insurance Corporation, or any successor thereto.
Final
Certification:
The
certification substantially in the form of Exhibit Three to the Custodial
Agreement.
Final
Recovery Determination:
With
respect to any defaulted Mortgage Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased by EMC (on its own behalf as Seller
and
on behalf of Master Funding) pursuant to or as contemplated by Section 2.03(c)
or Section 10.01), a determination made by the Master Servicer that all
Insurance Proceeds, Liquidation Proceeds and other payments or recoveries
which
the Master Servicer, in its reasonable good faith judgment, expects to be
finally recoverable in respect thereof have been so recovered. The Master
Servicer shall maintain records of each Final Recovery Determination made
thereby.
FIRREA:
The
Financial Institutions Reform, Recovery, and Enforcement Act of
1989.
Fiscal
Quarter:
December 1 to February 29 (or the last day in such month), March 1 to May
31,
June 1 to August 31, or September 1 to November 30, as applicable.
Fitch:
Fitch,
Inc. and any successor thereto.
Form
8-K Disclosure Information:
As
defined in Section 3.16(a)(iii).
Xxxxxxx
Mac:
Federal
Home Loan Mortgage Corporation, or any successor thereto.
Global
Certificate:
Any
Private Certificate registered in the name of the Depository or its nominee,
beneficial interests in which are reflected on the books of the Depository
or on
the books of a Person maintaining an account with such Depository (directly
or
as an indirect participant in accordance with the rules of such
depository).
Gross
Margin:
With
respect to each Adjustable Rate Mortgage Loan, the fixed percentage set forth
in
the related Mortgage Note that is added to the Index on each Adjustment Date
in
accordance with the terms of the related Mortgage Note used to determine
the
Mortgage Rate for such Mortgage Loan.
Guarantor:
As
defined in Section 3.21(i).
Guarantee:
As
defined in Section 3.21(i).
Indemnified
Persons:
The
Trustee, the Master Servicer, the Trust Fund and their officers, directors,
agents and employees and, with respect to the Trustee, any separate co-trustee
and its officers, directors, agents and employees.
Index:
With
respect to each Adjustable Rate Mortgage Loan and with respect to each related
Adjustment Date, the index as specified in the related Mortgage
Note.
Individual
Certificate:
Any
Private Certificate registered in the name of the Holder other than the
Depository or its nominee.
Initial
Certification:
The
certification substantially in the form of Exhibit One to the Custodial
Agreement.
Initial
Certificate Principal Balance:
With
respect to any Certificate, the Certificate Principal Balance of such
Certificate or any predecessor Certificate on the Closing Date.
Institutional
Accredited Investor:
Any
Person meeting the requirements of Rule 501(a)(l), (2), (3) or (7) of Regulation
D under the Securities Act or any entity all of the equity Holders in which
come
within such paragraphs.
Insurance
Policy:
With
respect to any Mortgage Loan included in the Trust Fund, any insurance policy,
including all riders and endorsements thereto in effect with respect to such
Mortgage Loan, including any replacement policy or policies for any Insurance
Policies.
Insurance
Proceeds:
Proceeds paid in respect of the Mortgage Loans pursuant to any Insurance
Policy
and any other insurance policy covering a Mortgage Loan, to the extent such
proceeds are payable to the mortgagee under the Mortgage, the Master Servicer
or
the trustee under the deed of trust and are not applied to the restoration
of
the related Mortgaged Property or released to the Mortgagor in accordance
with
the procedures that the Master Servicer would follow in servicing mortgage
loans
held for its own account, in each case other than any amount included in
such
Insurance Proceeds in respect of Insured Expenses.
Insured
Expenses:
Expenses covered by any insurance policy with respect to the Mortgage
Loans.
Interest
Carry Forward Amount:
As of
any Distribution Date and with respect to each Class of Certificates (other
than
the Class CE, Class P and the Residual Certificates), the sum of (i) the
excess
of (a) the Current Interest for such Class with respect to such Distribution
Date and any prior Distribution Dates over (b) the amount actually distributed
to such Class of Certificates with respect to interest on such Distribution
Dates and (ii) interest thereon (to the extent permitted by applicable law)
at
the applicable Pass-Through Rate for such Class for the related Accrual Period
including the Accrual Period relating to such Distribution Date.
Interest
Determination Date:
Shall
mean the second LIBOR Business Day preceding the commencement of each Accrual
Period.
Interest
Funds:
With
respect to any Distribution Date (1) the sum, without duplication, of (a)
all
scheduled interest during the related Due Period with respect to the Mortgage
Loans, less the Servicing Fee, the Trustee Fee and the LPMI Fee, if any,
(b) all
Advances relating to interest with respect to the Mortgage Loans made on
or
prior to the related Distribution Account Deposit Date, (c) all Compensating
Interest with respect to the Mortgage Loans and required to be remitted by
the
Master Servicer pursuant to this Agreement with respect to such Distribution
Date, (d) Liquidation Proceeds and Subsequent Recoveries (to the extent such
Liquidation Proceeds and Subsequent Recoveries relate to interest) less all
Nonrecoverable Advances related to interest and certain expenses reimbursed
during the prior calendar month, in each case with respect to the Mortgage
Loans, (e) all amounts relating to interest with respect to each Mortgage
Loan
repurchased by EMC (on its own behalf as a Seller and on behalf of Master
Funding) pursuant to Sections 2.02 and 2.03 and by the Master Servicer pursuant
to Section 3.19, in each case to the extent remitted by the Master Servicer
to
the Distribution Account pursuant to this Agreement and (f) the interest
portion
of any proceeds received from the exercise of an Optional Termination, minus
(2)
(i) all amounts relating to interest required to be reimbursed pursuant to
Sections 4.02 and 4.05 or as otherwise set forth in this Agreement, and (ii)
any
Net Swap Payment or Swap Termination Payment (not due to a Swap Provider
Trigger
Event and other than to the extent already paid by the Swap Administrator
from
any upfront payment received pursuant to any replacement interest rate swap
agreements that may be entered into by the Supplemental Interest Trust Trustee)
owed to the Swap Administrator for payment to the Swap Provider for such
Distribution Date and any such payments remaining unpaid for any prior
Distribution Dates.
Interim
Certification:
The
certification substantially in the form of Exhibit Two to the Custodial
Agreement.
LaSalle:
LaSalle
Bank National Association, and any successor thereto.
Last
Scheduled Distribution Date:
Solely
for purposes of the face of the Certificates as follows: with respect to
the
Certificates, other than the Class A-1 Certificates and Class A-2 Certificates,
the Distribution Date in December 2036; with respect to the Class A-1
Certificates and Class A-2 Certificates, the Distribution Date in July 2031
and
July 2035, respectively.
Latest
Possible Maturity Date:
With
respect to the Certificates, December 25, 2036, which is the Distribution
Date
in the month following the final scheduled maturity date of the Mortgage
Loan in
the Trust Fund having the latest scheduled maturity date as of the Cut-off
Date.
For purposes of the Treasury regulations under Sections 860A through 860G
of the
Code, the latest possible maturity date of each Regular Interest issued by
REMIC
I, REMIC II, REMIC III, REMIC IV, REMIC V and REMIC VI shall be the Latest
Possible Maturity Date.
LIBOR
Business Day:
Shall
mean a day on which banks are open for dealing in foreign currency and exchange
in London and New York City.
Liquidated
Loan:
With
respect to any Distribution Date, a defaulted Mortgage Loan that has been
liquidated through deed-in-lieu of foreclosure, foreclosure sale, trustee’s sale
or other realization as provided by applicable law governing the real property
subject to the related Mortgage and any security agreements and as to which
the
Master Servicer has made a Final Recovery Determination with respect
thereto.
Liquidation
Proceeds:
Amounts, other than Insurance Proceeds, received in connection with the partial
or complete liquidation of a Mortgage Loan, whether through trustee’s sale,
foreclosure sale or otherwise, or in connection with any condemnation or
partial
release of a Mortgaged Property and any other proceeds received with respect
to
an REO Property, less the sum of related unreimbursed Advances, Servicing
Fees
and Servicing Advances and all expenses of liquidation, including property
protection expenses and foreclosure and sale costs, including court and
reasonable attorneys fees.
Loan-to-Value
Ratio:
The
fraction, expressed as a percentage, the numerator of which is the original
principal balance of the related Mortgage Loan and the denominator of which
is
the Appraised Value of the related Mortgaged Property.
Loss
Allocation Limitation:
The
meaning specified in Section 5.05(b) hereof.
LPMI
Fee:
The fee
payable to the insurer for each Mortgage Loan subject to an LPMI Policy as
set
forth in such LPMI Policy.
LPMI
Policy:
A
policy of mortgage guaranty insurance issued by an insurer meeting the
requirements of Xxxxxx Xxx and Xxxxxxx Mac in which the Master Servicer or
the
related subservicer of the related Mortgage Loan is responsible for the payment
of the LPMI Fee thereunder from collections on the related Mortgage
Loan.
Majority
Class CE Certificateholder:
The
Holder of a 50.01% or greater Percentage Interest in the Class CE
Certificates.
Marker
Rate:
With
respect to the Class CE Interest and any Distribution Date, a per annum rate
equal to two (2) times the weighted average of the Uncertificated REMIC II
Pass-Through Rates for the REMIC II Regular Interests (other than REMIC II
Regular Interests AA, IO and P), with the rate on each such REMIC II Regular
Interest (other than REMIC II Regular Interest ZZ) subject to a cap equal
to the
lesser of (i) the One-Month LIBOR Pass-Through Rate for the Corresponding
Certificate and (ii) the Net Rate Cap for the REMIC III Regular Interest
the
ownership of which is represented by the Corresponding Certificate for the
purpose of this calculation for such Distribution Date, and with the rate
on
REMIC II Regular Interest ZZ subject to a cap of zero for the purpose of
this
calculation; provided, however, that solely for this purpose, the related
cap
with respect to each REMIC II Regular Interest (other than REMIC II Regular
Interests AA, ZZ, IO and P) shall be multiplied by a fraction, the numerator
of
which is 30 and the denominator of which is the actual number of days in
the
related Accrual Period.
Master
Funding:
Master
Funding LLC, a Delaware limited liability company, and its successors and
assigns, in its capacity as the seller of the Master Funding Mortgage Loans
to
the Depositor.
Master
Funding Mortgage Loans:
The
Mortgage Loans identified as such on the Mortgage Loan Schedule for which
Master
Funding is the applicable seller.
Master
Servicer:
EMC
Mortgage Corporation, in its capacity as master servicer, and its successors
and
assigns.
Maximum
Mortgage Rate:
With
respect to each Adjustable Rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the maximum Mortgage Rate thereunder.
Maximum
Probable Exposure:
With
respect to each Distribution Date, the amount calculated by the Depositor
in
accordance with the Seller’s internal risk management process in respect of
similar instruments, such calculation to be performed as agreed by the Trustee
and the Depositor.
Maximum
Uncertificated Accrued Interest Deferral Amount:
With
respect to any Distribution Date, the excess, if any, of (i) accrued interest
at
the Uncertificated REMIC II Pass-Through Rate applicable to REMIC II Regular
Interest ZZ for such Distribution Date on a balance equal to the Uncertificated
Principal Balance of REMIC II Regular Interest ZZ minus the REMIC II
Overcollateralization Amount, in each case for such Distribution Date, over
(ii)
the aggregate amount of Uncertificated Accrued Interest for such Distribution
Date on the REMIC II Regular Interests (other than REMIC II Regular Interests
AA, ZZ, IO and P), with the rate on each such REMIC II Regular Interest subject
to a cap equal to the lesser of (x) the One-Month LIBOR Pass Through Rate
for
the Corresponding Certificate and (y) the Net Rate Cap for the REMIC III
Regular
Interest the ownership of which is represented by the Corresponding Certificate
for the purpose of this calculation for such Distribution Date; provided,
however, that solely for this purpose, the related cap with respect to each
REMIC II Regular Interest (other than REMIC II Regular Interests AA, ZZ,
IO and
P) shall be multiplied by a fraction, the numerator of which is 30 and the
denominator of which is the actual number of days in the related Accrual
Period.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS®
System:
The
system of recording transfers of Mortgages electronically maintained by
MERS.
MIN:
The
Mortgage Identification Number for Mortgage Loans registered with MERS on
the
MERS® System.
Minimum
Mortgage Rate:
With
respect to each Adjustable Rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the minimum Mortgage Rate thereunder.
MOM
Loan:
With
respect to any Mortgage Loan, MERS acting as the mortgagee of such Mortgage
Loan, solely as nominee for the originator of such Mortgage Loan and its
successors and assigns, at the origination thereof.
Monthly
Statement:
The
statement delivered to the Certificateholders pursuant to Section
5.06.
Moody’s:
Xxxxx’x
Investors Service, Inc., and any successor thereto.
Mortgage:
The
mortgage, deed of trust or other instrument creating a first or second lien
on
or first or second priority ownership interest in an estate in fee simple
in
real property securing a Mortgage Note.
Mortgage
File:
The
mortgage documents listed in Section 2.01 hereof pertaining to a particular
Mortgage Loan and any additional documents delivered to the Custodian to
be
added to the Mortgage File pursuant to this Agreement and the Custodial
Agreement.
Mortgage
Loans:
Such of
the Mortgage Loans transferred and assigned to the Trustee pursuant to the
provisions hereof, as from time to time are held as a part of the Trust Fund
(including any REO Property), the mortgage loans so held being identified
in the
Mortgage Loan Schedule, notwithstanding foreclosure or other acquisition
of
title of the related Mortgaged Property.
Mortgage
Loan Purchase Agreement:
The
Mortgage Loan Purchase Agreement, dated as of January 30, 2007, among EMC,
as a
seller, Master Funding, as a seller and the Depositor, as purchaser in the
form
attached hereto as Exhibit L.
Mortgage
Loan Purchase Price:
The
price, calculated as set forth in Section 10.01, to be paid in connection
with
the repurchase of the Mortgage Loans pursuant to Section 10.01.
Mortgage
Loan Schedule:
The
list of Mortgage Loans (as from time to time amended by the Seller or the
Master
Servicer to reflect the deletion of Deleted Mortgage Loans and the addition
of
Replacement Mortgage Loans pursuant to the provisions of this Agreement)
transferred to the Trustee as part of the Trust Fund and from time to time
subject to this Agreement, the initial Mortgage Loan Schedule being attached
hereto as Exhibit B setting forth the following information with respect
to each
Mortgage Loan:
(a) the
city,
state and zip code of the Mortgaged Property;
(b) the
property type;
(c) the
Mortgage Interest Rate;
(d) the
Servicing Fee Rate;
(e) the
Master Servicer's Fee Rate;
(f) the
LPMI
Fee, if applicable;
(g) [reserved];
(h) the
Net
Rate;
(i) the
maturity date;
(j) the
stated original term to maturity;
(k) the
stated remaining term to maturity;
(l) the
original Principal Balance;
(m) the
first
payment date;
(n) the
principal and interest payment in effect as of the Cut-off Date;
(o) the
unpaid Principal Balance as of the Cut-off Date;
(p) the
Loan-to-Value Ratio at origination;
(q) the
insurer of any Primary Mortgage Insurance Policy;
(r) the
MIN
with respect to each MOM Loan;
(s) the
Gross
Margin, if applicable;
(t) the
next
Adjustment Date, if applicable;
(u) the
Maximum Mortgage Rate, if applicable;
(v) the
Minimum Mortgage Rate, if applicable;
(w) the
Periodic Rate Cap, if applicable;
(x) the
Loan
Group, if applicable;
(y) a
code
indicating whether the Mortgage Loan is negatively amortizing;
(z) which
Mortgage Loans adjust after an initial fixed-rate period of one, two, three,
five, seven or ten years or any other period;
(aa) the
Prepayment Charge, if any;
(bb) lien
position (e.g., first lien or second lien);
(cc) a
code
indicating whether the Mortgage Loan is has a balloon payment;
(dd) a
code
indicating whether the Mortgage Loan is an interest-only loan;
(ee) the
interest-only term, if applicable;
(ff) the
Mortgage Loan Seller; and
(gg) the
original amortization term.
Such
schedule also shall set forth for all of the Mortgage Loans, the total number
of
Mortgage Loans, the total of each of the amounts described under (n) and
(o)
above, the weighted average by principal balance as of the Cut-off Date of
each
of the rates described under (c) through (h) above, and the weighted average
remaining term to maturity by unpaid principal balance as of the Cut-off
Date.
Mortgage
Loan Seller: EMC or Master Funding, as applicable.
Mortgage
Note:
The
original executed note or other evidence of indebtedness of a Mortgagor under
a
Mortgage Loan.
Mortgage
Rate:
With
respect to each fixed rate Mortgage Loan, the rate set forth in the related
Mortgage Note. With respect to each Adjustable Rate Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, which rate (A)
as
of any date of determination until the first Adjustment Date following the
Cut-off Date shall be the rate set forth in the Mortgage Loan Schedule as
the
Mortgage Rate in effect immediately following the Cut-off Date and (B) as
of any
date of determination thereafter shall be the rate as adjusted on the most
recent Adjustment Date, to equal the sum, rounded to the next highest or
nearest
0.125% (as provided in the Mortgage Note), of the Index, determined as set
forth
in the related Mortgage Note, plus the related Gross Margin subject to the
limitations set forth in the related Mortgage Note. With respect to each
Mortgage Loan that becomes an REO Property, as of any date of determination,
the
annual rate determined in accordance with the immediately preceding sentence
as
of the date such Mortgage Loan became an REO Property.
Mortgaged
Property:
The
underlying property securing a Mortgage Loan.
Mortgagor:
The
obligors on a Mortgage Note.
Net
Mortgage Rate:
As to
each Mortgage Loan, and at any time, the per annum rate equal to the Mortgage
Rate less the sum of (i) the Servicing Fee Rate, (ii) the Trustee Fee Rate
and
(iii) the rate at which the LPMI Fee is calculated, if any.
Net
Rate Cap:
With
respect to any Distribution Date and the Class A Certificates and Class M
Certificates, the excess, if any, of (A) a per annum rate equal to the product
of (x) the weighted average of the Net Mortgage Rates on the then outstanding
Mortgage Loans, weighted based on the Stated Principal Balances of such Mortgage
Loans as
of the
related Due Date prior to giving effect to any reduction in the Stated Principal
Balances of such Mortgage Loans on such Due Date,
and (y)
a fraction, the numerator of which is 30 and the denominator of which is
the
actual number of days elapsed in the related Accrual Period, over (B) an
amount,
expressed as a per annum rate, equal to the sum of (i) the Net Swap Payment
payable to the Swap Provider on such Distribution Date and (ii) any Swap
Termination Payment not due to a Swap Provider Trigger Event payable to the
Swap
Provider (other than to the extent already paid by the Swap Administrator
from
any upfront payment received pursuant to any replacement interest rate swap
agreement that may be entered into by the Supplemental Interest Trust Trustee),
divided by the aggregate outstanding Stated Principal Balance of the Mortgage
Loans as of the related Due Date prior to giving effect to any reduction
in the
Stated Principal Balances of such Mortgage Loans on such Due Date, multiplied
by
12. The Net Rate Cap for the Class A Certificates and Class M Certificates
will
be adjusted to an effective rate reflecting the accrual of interest on an
actual/360 basis. With
respect to any Distribution Date and the REMIC III Regular Interests the
ownership of which is represented by Class A Certificates and Class M
Certificates, a per annum rate equal to the weighted average (adjusted for
the
actual number of days elapsed in the related Accrual Period) of the
Uncertificated REMIC II Pass-Through Rates on the REMIC II Regular Interests
(other than REMIC II Regular Interests IO and P), weighted on the basis of
the
Uncertificated Principal Balances of each such REMIC II Regular Interest
immediately prior to such Distribution Date.
Net
Swap Payment:
With
respect to each Distribution Date, the net payment required to be made pursuant
to the terms of the Swap Agreement by either the Swap Provider or the Swap
Administrator, which net payment shall not take into account any Swap
Termination Payment.
Non
Book-Entry Certificate:
Any
Certificate other than a Book-Entry Certificate.
Nonrecoverable
Advance:
Any
portion of an Advance previously made or proposed to be made by the Master
Servicer pursuant to this Agreement, that, in the good faith judgment of
the
Master Servicer, will not or, in the case of a proposed advance, would not,
be
ultimately recoverable by it from the related Mortgagor, related Liquidation
Proceeds, Insurance Proceeds or otherwise.
Notional
Amount:
With
respect to each Distribution Date and the Swap Agreement, the notional amount
for the related calculation period as set forth in the related schedule set
forth in Exhibit M.
Offered
Certificates:
The
Class A-1, Class X-0, Xxxxx X-0, Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificates.
Officer’s
Certificate:
A
certificate (i) signed by the Chairman of the Board, the Vice Chairman of
the
Board, the President, a Vice President (however denominated), an Assistant
Vice
President, the Treasurer, the Secretary, or one of the assistant treasurers
or
assistant secretaries of the Depositor or the Master Servicer (or any other
officer customarily performing functions similar to those performed by any
of
the above designated officers and also to whom, with respect to a particular
matter, such matter is referred because of such officer’s knowledge of and
familiarity with a particular subject) or (ii), if provided for in this
Agreement, signed by a Servicing Officer, as the case may be, and delivered
to
the Depositor, the Seller, Master Funding and/or the Trustee, as the case
may
be, as required by this Agreement.
One-Month
LIBOR:
With
respect to any Accrual Period, the rate determined by the Trustee on the
related
Interest Determination Date on the basis of the rate for U.S. dollar deposits
for one month that appears on Telerate Screen Page 3750 as of 11:00 a.m.
(London
time) on such Interest Determination Date. If such rate does not appear on
such
page (or such other page as may replace that page on that service, or if
such
service is no longer offered, such other service for displaying One-Month
LIBOR
or comparable rates as may be reasonably selected by the Trustee), One-Month
LIBOR for the applicable Accrual Period will be the Reference Bank Rate.
If no
such quotations can be obtained by the Trustee and no Reference Bank Rate
is
available, One-Month LIBOR will be One-Month LIBOR applicable to the preceding
Accrual Period. The establishment of One-Month LIBOR on each Interest
Determination Date by the Trustee and the Trustee’s calculation of the rate of
interest applicable to the Class A Certificates and Class M Certificates
for the
related Accrual Period shall, in the absence of manifest error, be final
and
binding.
One-Month
LIBOR Pass-Through Rate:
With
respect to each Class A Certificate and Class M Certificate and, for purposes
of
the definitions of “Marker Rate” and “Maximum Uncertificated Accrued Interest
Deferral Amount”, the REMIC II Regular Interest for which such Certificate is
the Corresponding Certificate, a per annum rate equal to One-Month LIBOR
plus
the related Certificate Margin.
Opinion
of Counsel:
A
written opinion of counsel, who may be counsel for the Seller, the Depositor
or
the Master Servicer, reasonably acceptable to each addressee of such opinion;
provided that with respect to Section 2.05, 7.05, 7.07 or 11.01, or the
interpretation or application of the REMIC Provisions, such counsel must
(i) in
fact be independent of the Seller, Depositor and the Master Servicer, (ii)
not
have any direct financial interest in the
Seller, the
Depositor or the Master Servicer or in any affiliate of either, and (iii)
not be
connected with the Seller, the Depositor or the Master Servicer as an officer,
employee, promoter, underwriter, trustee, partner, director or person performing
similar functions.
Optional
Termination:
The
termination of the Trust Fund created hereunder as a result of the purchase
of
all of the Mortgage Loans and REO Property pursuant to Section 10.01
hereof.
Optional
Termination Date:
The
Distribution Date on which the Stated Principal Balance of all of the Mortgage
Loans is equal to or less than 10% of the Stated Principal Balance of all
of the
Mortgage Loans as of the Cut-off Date.
Original
Value:
The
value of the property underlying a Mortgage Loan based, in the case of the
purchase of the underlying Mortgaged Property, on the lower of an appraisal
or
the sales price of such property or, in the case of a refinancing, on an
appraisal.
OTS:
The
Office of Thrift Supervision.
Outstanding:
With
respect to the Certificates as of any date of determination, all Certificates
theretofore executed and authenticated under this Agreement except:
(a) Certificates
theretofore canceled by the Trustee or delivered to the Trustee for
cancellation; and
(b) Certificates
in exchange for which or in lieu of which other Certificates have been executed
and delivered by the Trustee pursuant to this Agreement.
Outstanding
Mortgage Loan:
As of
any date of determination, a Mortgage Loan with a Stated Principal Balance
greater than zero that was not the subject of a Principal Prepayment in full,
and that did not become a Liquidated Loan, prior to the end of the related
Prepayment Period.
Overcollateralization
Amount:
With
respect to any Distribution Date, the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related
Due
Period (after giving effect to scheduled payments of principal due during
the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month)
over the aggregate Certificate Principal Balance of the Class A Certificates
and
Class M Certificates on such Distribution Date (after taking into account
the
payment of principal other than any Extra Principal Distribution Amount on
such
Certificates).
Overcollateralization
Release Amount:
With
respect to any Distribution Date, the lesser of (x) the Principal Funds for
such
Distribution Date and (y) the excess, if any, of (i) the Overcollateralization
Amount for such Distribution Date (assuming that 100% of the Principal Funds
is
applied as a principal payment on such Distribution Date) over (ii) the
Overcollateralization Target Amount for such Distribution Date (with the
amount
pursuant to clause (y) deemed to be $0 if the Overcollateralization Amount
is
less than or equal to the Overcollateralization Target Amount on that
Distribution Date).
Overcollateralization
Target Amount:
With
respect to any Distribution Date (a) prior to the Stepdown Date, 4.00% of
the
aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off
Date,
(b) on or after the Stepdown Date and if a Trigger Event is not in effect,
the
greater of (i) the lesser of (1) 4.00% of the aggregate Stated Principal
Balance
of the Mortgage Loans as of the Cut-off Date and (2) 8.00% of the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the
related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period, and
after reduction for Realized Losses incurred during the prior calendar month)
and (ii) $1,766,719 or (c) on or after the Stepdown Date and if a Trigger
Event
is in effect, the Overcollateralization Target Amount for the immediately
preceding Distribution Date.
Ownership
Interest:
As to
any Certificate, any ownership interest in such Certificate including any
interest in such Certificate as the Holder thereof and any other interest
therein, whether direct or indirect, legal or beneficial.
Pass-Through
Rate:
With
respect to the Class A Certificates and Class M Certificates and any
Distribution Date, a per annum rate equal to the lesser of (i) the related
One-Month LIBOR Pass-Through Rate for such Distribution Date and (ii) the
Net
Rate Cap for such Distribution Date.
With
respect to the Class CE Interest and any Distribution Date, a rate per annum
equal to the percentage equivalent of a fraction, the numerator of which
is (x)
the sum of the amount determined for each REMIC II Regular Interest (other
than
REMIC II Regular Interests IO and P) equal to the product of (a) the excess,
if
any, of the Uncertificated REMIC II Pass-Through Rate for such REMIC II Regular
Interest over the Marker Rate and (b) a notional amount equal to the
Uncertificated Principal Balance of such REMIC II Regular Interest, and the
denominator of which is (y) the aggregate Uncertificated Principal Balance
of
such REMIC II Regular Interests.
With
respect to the Class CE Certificate, the Class CE Certificate shall not have
a
Pass-Through Rate, but Current Interest for such Certificate and each
Distribution Date shall be an amount equal to 100% of the amounts distributable
to the Class CE Interest for such Distribution Date.
With
respect to the Class P Certificate and the Class P Interest, 0.00% per
annum.
With
respect to the Class IO Interest, Class IO Interest shall not have a
Pass-Through Rate, but Current Interest for such interest and each Distribution
Date shall be an amount equal to 100% of the amounts distributable to REMIC
II
Regular Interest IO for such Distribution Date.
With
respect to REMIC VI Regular Interest IO, REMIC VI Regular Interest IO shall
not
have a Pass-Through Rate, but Current Interest for such Regular Interest
and
each Distribution Date shall be an amount equal to 100% of the amounts
distributable to the Class IO Interest for such Distribution Date.
Pass-Through
Transfer:
Any
transaction involving either (1) a sale or other transfer of mortgage loans
directly or indirectly to an issuing entity in connection with an issuance
of
publicly offered or privately placed, rated or unrated mortgage-backed
securities or (2) an issuance of publicly offered or privately placed, rated
or
unrated securities, the payments on which are determined primarily by reference
to one or more portfolios of residential mortgage loans.
Percentage
Interest:
With
respect to any Certificate of a specified Class, the Percentage Interest
set
forth on the face thereof or the percentage obtained by dividing the
Denomination of such Certificate by the aggregate of the Denominations of
all
Certificates of such Class.
Periodic
Rate Cap:
With
respect to each Adjustable Rate Mortgage Loan and any Adjustment Date therefor,
the fixed percentage set forth in the related Mortgage Note, which is the
maximum amount by which the Mortgage Rate for such Mortgage Loan may increase
or
decrease (without regard to the Maximum Mortgage Rate or the Minimum Mortgage
Rate) on such Adjustment Date from the Mortgage Rate in effect immediately
prior
to such Adjustment Date.
Permitted
Investments:
At any
time, any one or more of the following obligations and securities:
| (i) |
obligations
of the United States or any agency thereof, provided such obligations
are
backed by the full faith and credit of the United
States;
|
| (ii) |
general
obligations of or obligations guaranteed by any state of the United
States
or the District of Columbia receiving the highest long-term debt
rating of
each Rating Agency, or such lower rating as will not result in the
downgrading or withdrawal of the ratings then assigned to the Certificates
by each Rating Agency, as evidenced in
writing;
|
| (iii) |
commercial
or finance company paper which is then receiving the highest commercial
or
finance company paper rating of each Rating Agency, or such lower
rating
as will not result in the downgrading or withdrawal of the ratings
then
assigned to the Certificates by each Rating Agency, as evidenced
in
writing;
|
| (iv) |
certificates
of deposit, demand or time deposits, or bankers’ acceptances issued by any
depository institution or trust company incorporated under the laws
of the
United States or of any state thereof and subject to supervision
and
examination by federal and/or state banking authorities (including
the
Trustee in its commercial banking capacity), provided that the commercial
paper and/or long term unsecured debt obligations of such depository
institution or trust company are then rated one of the two highest
long-term and the highest short-term ratings of each such Rating
Agency
for such securities, or such lower ratings as will not result in
the
downgrading or withdrawal of the rating then assigned to the Certificates
by any Rating Agency, as evidenced in
writing;
|
| (v) |
guaranteed
reinvestment agreements issued by any bank, insurance company or
other
corporation containing, at the time of the issuance of such agreements,
such terms and conditions as will not result in the downgrading or
withdrawal of the rating then assigned to the Certificates by each
Rating
Agency, as evidenced in writing;
|
| (vi) |
repurchase
obligations with respect to any security described in clauses (i)
and (ii)
above, in either case entered into with a depository institution
or trust
company (acting as principal) described in clause (v)
above;
|
| (vii) |
securities
(other than stripped bonds, stripped coupons or instruments sold
at a
purchase price in excess of 115% of the face amount thereof) bearing
interest or sold at a discount issued by any corporation incorporated
under the laws of the United States or any state thereof which, at
the
time of such investment, have one of the two highest short term ratings
of
each Rating Agency (except if the Rating Agency is Moody’s, such rating
shall be the highest commercial paper rating of Moody’s for any such
securities), or such lower rating as will not result in the downgrading
or
withdrawal of the rating then assigned to the Certificates by each
Rating
Agency, as evidenced by a signed writing delivered by each Rating
Agency;
|
| (viii) |
interests
in any money market fund (including any such fund managed or advised
by
the Trustee or any affiliate thereof) which at the date of acquisition
of
the interests in such fund and throughout the time such interests
are held
in such fund has the highest applicable short term rating by each
Rating
Agency or such lower rating as will not result in the downgrading
or
withdrawal of the ratings then assigned to the Certificates by each
Rating
Agency, as evidenced in writing;
|
| (ix) |
short
term investment funds sponsored by any trust company or banking
association incorporated under the laws of the United States or any
state
thereof (including any such fund managed or advised by the Trustee
or the
Master Servicer or any affiliate thereof) which on the date of acquisition
has been rated by each Rating Agency in their respective highest
applicable rating category or such lower rating as will not result
in the
downgrading or withdrawal of the ratings then assigned to the Certificates
by each Rating Agency, as evidenced in writing;
and
|
| (x) |
such
other investments having a specified stated maturity and bearing
interest
or sold at a discount acceptable to each Rating Agency and as will
not
result in the downgrading or withdrawal of the rating then assigned
to the
Certificates by any Rating Agency, as evidenced by a signed writing
delivered by each Rating Agency;
|
provided,
that no such instrument shall be a Permitted Investment if such instrument
(i)
evidences the right to receive interest only payments with respect to the
obligations underlying such instrument, (ii) is purchased at a premium or
(iii)
is purchased at a deep discount; provided further that no such instrument
shall
be a Permitted Investment (A) if such instrument evidences principal and
interest payments derived from obligations underlying such instrument and
the
interest payments with respect to such instrument provide a yield to maturity
of
greater than 120% of the yield to maturity at par of such underlying
obligations, or (B) if it may be redeemed at a price below the purchase price
(the foregoing clause (B) not to apply to investments in units of money market
funds pursuant to clause (viii) above); provided further that no amount
beneficially owned by any REMIC may be invested in investments (other than
money
market funds) treated as equity interests for federal income tax purposes,
unless the Trustee shall receive an Opinion of Counsel, at the expense of
the
Trustee, to the effect that such investment will not adversely affect the
status
of any such REMIC as a REMIC under the Code or result in imposition of a
tax on
any such REMIC. Permitted Investments that are subject to prepayment or call
may
not be purchased at a price in excess of par.
Permitted
Transferee:
Any
person (x) other than (i) the United States, any State or political subdivision
thereof, any possession of the United States or any agency or instrumentality
of
any of the foregoing, (ii) a foreign government, International Organization
or
any agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers’ cooperatives described in section 521 of the Code) that
is exempt from tax imposed by Chapter 1 of the Code (including the tax imposed
by section 511 of the Code on unrelated business taxable income) on any excess
inclusions (as defined in section 860E(c)(1) of the Code) with respect to
any
Residual Certificate, (iv) rural electric and telephone cooperatives described
in section 1381(a)(2)(C) of the Code or (v) on electing large partnership
within
the meaning of Section 775(a) of the Code, (y) that is a citizen or resident
of
the United States, a corporation, partnership (other than a partnership that
has
any direct or indirect foreign partners) or other entity (treated as a
corporation or a partnership for federal income tax purposes), created or
organized in or under the laws of the United States, any State thereof or
the
District of Columbia, an estate whose income from sources without the United
States is includible in gross income for United States federal income tax
purposes regardless of its connection with the conduct of a trade or business
within the United States, or a trust if a court within the United States
is able
to exercise primary supervision over the administration of the trust and
one or
more United States persons have authority to control all substantial decisions
of the trust or if it has a valid election in effect under applicable U.S.
Treasury regulations to be treated as a United States person and (z) other
than
any other Person so designated by the Trustee based upon an Opinion of Counsel
addressed to the Trustee (which shall not be an expense of the Trustee) that
states that the Transfer of an Ownership Interest in a Residual Certificate
to
such Person may cause REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or
REMIC
VI to fail to qualify as a REMIC at any time that any Certificates are
Outstanding. The terms “United States,” “State” and “International Organization”
shall have the meanings set forth in section 7701 of the Code or successor
provisions. A corporation will not be treated as an instrumentality of the
United States or of any State or political subdivision thereof for these
purposes if all of its activities are subject to tax and, with the exception
of
Xxxxxxx Mac, a majority of its board of directors is not selected by such
government unit.
Person:
Any
individual, corporation, partnership, joint venture, association, joint-stock
company, limited liability company, trust, unincorporated organization or
government, or any agency or political subdivision thereof.
Prepayment
Assumption:
The
applicable rate of prepayment as described in the Prospectus
Supplement.
Prepayment
Charge:
Any
prepayment premium, penalty or charge payable by a Mortgagor in connection
with
any Principal Prepayment on a Mortgage Loan pursuant to the terms of the
related
Mortgage Note.
Prepayment
Charge Waiver Amount:
Any
amount paid by the Master Servicer to the Trustee in respect of waived
Prepayment Charges pursuant to Section 4.01(a).
Prepayment
Interest Shortfall:
With
respect to any Distribution Date, for each Mortgage Loan that was the subject
of
a partial Principal Prepayment during the related Prepayment Period or a
Principal Prepayment in full during the related Prepayment Period, or that
became a Liquidated Loan during the prior calendar month, (other than a
Principal Prepayment in full resulting from the purchase of a Mortgage Loan
pursuant to Section 2.02, 2.03, 3.19 or 10.01 hereof), the amount, if any,
by
which (i) one month’s interest at the applicable Net Mortgage Rate on the Stated
Principal Balance of such Mortgage Loan immediately prior to such prepayment
(or
liquidation) or in the case of a partial Principal Prepayment on the amount
of
such prepayment (or liquidation proceeds) exceeds (ii) the amount of interest
paid or collected in connection with such Principal Prepayment or such
liquidation proceeds less the sum of (a) the Trustee Fee, (b) the Servicing
Fee
and (c) the LPMI Fee, if any, in each case with respect to the related Mortgage
Loan.
Prepayment
Period:
As
to any
Distribution Date, and each Principal Prepayment in full, the period commencing
on the 16th day of the month prior to the month in which the related
Distribution Date occurs (or with respect to the first Distribution Date,
the
period commencing on the Cut-off Date) and ending on the 15th day of the
month
in which such Distribution Date occurs. With respect to any Distribution
Date
and each partial Principal Prepayment, the calendar month prior to the month
of
such Distribution Date.
Primary
Mortgage Insurance Policy:
Any
primary mortgage guaranty insurance policy issued in connection with a Mortgage
Loan which provides compensation to a Mortgage Note Holder in the event of
default by the obligor under such Mortgage Note or the related security
instrument, if any or any replacement policy therefor through the related
Accrual Period for such Class relating to a Distribution Date.
Principal
Distribution Amount:
With
respect to each Distribution Date, an amount equal to (x) the Principal Funds
for such Distribution Date plus (y) any Extra Principal Distribution Amount
for
such Distribution Date, less (z) any Overcollateralization Release
Amount.
Principal
Funds:
With
respect to any Distribution Date,
(1) the
sum, without duplication, of (a) all scheduled principal collected during
the
related Due Period, (b) all Advances relating to principal made on or before
the
Distribution Account Deposit Date, (c) Principal Prepayments exclusive of
Prepayment Charges or penalties collected on the Mortgage Loans during the
related Prepayment Period, (d) the Stated Principal Balance of each Mortgage
Loan that was repurchased by EMC on its own behalf as Seller and on behalf
of
Master Funding) pursuant to Sections 2.02 and 2.03 and by the Master Servicer
pursuant to Section 3.19, (e) the aggregate of all Substitution Adjustment
Amounts for the related Determination Date in connection with the substitution
of Mortgage Loans pursuant to Section 2.03(c), (f) all Liquidation Proceeds
and
Subsequent Recoveries collected on the Mortgage Loans during the prior calendar
month (to the extent such Liquidation Proceeds and Subsequent Recoveries
relate
to principal), in each case to the extent remitted by the Master Servicer
to the
Distribution Account pursuant to this Agreement and (g) the principal portion
of
any proceeds received from the exercise of an Optional Termination, as
applicable, minus (2)(i) all amounts required to be reimbursed pursuant to
Sections 4.02 and 4.05 or as otherwise set forth in this Agreement and (ii)
any
Net Swap Payments or Swap Termination Payments (not due to a Swap Provider
Trigger Event and other than to the extent already paid by the Swap
Administrator from any upfront payment received pursuant to any replacement
interest rate swap agreement that may be entered into by the Supplemental
Interest Trust Trustee) owed to the Swap Administrator for payment to the
Swap
Provider for such Distribution Date and any such payments remaining unpaid
for
any prior Distribution Dates to the extent not paid from Interest
Funds.
Principal
Prepayment:
Any
Mortgagor payment or other recovery of (or proceeds with respect to) principal
on a Mortgage Loan (including loans purchased or repurchased under Sections
2.02, 2.03, 3.19 and 10.01 hereof) that is received in advance of its scheduled
Due Date and is not accompanied by an amount as to interest representing
scheduled interest due on any date or dates in any month or months subsequent
to
the month of prepayment. Partial Principal Prepayments shall be applied by
the
Master Servicer, as appropriate, in accordance with the terms of the related
Mortgage Note.
Private
Certificates:
Any of
the Class M-10, Class P, Class CE and Residual Certificates.
Prospectus
Supplement:
The
Prospectus Supplement dated January 26, 2007 relating to the public offering
of
the Offered Certificates.
Protected
Account:
The
separate Eligible Account established and maintained by the Master Servicer
with
respect to the Mortgage Loans and REO Property in accordance with Section
4.01
hereof.
PUD:
A
Planned Unit Development.
Purchase
Price:
With
respect to any Mortgage Loan required to be purchased pursuant to the applicable
provisions of this Agreement, an amount equal to the sum of (i) 100% of the
Stated Principal Balance remaining unpaid on such Mortgage Loan as of the
date
of purchase (including if a foreclosure has already occurred, the principal
balance of the related Mortgage Loan at the time the Mortgaged Property was
acquired), net of any Servicing Advances and Advances attributable to principal
and payable to the purchaser of the Mortgage Loan if such purchaser is also
the
Master Servicer of such Mortgage Loan, (ii) accrued and unpaid interest thereon
at the applicable Mortgage Rate through and including the last day of the
month
of such purchase, net of any portion of the Servicing Fee and any Servicing
Advances and Advances attributable to interest that is payable to the purchaser
of the Mortgage Loan if such purchaser is also the Master Servicer of such
Mortgage Loan, and (iii) any costs and damages (if any) incurred by the Trust
in
connection with any violation of such Mortgage Loan of any anti-predatory
lending laws.
QIB:
A
Qualified Institutional Buyer as defined in Rule 144A promulgated under the
Securities Act.
Rating
Agency:
Each of
Xxxxx’x and S&P. If any such organization or its successor is no longer in
existence, “Rating Agency” shall be a nationally recognized statistical rating
organization, or other comparable Person, designated by the Depositor, notice
of
which designation shall be given to the Trustee. References herein to a given
rating category of a Rating Agency shall mean such rating category without
giving effect to any modifiers.
Realized
Loss:
With
respect to each Mortgage Loan as to which a Final Recovery Determination
has
been made, an amount (not less than zero) equal to (i) the unpaid principal
balance of such Mortgage Loan as of the commencement of the calendar month
in
which the Final Recovery Determination was made, plus (ii) accrued interest
from
the Due Date as to which interest was last paid by the Mortgagor or advanced
through the end of the calendar month in which such Final Recovery Determination
was made, calculated in the case of each calendar month during such period
(A)
at an annual rate equal to the annual rate at which interest was then accruing
on such Mortgage Loan and (B) on a principal amount equal to the Stated
Principal Balance of such Mortgage Loan as of the close of business on the
Distribution Date during such calendar month, minus (iii) the proceeds, if
any,
received in respect of such Mortgage Loan during the calendar month in which
such Final Recovery Determination was made, net of amounts that are payable
therefrom to the Master Servicer pursuant to this Agreement which have not
been
previously reimbursed. With respect to each Mortgage Loan which is the subject
of a Servicing Modification, (a)(1) the amount by which the interest portion
of
a monthly payment or the principal balance of such Mortgage Loan was reduced
or
(2) the sum of any other amounts owing under the Mortgage Loan that were
forgiven and that constitute Servicing Advances that are reimbursable to
the
Master Servicer, and (b) any such amount with respect to a monthly payment
that
was or would have been due in the month immediately following the month in
which
a Principal Prepayment or the Purchase Price of such Mortgage Loan is received
or is deemed to have been received and not paid due to a Servicing Modification.
In addition, to the extent the Master Servicer receives Subsequent Recoveries
with respect to any Mortgage Loan, the amount of the Realized Loss with respect
to that Mortgage Loan will be reduced to the extent such recoveries are
distributed to any Class of Certificates or applied to increase Excess Spread
on
any Distribution Date.
With
respect to any REO Property as to which a Final Recovery Determination has
been
made, an amount (not less than zero) equal to (i) the unpaid principal balance
of the related Mortgage Loan as of the date of acquisition of such REO Property
on behalf of REMIC I, plus (ii) accrued interest from the Due Date as to
which
interest was last paid by the Mortgagor in respect of the related Mortgage
Loan
through the end of the calendar month immediately preceding the calendar
month
in which such REO Property was acquired, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual rate at
which
interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan
as of
the close of business on the Distribution Date during such calendar month,
plus
(iii) REO Imputed Interest for such REO Property for each calendar month
commencing with the calendar month in which such REO Property was acquired
and
ending with the calendar month in which such Final Recovery Determination
was
made, minus (iv) the aggregate of all unreimbursed Advances and Servicing
Advances.
With
respect to each Mortgage Loan which has become the subject of a Deficient
Valuation, the difference between the principal balance of the Mortgage Loan
outstanding immediately prior to such Deficient Valuation and the principal
balance of the Mortgage Loan as reduced by the Deficient Valuation.
With
respect to each Mortgage Loan which has become the subject of a Debt Service
Reduction, the portion, if any, of the reduction in each affected Monthly
Payment attributable to a reduction in the Mortgage Rate imposed by a court
of
competent jurisdiction. Each such Realized Loss shall be deemed to have been
incurred on the Due Date for each affected Monthly Payment.
Record
Date:
With
respect to any Distribution Date and the Certificates (other than the Class
CE,
Class P and Residual Certificates), so long as such Classes of Certificates
are
Book-Entry Certificates, the Business Day preceding such Distribution Date,
and
otherwise, the close of business on the last Business Day of the month preceding
the month in which such Distribution Date occurs. With respect to the Class
CE,
Class P and Residual Certificates, so long as such Classes of Certificates
remain non Book-Entry Certificates, the close of business on the last Business
Day of the month preceding the month in which such Distribution Date
occurs.
Reference
Banks:
Shall
mean leading banks selected by the Trustee and engaged in transactions in
Eurodollar deposits in the international Eurocurrency market (i) with an
established place of business in London, (ii) which have been designated
as such
by the Trustee and (iii) which are not controlling, controlled by, or under
common control with, the Depositor, the Seller or the Master
Servicer.
Reference
Bank Rate:
With
respect to any Accrual Period shall mean the arithmetic mean, rounded upwards,
if necessary, to the nearest whole multiple of 0.03125%, of the offered rates
for United States dollar deposits for one month that are quoted by the Reference
Banks as of 11:00 a.m., New York City time, on the related Interest
Determination Date to prime banks in the London interbank market for a period
of
one month in an amount approximately equal to the aggregate Certificate
Principal Balance of the Class A Certificates and Class M Certificates for
such
Accrual Period, provided that at least two such Reference Banks provide such
rate. If fewer than two offered rates appear, the Reference Bank Rate will
be
the arithmetic mean, rounded upwards, if necessary, to the nearest whole
multiple of 0.03125%, of the rates quoted by one or more major banks in New
York
City, selected by the Trustee, as of 11:00 a.m., New York City time, on such
date for loans in United States dollars to leading European banks for a period
of one month in amounts approximately equal to the aggregate Certificate
Principal Balance of the Class A Certificates and Class M Certificates for
such
Accrual Period.
Regular
Certificate:
Any
Certificate other than a Residual Certificate.
Regular
Interest:
A
“regular interest” in a REMIC within the meaning of Section 860G(a)(1) of the
Code.
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject
to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
Relief
Act:
The
Servicemembers Civil Relief Act, as amended, or similar state law.
Relief
Act Interest Shortfall:
With
respect to any Distribution Date and any Mortgage Loan, any reduction in
the
amount of interest collectible on such Mortgage Loan for the most recently
ended
Due Period as a result of the application of the Relief Act.
Remaining
Excess Spread:
With
respect to any Distribution Date, the Excess Spread less any Extra Principal
Distribution Amount, in each case for such Distribution Date.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of section 860D of the
Code.
REMIC
I:
The
segregated pool of assets described in the Preliminary Statement and Section
5.07(a).
REMIC
I Regular Interest:
Any of
the separate non-certificated beneficial ownership interests in REMIC I issued
hereunder and designated as a Regular Interest in REMIC I. Each REMIC I Regular
Interest shall accrue interest at the related Uncertificated REMIC I
Pass-Through Rate in effect from time to time, and shall be entitled to
distributions of principal, subject to the terms and conditions hereof, in
an
aggregate amount equal to its initial Uncertificated Principal Balance as
set
forth in the Preliminary Statement hereto. The designations for the respective
REMIC I Regular Interests are set forth in the Preliminary Statement hereto.
The
REMIC I Regular Interests consist of REMIC I Regular Interest I-1-A through
REMIC I Regular Interest I-60-B and REMIC I Regular Interest P, each as
designated in the Preliminary Statement hereto.
REMIC
II:
The
segregated pool of assets described in the Preliminary Statement and Section
5.07(a).
REMIC
II Interest Loss Allocation Amount:
With
respect to any Distribution Date, an amount (subject to adjustment based
on the
actual number of days elapsed in the respective Accrual Period) equal to
(a) the
product of (i) the aggregate Stated Principal Balance of the Mortgage Loans
and
the related REO Properties then outstanding and (ii) the Uncertificated REMIC
II
Pass-Through Rate for REMIC II Regular Interest AA minus the Marker Rate,
divided by (b) 12.
REMIC
II Overcollateralization Amount:
With
respect to any date of determination, (i) 1.00% of the aggregate Uncertificated
Principal Balance of the REMIC II Regular Interests (other than REMIC II
Regular
Interests IO and P) minus (ii) the aggregate Uncertificated Principal Balance
of
each REMIC II Regular Interest for which a Class A Certificate or Class M
Certificate is a Corresponding Certificate, in each case, as of such date
of
determination.
REMIC
II Principal Loss Allocation Amount:
With
respect to any Distribution Date, an amount equal to the product of (i) the
aggregate Stated Principal Balance of the Mortgage Loans and the related
REO
Properties then outstanding and (ii) 1 minus a fraction, the numerator of
which
is two (2) times the aggregate Uncertificated Principal Balance of each REMIC
II
Regular Interest for which a Class A Certificate or Class M Certificate is
a
Corresponding Certificate and the denominator of which is the aggregate
Uncertificated Principal Balance of each REMIC II Regular Interest for which
a
Class A Certificate or Class M Certificate is a Corresponding Certificate
and
REMIC II Regular Interest ZZ.
REMIC
II Regular Interest:
Any of
the separate non-certificated beneficial ownership interests in REMIC II
issued
hereunder and designated as a Regular Interest in REMIC II. Each REMIC II
Regular Interest shall accrue interest at the related Uncertificated REMIC
II
Pass-Through Rate in effect from time to time, and (except for the REMIC
II
Regular Interest IO) shall be entitled to distributions of principal, subject
to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Principal Balance as set forth in the Preliminary Statement
hereto. The designations for the respective REMIC II Regular Interests are
set
forth in the Preliminary Statement hereto.
REMIC
II Required Overcollateralization Amount:
1.00%
of the Overcollateralization Target Amount.
REMIC
III:
The
segregated pool of assets described in the Preliminary Statement and Section
5.07(a).
REMIC
III Regular Interest:
The
Class CE Interest, Class P Interest, Class IO Interest or any Regular Interest
in REMIC III the ownership of which is represented by any of the Class A
Certificates or Class M Certificates.
REMIC
IV:
The
segregated pool of assets consisting of the Class CE Interest conveyed in
trust
to the Trustee, for the benefit of the Holders of the Class CE Certificates
and
the Class RX Certificate (in respect of the Class R-4 Interest), with respect
to
which a separate REMIC election is to be made.
REMIC
IV Certificate:
Any
Class CE Certificate or Class RX Certificate (in respect of the Class I-R-4
Interest).
REMIC
V:
The
segregated pool of assets consisting of the Class P Interest conveyed in
trust
to the Trustee, for the benefit of the Holders of the Class P Certificates
and
the Class RX Certificate (in respect of the Class R-5 Interest), with respect
to
which a separate REMIC election is to be made.
REMIC
V Certificate:
Any
Class P Certificate or Class RX Certificate (in respect of the Class I-R-5
Interest).
REMIC
VI:
The
segregated pool of assets consisting of the Class IO Interest conveyed in
trust
to the Trustee, for the benefit of the holders of REMIC VI Regular Interest
IO
and the Class RX Certificate (in respect of the Class R-6 Interest), with
respect to which a separate REMIC election is to be made.
REMIC
VI Interests:
The
REMIC VI Regular Interest IO or Class RX Certificate (in respect of the Class
R-6 Interest).
REMIC
Opinion:
Shall
mean an Opinion of Counsel to the effect that the proposed action will not
cause
any of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or REMIC VI to fail
to
qualify as a REMIC at any time that any Certificates are
outstanding.
REMIC
Provisions:
Provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Sections 860A through 860G of the Code,
and
related provisions, and proposed, temporary and final regulations and published
rulings, notices and announcements promulgated thereunder, as the foregoing
may
be in effect from time to time, as well as provisions of applicable state
laws.
REMIC
Regular Interests:
The
REMIC I Regular Interests and REMIC II Regular Interests.
Remittance
Report:
Shall
mean a report to the Trustee in an electronic format (or by such other means
as
the Master Servicer and the Trustee may agree from time to time) containing
such
data and information, as agreed to by the Master Servicer and the Trustee
such
as to permit the Trustee to prepare the Monthly Statement to
Certificateholders.
REO
Imputed Interest:
As to
any REO Property, for any calendar month during which such REO Property was
at
any time part of REMIC I, one month’s interest at the applicable Net Mortgage
Rate on the Stated Principal Balance of such REO Property (or, in the case
of
the first such calendar month, of the related Mortgage Loan, if appropriate)
as
of the close of business on the Distribution Date in such calendar
month.
REO
Property:
A
Mortgaged Property acquired by the Master Servicer through foreclosure or
deed-in-lieu of foreclosure in connection with a defaulted Mortgage
Loan.
Replacement
Mortgage Loan:
A
Mortgage Loan or Mortgage Loans in the aggregate substituted by the Seller
for a
Deleted Mortgage Loan, which must, on the date of such substitution, as
confirmed in a Request for Release, (i) have a Stated Principal Balance,
after
deduction of the principal portion of the Scheduled Payment due in the month
of
substitution, not in excess of, and not less than 90% of, the Stated Principal
Balance of the Deleted Mortgage Loan; (ii) if the Replacement Mortgage Loan
is a
fixed rate Mortgage Loan, have a fixed Mortgage Rate not less than or more
than
1% per annum higher than the Mortgage Rate of the Deleted Mortgage Loan;
(iii)
have the same or higher credit quality characteristics than that of the Deleted
Mortgage Loan; (iv) have a Loan-to-Value Ratio no higher than that of the
Deleted Mortgage Loan; (v) have a remaining term to maturity no greater than
(and not more than one year less than) that of the Deleted Mortgage Loan;
(vi)
not permit conversion of the Mortgage Rate from a fixed rate to a variable
rate;
(vii) have the same lien priority as the Deleted Mortgage Loan; (viii)
constitute the same occupancy type as the Deleted Mortgage Loan or be owner
occupied; (ix) if the Replacement Mortgage Loan is an Adjustable Rate Mortgage
Loan, have a Maximum Mortgage Rate not less than the Maximum Mortgage Rate
on
the Deleted Mortgage Loan, (x) if the Replacement Mortgage Loan is an Adjustable
Rate Mortgage Loan, have a Minimum Mortgage Rate not less than the Minimum
Mortgage Rate of the Deleted Mortgage Loan, (xi) if the Replacement Mortgage
Loan is an Adjustable Rate Mortgage Loan, have a Gross Margin equal to or
greater than the Gross Margin of the Deleted Mortgage Loan, (xii) if the
Replacement Mortgage Loan is an Adjustable Rate Mortgage Loan, have a next
Adjustment Date not more than two months later than the next Adjustment Date
on
the Deleted Mortgage Loan, (xiii) comply with each representation and warranty
set forth in Section 7 of the Mortgage Loan Purchase Agreement and (xiv)
the
Custodian has delivered a Final Certification noting no defects or
exceptions.
Reportable
Event:
As
defined in Section 3.16(a)(iii).
Request
for Release:
The
Request for Release to be submitted by the Seller or the Master Servicer
to the
Custodian substantially in the form of Exhibit G. Each Request for Release
furnished to the Custodian by the Seller or the Master Servicer shall be
in
duplicate and shall be executed by an officer of such Person or a Servicing
Officer (or, if furnished electronically to the Custodian, shall be deemed
to
have been sent and executed by an officer of such Person or a Servicing Officer)
of the Master Servicer.
Required
Insurance Policy:
With
respect to any Mortgage Loan, any insurance policy that is required to be
maintained from time to time under this Agreement.
Reserve
Fund:
Shall
mean the separate trust account created and maintained by the Trustee pursuant
to Section 3.21 hereof.
Reserve
Fund Deposit:
With
respect to the Reserve Fund, an amount equal to $5,000, which the Depositor
shall initially deposit into the Reserve Fund pursuant to Section 3.21
hereof.
Residual
Certificates:
The
Class R-1, Class R-2, Class R-3 and Class RX Certificates (representing
ownership of the Class R-4 Interest, Class R-5 Interest and Class R-6 Interest),
each evidencing the sole class of Residual Interests in the related
REMIC.
Residual
Interest:
The
sole class of “residual interests” in a REMIC within the meaning of Section
860G(a)(2) of the Code.
Responsible
Officer:
With
respect to the Trustee, any Vice President, any Assistant Vice President,
the
Secretary, any Assistant Secretary, or any Trust Officer with specific
responsibility for the transactions contemplated hereby, any other officer
customarily performing functions similar to those performed by any of the
above
designated officers or other officers of the Trustee specified by the Trustee,
as to whom, with respect to a particular matter, such matter is referred
because
of such officer’s knowledge of and familiarity with the particular
subject.
S&P:
Standard & Poor’s, a division of The XxXxxx-Xxxx Companies, Inc., and any
successor thereto.
Xxxxxxxx-Xxxxx
Act:
The
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations of the Commission
promulgated thereunder (including any interpretations thereof by the
Commission’s staff).
Xxxxxxxx-Xxxxx
Certification:
As
defined in Section 3.16(a)(iii).
Scheduled
Payment:
The
scheduled monthly payment on a Mortgage Loan due on any Due Date allocable
to
principal and/or interest on such Mortgage Loan.
Securities
Act:
The
Securities Act of 1933, as amended.
Seller:
EMC, in
its capacity as seller of the Mortgage Loans to the Depositor.
Senior
Certificates:
Any of
the Class A-1, Class A-2 and Class A-3 Certificates.
Servic(es)(ing):
In
accordance with Regulation AB, the act of servicing and administering the
Mortgage Loans or any other assets of the Trust by an entity that meets the
definition of “servicer’ set forth in Item 1101 of Regulation AB and is subject
to the disclosure requirements set forth in 1108 of Regulation AB. For
clarification purposes, any uncapitalized occurrence of this term shall have
the
meaning commonly understood by participants in the residential mortgage-backed
securitization market.
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses
(including reasonable legal fees) incurred in the performance by the Master
Servicer of its servicing obligations hereunder, including, but not limited
to,
the cost of (i) the preservation, restoration and protection of a Mortgaged
Property, (ii) any enforcement or judicial proceedings, including foreclosures,
and including any expenses incurred in relation to any such proceedings that
result from the Mortgage Loan being registered in the MERS® System, (iii) the
management and liquidation of any REO Property (including, without limitation,
realtor’s commissions) and (iv) compliance with any obligations under Section
3.07 hereof to cause insurance to be maintained.
Servicing
Criteria:
The
“servicing criteria” set forth in Item 1122(d) of Regulation AB, as such may be
amended from time to time.
Servicing
Fee:
As to
each Mortgage Loan and any Distribution Date, an amount equal to 1/12th of
the
Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage
Loan as of the Due Date in the month preceding the month in which such
Distribution Date occurs or, in the event of any payment of interest that
accompanies a Principal Prepayment in full during the related Due Period
made by
the Mortgagor immediately prior to such prepayment, interest at the Servicing
Fee Rate on the Stated Principal Balance of such Mortgage Loan for the period
covered by such payment of interest.
Servicing
Fee Rate:
0.500%
per annum.
Servicing
Modification:
With
respect to any Mortgage Loan that is in default or, in the reasonable judgment
of the Master Servicer, as to which default is reasonably foreseeable, any
modification which is effected by the Master Servicer in accordance with
the
terms of this Agreement which results in any change in the outstanding Stated
Principal Balance, any change in the Mortgage Rate or any extension of the
term
of such Mortgage Loan.
Servicing
Officer:
Any
officer of the Master Servicer involved in, or responsible for, the
administration and servicing of the Mortgage Loans whose name and facsimile
signature appear on a list of servicing officers furnished to the Trustee
by the
Master Servicer on the Closing Date pursuant to this Agreement, as such list
may
from time to time be amended.
Significance
Estimate:
With
respect to any Distribution Date, and in accordance with Item 1115 of Regulation
AB, shall be an amount determined based on the reasonable good-faith estimate
by
the Seller or its affiliate of the aggregate Maximum Probable Exposure of
the
outstanding Class A Certificates and Class M Certificates to the Swap Agreement.
Significance
Percentage:
With
respect to any Distribution Date, and in accordance with Item 1115 of Regulation
AB, shall be a percentage equal to the Significance Estimate divided by the
aggregate outstanding Certificate Principal Balance of the Class A Certificates
and Class M Certificates, prior to the distribution of the Principal
Distribution Amount on such Distribution Date.
Sponsor:
EMC
Mortgage Corporation, in its capacity as sponsor hereunder.
Startup
Day:
The
Startup Day for each REMIC formed hereunder shall be the Closing
Date.
Stated
Principal Balance:
With
respect to any Mortgage Loan or related REO Property and any Distribution
Date,
the Cut-off Date Principal Balance thereof minus the sum of (i) the principal
portion of the Scheduled Payments due with respect to such Mortgage Loan
during
each Due Period ending prior to such Distribution Date (and irrespective
of any
delinquency in their payment), (ii) all Principal Prepayments with respect
to
such Mortgage Loan received prior to or during the related Prepayment Period,
(iii) all Liquidation Proceeds to the extent applied by the Master Servicer
as
recoveries of principal in accordance with Section 3.09 with respect to such
Mortgage Loan, that were received by the Master Servicer as of the close
of
business on the last day of the calendar month immediately preceeding such
Distribution Date and (iv) any Realized Losses on such Mortgage Loan incurred
during the prior calendar month. The Stated Principal Balance of a Liquidated
Loan equals zero.
Stepdown
Date:
The
earlier to occur of, (I) the first Distribution Date following the Distribution
Date for which the Certificate Principal Balance for each of the Class A
Certificates has been reduced to zero, and (II) the later to occur of (a)
the
Distribution Date in February 2010 and (b) the first Distribution Date on
which
the Current Specified Enhancement Percentage is greater than or equal to
50.40%.
Subsequent
Recoveries:
As of
any Distribution Date, amounts received by the Master Servicer (net of any
related expenses permitted to be reimbursed pursuant to Section 4.02) or
surplus
amounts held by the Master Servicer to cover estimated expenses (including,
but
not limited to, recoveries in respect of the representations and warranties
made
by the Seller pursuant to the Mortgage Loan Purchase Agreement) specifically
related to a Mortgage Loan that was the subject of a liquidation or final
disposition of any REO Property prior to the related calendar month that
resulted in a Realized Loss.
Subservicing
Agreement:
Any
agreement entered into between the Master Servicer and a subservicer with
respect to the subservicing of any Mortgage Loan hereunder by such
subservicer.
Substitution
Adjustment Amount:
The
meaning ascribed to such term pursuant to Section 2.03(c).
Successor
Master Servicer:
The
meaning ascribed to such term pursuant to Section 8.02.
Supplemental
Interest Trust:
The
corpus of a trust created pursuant to Section 3.21 of this Agreement and
designated as the “Supplemental Interest Trust,” consisting of the Swap
Agreement, the Swap Administration Agreement, REMIC VI Regular Interest IO,
the
Swap Collateral Account and the Swap Account. For the avoidance of doubt,
the
Supplemental Interest Trust, the Swap Agreement, the Swap Account, the Swap
Collateral Account and the Swap Administration Agreement do not constitute
parts
of the Trust Fund or any REMIC.
Supplemental
Interest Trust Trustee:
LaSalle
Bank National Association, a national banking association not in its individual
capacity but solely in its capacity as supplemental interest trust trustee
and
any successor thereto, and any corporation or national banking association
resulting from or surviving any consolidation or merger to which it or its
successors may be a party and any successor supplemental interest trust trustee
as may from time to time be serving as successor supplemental interest trust
trustee.
Swap
Account:
The
separate trust account created and maintained by the Swap Administrator,
and
held within the Supplemental Interest Trust, pursuant to the Swap Administration
Agreement.
Swap
Administrator:
LaSalle
Bank National Association acting as Swap administrator under the Swap
Administration Agreement.
Swap
Administration Agreement:
The
Swap Administration Agreement, dated January 30, 2007, pursuant to which
the
Swap Administrator will make payments to the Swap Provider and the
Certificateholders, and certain other payments, as such agreement may be
amended
or supplemented from time to time.
Swap
Agreement:
The
interest rate swap agreement, dated as of January 30, 2007, between the
Supplemental Interest Trust Trustee and the Swap Provider, including any
schedule, confirmations, credit support annex or other credit support document
relating thereto, and attached hereto as Exhibit N.
Swap
Collateral Account:
Shall
mean the separate interest-bearing account created and maintained by the
Swap
Administrator pursuant to the Swap Administration Agreement.
Swap
Credit Support Annex:
The
credit support annex, dated as of January 30, 2007, between the Supplemental
Interest Trust Trustee and the Swap Provider, which is annexed to and forms
part
of the Swap Agreement.
Swap
Early Termination:
The
occurrence of an Early Termination Date (as defined in the Swap Agreement)
under
the Swap Agreement.
Swap
LIBOR:
For any
Distribution Date, a per annum rate equal to the Floating Rate Option (as
defined in the Swap Agreement) for the related Calculation Period (as defined
in
the Swap Agreement).
Swap
Optional Termination Payment:
As
defined in Section 10.01.
Swap
Provider:
The
swap provider under the Swap Agreement either (a) entitled to receive payments
from the Swap Administrator from amounts payable by the Trust Fund under
this
Agreement or (b) required to make payments to the Swap Administrator for
distribution as provided herein, in either case pursuant to the terms of
the
Swap Agreement, and any successor in interest or assign. Initially, the Swap
Provider shall be Wachovia Bank, N.A.
Swap
Provider Trigger Event:
With
respect to any Distribution Date, (i) an Event of Default under the Swap
Agreement with respect to which the Swap Provider is a Defaulting Party,
(ii) a
Termination Event under the Swap Agreement with respect to which the Swap
Provider is the sole Affected Party, or (iii) an Additional Termination Event
under the Swap Agreement with respect to which the Swap Provider is the sole
Affected Party.
Swap
Termination Payment:
Upon
the designation of an “Early Termination Date” as defined in the Swap Agreement,
the payment to be made by the Swap Administrator to the Swap Provider from
payments from the Trust Fund, or by the Swap Provider to the Swap Administrator
for payment to the Trust Fund, as applicable, pursuant to the terms of the
Swap
Agreement.
Tax
Matters Person:
The
person designated as “tax matters person” in the manner provided under Treasury
Regulation Sections 1.860F-4(d) and 301.6231(a)(7)-1T. The Holder of the
greatest Percentage Interest in a Class of Residual Certificates shall be
the
Tax Matters Person for the related REMIC. The Trustee, or any successor thereto
or assignee thereof, shall serve as tax administrator hereunder and as agent
for
the related Tax Matters Person.
Transfer:
Any
direct or indirect transfer or sale of any Ownership Interest in a
Certificate.
Transfer
Affidavit:
As
defined in Section 6.02.
Trigger
Event:
With
respect to any Distribution Date, a Trigger Event exists if (i) a related
Delinquency Event shall have occurred and be continuing or (ii) the aggregate
amount of Realized Losses on the Mortgage Loans since the Cut-off Date as
a
percentage of the aggregate Cut-off Date Principal Balance of the Mortgage
Loans
exceeds the applicable percentages set forth below with respect to such
Distribution Date:
|
Distribution
Date
|
Percentage
|
|
February
2010 through January 2011
|
4.60%
with respect to February 2010, plus an additional 1/12th
of
the difference between 7.25% and 4.60% for each month
thereafter
|
|
February
2011 through January 2012
|
7.25%
with respect to February 2011, plus an additional 1/12th
of
the difference between 9.30% and 7.25% for each month
thereafter
|
|
February
2012 through January 2013
|
9.30%
with respect to February 2012, plus an additional 1/12th
of
the difference between 10.40% and 9.30% for each month
thereafter
|
|
February
2013 and thereafter
|
10.40%
|
Trust
Fund or Trust:
The
corpus of the trust created hereunder consisting of (i) the Mortgage Loans
and
all interest accruing and principal due with respect thereto after the Cut-off
Date to the extent not applied in computing the Cut-off Date Principal Balance
thereof; (ii) the Distribution Account, the Class P Certificate Account,
the
Reserve Fund and the Protected Account and all amounts deposited therein
pursuant to the applicable provisions of this Agreement; (iii) property that
secured a Mortgage Loan and has been acquired by foreclosure, deed in lieu
of
foreclosure or otherwise; (iv) the mortgagee’s rights under the Insurance
Policies with respect to the Mortgage Loans; (v) the rights under the Swap
Administration Agreement relating to the Certificates; (vi) the rights under
the
Mortgage Loan Purchase Agreement; and (vii) all proceeds of the foregoing,
including proceeds of conversion, voluntary or involuntary, of any of the
foregoing into cash or other liquid property.
Trustee:
LaSalle
Bank National Association, for the benefit of the Certificateholders under
this
Agreement, a national banking association and any successor thereto, and
any
corporation or national banking association resulting from or surviving any
consolidation or merger to which it or its successors may be a party and
any
successor trustee as may from time to time be serving as successor trustee
hereunder.
Trustee
Fee:
As to
each Mortgage Loan and any Distribution Date, a per annum fee equal to 0.0080%
multiplied by the Stated Principal Balance of such Mortgage Loan as of the
Due
Date in the month preceding the month in which such Distribution Date
occurs.
Uncertificated
Accrued Interest:
With
respect to each REMIC Regular Interest on each Distribution Date, an amount
equal to one month’s interest at the related Uncertificated Pass-Through Rate on
the related Uncertificated Principal Balance or related Uncertificated Notional
Amount of such REMIC Regular Interest. In each case, Uncertificated Accrued
Interest will be reduced by any Prepayment Interest Shortfalls and Relief
Act
Interest Shortfalls (allocated to such REMIC Regular Interests as set forth
in
Section 1.02).
Uncertificated
Notional Amount:
With
respect to the Class CE Interest and any Distribution Date, an amount equal
to
the aggregate Uncertificated Principal Balance of the REMIC II Regular Interests
(other than REMIC II Regular Interest P) for such Distribution
Date.
With
respect to REMIC II Regular Interest IO and each Distribution Date listed
below,
the aggregate Uncertificated Principal Balance of the REMIC I Regular Interests
ending with the designation “A” listed below:
|
Distribution
Date
|
REMIC
I Regular Interests
|
|
1
|
I-1-A
through X-00-X
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
0
|
X-0-X
through X-00-X
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
0
|
X-0-X
through X-00-X
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
0
|
X-0-X
through X-00-X
|
|
0
|
X-0-X
xxxxxxx X-00-X
|
|
0
|
X-0-X
through I-60-A
|
|
10
|
I-10-A
through I-60-A
|
|
11
|
I-11-A
through I-60-A
|
|
12
|
I-12-A
through I-60-A
|
|
13
|
I-13-A
through I-60-A
|
|
14
|
I-14-A
through I-60-A
|
|
15
|
I-15-A
through I-60-A
|
|
16
|
I-16-A
through I-60-A
|
|
17
|
I-17-A
through I-60-A
|
|
18
|
I-18-A
through I-60-A
|
|
19
|
I-19-A
through I-60-A
|
|
20
|
I-20-A
through I-60-A
|
|
21
|
I-21-A
through I-60-A
|
|
22
|
I-22-A
through I-60-A
|
|
23
|
I-23-A
through I-60-A
|
|
24
|
I-24-A
through I-60-A
|
|
25
|
I-25-A
through I-60-A
|
|
26
|
I-26-A
through I-60-A
|
|
27
|
I-27-A
through I-60-A
|
|
28
|
I-28-A
through I-60-A
|
|
29
|
I-29-A
through I-60-A
|
|
30
|
I-30-A
through I-60-A
|
|
31
|
I-31-A
through I-60-A
|
|
32
|
I-32-A
through I-60-A
|
|
33
|
I-33-A
through I-60-A
|
|
34
|
I-34-A
through I-60-A
|
|
35
|
I-35-A
through I-60-A
|
|
36
|
I-36-A
through I-60-A
|
|
37
|
I-37-A
through I-60-A
|
|
38
|
I-38-A
through I-60-A
|
|
39
|
I-39-A
through I-60-A
|
|
40
|
I-40-A
through I-60-A
|
|
41
|
I-41-A
through I-60-A
|
|
42
|
I-42-A
through I-60-A
|
|
43
|
I-43-A
through I-60-A
|
|
44
|
I-44-A
through I-60-A
|
|
45
|
I-45-A
through I-60-A
|
|
46
|
I-46-A
through I-60-A
|
|
47
|
I-47-A
through I-60-A
|
|
48
|
I-48-A
through I-60-A
|
|
49
|
I-49-A
through I-60-A
|
|
50
|
I-50-A
through I-60-A
|
|
51
|
I-51-A
through I-60-A
|
|
52
|
I-52-A
through I-60-A
|
|
53
|
I-53-A
through I-60-A
|
|
54
|
I-54-A
through I-60-A
|
|
55
|
I-55-A
through I-60-A
|
|
56
|
I-56-A
through I-60-A
|
|
57
|
I-57-A
through I-60-A
|
|
58
|
I-58-A
through I-60-A
|
|
59
|
I-59-A
through I-60-A
|
|
60
|
I-60-A
|
|
thereafter
|
$0.00
|
With
respect to the Class IO Interest and any Distribution Date, an amount equal
to
the Uncertificated Notional Amount of the REMIC II Regular Interest IO. With
respect to REMIC VI Regular Interest IO, an amount equal to the Uncertificated
Notional Amount of the Class IO Interest.
Uncertificated
Pass-Through Rate:
The
Uncertificated REMIC I Pass-Through Rate or Uncertificated REMIC II Pass-Through
Rate.
Uncertificated
Principal Balance:
The
amount of REMIC Regular Interests, Class P Interest and Class CE Interest
outstanding as of any date of determination. As of the Closing Date, the
Uncertificated Principal Balance of each REMIC Regular Interest, Class P
Interest and Class CE Interest shall equal the amount set forth in the
Preliminary Statement hereto as its initial Uncertificated Principal Balance,
and on any date of determination thereafter, the Uncertificated Principal
Balance of the Class CE Interest shall be an amount equal to the excess,
if any,
of (A) the then aggregate Uncertificated Principal Balance of the REMIC II
Regular Interests, over (B) the then aggregate Certificate Principal Balance
of
the Class A Certificates and the Class M Certificates and the Uncertificated
Principal Balance of the Class P Interest then outstanding. On each Distribution
Date, the Uncertificated Principal Balance of the REMIC Regular Interests,
Class
CE Interest and Class P Interest shall be reduced by all distributions of
principal made on such REMIC Regular Interests, Class CE Interest and Class
P
Interest on such Distribution Date pursuant to Section 5.07 and, if and to
the
extent necessary and appropriate, shall be further reduced on such Distribution
Date by Realized Losses as provided in Section 5.05, and the Uncertificated
Principal Balances of REMIC II Regular Interest ZZ shall be increased by
interest deferrals as provided in Sections 5.07(d)(1)(ii). The Uncertificated
Principal Balance of each REMIC Regular Interest, Class P Interest and Class
CE
Interest shall never be less than zero.
Uncertificated
REMIC I Pass-Through Rate:
With
respect to each REMIC I Regular Interest ending with the designation “A” and any
Distribution Date, a per annum rate equal to the weighted average Net Mortgage
Rate of the Mortgage Loans multiplied by 2, subject to a maximum rate of
10.4230%. With respect to each REMIC I Regular Interest ending with the
designation “B” and any Distribution Date, the greater of (x) a per annum rate
equal to the excess, if any, of (1) 2 multiplied by the weighted average
Net
Mortgage Rate of the Mortgage Loans over (2) 10.4230% and (y) 0.00% per annum.
With
respect to REMIC I Regular Interest P, 0.00%.
Uncertificated
REMIC II Pass-Through Rate:
With
respect to REMIC II Regular Interest AA, each REMIC II Regular Interest for
which a Class A Certificate or Class M Certificate is the Corresponding
Certificate and REMIC II Regular Interest ZZ, and any Distribution Date,
a per
annum rate equal to the weighted average of (x) the Uncertificated REMIC
I
Pass-Through Rates for the REMIC I Regular Interests ending with the designation
“B” for such Distribution Date and (y) the rates listed below for the REMIC I
Regular Interests ending with the designation “A” for such Distribution Date, in
each case, weighted on the basis of the Uncertificated Principal Balances
of
each such REMIC I Regular Interest for such Distribution Date:
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
|
1
|
I-1-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
2
|
I-2-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
3
|
I-3-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-2-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
4
|
I-4-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-3-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
5
|
I-5-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-4-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
6
|
I-6-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-5-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
7
|
I-7-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-6-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
8
|
I-8-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-7-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
9
|
I-9-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-8-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
10
|
I-10-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-9-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
11
|
I-11-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-10-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
12
|
I-12-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-11-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
13
|
I-13-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-12-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
14
|
I-14-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-13-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
15
|
I-15-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-14-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
16
|
I-16-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-15-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
17
|
I-17-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-16-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
18
|
I-18-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-17-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
19
|
I-19-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-18-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
20
|
I-20-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-19-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
21
|
I-21-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-20-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
22
|
I-22-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-21-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
23
|
I-23-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-22-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
24
|
I-24-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-23-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
25
|
I-25-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-24-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
26
|
I-26-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-25-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
27
|
I-27-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-26-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
28
|
I-28-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-27-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
29
|
I-29-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-28-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
30
|
I-30-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-29-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
31
|
I-31-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-30-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
32
|
I-32-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-31-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
33
|
I-33-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-32-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
34
|
I-34-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-33-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
35
|
I-35-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-34-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
36
|
I-36-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-35-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
37
|
I-37-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-36-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
38
|
I-38-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-37-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
39
|
I-39-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-38-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
40
|
I-40-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-39-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
41
|
I-41-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-40-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
42
|
I-42-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-41-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
43
|
I-43-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-42-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
44
|
I-44-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-43-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
45
|
I-45-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-44-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
46
|
I-46-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-45-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
47
|
I-47-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-46-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
48
|
I-48-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-47-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
49
|
I-49-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-48-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
50
|
I-50-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-49-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
51
|
I-51-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-50-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
52
|
I-52-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-51-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
53
|
I-53-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-52-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
54
|
I-54-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-53-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
55
|
I-55-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-54-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
56
|
I-56-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-55-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
57
|
I-57-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-56-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
58
|
I-58-A
through I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-57-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
59
|
I-59-A
and I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-58-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
60
|
I-60-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of Uncertificated
REMIC I Pass-Through Rate
|
|
I-1-A
through I-59-A
|
Uncertificated
REMIC I Pass-Through Rate
|
|
|
thereafter
|
I-1-A
through I-60-A
|
Uncertificated
REMIC I Pass-Through Rate
|
With
respect to REMIC II Regular Interest IO and any Distribution Date, a per
annum
rate equal to the excess, if any, of (x) the weighted average of the
Uncertificated REMIC I Pass-Through Rates for the REMIC I Regular Interests
ending with the designation “A”, over (y) 2 multiplied by Swap
LIBOR.
With
respect to REMIC II Regular Interest P, 0.00%.
Unpaid
Realized Loss Amount:
With
respect to any Class A Certificates and as to any Distribution Date, is the
excess of Applied Realized Loss Amounts with respect to such Class over the
sum
of all distributions in reduction of the Applied Realized Loss Amounts on
all
previous Distribution Dates. Any amounts distributed to the Class A Certificates
in respect of any Unpaid Realized Loss Amount shall not be applied to reduce
the
Certificate Principal Balance of such Class.
Voting
Rights:
The
portion of the voting rights of all the Certificates that is allocated to
any
Certificate for purposes of the voting provisions hereunder. Voting Rights
shall
be allocated, (i) 92% to the Class A Certificates and Class M Certificates,
(ii)
3% to the Class CE Certificates until paid in full, and (iii) 1% to each
of the
Class R-1, Class R-2, Class R-3, Class RX and Class P Certificates, with
the
allocation among the Certificates (other than the Class CE, Class P and Residual
Certificates) to be in proportion to the Certificate Principal Balance of
each
Class relative to the Certificate Principal Balance of all other such Classes.
Voting rights will be allocated among the Certificates of each such Class
in
accordance with their respective Percentage Interests.
Section
1.02 Allocation
of Certain Interest Shortfalls.
For
purposes of calculating the amount of Current Interest for the Class A, Class
M
and Class CE Certificates for any Distribution Date, the aggregate amount
of any
Prepayment Interest Shortfalls (to the extent not covered by payments by
the
Master Servicer pursuant to Section 5.02) and any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall
be
allocated first, to the CE Interest based on, and to the extent of, one month’s
interest at the then applicable Pass-Through Rate on the Uncertificated Notional
Amount thereof, and thereafter, among the Class A Certificates and Class
M
Certificates, in each case on a pro
rata
basis
based on, and to the extent of, one month’s interest at the then applicable
respective Pass Through Rates on the respective Certificate Principal Balances
of each such Certificate.
For
purposes of calculating the amount of Uncertificated Accrued Interest for
the
REMIC I Regular Interests (other
than REMIC I Regular Interest P) for
any
Distribution Date, the aggregate amount of any Prepayment Interest Shortfalls
(to the extent not covered by payments by the Master Servicer pursuant to
Section 5.02) and any Relief Act Interest Shortfalls incurred in respect
of the
Mortgage Loans for any Distribution Date shall be allocated first, to REMIC
I
Regular Interests ending with the designation “B”, on a pro
rata
basis,
based on, and to the extent of, one month’s interest at the then applicable
respective Uncertificated REMIC I Pass-Through Rates on the respective
Uncertificated Principal Balances of each such REMIC I Regular Interest,
and
second, to REMIC I Regular Interests ending with the designation “A”, on a
pro
rata
basis,
based on, and to the extent of, one month’s interest at the then applicable
respective Uncertificated REMIC I Pass-Through Rates on the respective
Uncertificated Principal Balances of each such REMIC I Regular
Interest.
For
purposes of calculating the amount of Uncertificated Accrued Interest for
the
REMIC II Regular Interests (other than REMIC I Regular Interests IO and P)
for
any Distribution Date, the aggregate amount of any Prepayment Interest
Shortfalls (to the extent not covered by payments by the Master Servicer
pursuant to Section 5.02) and any Relief Act Interest Shortfalls incurred
in
respect of the Mortgage Loans for any Distribution Date shall be allocated
first, to Uncertificated Accrued Interest payable to REMIC II Regular Interest
AA and REMIC II Regular Interest ZZ up to an aggregate amount equal to the
REMIC
II Interest Loss Allocation Amount, 98% and 2%, respectively, and thereafter,
among REMIC II Regular Interest AA, each REMIC II Regular Interest for which
a
Class A Certificate or Class M Certificate is a Corresponding Certificate
and
REMIC II Regular Interest ZZ, on a pro
rata
basis,
based on, and to the extent of, one month’s interest at the then applicable
respective Uncertificated REMIC II Pass-Through Rates on the respective
Uncertificated Principal Balances of each such REMIC II Regular
Interest.
ARTICLE
II
CONVEYANCE
OF TRUST FUND
Section
2.01 Conveyance
of Trust Fund.
Pursuant
to the Mortgage Loan Purchase Agreement, the Seller sold, transferred, assigned,
set over and otherwise conveyed to the Depositor, without recourse, all the
right, title and interest of the Seller in and to the assets sold by it in
the
Trust Fund. Pursuant to the Mortgage Loan Purchase Agreement, Master Funding
sold, transferred, assigned, set over and otherwise conveyed to the Depositor,
without recourse, all the right, title and interest of Master Funding in
and to
the assets sold by it in the Trust Fund.
The
Seller has entered into this Agreement in consideration for the purchase
of the
Mortgage Loans by the Depositor pursuant to the Mortgage Loan Purchase Agreement
and has agreed to take the actions specified herein.
The
Depositor, concurrently with the execution and delivery hereof, hereby sells,
transfers, assigns, sets over and otherwise conveys to the Trustee for the
use
and benefit of the Certificateholders, without recourse, all the right, title
and interest of the Depositor in and to the Trust Fund.
In
connection with such sale, the Depositor has delivered to, and deposited
with,
or caused to be delivered to and deposited with, the Trustee or the Custodian,
as its agent, the following documents or instruments with respect to each
Mortgage Loan so assigned: (i) the original Mortgage Note, including any
riders
thereto, endorsed without recourse (A) in blank or to the order of “LaSalle Bank
National Association, as Trustee for Certificateholders of Bear Xxxxxxx Asset
Backed Securities I LLC, Asset-Backed Certificates, Series 2007-AQ1,” or (B) in
the case of a loan registered on the MERS system, in blank, and in each case
showing an unbroken chain of endorsements from the original payee thereof
to the
Person endorsing it to the Trustee, (ii) the original Mortgage and, if the
related Mortgage Loan is a MOM Loan, noting the presence of the MIN and language
indicating that such Mortgage Loan is a MOM Loan, which shall have been recorded
(or, for Mortgage Loans other than the EMC Flow Loans, if the original is
not
available, a copy), with evidence of such recording indicated thereon (or
if
clause (x) in the proviso below applies, shall be in recordable form), (iii)
unless the Mortgage Loan is either a MOM Loan or has been assigned in the
name
of MERS, the assignment (either an original or a copy, which may be in the
form
of a blanket assignment if permitted in the jurisdiction in which the Mortgaged
Property is located) to the Trustee of the Mortgage with respect to each
Mortgage Loan in the name of “LaSalle Bank National Association, as Trustee for
Certificateholders of Bear Xxxxxxx Asset Backed Securities I LLC, Asset-Backed
Certificates, Series 2007-AQ1,” which shall have been recorded (or if clause (x)
in the proviso below applies, shall be in recordable form), (iv) an original
or
a copy of all intervening assignments of the Mortgage, if any, to the extent
available to the Seller, with evidence of recording thereon, (v) the original
policy of title insurance or mortgagee’s certificate of title insurance or
commitment or binder for title insurance or, in the event such original title
policy has not been received from the title insurer, such original title
policy
will be delivered within one year of the Closing Date or, in the event such
original title policy is unavailable, a photocopy of such title policy or,
in
lieu thereof, a current lien search on the related Mortgaged Property and
(vi)
originals or copies of all available assumption, modification or substitution
agreements, if any; provided, however, that in lieu of the foregoing, the
Seller
or Master Funding, as applicable, may deliver the following documents, under
the
circumstances set forth below: (x) if any Mortgage (other than the Mortgages
related to the EMC Flow Loans), assignment thereof to the Trustee or intervening
assignments thereof have been delivered or are being delivered to recording
offices for recording and have not been returned in time to permit their
delivery as specified above, the Depositor may deliver, or cause to be
delivered, a true copy thereof with a certification by the Seller or Master
Funding, as applicable, or the title company issuing the commitment for title
insurance, on the face of such copy, substantially as follows: “Certified to be
a true and correct copy of the original, which has been transmitted for
recording”; (y)
in
lieu of the Mortgage (other than the Mortgages related to the EMC Flow Loans),
assignment to the Trustee or in blank or intervening assignments thereof,
if the
applicable jurisdiction retains the originals of such documents (as evidenced
by
a certification from the Depositor to such effect) the Depositor may deliver,
or
cause to be delivered, photocopies of such documents containing an original
certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; and
(z)
in lieu of the Mortgage Notes relating to the Mortgage Loans identified in
the
list set forth in Exhibit I, the Depositor may deliver, or cause to be
delivered, a lost note affidavit and indemnity and a copy of the original
note,
if available; and provided, further, however, that in the case of Mortgage
Loans
which have been prepaid in full after the Cut-off Date and prior to the Closing
Date, the Depositor, in lieu of delivering the above documents, may deliver,
or
cause to be delivered, to the Trustee and the Custodian a certification of
a
Servicing Officer to such effect and in such case shall deposit all amounts
paid
in respect of such Mortgage Loans, in the Protected Account or in the
Distribution Account on the Closing Date. In the case of the documents referred
to in clause (x) above, the Depositor shall deliver, or cause to be delivered,
such documents to the Trustee or the Custodian promptly after they are
received.
EMC
(on
its own behalf as Seller and on behalf of Master Funding) shall cause, at
its
expense, the Mortgage and intervening assignments, if any, and to the extent
required in accordance with the foregoing, the assignment of the Mortgage
to the
Trustee to be submitted for recording promptly after the Closing Date; provided
that, the Seller need not cause to be recorded (a) any assignment in any
jurisdiction under the laws of which, as evidenced by an Opinion of Counsel
addressed to the Trustee delivered by EMC (on its own behalf as Seller and
on
behalf of Master Funding) to the Trustee and the Rating Agencies, the
recordation of such assignment is not necessary to protect the Trustee’s
interest in the related Mortgage Loan or (b) if MERS is identified on the
Mortgage or on a properly recorded assignment of the Mortgage as the mortgagee
of record solely as nominee for the Seller and Master Funding and its successors
and assigns. In the event that the Seller, Master Funding, the Depositor
or the
Master Servicer gives written notice to the Trustee that a court has
recharacterized the sale of the Mortgage Loans as a financing, EMC (on its
own
behalf as Seller and on behalf of Master Funding) shall submit or cause to
be
submitted for recording as specified above each such previously unrecorded
assignment to be submitted for recording as specified above at the expense
of
the Trust. In the event a Mortgage File is released to the Master Servicer
as a
result of such Person having completed a Request for Release, the Custodian
shall, if not so completed, complete the assignment of the related Mortgage
in
the manner specified in clause (iii) above.
In
connection with the assignment of any Mortgage Loan registered on the MERS®
System, EMC (on its own behalf as Seller and on behalf of Master Funding)
further agrees that it will cause, at the Seller’s own expense, within 30 days
after the Closing Date, the MERS® System to indicate that such Mortgage Loans
have been assigned by EMC (on its own behalf as Seller and on behalf of Master
Funding) to the Depositor and by the Depositor to the Trustee in accordance
with
this Agreement for the benefit of the Certificateholders by including (or
deleting, in the case of Mortgage Loans which are repurchased in accordance
with
this Agreement) in such computer files (a) the code in the field which
identifies the specific Trustee and (b) the code in the field “Pool Field” which
identifies the series of the Certificates issued in connection with such
Mortgage Loans. EMC (on its own behalf as Seller and on behalf of Master
Funding) further agrees that it will not, and will not permit the Master
Servicer to, and the Master Servicer agrees that it will not, alter the codes
referenced in this paragraph with respect to any Mortgage Loan during the
term
of this Agreement unless and until such Mortgage Loan is repurchased in
accordance with the terms of this Agreement or the Mortgage Loan Purchase
Agreement.
Section
2.02 Acceptance
of the Mortgage Loans.
(a) Based
on
the Initial Certification received by it from the Custodian, the Trustee
acknowledges receipt of, subject to the further review and exceptions reported
by the Custodian pursuant to the procedures described below, the documents
(or
certified copies thereof) delivered to the Trustee or the Custodian on its
behalf pursuant to Section 2.01 and declares that it holds and will continue
to
hold directly or through a custodian those documents and any amendments,
replacements or supplements thereto and all other assets of the Trust Fund
delivered to it in trust for the use and benefit of all present and future
Holders of the Certificates. On the Closing Date, the Trustee or the Custodian
on its behalf will deliver an Initial Certification, in the form of Exhibit
One
to the Custodial Agreement, to the parties indicated on such exhibit confirming
whether or not it has received the Mortgage File for each Mortgage Loan,
but
without review of such Mortgage File, except to the extent necessary to confirm
whether such Mortgage File contains the original Mortgage Note or a lost
note
affidavit and indemnity in lieu thereof. No later than 90 days after the
Closing
Date, the Trustee or the Custodian on its behalf shall, for the benefit of
the
Certificateholders, review each Mortgage File delivered to it and execute
and
deliver to EMC (on its own behalf and on behalf of Master Funding), the Master
Servicer and, if reviewed by the Custodian, the Trustee, an Interim
Certification, substantially in the form of Exhibit Two to the Custodial
Agreement. In conducting such review, the Trustee or the Custodian on its
behalf
will ascertain whether all required documents have been executed and received
and whether those documents relate, determined on the basis of the Mortgagor
name, original principal balance and loan number, to the Mortgage Loans
identified in Exhibit B to this Agreement, as supplemented (provided, however,
that with respect to those documents described in subclauses (iv) and (vi)
of
Section 2.01, such obligations shall extend only to documents actually delivered
pursuant to such subclauses). In performing any such review, the Trustee
and the
Custodian may conclusively rely on the purported due execution and genuineness
of any such document and on the purported genuineness of any signature thereon.
If the Trustee or the Custodian on its behalf finds any document constituting
part of the Mortgage File not to have been executed or received, or to be
unrelated to the Mortgage Loans identified in Exhibit B or to appear to be
defective on its face, the Trustee or the Custodian on its behalf shall include
such information in the exception report attached to the Interim Certification.
Within
90
days from the date of notice from the Trustee of the defect, EMC (on its
own
behalf as Seller and on behalf of Master Funding)
shall
correct or cure any such defect or, if prior to the end of the second
anniversary of the Closing Date, EMC (on its own behalf as Seller and on
behalf
of Master Funding) may substitute for the related Mortgage Loan a Replacement
Mortgage Loan, which substitution shall be accomplished in the manner and
subject to the conditions set forth in Section 2.03, or shall deliver to
the
Trustee an Opinion of Counsel addressed to the Trustee to the effect that
such
defect does not materially or adversely affect the interests of the
Certificateholders in such Mortgage Loan. If EMC (on its own behalf as Seller
and on behalf of Master Funding) fails to correct or cure the defect or deliver
such opinion within such period, EMC (on its own behalf as Seller and on
behalf
of Master Funding) will, subject to Section 2.03, within 90 days from the
notification of the Trustee purchase such Mortgage Loan at the Purchase Price;
provided, however, that if such defect relates solely to the inability of
EMC
(on its own behalf as Seller and on behalf of Master Funding) to deliver
the
Mortgage, assignment thereof to the Trustee, or intervening assignments thereof
with evidence of recording thereon because such documents have been submitted
for recording and have not been returned by the applicable jurisdiction,
EMC (on
its own behalf as Seller and on behalf of Master Funding) shall not be required
to purchase such Mortgage Loan if the Seller delivers such documents promptly
upon receipt, but in no event later than 360 days after the Closing Date.
Notwithstanding anything to the contrary, the Trustee shall have no
responsibility with respect to the custody or review of Mortgage Files held
by
the Custodian pursuant to the Custodial Agreement. The Trustee shall have
no
liability for the failure of the Custodian to perform its obligations under
the
Custodial Agreement.
(b) No
later
than 180 days after the Closing Date, the Trustee or the Custodian on its
behalf
will review, for the benefit of the Certificateholders, the Mortgage Files
and
will execute and deliver or cause to be executed and delivered to EMC (on
its
own behalf as Seller and on behalf of Master Funding), the Master Servicer
and,
if reviewed by the Custodian, the Trustee, a Final Certification, substantially
in the form of Exhibit Three to the Custodial Agreement. In conducting such
review, the Trustee or the Custodian on its behalf will ascertain whether
each
document required to be recorded has been returned from the recording office
with evidence of recording thereon and the Trustee or the Custodian on its
behalf has received either an original or a copy thereof, as required in
Section
2.01 (provided, however, that with respect to those documents described in
subclauses (iv) and (vi) of Section 2.01, such obligations shall extend only
to
documents actually delivered pursuant to such subclauses). If the Trustee
or the
Custodian on its behalf finds any document with respect to a Mortgage Loan
has
not been received, or to be unrelated, determined on the basis of the Mortgagor
name, original principal balance and loan number, to the Mortgage Loans
identified in Exhibit B or to appear defective on its face, the Trustee or
the
Custodian on its behalf shall note such defect in the exception report attached
to the Final Certification and shall promptly notify EMC (on its own behalf
as
Seller and on behalf of Master Funding). Within 90 days from the date of
notice
from the Trustee of the defect, EMC (on its own behalf as Seller and on behalf
of Master Funding) shall correct or cure any such defect or, if prior to
the end
of the second anniversary of the Closing Date, EMC (on its own behalf as
Seller
and on behalf of Master Funding) may substitute for the related Mortgage
Loan a
Replacement Mortgage Loan, which substitution shall be accomplished in the
manner and subject to the conditions set forth in Section 2.03, or shall
deliver
to the Trustee an Opinion of Counsel addressed to the Trustee to the effect
that
such defect does not materially or adversely affect the interests of
Certificateholders in such Mortgage Loan. If EMC (on its own behalf as Seller
and on behalf of Master Funding) is unable within such period to correct
or cure
such defect, or to substitute the related Mortgage Loan with a Replacement
Mortgage Loan or to deliver such opinion, EMC (on its own behalf as Seller
and
on behalf of Master Funding) shall, subject to Section 2.03, within 90 days
from
the notification of the Trustee, purchase such Mortgage Loan at the Purchase
Price; provided, however, that if such defect relates solely to the inability
of
EMC (on its own behalf as Seller and on behalf of Master Funding) to deliver
the
Mortgage, assignment thereof to the Trustee or intervening assignments thereof
with evidence of recording thereon, because such documents have not been
returned by the applicable jurisdiction, EMC (on its own behalf as Seller
and on
behalf of Master Funding) shall not be required to purchase such Mortgage
Loan,
if the Seller delivers such documents promptly upon receipt, but in no event
later than 360 days after the Closing Date. Notwithstanding anything to the
contrary, the Trustee shall have no responsibility with respect to the custody
or review of Mortgage Files held by the Custodian pursuant to the Custodial
Agreement. The Trustee shall have no liability for the failure of the Custodian
to perform its obligations under the Custodial Agreement.
(c) In
the
event that a Mortgage Loan is purchased by EMC (on its own behalf as Seller
and
on behalf of Master Funding) in accordance with subsections 2.02(a) or (b)
above
or Section 2.03, EMC (on its own behalf as Seller and on behalf of Master
Funding) shall remit the applicable Purchase Price to the Master Servicer
for
deposit in the Protected Account and shall provide written notice to the
Trustee
detailing the components of the Purchase Price, signed by a Servicing Officer.
Upon deposit of the Purchase Price in the Protected Account and upon receipt
of
a Request for Release with respect to such Mortgage Loan, the Trustee or
the
Custodian will release to EMC (on its own behalf as Seller and on behalf
of
Master Funding) the related Mortgage File and the Trustee shall execute and
deliver all instruments of transfer or assignment, without recourse,
representation or warranty furnished to it by the related Seller, as are
necessary to vest in the title to and rights under the Mortgage Loan. Such
purchase shall be deemed to have occurred on the date on which the deposit
into
the Protected Account was made. The Trustee shall promptly notify the Rating
Agencies of such repurchase. The obligation of the Seller to cure, repurchase
or
substitute for any Mortgage Loan as to which a defect in a constituent document
exists shall be the sole remedies respecting such defect available to the
Certificateholders or to the Trustee on their behalf.
(d) EMC
(on
its own behalf as Seller and on behalf of Master Funding) shall deliver to
the
Trustee or the Custodian on its behalf, and Trustee agrees to accept the
Mortgage Note and other documents constituting the Mortgage File with respect
to
any Replacement Mortgage Loan, which the Trustee or the Custodian will review
as
provided in subsections 2.02(a) and 2.02(b), provided, that the Closing Date
referred to therein shall instead be the date of delivery of the Mortgage
File
with respect to each Replacement Mortgage Loan.
Section
2.03 Representations,
Warranties and Covenants of the Master Servicer and the Seller.
(a) The
Master Servicer hereby represents and warrants to the Depositor and the Trustee
as follows, as of the Closing Date:
(i) It
is
duly organized and is validly existing and in good standing under the laws
of
the State of Delaware and is duly authorized and qualified to transact any
and
all business contemplated by this Agreement to be conducted by it in any
state
in which a Mortgaged Property is located or is otherwise not required under
applicable law to effect such qualification and, in any event, is in compliance
with the doing business laws of any such state, to the extent necessary to
ensure its ability to enforce each Mortgage Loan, to service the Mortgage
Loans
in accordance with the terms of the Mortgage Loan Purchase Agreement and
to
perform any of its other obligations under this Agreement in accordance with
the
terms hereof or thereof.
(ii) It
has
the full corporate power and authority to service each Mortgage Loan, and
to
execute, deliver and perform, and to enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all necessary
corporate action on its part the execution, delivery and performance of this
Agreement; and this Agreement, assuming the due authorization, execution
and
delivery hereof by the other parties hereto or thereto, as applicable,
constitutes its legal, valid and binding obligation, enforceable against
it in
accordance with its terms, except that (a) the enforceability hereof may
be
limited by bankruptcy, insolvency, moratorium, receivership and other similar
laws relating to creditors’ rights generally and (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(iii) The
execution and delivery of this Agreement, the servicing of the Mortgage Loans
by
it under this Agreement, the consummation of any other of the transactions
contemplated by this Agreement, and the fulfillment of or compliance with
the
terms hereof and thereof are in its ordinary course of business and will
not (A)
result in a breach of any term or provision of its charter or by-laws or
(B)
conflict with, result in a breach, violation or acceleration of, or result
in a
default under, the terms of any other material agreement or instrument to
which
it is a party or by which it may be bound, or (C) constitute a violation
of any
statute, order or regulation applicable to it of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it; and
it
is not in breach or violation of any material indenture or other material
agreement or instrument, or in violation of any statute, order or regulation
of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it which breach or violation may materially impair its
ability
to perform or meet any of its obligations under this Agreement.
(iv) It
is an
approved servicer of conventional mortgage loans for Xxxxxx Xxx or Xxxxxxx
Mac
and is a mortgagee approved by the Secretary of Housing and Urban Development
pursuant to sections 203 and 211 of the National Housing Act.
(v) No
litigation is pending or, to the best of its knowledge, threatened, against
it
that would materially and adversely affect the execution, delivery or
enforceability of this Agreement or its ability to service the Mortgage Loans
or
to perform any of its other obligations under this Agreement in accordance
with
the terms hereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for its execution, delivery and performance of, or compliance
with, this Agreement or the consummation of the transactions contemplated
hereby
or thereby, or if any such consent, approval, authorization or order is
required, it has obtained the same.
(vii) As
of the
Closing Date and except as has been otherwise disclosed to the Depositor,
or
disclosed in any public filing: (1) no default or servicing related performance
trigger has occurred as to any other Pass-Through Transfer due to any act
or
failure to act of the Master Servicer; (2) no material noncompliance with
applicable servicing criteria as to any other Pass-Through Transfer has
occurred, been disclosed or reported by the Master Servicer; (3) the Master
Servicer has not been terminated as servicer in a residential mortgage loan
Pass-Through Transfer, either due to a servicing default or to application
of a
servicing performance test or trigger; (4) no material changes to the Master
Servicer’s servicing policies and procedures for similar loans have occurred in
the preceding three years outside of the normal changes warranted by regulatory
and product type changes in the portfolio; (5) there are no aspects of the
Master Servicer’s financial condition that could have a material adverse impact
on the performance by the Master Servicer of its obligations hereunder; (6)
there are no legal proceedings pending, or known to be contemplated by
governmental authorities, against the Master Servicer that could be material
to
investors in the securities issued in such Pass-Through Transfer; and (7)
there
are no affiliations, relationships or transactions relating to the Master
Servicer of a type that are described under Item 1119 of Regulation
AB.
(viii) If
so
requested by the Depositor on any date, the Master Servicer shall, within
five
Business Days following such request, confirm in writing the accuracy of
the
representations and warranties set forth in clause (a)(vii) of this Section
or,
if any such representation and warranty is not accurate as of the date of
such
request, provide reasonably adequate disclosure of the pertinent facts, in
writing, to the requesting party.
(ix) As
a
condition to the succession to the Master Servicer or any subservicer as
servicer or subservicer under this Agreement by any Person (i) into which
the
Master Servicer or such subservicer may be merged or consolidated, or (ii)
which
may be appointed as a successor to the Master Servicer or any subservicer,
the
Master Servicer shall provide to the Depositor, at least 15 calendar days
prior
to the effective date of such succession or appointment, (x) written notice
to
the Depositor of such succession or appointment and (y) in writing and in
form
and substance reasonably satisfactory to the Depositor, all information
reasonably requested by the Depositor in order to comply with its reporting
obligation under Item 6.02 of Form 8-K with respect to any class of asset-backed
securities.
(b) The
Seller hereby represents and warrants to the Depositor and the Trustee as
follows, as of the Closing Date:
(i) The
Seller is duly organized as a Delaware corporation and is validly existing
and
in good standing under the laws of the State of Delaware and is duly authorized
and qualified to transact any and all business contemplated by this Agreement
to
be conducted by the Seller in any state in which a Mortgaged Property is
located
or is otherwise not required under applicable law to effect such qualification
and, in any event, is in compliance with the doing business laws of any such
state, to the extent necessary to ensure its ability to enforce each Mortgage
Loan, to sell the Mortgage Loans in accordance with the terms of the Mortgage
Loan Purchase Agreement and to perform any of its other obligations under
this
Agreement in accordance with the terms hereof.
(ii) The
Seller has the full corporate power and authority to sell each Mortgage Loan,
and to execute, deliver and perform, and to enter into and consummate the
transactions contemplated by this Agreement and has duly authorized by all
necessary corporate action on the part of the Seller the execution, delivery
and
performance of this Agreement, assuming the due authorization, execution
and
delivery hereof by the other parties hereto or thereto, as applicable,
constitutes a legal, valid and binding obligation of the Seller, enforceable
against the Seller in accordance with its terms, except that (a) the
enforceability hereof may be limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors’ rights generally and
(b) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion
of
the court before which any proceeding therefor may be brought.
(iii) The
execution and delivery of this Agreement by the Seller, the sale of the Mortgage
Loans by the Seller under the Mortgage Loan Purchase Agreement, the consummation
of any other of the transactions contemplated by this Agreement, and the
fulfillment of or compliance with the terms hereof and thereof are in the
ordinary course of business of the Seller and will not (A) result in a material
breach of any term or provision of the charter or by-laws of the Seller or
(B)
conflict with, result in a breach, violation or acceleration of, or result
in a
default under, the terms of any other material agreement or instrument to
which
the Seller is a party or by which it may be bound, or (C) constitute a violation
of any statute, order or regulation applicable to the Seller of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over the Seller; and the Seller is not in breach or violation of any material
indenture or other material agreement or instrument, or in violation of any
statute, order or regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it which breach or
violation may materially impair the Seller’s ability to perform or meet any of
its obligations under this Agreement.
(iv) The
Seller is an approved seller of conventional mortgage loans for Xxxxxx Xxx
or
Xxxxxxx Mac and is a mortgagee approved by the Secretary of Housing and Urban
Development pursuant to sections 203 and 211 of the National Housing
Act.
(v) No
litigation is pending or, to the best of the Seller’s knowledge, threatened,
against the Seller that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the Seller
to
sell the Mortgage Loans or to perform any of its other obligations under
this
Agreement in accordance with the terms hereof or thereof.
(vi) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Seller
of,
or compliance by the Seller with, this Agreement or the consummation of the
transactions contemplated hereby, or if any such consent, approval,
authorization or order is required, the Seller has obtained the
same.
(vii) With
respect to each Mortgage Loan as of the Closing Date (or such other date
as may
be specified in Section 7 of the Mortgage Loan Purchase Agreement), the Seller
hereby remakes and restates each of the representations and warranties set
forth
in Section 7 of the Mortgage Loan Purchase Agreement to the Depositor and
the
Trustee to the same extent as if fully set forth herein.
(c) Upon
discovery by any of the parties hereto of a breach of a representation or
warranty set forth in the Mortgage Loan Purchase Agreement with respect to
the
Mortgage Loans that materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach
shall
give prompt written notice thereof to the other parties. The Seller hereby
covenants, with respect to the representations and warranties set forth in
the
Mortgage Loan Purchase Agreement with respect to the Mortgage Loans, that
within
90 days of the discovery of a breach of any representation or warranty set
forth
therein that materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, it shall cure such breach in all
material respects and, if such breach is not so cured, (i) if such 90 day
period
expires prior to the second anniversary of the Closing Date, remove such
Mortgage Loan (a “Deleted Mortgage Loan”) from the Trust Fund and substitute in
its place a Replacement Mortgage Loan, in the manner and subject to the
conditions set forth in this Section; or (ii) repurchase the affected Mortgage
Loan or Mortgage Loans from the Trustee at the Purchase Price in the manner
set
forth below; provided that any such substitution pursuant to (i) above or
repurchase pursuant to (ii) above shall not be effected prior to the delivery
to
the Trustee of an Opinion of Counsel if required by Section 2.05 hereof and
any
such substitution pursuant to (i) above shall not be effected prior to the
additional delivery to the Trustee of a Request for Release. The Trustee
shall
give prompt written notice to the parties hereto of the Seller’s failure to cure
such breach as set forth in the preceding sentence. The Seller shall promptly
reimburse the Master Servicer and the Trustee for any expenses reasonably
incurred by the Master Servicer or the Trustee in respect of enforcing the
remedies for such breach. To enable the Master Servicer to amend the Mortgage
Loan Schedule, the Seller shall, unless it cures such breach in a timely
fashion
pursuant to this Section 2.03, promptly notify the Master Servicer whether
it
intends either to repurchase, or to substitute for, the Mortgage Loan affected
by such breach. With respect to the representations and warranties with respect
to the Mortgage Loans that are made to the best of the Seller’s knowledge, if it
is discovered by any of the Depositor, the Master Servicer, the Seller, the
Trustee or the Custodian that the substance of such representation and warranty
is inaccurate and such inaccuracy materially and adversely affects the value
of
the related Mortgage Loan, notwithstanding the Seller’s lack of knowledge with
respect to the substance of such representation or warranty, the Seller shall
nevertheless be required to cure, substitute for or repurchase the affected
Mortgage Loan in accordance with the foregoing.
With
respect to any Replacement Mortgage Loan or Loans, the Seller (pursuant to
the
Mortgage Loan Purchase Agreement) shall deliver to the Trustee or the Custodian
on its behalf for the benefit of the Certificateholders such documents and
agreements as are required by Section 2.01. No substitution will be made
in any
calendar month after the Determination Date for such month. Notwithstanding
the
foregoing, such substitution must be done within two years of the Closing
Date.
Scheduled Payments due with respect to Replacement Mortgage Loans in the
Due
Period related to the Distribution Date on which such proceeds are to be
distributed shall not be part of the Trust Fund and will be retained by the
Seller. For the month of substitution, distributions to Certificateholders
will
include the Scheduled Payment due on any Deleted Mortgage Loan for the related
Due Period and thereafter the Seller shall be entitled to retain all amounts
received in respect of such Deleted Mortgage Loan. The Master Servicer shall
amend the Mortgage Loan Schedule for the benefit of the Certificateholders
to
reflect the removal of each such Deleted Mortgage Loan and the substitution
of
the Replacement Mortgage Loan or Loans and the Master Servicer shall deliver
the
amended Mortgage Loan Schedule to the Trustee and the Custodian. Upon such
substitution, the Replacement Mortgage Loan or Loans shall be subject to
the
terms of this Agreement in all respects, and the Seller shall be deemed to
have
made with respect to such Replacement Mortgage Loan or Loans, as of the date
of
substitution, the representations and warranties set forth in Section 7 or
Section 8 of the Mortgage Loan Purchase Agreement with respect to such Mortgage
Loan. Upon any such substitution and the deposit into the Protected Account
of
the amount required to be deposited therein in connection with such substitution
as described in the following paragraph and receipt by the Trustee of a Request
for Release for such Mortgage Loan, the Trustee or the Custodian shall release
to the Seller the Mortgage File relating to such Deleted Mortgage Loan and
held
for the benefit of the Certificateholders and the Trustee shall execute and
deliver at the Seller’s direction such instruments of transfer or assignment as
have been prepared by the Seller in each case without recourse, representation
or warranty as shall be necessary to vest in the Seller or its respective
designee, title to the Trustee’s interest in any Deleted Mortgage Loan
substituted for pursuant to this Section 2.03.
For
any
month in which the Seller substitutes one or more Replacement Mortgage Loans
for
a Deleted Mortgage Loan, the Master Servicer will determine the amount (if
any)
by which the aggregate principal balance of all the Replacement Mortgage
Loans
as of the date of substitution is less than the Stated Principal Balance
(after
application of the principal portion of the Scheduled Payment due in the
month
of substitution) of such Deleted Mortgage Loan. An amount equal to the aggregate
of such deficiencies, described in the preceding sentence for any Distribution
Date (such amount, the “Substitution Adjustment Amount”) shall be deposited into
the Protected Account, by the Seller upon its delivering such Replacement
Mortgage Loan on the Determination Date for the Distribution Date relating
to
the Prepayment Period during which the related Mortgage Loan became required
to
be purchased or replaced hereunder.
In
the
event that the Seller shall have repurchased a Mortgage Loan, the Purchase
Price
therefor shall be deposited into the Protected Account, on the Determination
Date for the Distribution Date in the month following the month during which
the
Seller became obligated to repurchase or replace such Mortgage Loan and upon
such deposit of the Purchase Price, the delivery of an Opinion of Counsel
if
required by Section 2.05 and the receipt of a Request for Release, the Trustee
or the Custodian shall release the related Mortgage File held for the benefit
of
the Certificateholders to the Seller and the Trustee shall execute and deliver
at such Person’s direction the related instruments of transfer or assignment
prepared by the Seller, in each case without recourse, as shall be necessary
to
transfer title from the Trustee for the benefit of the Certificateholders
and
transfer the Trustee’s interest to EMC (on its own as a Seller and on behalf of
Master Funding) to any Mortgage Loan purchased pursuant to this Section 2.03.
It
is understood and agreed that the obligation under this Agreement of the
Seller
to cure, repurchase or replace any Mortgage Loan as to which a breach has
occurred and is continuing shall constitute the sole remedies against the
Seller
respecting such breach available to the Certificateholders, the Depositor
or the
Trustee.
(d) The
representations and warranties set forth in this Section 2.03 hereof shall
survive delivery of the respective Mortgage Loans and Mortgage Files to the
Trustee or the Custodian for the benefit of the Certificateholders.
Section
2.04 Representations
and Warranties of the Depositor.
The
Depositor hereby represents and warrants to the Master Servicer and the Trustee
as follows, as of the date hereof and as of the Closing Date:
(i) The
Depositor is duly organized and is validly existing as a limited liability
company in good standing under the laws of the State of Delaware and has
full
power and authority necessary to own or hold its properties and to conduct
its
business as now conducted by it and to enter into and perform its obligations
under this Agreement.
(ii) The
Depositor has the full power and authority to execute, deliver and perform,
and
to enter into and consummate the transactions contemplated by, this Agreement
and has duly authorized, by all necessary corporate action on its part, the
execution, delivery and performance of this Agreement, assuming the due
authorization, execution and delivery hereof by the other parties hereto,
constitutes a legal, valid and binding obligation of the Depositor, enforceable
against the Depositor in accordance with its terms, subject, as to
enforceability, to (i) bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting creditors’ rights generally and (ii) general
principles of equity, regardless of whether enforcement is sought in a
proceeding in equity or at law.
(iii) The
execution and delivery of this Agreement by the Depositor, the consummation
of
the transactions contemplated by this Agreement, and the fulfillment of or
compliance with the terms hereof and thereof are in the ordinary course of
business of the Depositor and will not (A) result in a material breach of
any
term or provision of the certificate of formation or limited liability company
agreement of the Depositor or (B) conflict with, result in a breach, violation
or acceleration of, or result in a default under, the terms of any other
material agreement or instrument to which the Depositor is a party or by
which
it may be bound or (C) constitute a violation of any statute, order or
regulation applicable to the Depositor of any court, regulatory body,
administrative agency or governmental body having jurisdiction over the
Depositor; and the Depositor is not in breach or violation of any material
indenture or other material agreement or instrument, or in violation of any
statute, order or regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it which breach or
violation may materially impair the Depositor’s ability to perform or meet any
of its obligations under this Agreement.
(iv) No
litigation is pending, or, to the best of the Depositor’s knowledge, threatened,
against the Depositor that would materially and adversely affect the execution,
delivery or enforceability of this Agreement or the ability of the Depositor
to
perform its obligations under this Agreement in accordance with the terms
hereof
or thereof.
(v) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Depositor
of, or compliance by the Depositor with this Agreement or the consummation
of
the transactions contemplated hereby or thereby, or if any such consent,
approval, authorization or order is required, the Depositor has obtained
the
same.
(vi) The
Depositor has filed all reports required to be filed by Section 13 or Section
15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the Depositor was required to file such reports) and it has been
subject to such filing requirements for the past 90 days.
The
Depositor hereby represents and warrants to the Trustee as of the Closing
Date,
following the transfer of the Mortgage Loans to it by the Mortgage Loan Sellers,
the Depositor had good title to the Mortgage Loans and the related Mortgage
Notes were subject to no offsets, claims, defenses or
counterclaims.
It
is
understood and agreed that the representations and warranties set forth in
this
Section 2.04 shall survive delivery of the Mortgage Files to the Trustee
or the
Custodian for the benefit of the Certificateholders. Upon discovery by the
Depositor or the Trustee of a breach of such representations and warranties,
the
party discovering such breach shall give prompt written notice to the others
and
to each Rating Agency.
Section
2.05 Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases.
(a) Notwithstanding
any contrary provision of this Agreement, with respect to any Mortgage Loan
that
is not in default or as to which default is not reasonably foreseeable, no
repurchase or substitution pursuant to Sections 2.02 or 2.03 shall be made
unless the Sponsor delivers to the Trustee an Opinion of Counsel, addressed
to
the Trustee, to the effect that such repurchase or substitution would not
(i)
result in the imposition of the tax on “prohibited transactions” of REMIC I,
REMIC II, REMIC III, REMIC IV, REMIC V or REMIC VI or contributions after
the
Closing Date, as defined in Sections 860F(a)(2) and 860G(d) of the Code,
respectively, or (ii) cause any of REMIC I, REMIC II, REMIC III, REMIC IV,
REMIC
V or REMIC VI to fail to qualify as a REMIC at any time that any Certificates
are outstanding. Any Mortgage Loan as to which repurchase or substitution
was
delayed pursuant to this paragraph shall be repurchased or the substitution
therefor shall occur (subject to compliance with Sections 2.02 or 2.03) upon
the
earlier of (a) the occurrence of a default or default becoming reasonably
foreseeable with respect to such Mortgage Loan and (b) receipt by the Trustee
of
an Opinion of Counsel addressed to the Trustee to the effect that such
repurchase or substitution, as applicable, will not result in the events
described in clause (i) or clause (ii) of the preceding sentence.
(b) Upon
discovery by the Depositor, the Seller or the Master Servicer that any Mortgage
Loan does not constitute a “qualified mortgage” within the meaning of section
860G(a)(3) of the Code, the party discovering such fact shall promptly (and
in
any event within 5 Business Days of discovery) give written notice thereof
to
the other parties and the Trustee. In connection therewith, the Trustee shall
require the Seller at it’s option, to either (i) substitute, if the conditions
in Section 2.03 with respect to substitutions are satisfied, a Replacement
Mortgage Loan for the affected Mortgage Loan, or (ii) repurchase the affected
Mortgage Loan within 90 days of such discovery in the same manner as it would
a
Mortgage Loan for a breach of representation or warranty in accordance with
Section 2.03. The Trustee shall reconvey to the Seller the Mortgage Loan
to be
released pursuant hereto (and the Custodian shall deliver the related Mortgage
File) in the same manner, and on the same terms and conditions, as it would
a
Mortgage Loan repurchased for breach of a representation or warranty in
accordance with Section 2.03.
Section
2.06 Countersignature
and Delivery of Certificates.
(a) The
Trustee acknowledges the sale, transfer and assignment to it of the Trust
Fund
and, concurrently with such transfer and assignment, has executed, countersigned
and delivered, to or upon the order of the Depositor, the Certificates in
authorized denominations evidencing the entire ownership of the Trust Fund.
The
Trustee agrees to hold the Trust Fund and exercise the rights referred to
above
for the benefit of all present and future Holders of the Certificates and
to
perform the duties set forth in this Agreement in accordance with its
terms.
(b) The
Depositor concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the
REMIC
I Regular Interests and the other assets of REMIC II for the benefit of the
holders of the REMIC II Regular Interests and the Class R-2 Certificates.
The
Trustee acknowledges receipt of the REMIC I Regular Interests (which are
uncertificated) and the other assets of REMIC II and declares that it holds
and
will hold the same in trust for the exclusive use and benefit of the holders
of
the REMIC II Regular Interests and the Class R-2 Certificates.
(c) The
Depositor concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the
REMIC
II Regular Interests and the other assets of REMIC III for the benefit of
the
holders of the REMIC III Regular Interests and the Class R-3 Certificates.
The
Trustee acknowledges receipt of the REMIC II Regular Interests (which are
uncertificated) and the other assets of REMIC III and declares that it holds
and
will hold the same in trust for the exclusive use and benefit of the holders
of
the REMIC III Regular Interests and the Class R-3 Certificates.
(d) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the
Class
CE Interest for the benefit of the Holders of the REMIC IV Certificates.
The
Trustee acknowledges receipt of the Class CE Interest (which is uncertificated)
and declares that it holds and will hold the same in trust for the exclusive
use
and benefit of the Holders of the REMIC IV Certificates.
(e) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the
Class
P Interest for the benefit of the Holders of the REMIC V Certificates. The
Trustee acknowledges receipt of the Class P Interest (which is uncertificated)
and declares that it holds and will hold the same in trust for the exclusive
use
and benefit of the Holders of the REMIC V Certificates.
(f) The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey in trust to the Trustee without
recourse all the right, title and interest of the Depositor in and to the
Class
IO Interest for the benefit of the holders of the REMIC VI Interests. The
Trustee acknowledges receipt of the Class IO Interest (which is uncertificated)
and declares that it holds and will hold the same in trust for the exclusive
use
and benefit of the holders of the REMIC VI Interests.
Section
2.07 Purposes
and Powers of the Trust.
The
purpose of the common law trust, as created hereunder, is to engage in the
following activities:
(a) acquire
and hold, as set forth in this Agreement, the Mortgage Loans and the other
assets of the Trust Fund and the proceeds therefrom for the benefit of the
Certificateholders;
(b) to
issue
the Certificates sold to the Depositor in exchange for the Mortgage Loans
and
any other assets of the Trust;
(c) to
make
distributions on the Certificates;
(d) to
engage
in those activities that are necessary, suitable or convenient to accomplish
the
foregoing or are incidental thereto or connected therewith; and
(e) subject
to compliance with this Agreement, to engage in such other activities as
may be
required in connection with conservation of the Trust Fund and the making
of
distributions to the Certificateholders.
The
Trust
is hereby authorized to engage in the foregoing activities. Neither the Trustee
nor the Master Servicer shall cause the Trust to engage in any activity other
than in connection with the foregoing or other than as required or authorized
by
the terms of this Agreement while any Certificate is outstanding.
ARTICLE
III
ADMINISTRATION
AND SERVICING OF THE MORTGAGE LOANS
Section
3.01 The
Master Servicer to act as Master Servicer.
The
Master Servicer shall service and administer the Mortgage Loans in accordance
with customary and usual standards of practice of prudent mortgage loan
servicers in the respective states in which the related Mortgaged Properties
are
located. In connection with such servicing and administration, the Master
Servicer shall have full power and authority, acting alone and/or through
subservicers as provided in Section 3.03, to do or cause to be done any and
all
things that it may deem necessary or desirable in connection with such servicing
and administration, including but not limited to, the power and authority,
subject to the terms hereof (i) to execute and deliver, on behalf of the
Certificateholders and the Trustee, customary consents or waivers and other
instruments and documents, (ii) to consent to transfers of any related Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages (but
only
in the manner provided herein), (iii) to collect any Insurance Proceeds and
other Liquidation Proceeds or Subsequent Recoveries, and (iv) subject to
Section
3.09, to effectuate foreclosure or other conversion of the ownership of the
Mortgaged Property securing any Mortgage Loan; provided that the Master Servicer
shall take no action that is inconsistent with or prejudices the interests
of
the Trust Fund or the Certificateholders in any Mortgage Loan or the rights
and
interests of the Depositor or the Trustee under this Agreement.
Without
limiting the generality of the foregoing, the Master Servicer, in its own
name
or in the name of the Trust, the Depositor or the Trustee, is hereby authorized
and empowered by the Trust, the Depositor and the Trustee, when the Master
Servicer believes it appropriate in its reasonable judgment, to execute and
deliver, on behalf of the Trustee, the Depositor, the Certificateholders
or any
of them, any and all instruments of satisfaction or cancellation, or of partial
or full release or discharge and all other comparable instruments, with respect
to the Mortgage Loans, and with respect to the Mortgaged Properties held
for the
benefit of the Certificateholders. The Master Servicer shall prepare and
deliver
to the Depositor and/or the Trustee such documents requiring execution and
delivery by any or all of them as are necessary or appropriate to enable
the
Master Servicer to service and administer the Mortgage Loans. Upon receipt
of
such documents, the Depositor and/or the Trustee shall execute such documents
and deliver them to the Master Servicer.
In
accordance with the standards of the first paragraph of this Section 3.01,
the
Master Servicer shall advance or cause to be advanced funds as necessary
for the
purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties, which advances shall be reimbursable in the first instance from
related collections from the Mortgagors pursuant to Section 4.03, and further
as
provided in Section 4.02. All costs incurred by the Master Servicer, if any,
in
effecting the timely payments of taxes and assessments on the Mortgaged
Properties and related insurance premiums shall not, for the purpose of
calculating monthly distributions to the Certificateholders, be added to
the
Stated Principal Balance under the Mortgage Loans, notwithstanding that the
terms of such Mortgage Loans so permit.
Section
3.02 Due-on-Sale
Clauses; Assumption Agreements.
(a) Except
as
otherwise provided in this Section 3.02, when any property subject to a Mortgage
has been or is about to be conveyed by the Mortgagor, the Master Servicer
shall
to the extent that it has knowledge of such conveyance, enforce any due-on-sale
clause contained in any Mortgage Note or Mortgage, to the extent permitted
under
applicable law and governmental regulations, but only to the extent that
such
enforcement will not adversely affect or jeopardize coverage under any Required
Insurance Policy. Notwithstanding the foregoing, the Master Servicer is not
required to exercise such rights with respect to a Mortgage Loan if the Person
to whom the related Mortgaged Property has been conveyed or is proposed to
be
conveyed satisfies the terms and conditions contained in the Mortgage Note
and
Mortgage related thereto and the consent of the mortgagee under such Mortgage
Note or Mortgage is not otherwise so required under such Mortgage Note or
Mortgage as a condition to such transfer. In the event that the Master Servicer
is prohibited by law from enforcing any such due-on-sale clause, or if coverage
under any Required Insurance Policy would be adversely affected, or if
nonenforcement is otherwise permitted hereunder, the Master Servicer is
authorized, subject to Section 3.02(b), to take or enter into an assumption
and
modification agreement from or with the person to whom such property has
been or
is about to be conveyed, pursuant to which such person becomes liable under
the
Mortgage Note and, unless prohibited by applicable state law, the Mortgagor
remains liable thereon, provided that the Mortgage Loan shall continue to
be
covered (if so covered before the Master Servicer enters such agreement)
by the
applicable Required Insurance Policies. The Master Servicer, subject to Section
3.02(b), is also authorized with the prior approval of the insurers under
any
Required Insurance Policies to enter into a substitution of liability agreement
with such Person, pursuant to which the original Mortgagor is released from
liability and such Person is substituted as Mortgagor and becomes liable
under
the Mortgage Note. Notwithstanding the foregoing, the Master Servicer shall
not
be deemed to be in default under this Section 3.02(a) by reason of any transfer
or assumption that the Master Servicer reasonably believes it is restricted
by
law from preventing.
(b) Subject
to the Master Servicer’s duty to enforce any due-on-sale clause to the extent
set forth in Section 3.02(a), in any case in which a Mortgaged Property has
been
conveyed to a Person by a Mortgagor, and such Person is to enter into an
assumption agreement or modification agreement or supplement to the Mortgage
Note or Mortgage that requires the signature of the Trustee, or if an instrument
of release signed by the Trustee is required releasing the Mortgagor from
liability on the related Mortgage Loan, the Master Servicer shall prepare
and
deliver or cause to be prepared and delivered to the Trustee for signature
and
shall direct, in writing, the Trustee to execute the assumption agreement
with
the Person to whom the Mortgaged Property is to be conveyed and such
modification agreement or supplement to the Mortgage Note or Mortgage or
other
instruments as are reasonable or necessary to carry out the terms of the
Mortgage Note or Mortgage or otherwise to comply with any applicable laws
regarding assumptions or the transfer of the Mortgaged Property to such Person.
In connection with any such assumption, no material term of the Mortgage
Note
(including, but not limited to, the Mortgage Rate, the amount of the Scheduled
Payment and any other term affecting the amount or timing of payment on the
Mortgage Loan) may be changed. In addition, the substitute Mortgagor and
the
Mortgaged Property must be acceptable to the Master Servicer in accordance
with
its servicing standards as then in effect. The Master Servicer shall notify
the
Trustee that any such substitution or assumption agreement has been completed
by
forwarding to the Trustee the original of such substitution or assumption
agreement, which in the case of the original shall be added to the related
Mortgage File and shall, for all purposes, be considered a part of such Mortgage
File to the same extent as all other documents and instruments constituting
a
part thereof. Any fee collected by the Master Servicer for entering into
an
assumption or substitution of liability agreement will be retained by the
Master
Servicer as additional servicing compensation.
Section
3.03 Subservicers.
The
Master Servicer shall perform all of its servicing responsibilities hereunder
or
may cause a subservicer to perform any such servicing responsibilities on
its
behalf, but the use by the Master Servicer of a subservicer shall not release
the Master Servicer from any of its obligations hereunder and the Master
Servicer shall remain responsible hereunder for all acts and omissions of
each
subservicer as fully as if such acts and omissions were those of the Master
Servicer. The Master Servicer shall pay all fees of each subservicer from
its
own funds, and a subservicer’s fee shall not exceed the Servicing Fee payable to
the Master Servicer hereunder.
At
the
cost and expense of the Master Servicer, without any right of reimbursement
from
its Protected Account, the Master Servicer shall be entitled to terminate
the
rights and responsibilities of a subservicer and arrange for any servicing
responsibilities to be performed by a successor subservicer; provided, however,
that nothing contained herein shall be deemed to prevent or prohibit the
Master
Servicer, at the Master Servicer’s option, from electing to service the related
Mortgage Loans itself. In the event that the Master Servicer’s responsibilities
and duties under this Agreement are terminated pursuant to Section 8.01,
the
Master Servicer shall at its own cost and expense terminate the rights and
responsibilities of each subservicer effective as of the date of termination
of
the Master Servicer. The Master Servicer shall pay all fees, expenses or
penalties necessary in order to terminate the rights and responsibilities
of
each subservicer from the Master Servicer’s own funds without reimbursement from
the Trust Fund.
Notwithstanding
the foregoing, the Master Servicer shall not be relieved of its obligations
hereunder and shall be obligated to the same extent and under the same terms
and
conditions as if it alone were servicing and administering the Mortgage Loans.
The Master Servicer shall be entitled to enter into an agreement with a
subservicer for indemnification of the Master Servicer by the subservicer
and
nothing contained in this Agreement shall be deemed to limit or modify such
indemnification.
Any
subservicing agreement and any other transactions or services relating to
the
Mortgage Loans involving a subservicer shall be deemed to be between such
subservicer and the Master Servicer alone, and the Trustee shall not have
any
obligations, duties or liabilities with respect to such subservicer including
any obligation, duty or liability of the Trustee to pay such subservicer’s fees
and expenses. Each subservicing agreement shall provide that such agreement
may
be assumed or terminated without cause or penalty by the Trustee or other
Successor Master Servicer in the event the Master Servicer is terminated
in
accordance with this Agreement. For purposes of remittances to the Trustee
pursuant to this Agreement, the Master Servicer shall be deemed to have received
a payment on a Mortgage Loan when a subservicer has received such
payment.
Section
3.04 Documents,
Records and Funds in Possession of the Master Servicer To Be Held for
Trustee.
Notwithstanding
any other provisions of this Agreement, the Master Servicer shall transmit
to
the Trustee or the Custodian on behalf of the Trustee as required by this
Agreement all documents and instruments in respect of a Mortgage Loan coming
into the possession of the Master Servicer from time to time and shall account
fully to the Trustee for any funds received by the Master Servicer or that
otherwise are collected by the Master Servicer as Liquidation Proceeds,
Insurance Proceeds or Subsequent Recoveries in respect of any such Mortgage
Loan. All Mortgage Files and funds collected or held by, or under the control
of, the Master Servicer in respect of any Mortgage Loans, whether from the
collection of principal and interest payments or from Liquidation Proceeds
or
Subsequent Recoveries, including but not limited to, any funds on deposit
in the
Protected Account, shall be held by the Master Servicer for and on behalf
of the
Trustee and shall be and remain the sole and exclusive property of the Trustee,
subject to the applicable provisions of this Agreement. The Master Servicer
also
agrees that it shall not create, incur or subject any Mortgage File or any
funds
that are deposited in the Protected Account or in any Escrow Account, or
any
funds that otherwise are or may become due or payable to the Trustee for
the
benefit of the Certificateholders, to any claim, lien, security interest,
judgment, levy, writ of attachment or other encumbrance, or assert by legal
action or otherwise any claim or right of set off against any Mortgage File
or
any funds collected on, or in connection with, a Mortgage Loan, except, however,
that the Master Servicer shall be entitled to set off against and deduct
from
any such funds any amounts that are properly due and payable to the Master
Servicer under this Agreement.
Section
3.05 Maintenance
of Hazard Insurance.
The
Master Servicer shall cause to be maintained, for each Mortgage Loan, hazard
insurance on buildings upon, or comprising part of, the Mortgaged Property
against loss by fire, hazards of extended coverage and such other hazards
as are
customary in the area where the related Mortgaged Property is located with
an
insurer which is licensed to do business in the state where the related
Mortgaged Property is located. Each such policy of standard hazard insurance
shall contain, or have an accompanying endorsement that contains, a standard
mortgagee clause. The Master Servicer shall also cause flood insurance to
be
maintained on property acquired upon foreclosure or deed in lieu of foreclosure
of any Mortgage Loan, to the extent described below. Pursuant to Section
4.01,
any amounts collected by the Master Servicer under any such policies (other
than
the amounts to be applied to the restoration or repair of the related Mortgaged
Property or property thus acquired or amounts released to the Mortgagor in
accordance with the Master Servicer’s normal servicing procedures) shall be
deposited in the Protected Account. Any cost incurred by the Master Servicer
in
maintaining any such insurance shall not, for the purpose of calculating
monthly
distributions to the Certificateholders or remittances to the Trustee for
their
benefit, be added to the principal balance of the Mortgage Loan, notwithstanding
that the terms of the Mortgage Loan so permit. Such costs shall be recoverable
by the Master Servicer out of late payments by the related Mortgagor or out
of
Liquidation Proceeds to the extent permitted by Section 4.02. It is understood
and agreed that no earthquake or other additional insurance is to be required
of
any Mortgagor or maintained on property acquired in respect of a Mortgage
other
than pursuant to such applicable laws and regulations as shall at any time
be in
force and as shall require such additional insurance. If the Mortgaged Property
is located at the time of origination of the Mortgage Loan in a federally
designated special flood hazard area and such area is participating in the
national flood insurance program, the Master Servicer shall cause flood
insurance to be maintained with respect to such Mortgage Loan. Such flood
insurance shall be in an amount equal to the least of (i) the Stated Principal
Balance of the related Mortgage Loan, (ii) minimum amount required to compensate
for damage or loss on a replacement cost basis or (iii) the maximum amount
of
such insurance available for the related Mortgaged Property under the Flood
Disaster Protection Act of 1973, as amended.
In
the
event that the Master Servicer shall obtain and maintain a blanket policy
insuring against hazard losses on all of the Mortgage Loans, it shall
conclusively be deemed to have satisfied its obligations as set forth in
the
first sentence of this Section 3.05, it being understood and agreed that
such
policy may contain a deductible clause on terms substantially equivalent
to
those commercially available and maintained by comparable servicers. If such
policy contains a deductible clause, the Master Servicer shall, in the event
that there shall not have been maintained on the related Mortgaged Property
a
policy complying with the first sentence of this Section 3.05, and there
shall
have been a loss that would have been covered by such policy, deposit in
the
Protected Account the amount not otherwise payable under the blanket policy
because of such deductible clause. Such deposit shall be from the Master
Servicer’s own funds without reimbursement therefor. In connection with its
activities as administrator and servicer of the Mortgage Loans, the Master
Servicer agrees to present, on behalf of itself, the Depositor and the Trustee
for the benefit of the Certificateholders claims under any such blanket
policy.
Section
3.06 Presentment
of Claims and Collection of Proceeds.
The
Master Servicer shall prepare and present on behalf of the Trustee and the
Certificateholders all claims under the Insurance Policies and take such
actions
(including the negotiation, settlement, compromise or enforcement of the
insured’s claim) as shall be necessary to realize recovery under such Insurance
Policies. Any proceeds disbursed to the Master Servicer in respect of such
Insurance Policies shall be promptly deposited in the Protected Account upon
receipt, except that any amounts that are to be applied upon receipt to the
repair or restoration of the related Mortgaged Property, which repair or
restoration the owner of such Mortgaged Property or EMC, as applicable, has
agreed to make as a condition precedent to the presentation of its claims
on the
Mortgage Loan under the applicable Insurance Policy, need not be so deposited
(or remitted).
Section
3.07 Maintenance
of the Primary Mortgage Insurance Policies.
(a) The
Master Servicer shall not take any action that would result in noncoverage
under
any applicable Primary Mortgage Insurance Policy of any loss which, but for
the
actions of the Master Servicer would have been covered thereunder. The Master
Servicer shall use its best efforts to keep in force and effect (to the extent
that the Mortgage Loan requires the Mortgagor to maintain such insurance),
Primary Mortgage Insurance applicable to each Mortgage Loan. The Master Servicer
shall not cancel or refuse to renew any such Primary Mortgage Insurance Policy
that is in effect at the date of the initial issuance of the Mortgage Note
and
is required to be kept in force hereunder.
(b) The
Master Servicer agrees to present on behalf of the Trustee, the
Certificateholders claims to the insurer under any Primary Mortgage Insurance
Policies and, in this regard, to take such reasonable action as shall be
necessary to permit recovery under any Primary Mortgage Insurance Policies
respecting defaulted Mortgage Loans. Pursuant to Section 4.01, any amounts
collected by the Master Servicer under any Primary Mortgage Insurance Policies
shall be deposited in the Protected Account, subject to withdrawal pursuant
to
Section 4.02 hereof.
Section
3.08 Fidelity
Bond, Errors and Omissions Insurance.
The
Master Servicer shall maintain, at its own expense, a blanket fidelity bond
and
an errors and omissions insurance policy, with broad coverage with responsible
companies on all officers, employees or other persons acting in any capacity
with regard to the Mortgage Loans and who handle funds, money, documents
and
papers relating to the Mortgage Loans. The fidelity bond and errors and
omissions insurance shall be in the form of the Mortgage Banker’s Blanket Bond
and shall protect and insure the Master Servicer against losses, including
forgery, theft, embezzlement, fraud, errors and omissions and negligent acts
of
such persons. Such fidelity bond shall also protect and insure the Master
Servicer against losses in connection with the failure to maintain any insurance
policies required pursuant to this Agreement and the release or satisfaction
of
a Mortgage Loan which is not in accordance with Accepted Servicing Practices.
No
provision of this Section 3.08 requiring the fidelity bond and errors and
omissions insurance shall diminish or relieve the Master Servicer from its
duties and obligations as set forth in this Agreement. The minimum coverage
under any such bond and insurance policy shall be at least equal to the
corresponding amounts required by Accepted Servicing Practices. The Master
Servicer shall deliver to the Trustee a certificate from the surety and the
insurer as to the existence of the fidelity bond and errors and omissions
insurance policy and shall obtain a statement from the surety and the insurer
that such fidelity bond or insurance policy shall in no event be terminated
or
materially modified without thirty days prior written notice to the Trustee.
The
Master Servicer shall notify the Trustee within five business days of receipt
of
notice that such fidelity bond or insurance policy will be, or has been,
materially modified or terminated. The Trustee for the benefit of the
Certificateholders must be named as loss payees on the fidelity bond and
as
additional insured on the errors and omissions policy.
Section
3.09 Realization
Upon Defaulted Mortgage Loans; Determination of Excess Liquidation Proceeds
and
Realized Losses; Repurchases of Certain Mortgage Loans.
(a) The
Master Servicer shall use reasonable efforts to foreclose upon or otherwise
comparably convert the ownership of properties securing such of the Mortgage
Loans as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments. In connection
with such foreclosure or other conversion, the Master Servicer shall follow
such
practices and procedures as it shall deem necessary or advisable and as shall
be
normal and usual in its general mortgage servicing activities and the
requirements of the insurer under any Required Insurance Policy; provided
that
the Master Servicer shall not be required to expend its own funds in connection
with any foreclosure or towards the restoration of any property unless it
shall
determine (i) that such restoration and/or foreclosure will increase the
proceeds of liquidation of the Mortgage Loan after reimbursement to itself
of
such expenses and (ii) that such expenses will be recoverable to it through
Insurance Proceeds, Liquidation Proceeds (respecting which it shall have
priority for purposes of withdrawals from the Protected Account pursuant
to
Section 4.02). If the Master Servicer reasonably believes that Liquidation
Proceeds with respect to any such Mortgage Loan would not be increased as
a
result of such foreclosure or other action, such Mortgage Loan will be
charged-off and will become a Liquidated Loan. The Master Servicer will give
notice of any such charge-off to the Trustee. The Master Servicer shall be
responsible for all other costs and expenses incurred by it in any such
proceedings; provided that such costs and expenses shall be Servicing Advances
and that it shall be entitled to reimbursement thereof from the proceeds
of
liquidation of the related Mortgaged Property, as contemplated in Section
4.02.
If the Master Servicer has knowledge that a Mortgaged Property that the Master
Servicer is contemplating acquiring in foreclosure or by deed- in-lieu of
foreclosure is located within a one-mile radius of any site with environmental
or hazardous waste risks known to the Master Servicer, the Master Servicer
will,
prior to acquiring the Mortgaged Property, consider such risks and only take
action in accordance with its established environmental review
procedures.
With
respect to any REO Property, the deed or certificate of sale shall be taken
in
the name of the Trustee for the benefit of the Certificateholders (or the
Trustee’s nominee on behalf of the Certificateholders). The Trustee’s name shall
be placed on the title to such REO Property solely as the Trustee hereunder
and
not in its individual capacity. The Master Servicer shall ensure that the
title
to such REO Property references this Agreement and the Trustee’s capacity
hereunder. Pursuant to its efforts to sell such REO Property, the Master
Servicer shall either itself or through an agent selected by the Master Servicer
protect and conserve such REO Property in the same manner and to such extent
as
is customary in the locality where such REO Property is located and may,
incident to its conservation and protection of the interests of the
Certificateholders, rent the same, or any part thereof, as the Master Servicer
deems to be in the best interest of the Master Servicer and the
Certificateholders for the period prior to the sale of such REO Property.
The
Master Servicer shall prepare for and deliver to the Trustee a statement
with
respect to each REO Property that has been rented showing the aggregate rental
income received and all expenses incurred in connection with the management
and
maintenance of such REO Property at such times as is necessary to enable
the
Trustee to comply with the reporting requirements of the REMIC Provisions.
The
net monthly rental income, if any, from such REO Property shall be deposited
in
the Protected Account no later than the close of business on each Determination
Date. The Master Servicer shall perform the tax reporting and withholding
related to foreclosures, abandonments and cancellation of indebtedness income
as
specified by Sections 1445, 6050J and 6050P of the Code by preparing and
filing
such tax and information returns, as may be required.
In
the
event that the Trust Fund acquires any Mortgaged Property as aforesaid or
otherwise in connection with a default or reasonably foreseeable default
on a
Mortgage Loan, the Master Servicer shall dispose of such Mortgaged Property
prior to three years after its acquisition by the Trust Fund or, at the expense
of the Trust Fund, request more than 60 days prior to the day on which such
three-year period would otherwise expire, an extension of the three-year
grace
period unless the Trustee shall have been supplied with an Opinion of Counsel
addressed to the Trustee (such opinion not to be an expense of the Trustee)
to
the effect that the holding by the Trust Fund of such Mortgaged Property
subsequent to such three-year period will not result in the imposition of
taxes
on “prohibited transactions” of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V
or REMIC VI as defined in Section 860F of the Code or cause any of REMIC
I,
REMIC II, REMIC III, REMIC IV, REMIC V or REMIC VI to fail to qualify as
a REMIC
at any time that any Certificates are outstanding, in which case the Trust
Fund
may continue to hold such Mortgaged Property (subject to any conditions
contained in such Opinion of Counsel). Notwithstanding any other provision
of
this Agreement, no Mortgaged Property acquired by the Trust Fund shall be
rented
(or allowed to continue to be rented) or otherwise used for the production
of
income by or on behalf of the Trust Fund in such a manner or pursuant to
any
terms that would (i) cause such Mortgaged Property to fail to qualify as
“foreclosure property” within the meaning of Section 860G(a)(8) of the Code or
(ii) subject any of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or REMIC
VI
to the imposition of any federal, state or local income taxes on the income
earned from such Mortgaged Property under Section 860G(c) of the Code or
otherwise, unless the Master Servicer has agreed to indemnify and hold harmless
the Trust Fund with respect to the imposition of any such taxes.
The
decision of the Master Servicer to foreclose on a defaulted Mortgage Loan
shall
be subject to a determination by the Master Servicer that the proceeds of
such
foreclosure would exceed the costs and expenses of bringing such a proceeding.
The income earned from the management of any Mortgaged Properties acquired
through foreclosure or other judicial proceeding, net of reimbursement to
the
Master Servicer for expenses incurred (including any property or other taxes)
in
connection with such management and net of unreimbursed Servicing Fees,
Advances, Servicing Advances and any management fee paid or to be paid with
respect to the management of such Mortgaged Property, shall be applied to
the
payment of principal of, and interest on, the related defaulted Mortgage
Loans
(with interest accruing as though such Mortgage Loans were still current)
and
all such income shall be deemed, for all purposes in the Agreement, to be
payments on account of principal and interest on the related Mortgage Notes
and
shall be deposited into the Protected Account. To the extent the income received
during a Prepayment Period is in excess of the amount attributable to amortizing
principal and accrued interest at the related Mortgage Rate on the related
Mortgage Loan, such excess shall be considered to be a partial Principal
Prepayment for all purposes hereof.
The
Liquidation Proceeds from any liquidation of a Mortgage Loan, net of any
payment
to the Master Servicer as provided above, shall be deposited in the Protected
Account upon
receipt and made available on
the
next succeeding Determination Date following receipt thereof for distribution
on
the related Distribution Date, except that any Excess Liquidation Proceeds
shall
be retained by the Master Servicer as additional servicing
compensation.
The
proceeds of any Liquidated Loan, as well as any recovery resulting from a
partial collection of related Liquidation Proceeds or any income from a related
REO Property, will be applied in the following order of priority: first,
to
reimburse the Master Servicer for any related unreimbursed Servicing Advances
and Servicing Fees, pursuant to Section 4.02 or this Section 3.09; second,
to
reimburse the Master Servicer for any unreimbursed Advances, pursuant to
Section
4.02 or this Section 3.09; third, to accrued and unpaid interest (to the
extent
no Advance has been made for such amount) on the Mortgage Loan or related
REO
Property, at the Net Mortgage Rate to the first day of the month in which
such
amounts are required to be distributed; and fourth, as a recovery of principal
of the Mortgage Loan.
(b) On
each
Determination Date, the Master Servicer shall determine the respective aggregate
amounts of Excess Liquidation Proceeds and Realized Losses, if any, for the
preceding calendar month.
(c) The
Master Servicer has no intent to foreclose on any Mortgage Loan based on
the
delinquency characteristics as of the Closing Date; provided, that the foregoing
does not prevent the Master Servicer from initiating foreclosure proceedings
on
any date hereafter if the facts and circumstances of such Mortgage Loans
including delinquency characteristics in the Master Servicer’s discretion so
warrant such action.
Section
3.10 Servicing
Compensation.
As
compensation for its activities hereunder, the Master Servicer shall be entitled
to retain or withdraw from the Protected Account out of each payment of interest
on a Mortgage Loan included in the Trust Fund an amount equal to the Servicing
Fee.
Additional
servicing compensation in the form of any Excess Liquidation Proceeds,
assumption fees, late payment charges, all Prepayment Interest Excess on
any
Mortgage Loan, other ancillary income, all income and gain net of any losses
realized from Permitted Investments with respect to funds in or credited
to the
Protected Account shall be retained by the Master Servicer to the extent
not
required to be deposited in the Protected Account pursuant to Section 4.02.
The
Master Servicer shall be required to pay all expenses incurred by it in
connection with its servicing activities hereunder (including payment of
any
premiums for hazard insurance, as required by Section 3.05 and maintenance
of
the other forms of insurance coverage required by Section 3.07) and shall
not be
entitled to reimbursement therefor except as specifically provided in Section
4.02.
Section
3.11 REO
Property.
(a) In
the
event the Trust Fund acquires ownership of any REO Property in respect of
any
related Mortgage Loan, the deed or certificate of sale shall be issued to
the
Trustee, or to its nominee, on behalf of the Certificateholders. The Master
Servicer shall sell any REO Property as expeditiously as possible and in
accordance with the provisions of this Agreement. Pursuant to its efforts
to
sell such REO Property, the Master Servicer shall protect and conserve such
REO
Property in the manner and to the extent required herein, in accordance with
the
REMIC Provisions.
(b) The
Master Servicer shall deposit all funds collected and received in connection
with the operation of any REO Property into the Protected Account.
(c) The
Master Servicer, upon the final disposition of any REO Property, shall be
entitled to reimbursement for any related unreimbursed Advances, unreimbursed
Servicing Advances or Servicing Fees from Liquidation Proceeds received in
connection with the final disposition of such REO Property; provided, that
any
such unreimbursed Advances or Servicing Fees as well as any unpaid Servicing
Fees may be reimbursed or paid, as the case may be, prior to final disposition,
out of any net rental income or other net amounts derived from such REO
Property.
Section
3.12 Liquidation
Reports.
Upon
the
foreclosure of any Mortgaged Property or the acquisition thereof by the Trust
Fund pursuant to a deed-in-lieu of foreclosure, the Master Servicer shall
submit
a liquidation report to the Trustee containing such information as shall
be
mutually acceptable to the Master Servicer and the Trustee with respect to
such
Mortgaged Property.
Section
3.13 Annual
Statement as to Compliance.
The
Master Servicer and the Trustee shall deliver to the Master Servicer, the
Depositor and the Trustee, not later than March 15th
of each
calendar year beginning in 2008, an Officer’s Certificate (an “Annual Statement
of Compliance”) stating, as to each signatory thereof, that (i) a review of the
activities of each such party during the preceding calendar year and of its
performance under this Agreement has been made under such officer’s supervision
and (ii) to the best of such officer’s knowledge, based on such review, each
such party has fulfilled all of its obligations under this Agreement in all
material respects throughout such year or, if there has been a failure to
fulfill any such obligation in any material respect, specifying each such
failure known to such officer and the nature and status thereof. Such Annual
Statement of Compliance shall contain no restrictions or limitations on its
use.
In the event that the Master Servicer or the Trustee has delegated any servicing
responsibilities with respect to the Mortgage Loans to a subservicer or
subcontractor, such servicer or subcontractor shall be directed by such
delegating party to deliver a similar Annual Statement of Compliance by such
subservicer or subcontractor to the Master Servicer, the Depositor and the
Trustee as described above as and when required with respect to the Master
Servicer and the Trustee.
Failure
of the Master Servicer to comply with this Section 3.13 (including
with respect to the time frames required in this Section)
shall be
deemed an Event of Default with respect to such party, and the Trustee at
the
direction of the Depositor shall, in addition to whatever rights the Trustee
may
have under this Agreement and at law or in equity or to damages, including
injunctive relief and specific performance, upon notice, immediately terminate
all the rights and obligations of the Master Servicer under this Agreement
and
in and to the Mortgage Loans and the proceeds thereof without compensating
the
Master Servicer for the same. Failure of the Trustee to comply with this
Section
3.13 (including with respect to the time frames required in this Section)
which
failure results in a failure to timely file the Form 10-K shall be deemed
a
default which may result in the termination of the Trustee pursuant to Section
9.08 of this Agreement and the Depositor may, in addition to whatever rights
the
Depositor may have under this Agreement and at law or in equity or to damages,
including injunctive relief and specific performance, upon notice immediately
terminate all of the rights and obligations of the Trustee under this Agreement
and in and to the Mortgage Loans and the proceeds thereof without compensating
the Trustee for the same. This paragraph shall supersede any other provision
in
this Agreement or any other agreement to the contrary.
In
the
event the Master Servicer, the Trustee or any subservicer or subcontractor
engaged by either such party is terminated or resigns pursuant to the terms
of
the Agreement, or any other applicable agreement in the case of a subservicer
or
subcontractor, as the case may be, such party shall provide an Annual Statement
of Compliance pursuant to this Section 3.13 or to the related section of
such
other applicable agreement, as the case may be, as to the performance of
its
obligations with respect to the period of time it was subject to this Agreement
or any other applicable agreement, as the case may be notwithstanding any
such
termination or resignation.
Section
3.14 Assessments
of Compliance and Attestation Reports.
The
Master Servicer shall service and administer the Mortgage Loans in accordance
with all applicable requirements of the Servicing Criteria. Pursuant to Rules
13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB, each
of
the Master Servicer, the Trustee and the Custodian (each, an “Attesting Party”)
at its own expense shall deliver to the Trustee, the Master Servicer and
the
Depositor on or before March 15th
of
each
calendar year beginning in 2008, a report signed by an authorized officer
of
such party regarding such Attesting Party’s assessment of compliance (an
“Assessment of Compliance”) with the Servicing Criteria during the preceding
calendar year. The Assessment of Compliance, as set forth in Regulation AB,
must
contain the following:
(a) A
statement by such officer of its responsibility for assessing compliance
with
the Servicing Criteria applicable to the related Attesting Party;
(b) A
statement by such officer that such Attesting Party used the Servicing Criteria
attached as Exhibit P hereto, and which will also be attached to the Assessment
of Compliance, to assess compliance with the Servicing Criteria applicable
to
the related Attesting Party;
(c) An
assessment by such officer of the related Attesting Party’s compliance with the
applicable Servicing Criteria for the period consisting of the preceding
calendar year, including disclosure of any material instance of noncompliance
with respect thereto during such period, which assessment shall be based
on the
activities such Attesting Party performs with respect to asset-backed securities
transactions taken as a whole involving the related Attesting Party, that
are
backed by the same asset type as the Mortgage Loans;
(d) A
statement that a registered public accounting firm has issued an attestation
report on the related Attesting Party’s Assessment of Compliance for the period
consisting of the preceding calendar year; and
(e) A
statement as to which of the Servicing Criteria, if any, are not applicable
to
such Attesting Party, which statement shall be based on the activities such
Attesting Party performs with respect to asset-backed securities transactions
taken as a whole involving such Attesting Party, that are backed by the same
asset type as the Mortgage Loans.
Such
report at a minimum shall address each of the Servicing Criteria specified
on
Exhibit P hereto which are indicated as applicable to the related Attesting
Party.
Notwithstanding
the foregoing, as to the Trustee and any Custodian, an Assessment of Compliance
is not required to be delivered unless it is required as part of a Form 10-K
with respect to the Trust Fund.
On
or
before March 15th of each calendar year beginning in 2008, each Attesting
Party
shall furnish to the Master Servicer, the Depositor and the Trustee a report
(an
“Attestation Report”) by a registered public accounting firm that attests to,
and reports on, the Assessment of Compliance made by the related Attesting
Party, as required by Rules 13a-18 and 15d-18 of the Exchange Act and Item
1122(b) of Regulation AB, which Attestation Report must be made in accordance
with standards for attestation reports issued or adopted by the Public Company
Accounting Oversight Board.
The
Master Servicer shall cause any subservicer and each subcontractor determined
by
it to be “participating in the servicing function” within the meaning of Item
1122 of Regulation AB, to deliver to the Trustee, the Master Servicer and
the
Depositor an Assessment of Compliance and Attestation Report as and when
provided above along with an indication of what Servicing Criteria are addressed
in such assessment.
The
Trustee shall confirm that the assessments, taken as a whole, address all
of the
Servicing Criteria and taken individually address the Servicing Criteria
for
each party as set forth on Exhibit P and notify the Depositor of any exceptions.
Notwithstanding the foregoing, as to any subcontractor (as defined in the
related servicing agreement), an Assessment of Compliance is not required
to be
delivered unless it is required as part of a Form 10-K with respect to the
Trust
Fund.
In
addition, for the avoidance of doubt and without duplication, the Master
Servicer shall (and shall cause each subservicer engaged by it to) provide
to
the Depositor and the Trustee information concerning the following: (A) any
Event of Default hereunder and any subservicer event of default under the
terms
of the related Subservicing Agreement, (B) any merger, consolidation or sale
of
substantially all of the assets of the Master Servicer or, to the best of
the
Master Servicer’s knowledge, any such subservicer, and (C) the Master Servicer’s
entry into an agreement with a subservicer to perform or assist in the
performance of any of the Master Servicer’s obligations.
In
addition, the Master Servicer shall cause each subservicer engaged by it
to
provide the following information to the Depositor and the Trustee, to the
extent applicable, within the timeframes that the Master Servicer would
otherwise have to provide such information:
(A) any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB);
(B) information
regarding material breaches of pool asset representations or warranties or
transaction covenants (Item 1121(a)(12) of Regulation AB); and
(C) information
regarding new asset-backed securities issuances backed by the same pool assets,
any pool asset changes (such as, additions, substitutions or repurchases),
and
any material changes in origination, underwriting or other criteria for
acquisition or selection of pool assets (Item 1121(a)(14) of Regulation
AB).
Failure
of the Master Servicer to comply with this Section 3.14 (including with respect
to the time frames required in this Section) shall be deemed an Event of
Default, and the Trustee at the direction of the Depositor shall, in addition
to
whatever rights the Trustee may have under this Agreement and at law or in
equity or to damages, including injunctive relief and specific performance,
upon
notice immediately terminate all the rights and obligations of the Master
Servicer under this Agreement and in and to the Mortgage Loans and the proceeds
thereof without compensating the Master Servicer for the same. Failure of
the
Trustee to comply with this Section 3.14 (including with respect to the time
frames required in this Section) which failure results in a failure to timely
file the Form 10-K shall be deemed a default which may result in the termination
of the Trustee pursuant to Section 9.08 of this Agreement and the Depositor
may,
in addition to whatever rights the Depositor may have under this Agreement
and
at law or in equity or to damages, including injunctive relief and specific
performance, upon notice immediately terminate all of the rights and obligations
of the Trustee under this Agreement and in and to the Mortgage Loans and
the
proceeds thereof without compensating the Trustee for the same. This paragraph
shall supersede any other provision in this Agreement or any other agreement
to
the contrary.
In
the
event the Master Servicer, the Custodian, the Trustee or any subservicer
or
subcontractor engaged by any such party is terminated, assigns its rights
and
obligations under, or resigns pursuant to, the terms of the Agreement, the
related Custodial Agreement, or any other applicable agreement in the case
of a
subservicer or subcontractor, as the case may be, such party shall provide
an
Assessment of Compliance and cause to be provided an Attestation Report pursuant
to this Section 3.14 or to the related section of such other applicable
agreement, as the case may be, notwithstanding any such termination, assignment
or resignation.
Section
3.15 Books
and Records.
The
Master Servicer shall be responsible for maintaining, and shall maintain,
a
complete set of books and records for the Mortgage Loans which shall be
appropriately identified in the Master Servicer’s computer system to clearly
reflect the ownership of the Mortgage Loans by the Trust. In particular,
the
Master Servicer shall maintain in its possession, available for inspection
by
the Trustee and shall deliver to the Trustee upon demand, evidence of compliance
with all federal, state and local laws, rules and regulations. To the extent
that original documents are not required for purposes of realization of
Liquidation Proceeds or Insurance Proceeds, documents maintained by the Master
Servicer may be in the form of microfilm or microfiche or such other reliable
means of recreating original documents, including, but not limited to, optical
imagery techniques so long as the Master Servicer complies with the requirements
of Accepted Servicing Practices.
The
Master Servicer shall maintain with respect to each Mortgage Loan and shall
make
available for inspection by the Trustee the related servicing file during
the
time such Mortgage Loan is subject to this Agreement and thereafter in
accordance with applicable law.
Payments
on the Mortgage Loans, including any payoffs, made in accordance with the
related Mortgage File will be entered in the Master Servicer’s set of books and
records no more than two Business Days after receipt and identification,
and
allocated to principal or interest as specified in the related Mortgage
File.
Section
3.16 Reports
Filed with Securities and Exchange Commission.
(a) (i)Within
15
days after each Distribution Date (subject to permitted exceptions under
the
Exchange Act), the Trustee shall, in accordance with industry standards,
prepare
and file with the Commission via the Electronic Data Gathering and Retrieval
System (“XXXXX”), a Form 10-D, signed by the Master Servicer, with a copy of the
Monthly Statement to be furnished by the Trustee to the Certificateholders
for
such Distribution Date attached thereto; provided that the Trustee shall
have
received no later than seven (7) calendar days after the related Distribution
Date, all information required to be provided to the Trustee as described
in
clause (a)(ii) below. Any disclosure in addition to the Monthly Statement
that
is required to be included on Form 10-D (“Additional Form 10-D Disclosure”)
shall
be
reported by the parties set forth on Exhibit Q to the Trustee and the Depositor
and approved by the Depositor pursuant to the paragraph immediately below,
and
the Trustee will have no duty or liability for any failure hereunder to
determine or prepare any Additional Form 10-D Disclosure absent such reporting
(other than with respect to when it is the reporting party as set forth in
Exhibit Q) and approval.
(ii) (A)
Within seven (7) calendar days after the related Distribution Date, (i) the
parties set forth in Exhibit Q shall be required to provide, pursuant to
section
3.16(a)(iv) below, to the Trustee and the Depositor, to the extent known,
in
XXXXX-compatible format, or in such other format as otherwise agreed upon
by the
Trustee and the Depositor and such party, the form and substance of any
Additional Form 10-D Disclosure, if applicable, and (ii) the Depositor will
approve, as to form and substance, or disapprove, as the case may be, the
inclusion of the Additional Form 10-D Disclosure on Form 10-D. The
Trustee has no duty under this Agreement to monitor or enforce the performance
by the parties listed on Exhibit Q of their duties under this paragraph or
proactively solicit or procure from such parties any Additional Form 10-D
Disclosure information. The Depositor will be responsible for any reasonable
out-of-pocket expenses incurred by the Trustee in
connection with including any Additional Form 10-D Disclosure on Form 10-D
pursuant to this Section.
(B) After
preparing the Form 10-D, the Trustee shall forward electronically a draft
copy
of the Form 10-D to the Depositor and the Master Servicer for review. No
later
than two (2) Business Days prior to the 15th calendar day after the related
Distribution Date, a duly authorized officer of the Master Servicer shall
sign
the Form 10-D and return an electronic or fax copy of such signed Form 10-D
(with an original executed hard copy to follow by overnight mail) to the
Trustee. If a Form 10-D cannot be filed on time or if a previously filed
Form
10-D needs to be amended, the Trustee will follow the procedures set forth
in
Section 3.16(a)(v). Promptly (but no later than one (1) Business Day) after
filing with the Commission, the Trustee will make available on its internet
website identified in Section 5.06 a final executed copy of each Form 10-D.
The
signing party at the Master Servicer can be contacted at 000-000-0000. Form
10-D
requires the registrant to indicate (by checking "yes" or "no") that it (1)
has
filed all reports required to be filed by Section 13 or 15(d) of the Exchange
Act during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such
filing requirements for the past 90 days. The Depositor shall notify the
Trustee
in writing, no later than the fifth calendar day after the related Distribution
Date with respect to the filing of a report on Form 10-D, if the answer to
either question should be "no." The Trustee shall be entitled to rely on
the
Depositor’s representations in Section 2.04(vi) in preparing and/or filing any
such Form 10-D. The parties to this Agreement acknowledge that the performance
by the Trustee of its duties under Sections 3.16(a)(i) and (v) related to
the
timely preparation and filing of Form 10-D is contingent upon such parties
strictly observing all applicable deadlines in the performance of their duties
under such Sections. It is understood by the parties hereto that the performance
by the Trustee of its duties under this Section 3.16(a)(ii) related to the
timely preparation, execution and filing of Form 10-D is also contingent
upon
the Custodian and any subservicers or subcontractors strictly observing
deadlines no later than those set forth in this paragraph that are applicable
to
the parties to this Agreement in the delivery to the Trustee of any necessary
Additional Form 10-D Disclosure pursuant to the Custodial Agreement or any
other
applicable agreement. The Trustee shall have no liability for any loss, expense,
damage or claim arising out of or with respect to any failure to properly
prepare and/or timely file such Form 10-D, where such failure results from
the
failure of any party hereto to deliver on a timely basis, any information
needed
by the Trustee to prepare, arrange for execution or file such Form
10-D.
(iii) (A)
Within four (4) Business Days after the occurrence of an event requiring
disclosure on Form 8-K (each such event, a “Reportable Event”), the Trustee
shall prepare and file, on behalf of the Trust, at the direction of the
Depositor, any Form 8-K, as required by the Exchange Act; provided that,
the
Depositor shall file the initial Form 8-K in connection with the issuance
of the
Certificates. Any disclosure or information related to a Reportable Event
or
that is otherwise required to be included on Form 8-K (“Form 8-K Disclosure
Information”) shall be, pursuant to the paragraph immediately below, reported by
the parties set forth on Exhibit Q to the Trustee and the Depositor and directed
and approved by the Depositor pursuant to the following paragraph, and the
Trustee will have no duty or liability for any failure hereunder to determine
or
prepare any Additional Form 8-K Disclosure absent such reporting (other than
with respect to when it is the reporting party as set forth in Exhibit Q)
and
approval.
(B) For
so
long as the Trust is subject to the Exchange Act reporting requirements,
(i) no
later than 12:00 p.m. New York City time on the 2nd Business Day after the
occurrence of a Reportable Event the parties set forth in Exhibit Q shall
be
required pursuant to Section 3.16(a)(iv) below to provide to the Trustee
and the
Depositor, to the extent known, in XXXXX-compatible format, or in such other
form as otherwise agreed upon by the Trustee and the Depositor and such party,
the form and substance of any Form 8-K Disclosure Information, if applicable,
and (ii) the Depositor will approve, as to form and substance, or disapprove,
as
the case may be, the inclusion of the Form 8-K Disclosure Information on
Form
8-K. The Trustee has no duty under this Agreement to monitor or enforce the
performance by the other parties listed on Exhibit Q of their duties under
this
paragraph or to proactively solicit or procure from such parties any Additional
Form 8-K Disclosure Information. The Depositor will be responsible for any
reasonable out-of-pocket expenses incurred by the Trustee in connection with
including any Form 8-K Disclosure Information on Form 8-K pursuant to this
Section.
(C) After
preparing the Form 8-K, the Trustee shall forward electronically a draft
copy of
the Form 8-K to the Depositor and the Master Servicer for review. No later
than
the end of business New York City time on the 3rd Business Day after the
Reportable Event, a duly authorized officer of the Master Servicer shall
sign
the Form 8-K and return an electronic or fax copy of such signed Form 8-K
(with
an original executed hard copy to follow by overnight mail) to the Trustee.
If a
Form 8-K cannot be filed on time or if a previously filed Form 8-K needs
to be
amended, the Trustee will follow the procedures set forth in Section 3.16(a)(v).
Promptly (but no later than one (1) Business Day) after filing with the
Commission, the Trustee will, make available on its internet website identified
in Section 5.06 a final executed copy of each Form 8-K. The signing party
at the
Master Servicer can be contacted at 000-000-0000. The parties to this Agreement
acknowledge that the performance by the Trustee of its duties under this
Section
3.16(a)(iii) related to the timely preparation and filing of Form 8-K is
contingent upon such parties strictly observing all applicable deadlines
in the
performance of their duties under this Section 3.16(a)(iii). It is understood
by
the parties hereto that the performance by the Trustee of its duties under
this
Section 3.16(a)(iii) related to the timely preparation, execution and filing
of
Form 8-K is also contingent upon the Custodian and any subservicers or
subcontractors strictly observing deadlines no later than those set forth
in
this paragraph that are applicable to the parties to this Agreement in the
delivery to the Trustee of any necessary Form 8-K Disclosure Information
pursuant to the Custodial Agreement or any other applicable agreement. The
Trustee shall have no liability for any loss, expense, damage or claim arising
out of or with respect to any failure to properly prepare and/or timely file
such Form 8-K, where such failure results from the failure of any party hereto
to deliver on a timely basis, any information needed by the Trustee to prepare,
arrange for execution or file such Form 8-K.
(D) On
or
prior to the 90th day after the end of each fiscal year of the Trust or such
earlier date as may be required by the Exchange Act (the “10-K Filing Deadline”)
(it being understood that the fiscal year for the Trust ends on December
31st of
each year), commencing in March 2008, the Trustee shall prepare and file
on
behalf of the Trust a Form 10-K, in form and substance as required by the
Exchange Act. Each such Form 10-K shall include the following items, in each
case to the extent they have been delivered to the Trustee within the applicable
time frames set forth in this Agreement, (I) an Annual Statement of Compliance
for the Trustee, Master Servicer and any subservicer, as described under
Section
3.13, (II)(A) the Assessment of Compliance with Servicing Criteria for the
Master Servicer and each subservicer and subcontractor participating in the
servicing function, the Trustee and the Custodian, as described under Section
3.14, and (B) if the Assessment of Compliance of the Master Servicer, the
Trustee or the Custodian described under Section 3.14 identifies any material
instance of noncompliance, disclosure identifying such instance of
noncompliance, or if the Assessment of Compliance of the Master Servicer,
the
Trustee or the Custodian described under Section 3.14 is not included as
an
exhibit to such Form 10-K, disclosure that such report is not included and
an
explanation why such report is not included, (III)(A) the registered public
accounting firm Attestation Report for the Master Servicer, the Trustee and
the
Custodian, as described under Section 3.14, and (B) if any registered public
accounting firm Attestation Report described under Section 3.14 identifies
any
material instance of noncompliance, disclosure identifying such instance
of
noncompliance, or if any such registered public accounting firm Attestation
Report is not included as an exhibit to such Form 10-K, disclosure that such
report is not included and an explanation why such report is not included,
and
(IV) a Xxxxxxxx-Xxxxx Certification (“Xxxxxxxx-Xxxxx Certification”) as
described in this Section 3.16 (a)(iii)(D) below. Any disclosure or information
in addition to (I) through (IV) above that is required to be included on
Form
10-K (“Additional Form 10-K Disclosure”) shall be reported by the parties set
forth on Exhibit Q to the Trustee and the Depositor and, pursuant to the
paragraph immediately below, approved by the Depositor, and the Trustee will
have no duty or liability for any failure hereunder to determine or prepare
any
Additional Form 10-K Disclosure absent such reporting (other than with respect
to when it is the reporting party as set forth in Exhibit Q) and
approval.
(E) No
later
than March 15th of each year that the Trust is subject to the Exchange Act
reporting requirements, commencing in 2008, (i) the parties set forth in
Exhibit
Q shall be required to provide pursuant to Section 3.16(a)(iv) below to the
Trustee and the Depositor, to the extent known, in XXXXX-compatible format,
or
in such other format as otherwise agreed upon by the Trustee and the Depositor
and such party, the form and substance of any Additional Form 10-K Disclosure,
if applicable, and (ii) the Depositor will approve, as to form and substance,
or
disapprove, as the case may be, the inclusion of the Additional Form 10-K
Disclosure on Form 10-K. The Trustee has no duty under this Agreement to
monitor
or enforce the performance by the other parties listed on Exhibit Q of their
duties under this paragraph or to proactively solicit or procure from such
parties any Additional Form 10-K Disclosure information. The Depositor will
be
responsible for any reasonable out-of-pocket expenses incurred by the Trustee
in
connection with including any Form 10-K Disclosure Information on Form 10-K
pursuant to this Section.
(F) After
preparing the Form 10-K, the Trustee shall forward electronically a draft
copy
of the Form 10-K to the Depositor and the Master Servicer for review. Form
10-K
requires the registrant to indicate (by checking "yes" or "no") that it (1)
has
filed all reports required to be filed by Section 13 or 15(d) of the Exchange
Act during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such
filing requirements for the past 90 days. The Depositor shall notify the
Trustee
in writing, no later than the fifteenth calendar day of March in any year
in
which the Trust is subject to the reporting requirements of the Exchange
Act, if
the answer to either question should be "no." The Trustee shall be entitled
to
rely on the Depositor’s representations in Section 2.04(vi) in preparing and/or
filing any such Form 10-K. No
later
than 12:00 p.m. New York City time on the 4th Business Day prior to the 10-K
Filing Deadline, a senior officer of the Master Servicer in charge of the
servicing function shall sign the Form 10-K and return an electronic or fax
copy
of such signed Form 10-K (with an original executed hard copy to follow by
overnight mail) to the Trustee. If a Form 10-K cannot be filed on time or
if a
previously filed Form 10-K needs to be amended, the Trustee will follow the
procedures set forth in Section 3.16(a)(v). Promptly (but no later than one
(1)
Business Day) after filing with the Commission, the Trustee will make available
on its internet website identified in Section 5.06 a final executed copy
of each
Form 10-K. The signing party at the Master Servicer can be contacted at
000-000-0000. The parties to this Agreement acknowledge that the performance
by
the Trustee of its duties under Section 3.16(a)(iv) related to the timely
preparation and filing of Form 10-K is contingent upon such parties strictly
observing all applicable deadlines in the performance of their duties under
Section 3.13 and Section 3.14. It is understood by the parties hereto that
the
performance by the Trustee of its duties under this Section 3.16(a)(iii)
related
to the timely preparation, execution and filing of Form 10-K is also contingent
upon the Custodian and any subservicer or subcontractor strictly observing
deadlines no later than those set forth in this paragraph that are applicable
to
the parties to this Agreement in the delivery to the Trustee of any necessary
Additional Form 10-K Disclosure, any annual statement of compliance and any
assessment of compliance and attestation pursuant to the Custodial Agreement
or
any other applicable agreement. The Trustee shall have no liability for any
loss, expense, damage or claim arising out of or with respect to any failure
to
properly prepare and/or timely file such Form 10-K, where such failure results
from the failure of any party hereto to deliver on a timely basis, any
information needed by the Trustee to prepare, arrange for execution or file
such
Form 10-K.
(G) Each
Form
10-K shall include a certification (the “Xxxxxxxx-Xxxxx Certification”) required
to be included therewith pursuant to the Xxxxxxxx-Xxxxx Act. The Trustee
shall,
and the Master Servicer shall cause any subservicer or subcontractor engaged
by
it to, provide to the Person who signs the Xxxxxxxx-Xxxxx Certification (the
“Certifying Person”), by March 15 of each year in which the Trust is subject to
the reporting requirements of the Exchange Act and otherwise within a reasonable
period of time upon request, a certification (each, a “Back-Up Certification”),
in the form attached hereto as Exhibit K, upon which the Certifying Person,
the
entity for which the Certifying Person acts as an officer, and such entity’s
officers, directors and Affiliates (collectively with the Certifying Person,
“Certification Parties”) can reasonably rely; provided, however, that the
Trustee shall not be required to undertake an analysis of any accountant’s
report attached as an exhibit to the Form 10-K. The senior officer of the
Master
Servicer shall serve as the Certifying Person on behalf of the Trust. Such
officer of the Certifying Person can be contacted at 000-000-0000.
In
the
event the Trustee is terminated or resigns pursuant to the terms of this
Agreement or any subcontractor or subservicer is terminated pursuant to the
related servicing agreement, the Trustee, subcontractor or subservicer, as
applicable, shall provide a Back-Up Certification to the Certifying Person
pursuant to this Section 3.16(a)(iii) with respect to the period of time
it was
subject to this Agreement or the related servicing agreement, as
applicable.
(iv) With
respect to any Additional Form 10-D Disclosure, Additional Form 10-K Disclosure
or any Form 8-K Disclosure Information (collectively, the “Additional
Disclosure”) relating to the Trust Fund in the form attached hereto as Exhibit
R, the Trustee’s obligation to include such Additional Information in the
applicable Exchange Act report is subject to receipt from the entity that
is
indicated in Exhibit Q as the responsible party for providing that information,
if other than the Trustee, as and when required as described in Section
3.16(a)(i) through (iii) above. Each of the Master Servicer, Seller, and
Depositor hereby agree to notify and provide (to the extent known) to the
Trustee and the Depositor all Additional Disclosure relating to the Trust
Fund,
with respect to which such party is indicated in Exhibit Q as the responsible
party for providing that information. Within
five Business Days prior to each Distribution Date occurring in any year
that
the Trust is subject to the Exchange Act reporting requirements, the Depositor
shall make available to the Trustee the Significance Estimate and the Trustee
shall use such information to calculate the Significance Percentage.
The
Trustee shall provide the Significance Percentage to the Depositor by the
later
of the Distribution Date or three (3) Business Days after the receipt of
the
Significance Estimate from the Depositor. If the Significance Percentage
meets
either of the threshold levels detailed in Item 1115(b)(1) or 1115(b)(2)
of
Regulation AB, the Trustee shall deliver written notification to the Depositor
and the Swap Provider to that effect. The
Trustee shall request from the Depositor and the Depositor shall deliver
to the
Trustee any information that the Swap Provider delivered to the Depositor
as
required under Regulation AB, to the extent required under the Swap Agreement.
The Depositor shall be obligated to provide to the Trustee (no later than,
in
the case of Form 10-D, the seventh calendar day after the Distribution Date
and
in the case of Form 10-K, March 15th
in any
year in which a Form 10-K is filed for the Trust) any information that may
be
required to be included in any Form 10-D, Form 8-K or Form 10-K or written
notification instructing the Trustee that such Additional Disclosure regarding
the Swap Provider is not necessary for such Distribution Date. The
Master Servicer shall be responsible for determining the pool concentration
applicable to any subservicer or originator at any time.
(v) (A)
On or
prior to January 30 of the first year in which the Trustee is able to do
so
under applicable law, the Trustee shall file a Form 15 relating to the automatic
suspension of reporting in respect of the Trust under the Exchange Act.
(B) In
the
event that the Trustee is unable to timely file with the Commission all or
any
required portion of any Forms 8-K, 10-D or 10-K required to be filed by this
Agreement because required disclosure information was either not delivered
to it
or delivered to it after the delivery deadlines set forth in this Agreement
or
for any other reason, the Trustee will immediately notify the Depositor and
the
Master Servicer. In the case of Forms 10-D and 10-K, the Depositor, Master
Servicer and Trustee will cooperate to prepare and file a Form 12b-25 and
a
10-D/A and 10-K/A as applicable, pursuant to Rule 12b-25 of the Exchange
Act. In
the case of Form 8-K, the Trustee will, upon receipt of all required Form
8-K
Disclosure Information and upon the approval and direction of the Depositor,
include such disclosure information on the next Form 10-D. In the event that
any
previously filed Forms 8-K, 10-D or 10-K needs to be amended, the Trustee
will
notify the Depositor and the Master Servicer and such parties will cooperate
to
prepare any necessary 8-K/A, 10-D/A or 10-K/A. Any Form 15, Form 12b-25 or
any
amendment to Forms 8-K, 10-D or 10-K shall be signed by a senior officer
of the
Master Servicer. The Depositor and Master Servicer acknowledge that the
performance by the Trustee of its duties under this Section 3.16(a)(vi) related
to the timely preparation and filing of Form 15, a Form 12b-25 or any amendment
to Forms 8-K, 10-D or 10-K is contingent upon the Master Servicer and the
Depositor performing their duties under this Section. The Trustee shall have
no
liability for any loss, expense, damage, claim arising out of or with respect
to
any failure to properly prepare and/or timely file any such Form 15, Form
12b-25
or any amendments to Forms 8-K, 10-D or 10-K, where such failure results
from
the failure of any party hereto to deliver on a timely basis, any information
needed by the Trustee to prepare, arrange for execution or file such Form
15,
Form 12b-25 or any amendments to Forms 8-K, 10-D or 10-K.
The
Depositor agrees to promptly furnish to the Trustee, from time to time upon
request, such further information, reports and financial statements within
its
control related to this Agreement and the Mortgage Loans as the Trustee
reasonably deems appropriate to prepare and file all necessary reports with
the
Commission. The Trustee shall have no responsibility to file any items other
than those specified in this Section 3.16; provided, however, the Trustee
shall
cooperate with the Depositor in connection with any additional filings with
respect to the Trust Fund as the Depositor deems necessary under the Exchange
Act. Copies of all reports filed by the Trustee under the Exchange Act shall
be
sent to: the Depositor c/o Bear, Xxxxxxx & Co. Inc., Attn: Managing Director
Analysis and Control, Xxx Xxxxxxxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000-0000.
Fees and expenses incurred by the Trustee in connection with this Section
3.16
shall not be reimbursable from the Trust Fund.
(b) In
connection with the filing of any 10-K hereunder, the Trustee shall sign
a
Back-Up Certification substantially in the form attached hereto as Exhibit
K for
the Depositor regarding certain aspects of the Form 10-K certification signed
by
the Master Servicer; provided, however, the Trustee shall not be required
to
undertake an analysis of any accountant’s report attached as an exhibit to the
Form 10-K.
(c) The
Trustee shall indemnify and hold harmless, the Depositor and the Master Servicer
and each of its officers, directors and affiliates from and against any losses,
damages, penalties, fines, forfeitures, reasonable and necessary legal fees
and
related costs, judgments and other costs and expenses arising out of or based
upon a breach of the Trustee’s obligations under Sections 3.13, 3.14 and 3.16 or
the Trustee’s negligence, bad faith or willful misconduct in connection
therewith. In addition, the Trustee shall indemnify and hold harmless the
Depositor and the Master Servicer and each of their officers, directors and
affiliates from and against any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments and other
costs
and expenses arising out of or based upon (i) any untrue statement or alleged
untrue statement of any material fact contained in any Back-Up Certification,
the Annual Statement of Compliance, the Assessment of Compliance, any Additional
Disclosure or other information provided by the Trustee pursuant to Section
3.13, 3.14 and 3.16 (the “Trustee Information”), or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which
they were made, not misleading; provided, by way of clarification, that clause
(ii) of this paragraph shall be construed solely by reference to the Trustee
Information and not to any other information communicated in connection with
the
Certificates, without regard to whether the Trustee Information or any portion
thereof is presented together with or separately from such other
information.
(d) The
Depositor shall indemnify and hold harmless the Trustee and its officers,
directors and affiliates from and against any losses, damages, penalties,
fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments
and other costs and expenses arising out of or based upon a breach of the
obligations of the Depositor under Section 3.13, Section 3.14 and Section
3.16
or the Depositor’s negligence, bad faith or willful misconduct in connection
therewith. In addition, the Depositor shall indemnify and hold harmless the
Trustee and each of its officers, directors and affiliates from and against
any
losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal
fees and related costs, judgments and other costs and expenses arising out
of or
based upon (i) any untrue statement or alleged untrue statement of any material
fact contained in any Additional Disclosure or other information provided
by the
Depositor pursuant to Section 3.16 (the “Depositor Information”), or (ii) the
omission or alleged omission to state therein a material fact required to
be
stated therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading; provided, by way of
clarification, that clause (ii) of this paragraph shall be construed solely
by
reference to the Depositor Information and not to any other information
communicated in connection with the Certificates, without regard to whether
the
Depositor Information or any portion thereof is presented together with or
separately from such other information.
(e) The
Master Servicer shall indemnify and hold harmless the Trustee and the Depositor
and their respective officers, directors and affiliates from and against
any
losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal
fees and related costs, judgments and other costs and expenses arising out
of or
based upon a breach of the obligations of the Master Servicer under Section
3.13, Section 3.14 and Section 3.16 or the Master Servicer’s negligence, bad
faith or willful misconduct in connection therewith. In addition, the Master
Servicer shall indemnify and hold harmless the Trustee and the Depositor
and
each of its officers, directors and affiliates from and against any losses,
damages, penalties, fines, forfeitures, reasonable and necessary legal fees
and
related costs, judgments and other costs and expenses arising out of or based
upon (i) any untrue statement or alleged untrue statement of any material
fact
contained in any Xxxxxxxx-Xxxxx Certification, the Annual Statement of
Compliance, the Assessment of Compliance, any Additional Disclosure or other
information provided by the Master Servicer pursuant to Section 3.13, 3.14
and
3.16 (the “Master Servicer Information”), or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which
they were made, not misleading; provided, by way of clarification, that clause
(ii) of this paragraph shall be construed solely by reference to the Master
Servicer Information and not to any other information communicated in connection
with the Certificates, without regard to whether the Master Servicer Information
or any portion thereof is presented together with or separately from such
other
information.
If
the
indemnification provided for herein is unavailable or insufficient to hold
harmless the Master Servicer, the Depositor or the Trustee, as applicable,
then
the defaulting party, in connection with a breach of its respective obligations
under Section 3.13, Section 3.14 and Section 3.16 or its respective negligence,
bad faith or willful misconduct in connection therewith, agrees that it shall
contribute to the amount paid or payable by the other parties as a result
of the
losses, claims, damages or liabilities of the other party in such proportion
as
is appropriate to reflect the relative fault and the relative benefit of
the
respective parties.
(f) Nothing
shall be construed from the foregoing subsections (a), (b) and (c) to require
the Trustee or any officer, director or Affiliate thereof to sign any Form
10-K
or any certification contained therein. Furthermore, the inability of the
Trustee to file a Form 10-K as a result of the lack of required information
as
set forth in Section 3.16(a) or required signatures on such Form 10-K or
any
certification contained therein shall not be regarded as a breach by the
Trustee
of any obligation under this Agreement.
(g) Notwithstanding
the provisions of Section 11.01, this Section 3.16 may be amended without
the
consent of the Certificateholders.
Section
3.17 Intention
of the Parties and Interpretation.
Each
of
the parties acknowledges and agrees that the purpose of Sections 3.13, 3.14
and
3.16 of this Agreement is to facilitate compliance by the Seller and the
Depositor with the provisions of Regulation AB. Therefore, each of the parties
agrees that (a) the obligations of the parties hereunder shall be interpreted
in
such a manner as to accomplish that purpose, (b) the parties’ obligations
hereunder will be supplemented and modified as necessary to be consistent
with
any such amendments, interpretive advice or guidance, convention or consensus
among active participants in the asset-backed securities markets, advice
of
counsel, or otherwise in respect of the requirements of Regulation AB, (c)
the
parties shall comply with reasonable requests made by the Seller, the Trustee
or
the Depositor for delivery of additional or different information as the
Seller,
the Trustee or the Depositor may determine in good faith is necessary to
comply
with the provisions of Regulation AB, and (d) no amendment of this Agreement
shall be required to effect any such changes in the parties’ obligations as are
necessary to accommodate evolving interpretations of the provisions of
Regulation AB.
Section
3.18 UCC.
The
Seller shall file any financing statements, continuation statements or
amendments thereto required by any change in the Uniform Commercial
Code.
Section
3.19 Optional
Purchase of Certain Mortgage Loans.
With
respect to any Mortgage Loan which as of the first day of a Fiscal Quarter
is
delinquent in payment by 90 days or more or is an REO Property, the Seller
shall
have the right to purchase any such Mortgage Loan or REO Property from the
Trust
at a price equal to the Purchase Price; provided however (i) that such Mortgage
Loan is still 90 days or more delinquent or is an REO Property as of the
date of
such purchase and (ii) this purchase option, if not theretofore exercised,
shall
terminate on the date prior to the last day of the related Fiscal Quarter.
This
purchase option, if not exercised, shall not be thereafter reinstated unless
the
delinquency is cured and the Mortgage Loan thereafter again becomes 90 days
or
more delinquent or becomes an REO Property, in which case the option shall
again
become exercisable as of the first day of the related Fiscal Quarter. This
right
may be assigned by the Seller to a third party, including a holder of a Class
of
Certificates.
If
at any
time the Seller remits to the Master Servicer a payment for deposit in the
Protected Account covering the amount of the Purchase Price for such a Mortgage
Loan, and the Seller provides to the Trustee a certification signed by a
Servicing Officer stating that the amount of such payment has been deposited
in
the Protected Account, then the Trustee shall execute the assignment of such
Mortgage Loan prepared and delivered to the Trustee, at the request of the
Seller, without recourse, representation or warranty, to the Seller which
shall
succeed to all the Trustee’s right, title and interest in and to such Mortgage
Loan, and all security and documents relative thereto. Such assignment shall
be
an assignment outright and not for security. The Seller will thereupon own
such
Mortgage, and all such security and documents, free of any further obligation
to
the Trustee or the Certificateholders with respect thereto.
Section
3.20 Obligations
of the Master Servicer in Respect of Mortgage Rates and Scheduled
Payments.
In
the
event that a shortfall in any collection on or liability with respect to
any
Mortgage Loan results from or is attributable to adjustments to Mortgage
Rates,
Scheduled Payments or Stated Principal Balances that were made by the Master
Servicer in a manner not consistent with the terms of the related Mortgage
Note
and this Agreement, the Master Servicer, upon discovery or receipt of notice
thereof, immediately shall deliver to the Trustee for deposit in the
Distribution Account from its own funds the amount of any such shortfall
and
shall indemnify and hold harmless the Trust Fund, the Trustee, the Depositor
and
any Successor Master Servicer in respect of any such liability. Such indemnities
shall survive the termination or discharge of this Agreement. Notwithstanding
the foregoing, this Section 3.20 shall not limit the ability of the Master
Servicer to seek recovery of any such amounts from the related Mortgagor
under
the terms of the related Mortgage Note and Mortgage, to the extent permitted
by
applicable law.
Section
3.21 Reserve
Fund; Payments to and from Swap Administrator; Supplemental Interest
Trust.
(a) Pursuant
to the Swap Administration Agreement, the Supplemental Interest Trust shall
be
established and maintained in the name of the Supplemental Interest Trust
Trustee, as a separate trust, the corpus of which shall be held by the
Supplemental Interest Trust Trustee, for the benefit of the Holders of the
Class
A Certificates and Class M Certificates and the Swap Provider. The Supplemental
Interest Trust shall hold the Swap Agreement, the Swap Administration Agreement,
REMIC VI Regular Interest IO, the Swap Collateral Account and the Swap Account.
The Swap Account shall be an Eligible Account, and funds on deposit therein
shall be held separate and apart from, and shall not be commingled with,
any
other moneys, including, without limitation, other moneys of the Trustee
held
pursuant to this Agreement. Amounts in the Swap Account shall, at the direction
of the Majority Class CE Certificateholder, be invested in Permitted Investments
that mature no later than the Business Day prior to the next succeeding
Distribution Date. All net income and gain from such investments shall be
distributed to the Majority Class CE Certificateholder, not as a distribution
in
respect of any interest in any REMIC, on such Distribution Date. In the absence
of written instructions to the Trustee, amounts on deposit in the Swap Account
shall remain uninvested. All amounts earned on amounts on deposit in the
Swap
Account shall be taxable to the Majority Class CE Certificateholder. Any
losses
on such investments shall be deposited in the Swap Account by the Majority
Class
CE Certificateholder out of its own funds immediately as realized. In performing
its duties hereunder and under the Swap Agreement and Swap Administration
Agreement, the Supplemental Interest Trust Trustee shall be entitled to the
same
rights, protections and indemnities as provided to the Trustee
hereunder.
(b) On
or
before the Closing Date, the Trustee shall establish a Reserve Fund on behalf
of
the Holders of the Certificates. On the Closing Date, the Depositor shall
cause
an amount equal to the Reserve Fund Deposit to be deposited into the Reserve
Fund. The Reserve Fund must be an Eligible Account. The Reserve Fund shall
be
entitled “Reserve Fund, LaSalle Bank National Association as Trustee for the
benefit of holders of Bear Xxxxxxx Asset Backed Securities I LLC, Asset-Backed
Certificates, Series 2007-AQ1”. The Trustee shall deposit in the Reserve Fund
all payments received from the Swap Administrator that are payable to the
Trust
Fund pursuant to the Swap Administration Agreement. On each Distribution
Date
the Trustee shall remit such amounts received from the Swap Administrator
to the
Holders of the Class A Certificates and Class M Certificates in the manner
provided in clause (d) below. In addition, on each Distribution Date as to
which
there is a Basis Risk Shortfall Carry Forward Amount payable to any Class
of
Class A Certificates and/or Class M Certificates, the Trustee shall deposit
the
amounts distributable pursuant to clauses (C) and (D) of Section 5.04(a)(3)
into
the Reserve Fund, and the Trustee has been directed by the Class CE
Certificateholder to distribute any amounts then on deposit in the Reserve
Fund
to the Holders of the Class A and/or Class M Certificates in respect of the
Basis Risk Shortfall Carry Forward Amounts for each such Class in the priorities
set forth in clauses (C) and (D) of Section 5.04(a)(3). Any amount paid to
the
Holders of Class A Certificates and/or Class M Certificates from amounts
distributable pursuant to clauses (C) and (D) of Section 5.04(a)(3) pursuant
to
the preceding sentence in respect of Basis Risk Shortfall Carry Forward Amounts
shall be treated as distributed to the Class CE Certificateholder in respect
of
the Class CE Certificates and paid by the Class CE Certificateholder to the
Holders of the Class A Certificates and/or Class M Certificates. Any payments
to
the Holders of the Class A Certificates and/or Class M Certificates in respect
of Basis Risk Shortfall Carry Forward Amounts, whether pursuant to the second
preceding sentence or pursuant to clause (d) below, shall not be payments
with
respect to a Regular Interest in a REMIC within the meaning of Section
860G(a)(1) of the Code.
(c) Net
Swap
Payments and Swap Termination Payments (other than Swap Termination Payments
resulting from a Swap Provider Trigger Event and other than to the extent
already paid by the Swap Administrator on behalf of the Supplemental Interest
Trust Trustee from any upfront payment received pursuant to any replacement
interest rate swap agreement that may be entered into by the Supplemental
Interest Trust Trustee) payable by the Swap Administrator, on behalf of the
Supplemental Interest Trust Trustee, to the Swap Provider pursuant to the
Swap
Agreement shall be deducted from Interest Funds, and to the extent of any
such
remaining amounts due, from Principal Funds, prior to any distributions to
the
Certificateholders. On or before each Distribution Date, such amounts shall
be
remitted to the Swap Administrator, and deposited into the Swap Account,
first
to make any Net Swap Payment owed to the Swap Provider pursuant to the Swap
Agreement for such Distribution Date and for prior Distribution Dates, if
any,
and second to make any Swap Termination Payment (not due to a Swap Provider
Trigger Event and other than to the extent already paid by the Swap
Administrator on behalf of the Supplemental Interest Trust Trustee from any
upfront payment received pursuant to any replacement interest rate swap
agreement that may be entered into by the Supplemental Interest Trust Trustee)
owed to the Swap Provider pursuant to the Swap Agreement for such Distribution
Date and for prior Distribution Dates, if any. For federal income tax purposes,
such amounts paid to the Supplemental Interest Trust on each Distribution
Date
shall first be deemed paid to the Supplemental Interest Trust in respect
of
REMIC VI Regular Interest IO to the extent of the amount distributable on
such
REMIC VI Regular Interest IO on such Distribution Date, and any remaining
amount
shall be deemed paid to the Supplemental Interest Trust in respect of a Class
IO
Distribution Amount. Any Swap Termination Payment triggered by a Swap Provider
Trigger Event owed to the Swap Provider pursuant to the Swap Agreement will
be
subordinated to distributions to the Holders of the Class A Certificates
and
Class M Certificates and shall be paid as set forth under Section 5.04(a)(3).
In
addition, the Swap Administrator shall remit to the Swap Provider any Swap
Optional Termination Payment paid as part of the Mortgage Loan Purchase Price
and remitted to the Supplemental Interest Trust pursuant to Section
10.01.
(d) On
or
before each Distribution Date, Net Swap Payments payable by the Swap Provider
pursuant to the Swap Agreement to the Swap Administrator, on behalf of the
Supplemental Interest Trust Trustee, will be deposited by the Swap
Administrator, acting on behalf of the Supplemental Interest Trust Trustee,
into
the Swap Account pursuant to the Swap Administration Agreement. The Swap
Administrator shall, to the extent provided in the Swap Administration
Agreement, remit amounts on deposit in the Swap Account to the Trustee for
deposit into the Reserve Fund. On each Distribution Date, to the extent
required, the Trustee shall withdraw such amounts from the Reserve Fund to
distribute to the Class A Certificates and Class M Certificates in the following
order of priority:
(i) first,
to each
Class of Class A Certificates, on a pro
rata
basis,
to pay Current Interest and any Interest Carry Forward Amount to the extent
due
to the interest portion of a Realized Loss, in each case to the extent not
fully
paid pursuant to Section 5.04(a)(1);
(ii) second,
sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5,
Class
M-6, Class M-7, Class M-8, Class M-9 and Class M-10 Certificates, in that
order,
to pay Current Interest to the extent not fully paid pursuant to Section
5.04(a)(1) and any Interest Carry Forward Amount, in each case to the extent
due
to the interest portion of a Realized Loss;
(iii) third,
to pay
first, to each Class of Class A Certificates, on a pro
rata
basis,
based on the amount of Basis Risk Shortfall Carry Forward Amount for each
such
Class, and second, sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class M-10
Certificates, in that order, any Basis Risk Shortfall Carry Forward Amounts
for
such Distribution Date; and
(iv) fourth,
to pay
as principal to the Class A Certificates and Class M Certificates to be applied
as part of the Extra Principal Distribution Amount payable under Section
5.04(a)(2) to the extent that the Overcollateralization Amount is reduced
below
the Overcollateralization Target Amount, as a result of Realized Losses and
to
the extent not paid by Excess Spread pursuant to Section 5.04(a)(3) for such
Distribution Date. For the avoidance of doubt, any amounts distributable
pursuant to this clause (iv) shall be limited to rebuilding
overcollateralization to the extent overcollateralization has been reduced
through Realized Losses.
(e) The
Reserve Fund is an “outside reserve fund” within the meaning of Treasury
Regulation Section 1.860G-2(h) and shall be an asset of the Trust Fund but
not
an asset of any REMIC. The Trustee on behalf of the Trust shall be the nominal
owner of the Reserve Fund. The Majority Class CE Certificateholder shall
be the
beneficial owner of the Reserve Fund, subject to the power of the Trustee
to
transfer amounts under Section 5.04. Amounts in the Reserve Fund shall, at
the
direction of the Majority Class CE Certificateholder, be invested in Permitted
Investments that mature no later than the Business Day prior to the next
succeeding Distribution Date. All net income and gain from such investments
shall be distributed to the Majority Class CE Certificateholder, not as a
distribution in respect of any interest in any REMIC, on such Distribution
Date.
In the absence of written instructions to the Trustee, amounts on deposit
in the
Reserve Fund shall remain uninvested. All amounts earned on amounts on deposit
in the Reserve Fund shall be taxable to the Majority Class CE Certificateholder.
Any losses on such investments shall be deposited in the Reserve Fund by
the
Majority Class CE Certificateholder out of its own funds immediately as
realized. The Swap Account, which is created and maintained by the Swap
Administrator pursuant to the Swap Administration Agreement, is an “outside
reserve fund” within the meaning of Treasury Regulation Section 1.860G-2(h) and
shall not be an asset of any REMIC created hereunder. The beneficial owner
of
the Swap Account is identified, and other matters relating to the Swap Account
are addressed, in the Swap Administration Agreement.
(f) The
Trustee shall treat the Holders of Certificates (other than the Class P,
Class
CE and Class R Certificates) as having entered into a notional principal
contract with respect to the Holders of the Class CE Certificates. Pursuant
to
each such notional principal contract, all Holders of Certificates (other
than
the Class P, Class CE and Class R Certificates) shall be treated as having
agreed to pay, on each Distribution Date, to the Holder of the Class CE
Certificates an aggregate amount equal to the excess, if any, of (i) the
amount
payable on such Distribution Date on the REMIC III Regular Interest
corresponding to such Class of Certificates over (ii) the amount payable
on such
Class of Certificates on such Distribution Date (such excess, a “Class IO
Distribution Amount”). A Class IO Distribution Amount payable from interest
collections shall be allocated on a pro
rata
basis
among such Certificates based on the excess of, with respect to each such
Certificate, (i) the amount of interest otherwise payable to the REMIC III
Regular Interest relating to such Certificate over (ii) the amount of interest
payable to such Certificate at a per annum rate equal to the Net Rate Cap,
and a
Class IO Distribution Amount payable from principal collections shall be
allocated to the most subordinate Class of Certificates (other than the Class
P
Certificates and the Class R Certificates) with an outstanding principal
balance
to the extent of such balance. In addition, pursuant to such notional principal
contract, the Holder of the Class CE Certificates shall be treated as having
agreed to pay Basis Risk Shortfall Carry Forward Amounts to the Holders of
the
Certificates (other than the Class CE, Class P and Class R Certificates)
in
accordance with the terms of this Agreement. Any payments to the Certificates
from amounts deemed received in respect of this notional principal contract
shall not be payments with respect to a Regular Interest in a REMIC within
the
meaning of Code Section 860G(a)(1). However, any payment from the Certificates
(other than the Class CE, Class P and Class R Certificates) of a Class IO
Distribution Amount shall be treated for tax purposes as having been received
by
the Holders of such Certificates in respect of their interests in REMIC III
and
as having been paid by such Holders to the Swap Administrator pursuant to
the
notional principal contract. Thus, each Certificate (other than the Class
P
Certificates and Class R Certificates) shall be treated as representing not
only
ownership of Regular Interests in a REMIC, but also ownership of an interest
in,
and obligations with respect to, a notional principal contract.
(g) Upon
a
Swap Early Termination other than in connection with the Optional Termination
of
the Trust, the Swap Administrator, pursuant to the Swap Administration
Agreement, shall use reasonable efforts to appoint a successor swap provider
to
enter into a new interest rate swap agreement on terms substantially similar
to
the Swap Agreement, with a successor swap provider meeting all applicable
eligibility requirements. If the Swap Administrator receives a Swap Termination
Payment from the Swap Provider in connection with such Swap Early Termination,
the Swap Administrator will apply such Swap Termination Payment to any upfront
payment required to appoint the successor swap provider. If the Swap
Administrator is required to pay a Swap Termination Payment to the Swap Provider
in connection with such Swap Early Termination, the Swap Administrator will
apply any upfront payment received from the successor swap provider to pay
such
Swap Termination Payment. If the Swap Administrator is unable to appoint
a
successor swap provider within 30 days of the Swap Early Termination, then
the
Swap Administrator will deposit any Swap Termination Payment received from
the
original Swap Provider into a separate, non-interest bearing reserve account
and
will, on each subsequent distribution date, withdraw from the amount then
remaining on deposit in such reserve account an amount equal to the Net Swap
Payment, if any, that would have been paid to the Swap Administrator by the
original Swap Provider calculated in accordance with the terms of the original
Swap Agreement, and distribute such amount to the Holders of the Class A
Certificates and Class M Certificates or for such other purpose specified
in the
Swap Administration Agreement in accordance with the terms thereof.
(h) In
the
event that the Swap Provider fails to perform any of its obligations under
the
Swap Agreement (including, without limitation, its obligation to make any
payment or transfer collateral), or breaches any of its representations and
warranties thereunder, or in the event that an Event of Default, Termination
Event, or Additional Termination Event (each as defined in the Swap Agreement)
occurs with respect to the Swap Agreement, the Supplemental Interest Trust
Trustee shall, provided the Supplemental Interest Trust Trustee has actual
knowledge of such failure, breach or occurrence by the Swap Provider,
immediately, but no later than the next Business Day following such failure,
breach, or occurrence, notify the Depositor and send any notices and make
any
demands, on behalf of the Supplemental Interest Trust, in accordance with
the
Swap Agreement.
(i) In
the
event that the Swap Provider’s obligations are guaranteed by a third party under
a guaranty relating to the Swap Agreement (such guaranty the “Guaranty” and such
third party the “Guarantor”), then to the extent that the Swap Provider fails to
make any payment by the close of business on the day it is required to make
payment under the terms of the Swap Agreement, the Supplemental Interest
Trust
Trustee shall, as soon as practicable, but no later than two (2) Business
Days
after the Swap Provider’s failure to pay, demand that the Guarantor make any and
all payments then required to be made by the Guarantor pursuant to such
Guaranty. The Swap Provider or the Depositor shall promptly provide the
Supplemental Interest Trust Trustee with a copy of such Guaranty; provided
that,
the Supplemental Interest Trust Trustee shall in no event be liable for any
failure or delay in the performance by the Swap Provider or any Guarantor
of its
obligations hereunder or pursuant to the Swap Agreement and the Guaranty,
nor
for any special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits) in connection
therewith.
(j) The
Supplemental Interest Trust Trustee shall cause any replacement swap provider
to
provide a copy of the related replacement interest rate swap agreement to
the
Depositor.
Section
3.22 Tax
Treatment of Class IO Distribution Amounts in the Event of Resecuritization
of
Class A Certificates or Class M Certificates.
In
the
event that any Class A Certificate or Class M Certificate is resecuritized
in a
REMIC (the “Resecuritization REMIC”), for federal income tax purposes, (i)
payments on the REMIC III Regular Interest corresponding to such Class A
Certificate or Class M Certificate shall, for the avoidance of doubt, be
deemed
to include the related Class IO Distribution Amount, and (ii) to the extent
provided in the operative documents for the Resecuritization REMIC, (a) payments
on the “regular interests” issued by the Resecuritization REMIC shall be deemed
to include in the aggregate such Class IO Distribution Amount, and (b) such
Class IO Distribution Amount shall be deemed paid to the holder of the Class
CE
Certificates pursuant to a notional principal contract entered into by the
holders of one or more “regular interests” issued by the Resecuritization REMIC
(“Resecuritization Holders”) and the Holder of the Class CE Certificates. In
such event, Class IO Distribution Amounts deemed paid by Resecuritization
Holders under clause (b) of the immediately preceding sentence shall be paid
on
behalf of such holders pursuant to Section 3.21(c) hereof..
Section
3.23 Advancing
Facility.
(a) The
Master Servicer and/or the Trustee on behalf of the Trust Fund, in either
case,
with the consent of the Master Servicer in the case of the Trustee and, in
each
case, with notice to the Rating Agencies, is hereby authorized to enter into
a
facility (the “Advancing Facility”) with any Person which provides that such
Person (an “Advancing Person”) may fund Advances and/or Servicing Advances to
the Trust Fund under this Agreement, although no such facility shall reduce
or
otherwise affect the Master Servicer’s obligation to fund such Advances and/or
Servicing Advances. If the Master Servicer enters into such an Advancing
Facility pursuant to this Section 3.23, upon reasonable request of the Advancing
Person, the Trustee shall execute a letter of acknowledgment, confirming
its
receipt of notice of the existence of such Advancing Facility. To the extent
that an Advancing Person funds any Advance or any Servicing Advance and provides
the Trustee with notice acknowledged by the Master Servicer that such Advancing
Person is entitled to reimbursement, such Advancing Person shall be entitled
to
receive reimbursement pursuant to this Agreement for such amount to the extent
provided in Section 3.23(b). Such notice from the Advancing Person must specify
the amount of the reimbursement, the Section of this Agreement that permits
the
applicable Advance or Servicing Advance to be reimbursed and the section(s)
of
the Advancing Facility that entitle the Advancing Person to request
reimbursement from the Trustee, rather than the Master Servicer, and include
the
Master Servicer’s acknowledgment thereto or proof of an Event of Default under
the Advancing Facility. The Trustee shall have no duty or liability with
respect
to any calculation of any reimbursement to be paid to an Advancing Person
and
shall be entitled to rely without independent investigation on the Advancing
Person’s notice provided pursuant to this Section 3.23. An Advancing Person
whose obligations hereunder are limited to the funding of Advances and/or
Servicing Advances shall not be required to meet the qualifications of a
Master
Servicer or a subservicer pursuant to Section 8.02 hereof and will not be
deemed
to be a subservicer under this Agreement.
(b) If
an
Advancing Facility is entered into, then the Master Servicer shall not be
permitted to reimburse itself therefor under Section 4.02(a)(ii), Section
4.02(a)(iii) and Section 4.02(a)(v) prior to the remittance to the Trust
Fund,
but instead the Master Servicer shall include such amounts in the applicable
remittance to the Trustee made pursuant to Section 4.02. The Trustee is hereby
authorized to pay to the Advancing Person, reimbursements for Advances and
Servicing Advances from the Distribution Account to the same extent the Master
Servicer would have been permitted to reimburse itself for such Advances
and/or
Servicing Advances in accordance with Section 4.02(a)(ii), Section 4.02(a)(iii)
or Section 4.02(a)(v), as the case may be, had the Master Servicer itself
funded
such Advance or Servicing Advance. The Trustee is hereby authorized to pay
directly to the Advancing Person such portion of the Servicing Fee as the
parties to any advancing facility agree.
(c) All
Advances and Servicing Advances made pursuant to the terms of this Agreement
shall be deemed made and shall be reimbursed on a “first in-first out” (FIFO)
basis.
(d) Any
amendment to this Section 3.23 or to any other provision of this Agreement
that
may be necessary or appropriate to effect the terms of an Advancing Facility
as
described generally in this Section 3.23, including amendments to add provisions
relating to a Successor Master Servicer, may be entered into by the Trustee
and
the Master Servicer without the consent of any Certificateholder,
notwithstanding anything to the contrary in this Agreement.
ARTICLE
IV
ACCOUNTS
Section
4.01 Collection
of Mortgage Loan Payments; Protected Account.
(a) The
Master Servicer shall make reasonable efforts in accordance with customary
and
usual standards of practice of prudent mortgage lenders in the respective
states
in which the Mortgaged Properties are located to collect all payments called
for
under the terms and provisions of the Mortgage Loans to the extent such
procedures shall be consistent with this Agreement and the terms and provisions
of any related Required Insurance Policy. Consistent with the foregoing,
the
Master Servicer may in its discretion (i) waive any late payment charge and
(ii)
extend the due dates for payments due on a Mortgage Note for a period not
greater than 125 days. In the event of any such arrangement, the Master Servicer
shall make Advances on the related Mortgage Loan during the scheduled period
in
accordance with the amortization schedule of such Mortgage Loan without
modification thereof by reason of such arrangements, and shall be entitled
to
reimbursement therefor in accordance with Section 5.01. The Master Servicer
shall not be required to institute or join in litigation with respect to
collection of any payment (whether under a Mortgage, Mortgage Note or otherwise
or against any public or governmental authority with respect to a taking
or
condemnation) if it reasonably believes that enforcing the provision of the
Mortgage or other instrument pursuant to which such payment is required is
prohibited by applicable law. In
addition, if (x) a Mortgage Loan is in default or default is reasonably
foreseeable, the Master Servicer may also waive, modify or vary any term
of any
Mortgage Loan or consent to the postponement of strict compliance with any
such
term or in any manner grant indulgence to any mortgagor, including without
limitation, to (1) capitalize any amounts owing on the Mortgage Loan by adding
such amount to the outstanding principal balance of the Mortgage Loan, (2)
defer
such amounts to a later date or the final payment date of such Mortgage Loan,
(3) extend the maturity of any such Mortgage Loan, but in no instance past
the
date on which the final payment is due on the latest maturing Mortgage Loan
as
of the Cut-off Date, and/or (4) reduce the related Mortgage Rate (subject
to
clause (y) below), provided that, in the Master Servicer’s determination, such
waiver, modification, postponement or indulgence is not materially adverse
to
the interests of the Certificateholders (taking into account any estimated
Realized Loss that might result absent such action),
or (y)
the Master Servicer delivers to the Trustee a certification addressed to
the
Trustee, based on the advice of counsel or certified public accountants,
in
either case, that have a national reputation with respect to taxation of
REMICs,
that a modification of such Mortgage Loan will not result in the imposition
of
taxes on or disqualify from REMIC status any of REMIC I, REMIC II, REMIC
III,
REMIC IV, REMIC V or REMIC VI, the Master Servicer may, (A) amend the related
Mortgage Note to reduce the Mortgage Rate applicable thereto, provided that
such
reduced Mortgage Rate shall in no event be lower than 5.00% with respect
to any
Mortgage Loan and (B) amend any Mortgage Note to extend the maturity
thereof.
(b) The
Master Servicer shall not waive (or permit a sub-servicer to waive) any
Prepayment Charge unless: (i) the enforceability thereof shall have been
limited
by bankruptcy, insolvency, moratorium, receivership and other similar laws
relating to creditors’ rights generally, (ii) the enforcement thereof is
illegal, or any local, state or federal agency has threatened legal action
if
the prepayment penalty is enforced, (iii) the mortgage debt has been accelerated
in connection with a foreclosure or other involuntary payment or (iv) such
waiver is standard and customary in servicing similar Mortgage Loans and
relates
to a default or a reasonably foreseeable default and would, in the reasonable
judgment of the Master Servicer, maximize recovery of total proceeds taking
into
account the value of such Prepayment Charge and the related Mortgage Loan.
If
a
Prepayment Charge is waived, but does not meet the standards described above,
then the Master Servicer is required to pay the amount of such waived Prepayment
Charge, for the benefit of the Class P Certificates, by remitting such amount
to
the Trustee by the Distribution Account Deposit Date.
(c) The
Master Servicer shall establish and maintain a Protected Account (which shall
at
all times be an Eligible Account) with a depository institution in the name
of
the Master Servicer for the benefit of the Trustee on behalf of the
Certificateholders and designated “EMC Mortgage Corporation, as Master Servicer,
for the benefit of LaSalle Bank National Association, in trust for registered
Holders of Bear Xxxxxxx Asset Backed Securities I LLC, Asset-Backed
Certificates, Series 2007-AQ1”. The Master Servicer shall deposit or cause to be
deposited into the Protected Account on a daily basis within two Business
Days
of receipt and identification, except as otherwise specifically provided
herein,
the following payments and collections remitted by subservicers or received
by
it in respect of the Mortgage Loans subsequent to the Cut-off Date (other
than
in respect of principal and interest due on the Mortgage Loans on or before
the
Cut-off Date) and the following amounts required to be deposited
hereunder:
(i) all
payments on account of principal, including Principal Prepayments, on the
Mortgage Loans;
(ii) all
payments on account of interest on the Mortgage Loans net of the Servicing
Fee
permitted under Section 3.10 and LPMI Fees, if any;
(iii) all
Liquidation Proceeds, Subsequent Recoveries and Insurance Proceeds, other
than
proceeds to be applied to the restoration or repair of the Mortgaged Property
or
released to the Mortgagor in accordance with the Master Servicer’s normal
servicing procedures;
(iv) any
amount required to be deposited by the Master Servicer pursuant to Section
4.01(c) in connection with any losses on Permitted Investments;
(v) any
amounts required to be deposited by the Master Servicer pursuant to Section
3.05;
(vi) any
Prepayment Charges collected on the Mortgage Loans; and
(vii) any
other
amounts required to be deposited hereunder.
The
foregoing requirements for remittance by the Master Servicer into the Protected
Account shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of late
payment
charges or assumption fees, if collected, need not be remitted by the Master
Servicer. In the event that the Master Servicer shall remit any amount not
required to be remitted and not otherwise subject to withdrawal pursuant
to
Section 4.02, it may at any time withdraw or direct the institution maintaining
the Protected Account, to withdraw such amount from the Protected Account,
any
provision herein to the contrary notwithstanding. Such withdrawal or direction
may be accomplished by delivering written notice thereof to the institution
maintaining the Protected Account, that describes the amounts deposited in
error
in the Protected Account. The Master Servicer shall maintain adequate records
with respect to all withdrawals made pursuant to this Section. Reconciliations
will be prepared for the Protected Account within 45 calendar days after
the
bank statement cut-off date. All funds deposited in the Protected Account
shall
be held in trust for the Certificateholders until withdrawn in accordance
with
Section 4.02.
(d) The
institution that maintains the Protected Account shall invest the funds in
the
Protected Account, in the manner directed by the Master Servicer, in Permitted
Investments which shall mature not later than the Distribution Account Deposit
Date and shall not be sold or disposed of prior to its maturity. All such
Permitted Investments shall be made in the name of the Trustee, for the benefit
of the Certificateholders. All income and gain net of any losses realized
from
any such investment shall be for the benefit of the Master Servicer as servicing
compensation and shall be remitted to it monthly as provided herein. The
amount
of any losses incurred in the Protected Account in respect of any such
investments shall be deposited by the Master Servicer into the Protected
Account, out of the Master Servicer’s own funds.
(e) The
Master Servicer shall give at least 30 days advance notice to the Trustee,
the
Mortgage Loan Sellers, each Rating Agency and the Depositor of any proposed
change of location of the Protected Account prior to any change
thereof.
Section
4.02 Permitted
Withdrawals From the Protected Account.
(a) The
Master Servicer may from time to time make withdrawals from the Protected
Account for the following purposes:
(i) to
pay
itself (to the extent not previously paid to or withheld by the Master
Servicer), as servicing compensation in accordance with Section 3.10, that
portion of any payment of interest that equals the Servicing Fee for the
period
with respect to which such interest payment was made, and, as additional
servicing compensation, those other amounts set forth in Section
3.10;
(ii) to
reimburse the Master Servicer for Advances made by it with respect to the
related Mortgage Loans; provided, however, that the Master Servicer’s right of
reimbursement pursuant to this subclause (ii) shall be limited to amounts
received on particular Mortgage Loan(s) (including, for this purpose,
Liquidation Proceeds, Insurance Proceeds and Subsequent Recoveries) that
represent late recoveries of payments of principal and/or interest on such
particular Mortgage Loan(s) in respect of which any such Advance was
made;
(iii) to
reimburse the Master Servicer for any previously made portion of a Servicing
Advance or an Advance made by the Master Servicer that, in the good faith
judgment of the Master Servicer, will not be ultimately recoverable by it
from
the related Mortgagor, any related Liquidation Proceeds, Insurance Proceeds
or
otherwise (a “Nonrecoverable Advance”), to the extent not reimbursed pursuant to
clause (ii) or clause (v);
(iv) to
reimburse the Master Servicer from Insurance Proceeds for Insured Expenses
covered by the related Insurance Policy;
(v) to
pay
the Master Servicer any unpaid Servicing Fees and to reimburse it for any
unreimbursed Servicing Advances, provided, however, that the Master Servicer’s
right to reimbursement for Servicing Advances pursuant to this subclause
(v)
with respect to any Mortgage Loan shall be limited to amounts received on
particular Mortgage Loan(s) (including, for this purpose, Liquidation Proceeds,
Insurance Proceeds, Subsequent Recoveries and purchase and repurchase proceeds)
that represent late recoveries of the payments for which such Servicing Advances
were made;
(vi) to
pay to
the Seller, with respect to each Mortgage Loan or property acquired in respect
thereof that has been purchased pursuant to Section 2.02, 2.03 or 3.19 of
this
Agreement, all amounts received thereon and not taken into account in
determining the related Stated Principal Balance of such repurchased Mortgage
Loan;
(vii) to
pay
any expenses recoverable by the Master Servicer pursuant to Section 7.04
of this
Agreement;
(viii) to
withdraw pursuant to Section 4.01 any amount deposited in the Protected Account
and not required to be deposited therein; and
(ix) to
clear
and terminate the Protected Account upon termination of this Agreement pursuant
to Section 10.01 hereof.
In
addition, no later than 10:00 a.m. Eastern time on the Distribution Account
Deposit Date, the Master Servicer shall withdraw from the Protected Account
and
remit to the Trustee the amount of Interest Funds (without taking into account
any reduction in the amount of Interest Funds attributable to the application
of
clause (c) of the definition thereof contained in Article I of this Agreement)
and Principal Funds collected, to the extent on deposit, and the Trustee
shall
deposit such amount in the Distribution Account. In addition, on or before
the
Distribution Account Deposit Date, the Master Servicer shall remit to the
Trustee for deposit in the Distribution Account any Advances or any payments
of
Compensating Interest required to be made by the Master Servicer with respect
to
the Mortgage Loans. Furthermore, on each Distribution Account Deposit Date,
the
Master Servicer shall remit to the Trustee all Prepayment Charges collected
by
the Master Servicer with respect to the Mortgage Loans during the related
Prepayment Period. If the Master Servicer fails to remit any funds due by
the
time designated herein, the Master Servicer shall pay to the Trustee, out
of its
own funds, interest accrued at the prime rate as set forth in the Wall Street
Journal, from and including the applicable due date, to but excluding the
day
such funds are paid to the Trustee.
The
Master Servicer shall keep and maintain separate accounting, on a Mortgage
Loan
by Mortgage Loan basis, for the purpose of justifying any withdrawal from
the
Protected Account pursuant to subclauses (i), (ii), (iv), (v), (vi) and (vii)
above. Prior to making any withdrawal from the Protected Account pursuant
to
subclause (iii), the Master Servicer shall deliver to the Trustee an Officer’s
Certificate of a Servicing Officer indicating the amount of any previous
Advance
or Servicing Advance determined by the Master Servicer to be a Nonrecoverable
Advance and identifying the related Mortgage Loan(s), and their respective
portions of such Nonrecoverable Advance.
Section
4.03 Collection
of Taxes; Assessments and Similar Items; Escrow Accounts.
With
respect to each Mortgage Loan, to the extent required by the related Mortgage
Note, the Master Servicer shall establish and maintain one or more accounts
(each, an “Escrow Account”) and deposit and retain therein all collections from
the Mortgagors (or advances by the Master Servicer) for the payment of taxes,
assessments, hazard insurance premiums or comparable items for the account
of
the Mortgagors. Nothing herein shall require the Master Servicer to compel
a
Mortgagor to establish an Escrow Account in violation of applicable
law.
Withdrawals
of amounts so collected from the Escrow Accounts may be made only to effect
timely payment of taxes, assessments, hazard insurance premiums, condominium
or
PUD association dues, or comparable items, to reimburse the Master Servicer
out
of related collections for any payments made with respect to each Mortgage
Loan
pursuant to Section 3.01 (with respect to taxes and assessments and insurance
premiums) and Section 3.05 (with respect to hazard insurance), to refund
to any
Mortgagors for any Mortgage Loans any sums as may be determined to be overages,
to pay interest, if required by law or the terms of the related Mortgage
or
Mortgage Note, to such Mortgagors on balances in the Escrow Account or to
clear
and terminate the Escrow Account at the termination of this Agreement in
accordance with Section 10.01 thereof. The Escrow Account shall not be a
part of
the Trust Fund.
Section
4.04 Distribution
Account.
(a) The
Trustee shall establish and maintain in the name of the Trustee, for the
benefit
of the Certificateholders, the Distribution Account as a segregated trust
account or accounts.
(b) All
amounts deposited to the Distribution Account shall be held by the Trustee
in
the name of the Trustee in trust for the benefit of the Certificateholders
in
accordance with the terms and provisions of this Agreement.
(c) The
Distribution Account shall constitute an Eligible Account of the Trust Fund
segregated on the books of the Trustee and held by the Trustee and the
Distribution Account and the funds deposited therein shall not be subject
to,
and shall be protected from, all claims, liens, and encumbrances of any
creditors or depositors of the Trustee (whether made directly, or indirectly
through a liquidator or receiver of the Trustee). The amount at any time
credited to the Distribution Account may be invested in the name of the Trustee,
in such Permitted Investments, or deposited in demand deposits with such
depository institutions, as determined by the Trustee. All Permitted Investments
shall mature or be subject to redemption or withdrawal on or before, and
shall
be held until, the next succeeding Distribution Date if the obligor for such
Permitted Investment is the Trustee or, if such obligor is any other Person,
the
Business Day preceding such Distribution Date. All investment earnings on
amounts on deposit in the Distribution Account or benefit from funds uninvested
therein from time to time shall be for the account of the Trustee. The Trustee
shall be permitted to withdraw or receive distribution of any and all investment
earnings from the Distribution Account on each Distribution Date. If there
is
any loss on a Permitted Investment or demand deposit, the Trustee shall deposit
the amount of the loss from its own funds in the Distribution Account not
later
than the applicable Distribution Date on which the moneys so invested are
required to be distributed to the Certificateholders. With respect to the
Distribution Account and the funds deposited therein, the Trustee shall take
such action as may be necessary to ensure that the Certificateholders shall
be
entitled to the priorities afforded to such a trust account (in addition
to a
claim against the estate of the Trustee) as provided by 12 U.S.C. § 92a(e), and
applicable regulations pursuant thereto, if applicable, or any applicable
comparable state statute applicable to state chartered banking
corporations.
Section
4.05 Permitted
Withdrawals and Transfers from the Distribution Account.
(a) The
Trustee will make or cause to be made such withdrawals or transfers from
the
Distribution Account for the following purposes:
(i) to
pay to
itself the Trustee Fee;
(ii) to
reimburse the Trustee, Supplemental Interest Trust Trustees or the Swap
Administrator for expenses, costs and liabilities incurred by or reimbursable
to
it pursuant to this Agreement;
(iii) to
pay
investment income to the Trustee;
(iv) to
remove
amounts deposited in error;
(v) to
make
distributions to the Swap Administrator for payment to the Swap Provider
as
provided in this Agreement; and
(vi) to
clear
and terminate the Distribution Account pursuant to Section 10.01.
(b) On
each
Distribution Date, the Trustee shall distribute Interest Funds and Principal
Funds in the Distribution Account to the Holders of the Certificates in
accordance with Section 5.04.
Section
4.06 Class
P Certificate Account.
(a) The
Trustee shall establish and maintain in the name of the Trustee, for the
benefit
of the Class P Certificateholders, the Class P Certificate Account as a
segregated trust account or accounts.
(b) On
the
Closing Date, the Depositor will deposit, or cause to be deposited in the
Class
P Certificate Account, an amount equal to $100. All amounts deposited to
the
Class P Certificate Account shall be held by the Trustee in the name of the
Trustee in trust for the benefit of the Class P Certificateholders in accordance
with the terms and provisions of this Agreement. The amount on deposit in
the
Class P Certificate Account shall be held uninvested.
ARTICLE
V
DISTRIBUTIONS
AND ADVANCES
Section
5.01 Advances.
The
Master Servicer shall, or shall cause the related subservicer pursuant to
the
Subservicing Agreement to, make an Advance (other than any balloon payments)
and
deposit such Advance in the Protected Account. Each such Advance shall be
remitted to the Distribution Account no later than 10:00 a.m. Eastern time
on
the Distribution Account Deposit Date in immediately available funds. The
Master
Servicer shall be obligated to make any such Advance only to the extent that
such advance would not be a Nonrecoverable Advance. If the Master Servicer
shall
have determined that it has made a Nonrecoverable Advance or that a proposed
Advance or a lesser portion of such Advance would constitute a Nonrecoverable
Advance, the Master Servicer shall deliver (i) to the Trustee for the benefit
of
the Certificateholders the portion of such Advance that
is
not deemed Nonrecoverable,
if
applicable, and (ii) to the Depositor, each Rating Agency, and the Trustee
an
Officer’s Certificate setting forth the basis for such determination. Subject to
the Master Servicer’s recoverability determination, in the event that a
subservicer fails to make a required Advance, the Master Servicer shall be
required to remit the amount of such Advance to the Distribution
Account.
In
lieu
of making all or a portion of such Advance from its own funds, the Master
Servicer may (i) cause to be made an appropriate entry in its records relating
to the Protected Account that any Amount Held for Future Distributions has
been
used by the Master Servicer in discharge of its obligation to make any such
Advance and (ii) transfer such funds from the Protected Account to the
Distribution Account. Any funds so applied and transferred shall be replaced
by
the Master Servicer by deposit in the Distribution Account, no later than
the
close of business on the Business Day immediately preceding the Distribution
Date on which such funds are required to be distributed pursuant to this
Agreement.
The
Master Servicer shall be entitled to be reimbursed from the Protected Account
for all Advances of its own funds made pursuant to this Section as provided
in
Section 4.02. The obligation to make Advances with respect to any Mortgage
Loan
shall continue until such Mortgage Loan is paid in full or the related Mortgaged
Property or related REO Property has been liquidated or until the purchase
or
repurchase thereof (or substitution therefor) from the Trust Fund pursuant
to
any applicable provision of this Agreement, except as otherwise provided
in this
Section 5.01.
Subject
to and in accordance with the provisions of Article VIII hereof, in the event
the Master Servicer fails to make such Advance, then the Trustee, as Successor
Master Servicer, or any other Successor Master Servicer appointed hereunder,
shall be obligated to make such Advance, subject to the provisions of this
Section 5.01.
Section
5.02 Compensating
Interest Payments.
In
the
event that there is a Prepayment Interest Shortfall arising from a voluntary
Principal Prepayment in part or in full by the Mortgagor with respect to
any
Mortgage Loan, the Master Servicer shall, to the extent of the Servicing
Fee for
such Distribution Date, deposit into the Distribution Account, as a reduction
of
the Servicing Fee for such Distribution Date, no later than the close of
business on the Business Day immediately preceding such Distribution Date,
an
amount equal to such Prepayment Interest Shortfall; and in case of such deposit,
the Master Servicer shall not be entitled to any recovery or reimbursement
from
the Depositor, the Trustee, the Seller, the Trust Fund or the
Certificateholders.
Section
5.03 REMIC
Distributions.
On
each
Distribution Date the Trustee shall be deemed to have allocated distributions
to
the REMIC I Regular Interests, REMIC II Regular Interests, REMIC III Regular
Interests and REMIC IV Regular Interests in accordance with Section 5.07
hereof.
Section
5.04 Distributions.
(a) Subject
to Section 3.21(c), on each Distribution Date, an amount equal to the Interest
Funds and Principal Funds for such Distribution Date shall be withdrawn by
the
Trustee from the Distribution Account and distributed in the following order
of
priority:
(1) Interest
Funds shall be distributed in the following manner and order of
priority:
(A) To
the
Class A-1, Class A-2 and Class A-3 Certificates, the Current Interest and
then
any Interest Carry Forward Amount for each such Class, on a pro
rata
basis,
based on the entitlement of each such Class; and
(B) From
remaining Interest Funds, sequentially, to the Class X-0, Xxxxx X-0, Class
M-3,
Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class
M-10
Certificates, in that order, the Current Interest for each such Class.
Any
Excess Spread to the extent necessary to meet a level of overcollateralization
equal to the Overcollateralization Target Amount shall be the Extra Principal
Distribution Amount and shall be included as part of the Principal Distribution
Amount. Any Remaining Excess Spread together with any Overcollateralization
Release Amount shall be applied as Excess Cashflow and distributed pursuant
to
clauses (3)(A) through (H) below.
On
any
Distribution Date, any Relief Act Interest Shortfalls and any Prepayment
Interest Shortfalls to the extent not covered by Compensating Interest will
be
allocated to the Certificates as set forth in the definition of “Current
Interest” herein and Section 1.02.
(2) On
each
Distribution Date, the Principal Distribution shall be distributed in the
following manner and order of priority:
(A) For
each
Distribution Date (i) prior to the Stepdown Date or (ii) on which a Trigger
Event is in effect:
| (i) |
To
the Class A Certificates, the Principal Distribution Amount for such
Distribution Date, sequentially, to the Class A-1, Class A-2 and
Class A-3
Certificates, in that order, in each case until the Certificate Principal
Balance thereof is reduced to zero;
|
| (ii) |
To
the Class M-1 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (iii) |
To
the Class M-2 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (iv) |
To
the Class M-3 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (v) |
To
the Class M-4 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (vi) |
To
the Class M-5 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (vii) |
To
the Class M-6 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (viii) |
To
the Class M-7 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (ix) |
To
the Class M-8 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero;
|
| (x) |
To
the Class M-9 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero; and
|
| (xi) |
To
the Class M-10 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, until the Certificate Principal
Balance
thereof is reduced to zero.
|
(B) For
each
Distribution Date on or after the Stepdown Date, so long as a Trigger Event
is
not in effect:
| (i) |
To
the Class A Certificates, the Class A Principal Distribution Amount
for
such Distribution Date, sequentially to the Class A-1, Class A-2
and Class
A-3 Certificates, in that order, in each case until the Certificate
Principal Balance thereof is reduced to
zero;
|
| (ii) |
To
the Class M-1 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-1 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (iii) |
To
the Class M-2 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-2 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (iv) |
To
the Class M-3 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-3 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (v) |
To
the Class M-4 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-4 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (vi) |
To
the Class M-5 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-5 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (vii) |
To
the Class M-6 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-6 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (viii) |
To
the Class M-7 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-7 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (ix) |
To
the Class M-8 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-8 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero;
|
| (x) |
To
the Class M-9 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-9 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero; and
|
| (xi) |
To
the Class M-10 Certificates, from any remaining Principal Distribution
Amount for such Distribution Date, the Class M-10 Principal Distribution
Amount, until the Certificate Principal Balance thereof is reduced
to
zero.
|
(3) Any
Excess Cashflow shall be distributed in the following manner and order of
priority:
(A) Excess
Cashflow, to the Class A Certificates, (a) first, any remaining Interest
Carry
Forward Amount for such Classes, on a pro
rata
basis,
in accordance with the Interest Carry Forward Amount due with respect to
each
such Class,
to the
extent not fully paid pursuant to clause (1)(A) above
and
Section 3.21(d) and (b) second, any Unpaid Realized Loss Amount for such
Classes
for such Distribution Date, on a pro
rata
basis,
in accordance with the Applied Realized Loss Amount allocated to each such
Class;
(B) From
any
remaining Excess Cashflow sequentially, to the Class X-0, Xxxxx X-0, Class
M-3,
Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class
M-10
Certificates, in that order, an amount equal to the Interest Carry Forward
Amount for each such Class for such Distribution Date to the extent not fully
paid pursuant to Section 3.21(d);
(C) From
any
remaining Excess Cashflow otherwise distributable to the Class CE Interest
and
the Class CE Certificates, to the Reserve Fund, (i) first, to pay to the
Classes
of Class A Certificates, any Basis Risk Shortfall Carry Forward Amount for
such
Classes for such Distribution Date, on a pro
rata
basis,
based on the amount of the Basis Risk Shortfall Carry Forward Amount for
each
such Class to the extent not paid pursuant to Section 3.21(d) and to the
extent
such amount exceeds the amounts then on deposit in the Reserve Fund, and
(ii)
second, to maintain a balance in the Reserve Fund equal to the Reserve Fund
Deposit;
(D) From
any
remaining Excess Cashflow otherwise distributable to the Class CE Interest
and
the Class CE Certificates, to the Reserve Fund, (i) first, to pay to the
Class
X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class
M-8, Class M-9 and Class M-10 Certificates, sequentially in that order, any
Basis Risk Shortfall Carry Forward Amount for each such Class for such
Distribution Date, if any, in each case to the extent not paid pursuant to
Section 3.21(d) and to the extent such amount exceeds the amounts then on
deposit in the Reserve Fund, and (ii) second, to maintain a balance in the
Reserve Fund equal to the Reserve Fund Deposit;
(E) From
any
remaining Excess Cashflow, to the Class A Certificates, on a pro
rata
basis,
based on the entitlement of each such Class, and then sequentially to the
Class
X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class
M-8, Class M-9 and Class M-10 Certificates, in that order, the amount of
Relief
Act Shortfalls and any Prepayment Interest Shortfalls allocated to such Classes
of Certificates, to the extent not previously reimbursed;
(F) From
any
remaining Excess Cashflow to the Swap Administrator for payment to the Swap
Provider, any Swap Termination Payments due to a Swap Provider Trigger Event
owed by the Trust Fund (other than to the extent already paid by the Swap
Administrator from any upfront payment received pursuant to any related
replacement interest rate swap agreement that may be entered into by the
Supplemental Interest Trust Trustee);
(G) From
any
remaining Excess Cashflow, to the Class CE Interest and Class CE Certificates,
an amount equal to the Class CE Distribution Amount reduced by amounts
distributed in clauses (C) and (D) above; and
(H) From
any
remaining Excess Cashflow, to each of the Class R-1, Class R-2, Class R-3
and
Class RX Certificates, based on the related REMIC in which such amounts
remain.
On
each
Distribution Date, all amounts with respect to Prepayment Charges shall be
distributed to the Holders of the Class P Interest and the Class P Certificates,
provided that such distributions shall not be in reduction of the principal
balance thereof. On the Distribution Date immediately following the expiration
of the latest Prepayment Charge term as identified on the Mortgage Loan
Schedule, any amount on deposit in the Class P Certificate Account will be
distributed to the Holders of the Class P Interest and the Class P Certificates
in reduction of the Certificate Principal Balance thereof.
In
addition, notwithstanding the foregoing, on any Distribution Date after the
Distribution Date on which the Certificate Principal Balance of a Class of
Class
A Certificates or Class M Certificates has been reduced to zero, that Class
of
Certificates will be retired and will no longer be entitled to distributions,
including distributions in respect of Prepayment Interest Shortfalls or Basis
Risk Shortfall Carry Forward Amounts.
In
addition, notwithstanding the foregoing clause (a)(2), to the extent a Class
IO
Distribution Amount is payable from principal collections, Principal
Distribution Amounts will be deemed paid to the most subordinate Class of
Regular Certificates (other than the Class P Certificates), until the
Certificate Principal Balance thereof has been reduced to zero, and such
amount
will be paid pursuant to Section 3.21(f).
(b) In
addition to the foregoing distributions, with respect to any Subsequent
Recoveries, the Master Servicer shall deposit such funds into the Protected
Account pursuant to Section 4.01(b)(iii). If, after taking into account such
Subsequent Recoveries, the amount of a Realized Loss is reduced, the amount
of
such Subsequent Recoveries will be applied to increase the Certificate Principal
Balance of the Class of Certificates with the highest payment priority to
which
Realized Losses have been allocated, but not by more than the amount of Realized
Losses previously allocated to that Class of Certificates pursuant to Section
5.05; provided, however, to the extent that no reductions to a Certificate
Principal Balance of any Class of Certificates currently exists as the result
of
a prior allocation of a Realized Loss, such Subsequent Recoveries will be
applied as Excess Spread. The amount of any remaining Subsequent Recoveries
will
be applied to increase the Certificate Principal Balance of the Class of
Certificates with the next highest payment priority, up to the amount of
such
Realized Losses previously allocated to that Class of Certificates pursuant
to
Section 5.05, and so on. Holders of such Certificates will not be entitled
to
any payment in respect of Current Interest on the amount of such increases
for
any Accrual Period preceding the Distribution Date on which such increase
occurs. Any such increases shall be applied to the Certificate Principal
Balance
of each Certificate of such Class in accordance with its respective Percentage
Interest.
(c) Subject
to Section 10.02 hereof respecting the final distribution, on each Distribution
Date the Trustee shall make distributions to each Certificateholder of record
on
the preceding Record Date either by wire transfer in immediately available
funds
to the account of such Holder at a bank or other entity having appropriate
facilities therefor, if such Holder has so notified the Trustee at least
5
Business Days prior to the related Record Date, or, if not, by check mailed
by
first class mail to such Certificateholder at the address of such Holder
appearing in the Certificate Register. Notwithstanding the foregoing, but
subject to Section 10.02 hereof respecting the final distribution, distributions
with respect to Certificates registered in the name of a Depository shall
be
made to such Depository in immediately available funds.
(d) On
or
before 5:00 p.m. Eastern time on the fifth Business Day immediately preceding
each Distribution Date, the Master Servicer shall deliver a report to the
Trustee in electronic form (or by such other means as the Master Servicer
and
the Trustee may agree from time to time) containing such data and information,
as agreed to by the Master Servicer and the Trustee such as to permit the
Trustee to prepare the Monthly Statement to Certificateholders and to make
the
required distributions for the related Distribution Date.
Section
5.05 Allocation
of Realized Losses.
(a) All
Realized Losses on the Mortgage Loans allocated to any REMIC II Regular Interest
pursuant to Section 5.05(c) shall be allocated by the Trustee on each
Distribution Date as follows: first, to Excess Spread through an increased
distribution of the Extra Principal Distribution Amount for such Distribution
Date; second, to the Class CE Interest and Class CE Certificates, until the
Certificate Principal Balance or Uncertificated Principal Balance thereof,
as
applicable, has been reduced to zero; third, to the Class M-10 Certificates,
until the Certificate Principal Balance thereof has been reduced to zero;
fourth, to the Class M-9 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero; fifth, to the Class M-8 Certificates, until
the Certificate Principal Balance thereof has been reduced to zero; sixth,
to
the Class M-7 Certificates, until the Certificate Principal Balance thereof
has
been reduced to zero; seventh, to the Class M-6 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; eighth, to
the
Class M-5 Certificates, until the Certificate Principal Balance thereof has
been
reduced to zero; ninth, to the Class M-4 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; tenth, to the Class M-3
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; eleventh, to the Class M-2 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; twelfth, to the Class
M-1
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; and thirteenth, to the Class or Classes of Class A Certificates,
on a
pro
rata
basis,
until the Certificate Principal Balances thereof have been reduced to zero.
All
Realized Losses to be allocated to the Certificate Principal Balances of
all
Classes on any Distribution Date shall be so allocated after the actual
distributions to be made on such date as provided above. All references above
to
the Certificate Principal Balance of any Class of Certificates shall be to
the
Certificate Principal Balance of such Class immediately prior to the relevant
Distribution Date, before reduction thereof by any Realized Losses, in each
case
to be allocated to such Class of Certificates, on such Distribution
Date.
(b) Any
allocation of Realized Losses to a Class of Certificates or to a Class CE
Interest on any Distribution Date shall be made by reducing the Certificate
Principal Balance or Uncertificated Principal Balance thereof by the amount
so
allocated; any allocation of Realized Losses to Excess Spread shall be made
by
reducing the amount otherwise payable in respect of the Class CE Interest
and
the Class CE Certificates pursuant to clause (G) of Section 5.04(a)(3). No
allocations of any Realized Losses shall be made to the Certificate Principal
Balance or Uncertificated Principal Balance, as applicable, of the Class
P
Interest and the Class P Certificates.
Notwithstanding
the foregoing, no such allocation of any Realized Loss shall be made on a
Distribution Date to any Class of Certificates to the extent that such
allocation would result in the reduction of the aggregate Certificate Principal
Balance of all the Certificates as of such Distribution Date (other than
the
Class CE Certificates and Class P Certificates), after giving effect to all
distributions and prior allocations of Realized Losses on the Mortgage Loans
on
such date, to an amount less than the aggregate Stated Principal Balance
of all
of the Mortgage Loans as of the first day of the month of such Distribution
Date
(such limitation, the “Loss Allocation Limitation”). In addition in no event
will the Certificate Principal Balance of any Certificate be reduced more
than
once in respect of any particular amount both (i) allocable to such Certificate
in respect of Realized Losses and (ii) payable as principal to the Holder
of
such Certificate from Remaining Excess Spread.
As
used
herein, an allocation of a Realized Loss on a “pro
rata
basis”
among two or more specified Classes of Certificates means an allocation on
a
pro
rata
basis,
among the various Classes so specified, to each such Class of Certificates
on
the basis of their then outstanding Certificate Principal Balances prior
to
giving effect to distributions to be made on such Distribution Date. All
Realized Losses and all other losses allocated to a Class of Certificates
hereunder will be allocated among the Certificates of such Class in proportion
to the Percentage Interests evidenced thereby.
(c) (i)
All
Realized Losses on the Mortgage Loans shall be allocated on each Distribution
Date to REMIC I Regular Interest I-1-A through REMIC I Regular Interest I-60-B,
starting with the lowest numerical denomination, until the Uncertificated
Principal Balance of each such REMIC I Regular Interest has been reduced
to
zero; provided that, for REMIC I Regular Interests with the same numerical
denomination, such Realized Losses shall be allocated on a pro
rata
basis
between such REMIC I Regular Interests.
(ii)
All
Realized Losses on the Mortgage Loans shall be allocated by the Securities
Administrator on each Distribution Date to the following REMIC II Regular
Interests in the following specified percentages: first, to Uncertificated
Accrued Interest payable to the REMIC II Regular Interest AA and REMIC II
Regular Interest ZZ up to an aggregate amount equal to the REMIC II Interest
Loss Allocation Amount (without duplication of shortfalls allocated pursuant
to
Section 1.02), 98.00% and 2.00%, respectively; second, to the Uncertificated
Principal Balances of the REMIC II Regular Interest AA and REMIC II Regular
Interest ZZ up to an aggregate amount equal to the REMIC II Principal Loss
Allocation Amount, 98.00% and 2.00%, respectively; third, to the Uncertificated
Principal Balances of REMIC II Regular Interest AA, REMIC II Regular Interest
M-10 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively,
until the Uncertificated Principal Balance of REMIC II Regular Interest M-10
has
been reduced to zero; fourth, to the Uncertificated Principal Balances of
REMIC
II Regular Interest AA, REMIC II Regular Interest M-9 and REMIC II Regular
Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated
Principal Balance of REMIC II Regular Interest M-9 has been reduced to zero;
fifth, to the Uncertificated Principal Balances of REMIC II Regular Interest
AA,
REMIC II Regular Interest M-8 and REMIC II Regular Interest ZZ, 98.00%, 1.00%
and 1.00%, respectively, until the Uncertificated Principal Balance of REMIC
II
Regular Interest M-8 has been reduced to zero; sixth, to the Uncertificated
Principal Balances of REMIC II Regular Interest AA, REMIC II Regular Interest
M-7 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively,
until the Uncertificated Principal Balance of REMIC II Regular Interest M-7
has
been reduced to zero; seventh, to the Uncertificated Principal Balances of
REMIC
II Regular Interest AA, REMIC II Regular Interest M-6 and REMIC II Regular
Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated
Principal Balance of REMIC II Regular Interest M-6 has been reduced to zero;
eighth, to the Uncertificated Principal Balances of REMIC II Regular Interest
AA, REMIC II Regular Interest M-5 and REMIC II Regular Interest ZZ, 98.00%,
1.00% and 1.00%, respectively, until the Uncertificated Principal Balance
of
REMIC II Regular Interest M-5 has been reduced to zero; ninth, to the
Uncertificated Principal Balances of REMIC II Regular Interest AA, REMIC
II
Regular Interest M-4 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and
1.00%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest M-4 has been reduced to zero; tenth, to the Uncertificated Principal
Balances of REMIC II Regular Interest AA, REMIC II Regular Interest M-3 and
REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%, respectively, until
the
Uncertificated Principal Balance of REMIC II Regular Interest M-3 has been
reduced to zero; eleventh, to the Uncertificated Principal Balances of REMIC
II
Regular Interest AA, REMIC II Regular Interest M-2 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Principal
Balance of REMIC II Regular Interest M-2 has been reduced to zero; twelfth,
to
the Uncertificated Principal Balances of REMIC II Regular Interest AA, REMIC
II
Regular Interest M-1 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and
1.00%,
respectively, until the Uncertificated Principal Balance of REMIC II Regular
Interest M-1 has been reduced to zero; and, thirteenth, to the Uncertificated
Principal Balance of REMIC II Regular Interest AA, 98.00%, to the Uncertificated
Principal Balances of the REMIC II Regular Interests X-0, X-0 xxx X-0, on
a
pro
rata
basis,
1.00%, and to the Uncertificated Principal Balance of REMIC II Regular Interest
ZZ, 1.00%, until the Uncertificated Principal Balances of such REMIC II Regular
Interests A-1, A-2 and A-3 have been reduced to zero.
Section
5.06 Monthly
Statements to Certificateholders.
(a) Not
later
than each Distribution Date, the Trustee shall prepare and make available
to
each Holder of Certificates, the Master Servicer, the Swap Provider and the
Depositor a statement setting forth for the Certificates:
(i) the
applicable record dates, accrual periods, determination dates for calculating
distributions and general Distribution Dates;
(ii) the
total
cash flows received and the general sources thereof;
(iii) the
amount, if any, of fees or expenses accrued and paid, with an identification
of
the payee and the general purpose of such fees including the related amount
of
the Servicing Fees paid to or retained by the Master Servicer for the related
Due Period;
(iv) the
amount of any Net Swap Payment payable to the Trust, any Net Swap Payment
payable to the Swap Provider, any Swap Termination Payment payable to the
Trust
and any Swap Termination Payment payable to the Swap Provider;
(v) the
amount of the related distribution to Holders of the Class A Certificates
and
Class M Certificates (by Class) allocable to principal, separately identifying
(A) the aggregate amount of any Principal Prepayments included therein, (B)
the
aggregate of all scheduled payments of principal included therein and (C)
the
Extra Principal Distribution Amount (if any);
(vi) the
amount of such distribution to Holders of each Class of Class A Certificates
and
Class M Certificates allocable to interest and the portion thereof, if any,
provided by the Swap Agreement and the amount of coverage remaining under
such
credit enhancement;
(vii) the
Interest Carry Forward Amounts and any Basis Risk Shortfall Carry Forward
Amounts for each Class of Certificates (if any);
(viii) the
Pass-Through Rate for each Class of Class A Certificates and Class M
Certificates with respect to the current Accrual Period, and, if applicable,
whether such Pass-Through Rate was limited by the Net Rate Cap;
(ix) the
number and aggregate Stated Principal Balance of all of the Mortgage Loans
for
the following Distribution Date, together with updated pool composition
information including the following: weighted average mortgage rate and weighted
average remaining term;
(x) the
Certificate Principal Balance of the Class A Certificates and Class M
Certificates before and after giving effect (i) to all distributions allocable
to principal on such Distribution Date and (ii) the allocation of any Applied
Realized Loss Amounts for such Distribution Date;
(xi) the
number and aggregate Stated Principal Balance of the Mortgage Loans (A)
Delinquent (exclusive of Mortgage Loans in foreclosure and bankruptcy) (1)
30
days Delinquent, (2) 60 days Delinquent and (3) 90 days or more Delinquent,
(B)
in foreclosure and delinquent (1) 30 days Delinquent, (2) 60 days Delinquent
and
(3) 90 days or more Delinquent and (C) in bankruptcy and delinquent (1) 30
days
Delinquent, (2) 60 days Delinquent and (3) 90 days or more Delinquent, in
each
case as of the close of business on the last day of the calendar month preceding
such Distribution Date and separately identifying such information for the
(1)
first lien Mortgage Loans, (2) second lien Mortgage Loans, and (3) Adjustable
Rate Mortgage Loans;
(xii) the
amount of aggregate Advances included in the distribution on such Distribution
Date (including the general purpose of such Advances), the aggregate amount
of
unreimbursed Advances as of the end of the Due Period, and the general source
of
funds for reimbursements;
(xiii) the
amount, if any, of excess cashflow or excess spread and the application of
such
excess cashflow;
(xiv) the
cumulative Realized Losses through the end of the preceding month;
(xv) if
applicable, material modifications, extensions or waivers to Mortgage Loan
terms, fees, penalties or payments during the preceding calendar month or
that
have become material over time;
(xvi) with
respect to any Mortgage Loan that was liquidated during the preceding calendar
month, the aggregate Stated Principal Balance of, and Realized Loss on, such
Mortgage Loans as of the close of business on the prior calendar
month;
(xvii) the
total
number and principal balance of any real estate owned or REO Properties as
of
the end of the related calendar month;
(xviii) material
breaches of pool asset representation or warranties or transaction
covenants;
(xix) the
three
month rolling average of the percent equivalent of a fraction, the numerator
of
which is the aggregate Stated Principal Balance of the Mortgage Loans that
are
60 days or more delinquent or are in bankruptcy or foreclosure or are REO
Properties, and the denominator of which is the aggregate Stated Principal
Balance of all of the Mortgage Loans and separately identifying such information
for the (1) first lien Mortgage Loans, and (2) Adjustable Rate Mortgage Loans,
in each case as of the end of the Prepayment Period;
(xx) whether
a
Trigger Event exists;
(xxi) the
amount of the distribution made on such Distribution Date to the Holders
of the
Class P Certificates allocable to Prepayment Charges;
(xxii) information
on loss, delinquency or other tests used for determining early amortization,
liquidation, stepdowns or other performance triggers and whether the trigger
was
met;
(xxiii) the
amount of the Prepayment Charges remitted by the Master Servicer and the
amount
on deposit in the Reserve Fund;
(xxiv) updated
pool composition data including the following: weighted average mortgage
rate
and weighted average remaining term;
(xxv) information
regarding any new issuance of securities backed by the same asset pool, any
pool
asset changes, such as additions or removals of Mortgage Loans from the Trust
Fund, if applicable; and
(xxvi) any
material changes in the solicitation, credit-granting, underwriting,
origination, acquisition or Mortgage Loan selection criteria or procedures,
as
applicable, used to originate, acquire or select Mortgage Loans for the Trust
Fund.
The
Depositor covenants that if there is a material change in the solicitation,
credit-granting, underwriting, origination, acquisition or Mortgage Loan
selection criteria or procedures, as applicable, used to originate, acquire
or
select Mortgage Loans for the Trust Fund that it will notify the Trustee
five
calendar days before each Distribution Date, and if no such notification
occurs,
the Trustee has no obligation to report with respect to (xxvi). The Depositor
covenants to the Trustee that there will be no new issuance of securities
backed
by the same asset pool, so the Trustee will only be responsible in (xxv)
above
for reporting any pool asset changes, such as additions or removals of Mortgage
Loans from the Trust Fund.
The
Trustee may make the foregoing Monthly Statement (and, at its option, any
additional files containing the same information in an alternative format)
available each month to Certificateholders via the Trustee’s internet website.
The Trustee’s internet website shall initially be located at “xxx.xxxxxxxx.xxx”.
Assistance in using the website can be obtained by calling the Trustee at
(000)
000-0000. Parties that are unable to use the above distribution options are
entitled to have a paper copy mailed to them via first class mail by calling
the
Trustee and indicating such. The Trustee may change the way Monthly Statements
are distributed in order to make such distributions more convenient or more
accessible to the above parties.
(b) The
Trustee’s responsibility for making the above information available to the
Certificateholders is limited to the availability, timeliness and accuracy
of
the information derived from the parties providing the information to the
Trustee. The Trustee will make available a copy of each statement provided
pursuant to this Section 5.06 to each Rating Agency.
(c) Within
a
reasonable period of time after the end of each calendar year, the Trustee
shall
cause to be furnished upon request to each Person who at any time during
the
calendar year was a Certificateholder, a statement containing the information
(only with respect to principal and interest) set forth in clauses (a)(v)
and
(a)(vi) of this Section 5.06 aggregated for such calendar year or applicable
portion thereof during which such Person was a Certificateholder. Such
obligation of the Trustee shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Trustee
pursuant to any requirements of the Code as from time to time in
effect.
(d) Upon
filing with the Internal Revenue Service, the Trustee shall furnish to the
Holders of the Residual Certificates the applicable Form 1066 and each
applicable Form 1066Q and shall respond promptly to written requests made
not
more frequently than quarterly by any Holder of a Residual Certificate with
respect to the following matters:
(i) The
original projected principal and interest cash flows on the Closing Date
on each
class of Regular Interests and Residual Interests created hereunder and on
the
Mortgage Loans, based on the Prepayment Assumption;
(ii) The
projected remaining principal and interest cash flows as of the end of any
calendar quarter with respect to each class of Regular Interests and Residual
Interests created hereunder and the Mortgage Loans, based on the Prepayment
Assumption;
(iii) The
applicable Prepayment Assumption and any interest rate assumptions used in
determining the projected principal and interest cash flows described
above;
(iv) The
original issue discount (or, in the case of the Mortgage Loans, market discount)
or premium accrued or amortized through the end of such calendar quarter
with
respect to each class of Regular Interests or Residual Interests created
hereunder and to the Mortgage Loans, together with each constant yield to
maturity used in computing the same;
(v) The
treatment of Realized Losses with respect to the Mortgage Loans or the Regular
Interests created hereunder, including the timing and amount of any cancellation
of indebtedness income of a REMIC with respect to such Regular Interests
or bad
debt deductions claimed with respect to the Mortgage Loans;
(vi) The
amount and timing of any non-interest expenses of a REMIC; and
(vii) Any
taxes
(including penalties and interest) imposed on the REMIC, including, without
limitation, taxes on “prohibited transactions,” “contributions” or “net income
from foreclosure property” or state or local income or franchise
taxes.
The
information pursuant to clauses (i), (ii), (iii) and (iv) above shall be
provided by the Depositor pursuant to Section 9.12.
Section
5.07 REMIC
Designations and REMIC Distributions.
(a) The
Trustee shall elect that each of REMIC I, REMIC II, REMIC III, REMIC IV,
REMIC V
and REMIC VI shall be treated as a REMIC under Section 860D of the Code.
Any
inconsistencies or ambiguities in this Agreement or in the administration
of
this Agreement shall be resolved in a manner that preserves the validity
of such
REMIC elections. The assets of REMIC I shall include the Mortgage Loans and
all
interest owing in respect of and principal due thereon, the Distribution
Account, the Protected Account, any REO Property, any proceeds of the foregoing
and any other assets subject to this Agreement (other than the Reserve Fund,
any
Prepayment Charge Waiver Amounts and, for the avoidance of doubt, the
Supplemental Interest Trust, the Swap Agreement, the Swap Account, the Swap
Collateral Account and any rights or obligations in respect of the Swap
Administration Agreement). The REMIC I Regular Interests shall constitute
the
assets of REMIC II. The REMIC II Regular Interests shall constitute the assets
of REMIC III. The Class CE Interest shall constitute the assets of REMIC
IV. The
Class P Interest shall constitute the assets of REMIC V. The Class IO Interest
shall constitute the assets of REMIC VI.
(b) (1)On
each
Distribution Date, the following amounts, in the following order of priority,
shall be distributed by REMIC I to REMIC II on account of REMIC I Regular
Interests I-1-A through I-60-B or withdrawn from the Distribution Account
and
distributed to the Holders of the Class R-1 Certificates, as the case may
be:
(i) from
Interest Funds and Principal Funds, in each case, determined without regard
to
the related clause (2)(ii) of the definitions thereof, to holders of each
of the
REMIC I Regular Interests I-1-A through I-60-B, in a pro
rata
basis,
in an amount equal to (A) the Uncertificated Accrued Interest for such REMIC
I
Regular Interests for such Distribution Date, plus (B) any amounts payable
in
respect thereof remaining unpaid from previous Distribution Dates;
(ii) to
the
extent of Interest Funds and Principal Funds, in each case, determined without
regard to the related clause (2)(ii) of the definitions thereof, remaining
after
the distribution made pursuant to clause (i) above, to REMIC I Regular Interests
I-1-A through I-60-B, starting with the lowest numerical denomination, until
the
Uncertificated Principal Balance of each such REMIC I Regular Interest is
reduced to zero, provided that, for REMIC I Regular Interests with the same
numerical denomination, such payments of principal shall be allocated on
a
pro
rata
basis
between such REMIC I Regular Interests; and
(iii)
any
remaining amount to the Holders of the Class R-1 Certificates.
(2) On
each
Distribution Date, amounts representing Prepayment Charges on the Mortgage
loans
shall be deemed distributed to REMIC I Regular Interest P, provided that
such
amounts shall not reduce the Uncertificated Principal Balance of REMIC I
Regular
Interest P. On the Distribution Date immediately following the expiration
of the
latest Prepayment Charge term as identified on the Mortgage Loan Schedule,
$100
shall be deemed distributed in respect of REMIC I Regular Interest P in
reduction of the Uncertificated Principal Balance thereof.
(c) (1)On
each
Distribution Date, the following amounts, in the following order of priority,
shall be distributed by REMIC II to REMIC III on account of the REMIC II
Regular
Interests (other than REMIC II Regular Interest P) or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-2
Certificates, as the case may be:
(i) from
Interest Funds and Principal Funds, in each case, determined without regard
to
the related clause (2)(ii) of the definitions thereof, to the holders of
REMIC
II Regular Interest IO, in an amount equal to (A) the Uncertificated Accrued
Interest for such REMIC II Regular Interest for such Distribution Date, plus
(B)
any amounts in respect thereof remaining unpaid from previous Distribution
Dates;
(ii) to
the
extent of Interest Funds and Principal Funds, in each case, determined without
regard to the related clause (2)(ii) of the definitions thereof, remaining
after
the distribution pursuant to clause (i), to the holders of each REMIC II
Regular
Interest (other than REMIC II Regular Interests IO and P), on a pro
rata
basis,
in an amount equal to (A) the Uncertificated Accrued Interest for such REMIC
II
Regular Interest for such Distribution Date, plus (B) any amounts in respect
thereof remaining unpaid from previous Distribution Dates. Amounts payable
as
Uncertificated Accrued Interest in respect of REMIC II Regular Interest ZZ
shall
be reduced when the REMIC II Overcollateralization Amount is less than the
REMIC
II Required Overcollateralization Amount, by the lesser of (x) the amount
of
such difference and (y) the Maximum Uncertificated Accrued Interest Deferral
Amount, and such amount will be payable to the holders of each REMIC II Regular
Interest for which a Class A Certificate or Class M Certificate is the
Corresponding Certificate in the same proportion as the Extra Principal
Distribution Amount is allocated to the Corresponding Certificates for each
such
REMIC II Regular Interest, and the Uncertificated Principal Balance of REMIC
II
Regular Interest ZZ shall be increased by such amount;
(iii) to
the
holders of REMIC II Regular Interests (other than REMIC II Regular Interests
IO
and P) in an amount equal to the remainder of Interest Funds and Principal
Funds, in each case, determined without regard to the related clause (2)(ii)
of
the definitions thereof, after the distributions made pursuant to clauses
(i)
and (ii) above, allocated as follows:
(A) 98%
of
such remainder to the holders of REMIC II Regular Interest AA, until the
Uncertificated Principal Balance of such REMIC II Regular Interest is reduced
to
zero;
(B) 2%
of
such remainder, first, to the holders of each REMIC II Regular Interest for
which a Class A Certificate or Class M Certificate is the Corresponding
Certificate, in an aggregate amount equal to 1% of and in the same proportion
as
principal payments are allocated to the Corresponding Certificates for each
such
REMIC II Regular Interest, until the Uncertificated Principal Balances of
such
REMIC II Regular Interests are reduced to zero, and second, to the holders
of
REMIC II Regular Interest ZZ, until the Uncertificated Principal Balance
of such
REMIC II Regular Interest is reduced to zero; and
(C) any
remaining amount to the Holders of the Class R-2 Certificates.
(2) On
each
Distribution Date, amounts representing Prepayment Charges on the Mortgage
loans
deemed distributed in respect of REMIC I Regular Interest P shall be deemed
to
be distributed to REMIC II Regular Interest P, provided that such amounts
shall
not reduce the Uncertificated Principal Balance of REMIC II Regular Interest
P.
On the Distribution Date immediately following the expiration of the latest
Prepayment Charge term as identified on the Mortgage Loan Schedule, an amount
equal to $100 deemed distributed in respect of REMIC I Regular Interest P
in
reduction of the Uncertificated Principal Balance thereof shall be deemed
to be
distributed to REMIC II Regular Interest P in reduction of the Uncertificated
Principal Balance thereof.
(d) On
each
Distribution Date, interest shall be deemed payable from REMIC III to the
holders of each REMIC III Regular Interest the ownership of which is represented
by the Class A Certificates and Class M Certificates at a pass-through rate
equal to the lesser of (i) the One-Month LIBOR Pass-Through Rate for the
Corresponding Certificate and (ii) the Net Rate Cap for the REMIC III Regular
Interest the ownership of which is represented by the Corresponding Certificate
for such Distribution Date, in each case on a principal balance equal to
the
Certificate Principal Balance of the Corresponding Certificate for such
Distribution Date. For the avoidance of doubt, principal shall be payable
to,
and shortfalls, losses and prepayments shall be allocable to, the REMIC III
Regular Interests the ownership of which is represented by the Class A
Certificates and Class M Certificates as such amounts are payable and allocable
to the Corresponding Certificates.
(e) On
each
Distribution Date, an amount equal to the amounts distributed pursuant to
Sections 5.04(a)(3)(C), (D) and (G) on such date shall be deemed distributed
from REMIC III to REMIC IV in respect of the Class CE Distribution Amount
distributable to the Class CE Interest.
(f) On
each
Distribution Date, 100% of the amounts deemed distributed on REMIC II Regular
Interest P shall be deemed distributed by REMIC III to REMIC V in respect
of the
Class P Interest.
(g) On
each
Distribution Date, 100% of the amounts deemed distributed on REMIC II Regular
Interest IO shall be deemed distributed by REMIC III to REMIC VI in respect
of
the Class IO Interest. Such amounts shall be deemed distributed by REMIC
VI in
respect of REMIC VI Regular Interest IO for deposit into the Supplemental
Interest Trust.
ARTICLE
VI
THE
CERTIFICATES
Section
6.01 The
Certificates.
The
Certificates shall be substantially in the forms attached hereto as Exhibits
A-1
through A-5. The Certificates shall be issuable in registered form, in the
minimum dollar denominations, integral dollar multiples in excess thereof
(except that one Certificate of each Class may be issued in a different amount
which must be in excess of the applicable minimum dollar denomination) and
aggregate dollar denominations as set forth in the following table:
|
Class
|
Minimum
Denomination
|
Integral
Multiple in Excess of Minimum
|
Original
Certificate Principal Balance or Notional
Xxxxxx
|
|
X-0
|
$ 100,000
|
$ 1.00
|
$ 180,289,000.00
|
|
A-2
|
$ 100,000
|
$ 1.00
|
$ 61,828,000.00
|
|
A-3
|
$ 100,000
|
$ 1.00
|
$ 22,184,000.00
|
|
M-1
|
$ 100,000
|
$ 1.00
|
$ 13,957,000.00
|
|
M-2
|
$ 100,000
|
$ 1.00
|
$ 12,897,000.00
|
|
M-3
|
$ 100,000
|
$ 1.00
|
$ 7,950,000.00
|
|
M-4
|
$ 100,000
|
$ 1.00
|
$ 6,890,000.00
|
|
M-5
|
$ 100,000
|
$ 1.00
|
$ 6,360,000.00
|
|
M-6
|
$ 100,000
|
$ 1.00
|
$ 5,830,000.00
|
|
M-7
|
$ 100,000
|
$ 1.00
|
$ 5,830,000.00
|
|
M-8
|
$ 100,000
|
$ 1.00
|
$ 4,770,000.00
|
|
M-9
|
$ 100,000
|
$ 1.00
|
$ 4,947,000.00
|
|
M-10
|
$ 100,000
|
$ 1.00
|
$ 5,477,000.00
|
|
CE
|
10%
|
1%
|
$ (1)
353,343,723.06
|
|
P
|
$ 100
|
N/A
|
$100.00
|
|
R-1
|
100%
|
X/X
|
X/X
|
|
X-0
|
000%
|
X/X
|
X/X
|
|
R-3
|
100%
|
N/A
|
N/A
|
|
RX
|
100%
|
N/A
|
N/A
|
(1) This
is a
Notional Amount.
The
Certificates shall be executed by manual or facsimile signature on behalf
of the
Trustee by an authorized officer. Certificates bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures were
affixed, authorized to sign on behalf of the Trustee shall bind the Trustee,
notwithstanding that such individuals or any of them have ceased to be so
authorized prior to the authentication and delivery of such Certificates
or did
not hold such offices at the date of such authentication and delivery. No
Certificate shall be entitled to any benefit under this Agreement, or be
valid
for any purpose, unless there appears on such Certificate the countersignature
of the Trustee by manual signature, and such countersignature upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly countersigned and delivered hereunder. All
Certificates shall be dated the date of their countersignature. On the Closing
Date, the Trustee shall authenticate the Certificates to be issued at the
written direction of the Depositor, or any affiliate thereof.
The
Depositor shall provide, or cause to be provided, to the Trustee on a continuous
basis, an adequate inventory of Certificates to facilitate
transfers.
Section
6.02 Certificate
Register; Registration of Transfer and Exchange of Certificates.
(a) The
Trustee shall maintain, or cause to be maintained in accordance with the
provisions of Section 6.09 hereof, a Certificate Register for the Trust Fund
in
which, subject to the provisions of subsections (b) and (c) below and to
such
reasonable regulations as it may prescribe, the Trustee shall provide for
the
registration of Certificates and of Transfers and exchanges of Certificates
as
herein provided. Upon surrender for registration of Transfer of any Certificate,
the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of the same Class
and of
like aggregate Percentage Interest.
At
the
option of a Certificateholder, Certificates may be exchanged for other
Certificates of the same Class in authorized denominations and evidencing
the
same aggregate Percentage Interest upon surrender of the Certificates to
be
exchanged at the office or agency of the Trustee. Whenever any Certificates
are
so surrendered for exchange, the Trustee shall execute, authenticate, and
deliver the Certificates that the Certificateholder making the exchange is
entitled to receive. Every Certificate presented or surrendered for registration
of Transfer or exchange shall be accompanied by a written instrument of Transfer
in form satisfactory to the Trustee duly executed by the Holder thereof or
his
attorney duly authorized in writing.
No
service charge to the Certificateholders shall be made for any registration
of
Transfer or exchange of Certificates, but 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 may be required.
All
Certificates surrendered for registration of Transfer or exchange shall be
canceled and subsequently destroyed by the Trustee in accordance with the
Trustee’s customary procedures.
(b) Subject
to Section 6.07 and, in the case of any Global Certificate or Private
Certificate upon the satisfaction of the conditions set forth below, upon
surrender for registration of transfer of any Certificate at any office or
agency of the Trustee maintained for such purpose, the Trustee shall sign,
countersign and shall deliver, in the name of the designated transferee or
transferees, a new Certificate of a like Class and aggregate Percentage
Interest, but bearing a different number.
(c) Subject
to subsection 6.02(g), so long as a Global Certificate of such Class is
outstanding and is held by or on behalf of the Depository, transfers of
beneficial interests in such Global Certificate, or transfers by Holders
of
Individual Certificates of such Class to transferees that take delivery in
the
form of beneficial interests in the Global Certificate, may be made only
in
accordance with this subsection 6.02(c) and in accordance with the rules
of the
Depository:
(i) In
the
case of a beneficial interest in the Global Certificate being transferred
to an
Institutional Accredited Investor, such transferee shall be required to take
delivery in the form of an Individual Certificate or Certificates and the
Trustee shall register such transfer only upon compliance with the provisions
of
subsection 6.02(h).
(ii) In
the
case of a beneficial interest in a Class of Global Certificates being
transferred to a transferee that takes delivery in the form of an Individual
Certificate or Certificates of such Class, except as set forth in clause
(i)
above, the Trustee shall register such transfer only upon compliance with
the
provisions of subsection 6.02(h).
(iii) In
the
case of an Individual Certificate of a Class being transferred to a transferee
that takes delivery in the form of a beneficial interest in a Global Certificate
of such Class, the Trustee shall register such transfer if the transferee
has
provided the Trustee with a Rule 144A and Related Matters Certificate or
comparable evidence as to its QIB status.
(iv) No
restrictions shall apply with respect to the transfer or registration of
transfer of a beneficial interest in the Global Certificate of a Class to
a
transferee that takes delivery in the form of a beneficial interest in the
Global Certificate of such Class; provided that each such transferee shall
be
deemed to have made such representations and warranties contained in the
Rule
144A and Related Matters Certificate as are sufficient to establish that
it is a
QIB.
(d) Subject
to subsection 6.02(g), an exchange of a beneficial interest in a Global
Certificate of a Class for an Individual Certificate or Certificates of such
Class, an exchange of an Individual Certificate or Certificates of a Class
for a
beneficial interest in the Global Certificate of such Class and an exchange
of
an Individual Certificate or Certificates of a Class for another Individual
Certificate or Certificates of such Class (in each case, whether or not such
exchange is made in anticipation of subsequent transfer, and, in the case
of the
Global Certificate of such Class, so long as such Certificate is outstanding
and
is held by or on behalf of the Depository) may be made only in accordance
with
this subsection 6.02(d) and in accordance with the rules of the
Depository:
(i) A
Holder
of a beneficial interest in a Global Certificate of a Class may at any time
exchange such beneficial interest for an Individual Certificate or Certificates
of such Class.
(ii) A
Holder
of an Individual Certificate or Certificates of a Class may exchange such
Certificate or Certificates for a beneficial interest in the Global Certificate
of such Class if such holder furnishes to the Trustee a Rule 144A and Related
Matters Certificate or comparable evidence as to its QIB status.
(iii) A
Holder
of an Individual Certificate of a Class may exchange such Certificate for
an
equal aggregate principal amount of Individual Certificates of such Class
in
different authorized denominations without any certification.
(e) (i)Upon
acceptance for exchange or transfer of an Individual Certificate of a Class
for
a beneficial interest in a Global Certificate of such Class as provided herein,
the Trustee shall cancel such Individual Certificate and shall (or shall
request
the Depository to) endorse on the schedule affixed to the applicable Global
Certificate (or on a continuation of such schedule affixed to the Global
Certificate and made a part thereof) or otherwise make in its books and records
an appropriate notation evidencing the date of such exchange or transfer
and an
increase in the certificate balance of the Global Certificate equal to the
certificate balance of such Individual Certificate exchanged or transferred
therefor.
(ii) Upon
acceptance for exchange or transfer of a beneficial interest in a Global
Certificate of a Class for an Individual Certificate of such Class as provided
herein, the Trustee shall (or shall request the Depository to) endorse on
the
schedule affixed to such Global Certificate (or on a continuation of such
schedule affixed to such Global Certificate and made a part thereof) or
otherwise make in its books and records an appropriate notation evidencing
the
date of such exchange or transfer and a decrease in the certificate balance
of
such Global Certificate equal to the certificate balance of such Individual
Certificate issued in exchange therefor or upon transfer thereof.
(f) Any
Individual Certificate issued in exchange for or upon transfer of another
Individual Certificate or of a beneficial interest in a Global Certificate
shall
bear the applicable legends set forth in Exhibit A-2.
(g) Subject
to the restrictions on transfer and exchange set forth in this Section 6.02,
the
Holder of any Individual Certificate may transfer or exchange the same in
whole
or in part (in an initial certificate balance equal to the minimum authorized
denomination set forth in Section 6.01 above or any integral multiple of
$1.00
in excess thereof) by surrendering such Certificate at the Corporate Trust
Office, or at the office of any transfer agent, together with an executed
instrument of assignment and transfer satisfactory in form and substance
to the
Trustee in the case of transfer and a written request for exchange in the
case
of exchange. The Holder of a beneficial interest in a Global Certificate
may,
subject to the rules and procedures of the Depository, cause the Depository
(or
its nominee) to notify the Trustee in writing of a request for transfer or
exchange of such beneficial interest for an Individual Certificate or
Certificates. Following a proper request for transfer or exchange, the Trustee
shall, within five Business Days of such request made at the Corporate Trust
Office, sign, countersign and deliver at the Corporate Trust Office, to the
transferee (in the case of transfer) or Holder (in the case of exchange)
or send
by first class mail at the risk of the transferee (in the case of transfer)
or
Holder (in the case of exchange) to such address as the transferee or Holder,
as
applicable, may request, an Individual Certificate or Certificates, as the
case
may require, for a like aggregate Percentage Interest and in such authorized
denomination or denominations as may be requested. The presentation for transfer
or exchange of any Individual Certificate shall not be valid unless made
at the
Corporate Trust Office by the registered Holder in person, or by a duly
authorized attorney-in-fact.
(h) No
Transfer of a Private Certificate shall be made unless such Transfer is made
pursuant to an effective registration statement under the Securities Act
and any
applicable state securities laws or is exempt from the registration requirements
under the Securities Act and such state securities laws. In the event that
a
Transfer is to be made in reliance upon an exemption from the Securities
Act and
such laws, in order to assure compliance with the Securities Act and such
laws,
the Certificateholder desiring to effect such Transfer and such
Certificateholder’s prospective transferee shall each certify to the Trustee in
writing the facts surrounding the Transfer by (x)(i) the delivery to the
Trustee
by the Certificateholder desiring to effect such transfer of a certificate
substantially in the form set forth in Exhibit D (the “Transferor Certificate”)
and (ii) the delivery by the Certificateholder’s prospective transferee of (A) a
letter in substantially the form of Exhibit E (the “Investment Letter”) if the
prospective transferee is an Institutional Accredited Investor or (B) a letter
in substantially the form of Exhibit F (the “Rule 144A and Related Matters
Certificate”) if the prospective transferee is a QIB or (y) there shall be
delivered to the Trustee an Opinion of Counsel addressed to the Trustee that
such Transfer may be made pursuant to an exemption from the Securities Act,
which Opinion of Counsel shall not be an expense of the Depositor, the Mortgage
Loan Sellers, the Master Servicer or the Trustee; provided,
however,
that
such representation letters will not be required in connection with any transfer
of any such Certificate by the Depositor to an affiliate of the Depositor
and
the Trustee and the Trustee shall be entitled to conclusively rely upon a
representation (which, upon the request of the Trustee, shall be a written
representation) from the Depositor of the status of such transferee as an
affiliate of the Depositor. Notwithstanding
the provisions of the immediately preceding sentence, no restrictions shall
apply with respect to the transfer or registration of transfer of a beneficial
interest in any Certificate that is a Global Certificate of a Class to a
transferee that takes delivery in the form of a beneficial interest in the
Global Certificate of such Class provided that each such transferee shall
be
deemed to have made such representations and warranties contained in the
Rule
144A and Related Matters Certificate as are sufficient to establish that
it is a
QIB. The Depositor shall provide to any Holder of a Private Certificate and
any
prospective transferee designated by any such Holder, information regarding
the
related Certificates and the Mortgage Loans and such other information as
shall
be necessary to satisfy the condition to eligibility set forth in Rule
144A(d)(4) for Transfer of any such Certificate without registration thereof
under the Securities Act pursuant to the registration exemption provided
by Rule
144A. The Trustee and the Master Servicer shall cooperate with the Depositor
in
providing the Rule 144A information referenced in the preceding sentence,
including providing to the Depositor such information regarding the
Certificates, the Mortgage Loans and other matters regarding the Trust Fund
as
the Depositor shall reasonably request to meet its obligation under the
preceding sentence. Each Holder of a Private Certificate desiring to effect
such
Transfer shall, and does hereby agree to, indemnify the Trustee, the Depositor,
the Mortgage Loan Sellers and the Master Servicer against any liability that
may
result if the Transfer is not so exempt or is not made in accordance with
such
federal and state laws.
No
transfer of any Class CE Certificate shall be made unless the proposed
transferee of such Class CE Certificate (1) provides to the Trustee the
appropriate tax certification form that would eliminate any withholding or
deduction for taxes from amounts payable by the Swap Provider, pursuant to
the
Swap Agreement, to the Swap Administrator on behalf of the Supplemental Interest
Trust (i.e., IRS Form W-9 or IRS Form X-0XXX, X-0XXX, X-0XXX or W-8ECI, as
applicable (or any successor form thereto), together with any applicable
attachments) and (2) agrees to update such form (a) upon expiration of any
such
form, (b) as required under then applicable U.S. Treasury regulations and
(c)
promptly upon learning that such form has become obsolete or incorrect, each
as
a condition to such transfer. In addition, no transfer of any Class CE
Certificate shall be made if such transfer would cause the Supplemental Interest
Trust to be beneficially owned by two or more persons for federal income
tax
purposes, or continue to be so treated, unless (i) each proposed transferee
of
such Class CE Certificate complies with the foregoing conditions, (ii) the
proposed majority holder of the Class CE Certificates (or each holder, if
there
is or would be no majority holder) (A) provides, or causes to be provided,
on
behalf of the Supplemental Interest Trust, if applicable, to the Trustee,
the
appropriate tax certification form that would be required from the Supplemental
Interest Trust to eliminate any withholding or deduction for taxes from amounts
payable by the Swap Provider, pursuant to the Swap Agreement, to the Swap
Administrator on behalf of the Supplemental Interest Trust (i.e., IRS Form
W-9
or IRS Form X-0XXX, X-0XXX, X-0XXX or W-8ECI, as applicable (or any successor
form thereto), together with any applicable attachments) and (B) agrees to
update such form (x) upon expiration of any such form, (y) as required under
then applicable U.S. Treasury regulations and (z) promptly upon learning
that
such form has become obsolete or incorrect. If, under applicable U.S. Treasury
regulations, such tax certification form may only be signed by a trustee
acting
on behalf of the Supplemental Interest Trust, then the Supplemental Interest
Trust Trustee shall sign such certification form if so requested by a holder
of
the Class CE Certificates. Upon receipt of any tax certification form pursuant
to the conditions set forth in this paragraph from a holder of any Class
CE
Certificate, the Trustee shall forward such tax certification form to the
Supplemental Interest Trust Trustee. The Supplemental Interest Trust Trustee
shall forward such tax certification form provided to it to the Swap Provider.
Each holder of a Class CE Certificate and each transferee thereof shall be
deemed to have consented to the Supplemental Interest Trust Trustee forwarding
to the Swap Provider any tax certification form it has provided and updated
in
accordance with these transfer restrictions.
Any
purported sales or transfers of any Class CE Certificate to a transferee
which
does not comply with the requirements of this paragraph shall be deemed null
and
void under this Agreement.
Prior
to
the termination of the Supplemental Interest Trust, each beneficial owner
of a
Class A Certificate or Class M Certificate (other than a Class M-10 Certificate)
or any interest therein, shall be deemed to have represented by virtue of
its
acquisition or holding of the Offered Certificate, or interest therein that
either (i) such transferee is not an employee benefit plan subject to Section
406 of ERISA or a plan subject to Section 4975 of the Code (either a “Plan”), or
a Person acting on behalf of a Plan or using the assets of a Plan, or (ii)
the
transferee provides a representation, or is deemed to represent in the case
of
the Global Certificate that (A) such plan is an accredited investor within
the
meaning of the Exemption and (B) the proposed transfer or holding of such
Certificate and the separate right to receive payments from the Supplemental
Interest Trust are eligible for exemptive relief under Prohibited Transaction
Class Exemption (“PTCE”) 84-14, XXXX 00-00, XXXX 00-0, XXXX 95-60 or PTCE 96-23.
Subsequent
to the termination of the Supplemental Interest Trust, each beneficial owner
of
a Class M Certificate (other than a Class M-10 Certificate) or any interest
therein shall be deemed to have represented, by virtue of its acquisition
or
holding of that certificate or interest therein, that either (a)(i) it is
not a
Plan or investing with “Plan Assets”, (ii) it has acquired and is holding such
certificate in reliance on the Exemption, and that it understands that there
are
certain conditions to the availability of the Exemption, including that the
certificate must be rated, at the time of purchase, not lower than “BBB-” (or
its equivalent) by S&P, Fitch or Xxxxx’x, and the certificate is so rated or
(iii) (1) it is an insurance company, (2) the source of funds used to acquire
or
hold the certificate or interest therein is an “insurance company general
account,” as such term is defined in PTCE 95-60, and (3) the conditions in
Sections I and III of PTCE 95-60 have been satisfied.
Neither
the Trustee nor the Master Servicer will be required to monitor, determine
or
inquire as to compliance with the transfer restrictions with respect to the
Global Certificates. Any attempted or purported transfer of any Certificate
in
violation of the provisions of this Section 6.02 shall be void ab initio
and
such Certificate shall be considered to have been held continuously by the
prior
permitted Certificateholder. Any transferor of any Certificate in violation
of
such provisions, shall indemnify and hold harmless the Trustee and the Master
Servicer from and against any and all liabilities, claims, costs or expenses
incurred by the Trustee or the Master Servicer as a result of such attempted
or
purported transfer. Neither the Trustee nor the Master Servicer shall have
any
liability for transfer of any such Global Certificates in or through book-entry
facilities of any Depository or between or among Depository Participants
or
Certificate Owners made in violation of the transfer restrictions set forth
herein. Neither
the Trustee nor the Master Servicer shall be required to monitor, determine
or
inquire as to compliance with the transfer restrictions with respect to any
ERISA Restricted Certificate that is a Book-Entry Certificate, and neither
the Trustee nor the Master Servicer shall have any liability for transfers
of
any such Book-Entry Certificates made through the book-entry facilities of
any
Depository or between or among participants of the Depository or Certificate
Owners made in violation of the transfer restrictions set forth herein. Neither
the Trustee nor the Master Servicer shall be under any liability to any Person
for any registration or transfer of any ERISA Restricted Certificate that
is in
fact not permitted by this Section 6.02(h) or for making any payments due
on
such Certificate to the Holder thereof or taking any other action with respect
to such Holder under the provisions of this Agreement. The Trustee shall
be
entitled, but not obligated, to recover from any Holder of any ERISA Restricted
Certificate that was in fact a Plan or a Person acting on behalf of a Plan
at
the time it became a Holder or, at such subsequent time as it became a Plan
or
Person acting on behalf of a Plan, all payments made on such ERISA Restricted
Certificate at and after either such time. Any such payments so recovered
by the
Trustee shall be paid and delivered by the Trustee to the last preceding
Holder
of such Certificate that is not a Plan or Person acting on behalf of a
Plan.
No
Transfer of a Class M-10, Class CE, Class P or Residual Certificate shall
be
made unless either (i) the transferee of such Certificate provides a
representation, or is deemed to represent in the case of a Global Certificate,
to the Trustee and the Master Servicer acceptable to and in form and substance
satisfactory to the Trustee and the Master Servicer, to the effect that such
transferee is not a Plan, or a Person acting on behalf of a Plan or using
the
assets of a Plan, or (ii) in the case of any such Certificate presented for
registration in the name of a Plan, or a trustee of a Plan or any other person
acting on behalf of a Plan, the Trustee shall have received an Opinion of
Counsel for the benefit of the Trustee and the Master Servicer and on which
they
may rely, satisfactory to the Trustee, to the effect that the purchase and
holding of such Certificate are permissible under applicable law, will not
result in any prohibited transactions under ERISA or Section 4975 of the
Code
and will not subject the Trustee, the Master Servicer or the Depositor to
any
obligation in addition to those expressly undertaken in this Agreement, which
Opinion of Counsel shall not be an expense of the Trustee, the Master Servicer
or the Depositor, or (iii) in the case of a Class M-10 Certificate, the
transferee provides a representation, or is deemed to represent in the case
of
the Global Certificate, or an Opinion of Counsel to the effect that the proposed
transfer or holding of such Class M-10 Certificate and the servicing, management
and operation of the Trust and its assets: (I) will not result in any prohibited
transaction which is not covered under individual or class prohibited
transaction exemption including but not limited to XXXX 00-00, XXXX 00-00,
XXXX
00-0, XXXX 95-60 or PTCE 96-23 and (II) will not give rise to any obligation
on
the part of the Depositor, the Master Servicer or the Trustee in addition
to
those expressly undertaken in this Agreement. Neither the Trustee nor the
Master
Servicer shall be required to monitor, determine or inquire as to compliance
with the transfer restrictions with respect to any Private Certificate that
is a
Book-Entry Certificate, and neither the Trustee nor the Master Servicer shall
have any liability for transfers of any such Book-Entry Certificates made
through the book-entry facilities of any Depository or between or among
participants of the Depository or Certificate Owners made in violation of
the
transfer restrictions set forth herein. Neither the Trustee nor the Master
Servicer shall be under any liability to any Person for any registration
or
transfer of any Private Certificate that is in fact not permitted by this
Section 6.02(h) or for making any payments due on such Certificate to the
Holder
thereof or taking any other action with respect to such Holder under the
provisions of this Agreement. The Trustee shall be entitled, but not obligated,
to recover from any Holder of any Private Certificate that was in fact a
Plan or
a Person acting on behalf of a Plan at the time it became a Holder or, at
such
subsequent time as it became a Plan or Person acting on behalf of a Plan,
all
payments made on such Private Certificate at and after either such time.
Any
such payments so recovered by the Trustee shall be paid and delivered by
the
Trustee to the last preceding Holder of such Certificate that is not a Plan
or
Person acting on behalf of a Plan.
(i) Each
Person who has or who acquires any Ownership Interest in a Residual Certificate
shall be deemed by the acceptance or acquisition of such Ownership Interest
to
have agreed to be bound by the following provisions, and the rights of each
Person acquiring any Ownership Interest in a Residual Certificate are expressly
subject to the following provisions:
(i) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall be a Permitted Transferee and shall promptly notify the Trustee of
any
change or impending change in its status as a Permitted Transferee.
(ii) No
Ownership Interest in a Residual Certificate may be registered on the Closing
Date or thereafter transferred, and the Trustee shall not register the Transfer
of any Residual Certificate unless, in addition to the certificates required
to
be delivered to the Trustee under subsection (b) above, the Trustee shall
have
been furnished with an affidavit (a “Transfer Affidavit”) of the initial owner
or the proposed transferee in the form attached hereto as Exhibit
C.
(iii) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall agree (A) to obtain a Transfer Affidavit from any other Person to whom
such Person attempts to Transfer its Ownership Interest in a Residual
Certificate, (B) to obtain a Transfer Affidavit from any Person for whom
such
Person is acting as nominee, trustee or agent in connection with any Transfer
of
a Residual Certificate and (C) not to Transfer its Ownership Interest in
a
Residual Certificate or to cause the Transfer of an Ownership Interest in
a
Residual Certificate to any other Person if it has actual knowledge that
such
Person is not a Permitted Transferee.
(iv) Any
attempted or purported Transfer of any Ownership Interest in a Residual
Certificate in violation of the provisions of this Section 6.02(i) shall
be
absolutely null and void and shall vest no rights in the purported transferee.
If any purported transferee shall become a Holder of a Residual Certificate
in
violation of the provisions of this Section 6.02(i), then the last preceding
Permitted Transferee shall be restored to all rights as Holder thereof
retroactive to the date of registration of Transfer of such Residual
Certificate. The Trustee shall be under no liability to any Person for any
registration of Transfer of a Residual Certificate that is in fact not permitted
by Section 6.02(h) and this Section 6.02(i) or for making any payments due
on
such Certificate to the Holder thereof or taking any other action with respect
to such Holder under the provisions of this Agreement so long as the Transfer
was registered after receipt of the related Transfer Affidavit. The Trustee
shall be entitled but not obligated to recover from any Holder of a Residual
Certificate that was in fact not a Permitted Transferee at the time it became
a
Holder or, at such subsequent time as it became other than a Permitted
Transferee, all payments made on such Residual Certificate at and after either
such time. Any such payments so recovered by the Trustee shall be paid and
delivered by the Trustee to the last preceding Permitted Transferee of such
Certificate.
(v) The
Master Servicer shall make available within 60 days of written request from
the
Trustee, all information necessary to compute any tax imposed under Section
860E(e) of the Code as a result of a Transfer of an Ownership Interest in
a
Residual Certificate to any Holder who is not a Permitted
Transferee.
The
restrictions on Transfers of a Residual Certificate set forth in this Section
6.02(i) shall cease to apply (and the applicable portions of the legend on
a
Residual Certificate may be deleted) with respect to Transfers occurring
after
delivery to the Trustee of an Opinion of Counsel addressed to the Trustee, which
Opinion of Counsel shall not be an expense of the Trustee, the Mortgage Loan
Sellers or the Master Servicer to the effect that the elimination of such
restrictions, or any Transfer allowed by the elimination of such restrictions,
will not cause REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or REMIC VI,
as
applicable, to fail to qualify as a REMIC at any time that the Certificates
are
outstanding or result in the imposition of any tax on the Trust Fund, a
Certificateholder or another Person. Each Person holding or acquiring any
Ownership Interest in a Residual Certificate hereby consents to any amendment
of
this Agreement that, based on an Opinion of Counsel addressed to the Trustee
and
furnished to the Trustee, is reasonably necessary (a) to ensure that the
record
ownership of, or any beneficial interest in, a Residual Certificate is not
transferred, directly or indirectly, to a Person that is not a Permitted
Transferee and (b) to provide for a means to compel the Transfer of a Residual
Certificate that is held by a Person that is not a Permitted Transferee to
a
Holder that is a Permitted Transferee.
(j) The
preparation and delivery of all certificates and opinions referred to above
in
this Section 6.02 shall not be an expense of the Trust Fund, the Trustee,
the
Depositor, the Mortgage Loan Sellers or the Master Servicer.
Section
6.03 Mutilated,
Destroyed, Lost or Stolen Certificates.
If
(a)
any mutilated Certificate is surrendered to the Trustee, or the Trustee receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate and of the ownership thereof and (b) there is delivered to the
Trustee such security or indemnity as may be required by them to save each
of
them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute, authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and Percentage Interest. In connection with the issuance of
any new
Certificate under this Section 6.03, the Trustee may require the payment
of a
sum sufficient to cover any tax or other governmental charge that may be
imposed
in relation thereto and any other expenses (including the fees and expenses
of
the Trustee) connected therewith. Any replacement Certificate issued pursuant
to
this Section 6.03 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. All Certificates
surrendered to the Trustee under the terms of this Section 6.03 shall be
canceled and destroyed by the Trustee in accordance with its standard procedures
without liability on its part.
Section
6.04 Persons
Deemed Owners.
The
Trustee and any agent of the Trustee may treat the person in whose name any
Certificate is registered as the owner of such Certificate for the purpose
of
receiving distributions as provided in this Agreement and for all other purposes
whatsoever, and neither the Trustee nor any agent of the Trustee shall be
affected by any notice to the contrary.
Section
6.05 Access
to List of Certificateholders’ Names and Addresses.
If
three
or more Certificateholders (a) request such information in writing from the
Trustee, (b) state that such Certificateholders desire to communicate with
other
Certificateholders with respect to their rights under this Agreement or under
the Certificates, and (c) provide a copy of the communication that such
Certificateholders propose to transmit or if the Depositor or the Master
Servicer shall request such information in writing from the Trustee, then
the
Trustee shall, within ten Business Days after the receipt of such request,
provide the Depositor, the Master Servicer or such Certificateholders at
such
recipients’ expense the most recent list of the Certificateholders of the Trust
Fund held by the Trustee, if any. The Depositor and every Certificateholder,
by
receiving and holding a Certificate, agree that the Trustee shall not be
held
accountable by reason of the disclosure of any such information as to the
list
of the Certificateholders hereunder, regardless of the source from which
such
information was derived.
Section
6.06 Book-Entry
Certificates.
The
Regular Certificates (other than the Class CE Certificates and Class P
Certificates), upon original issuance, shall be issued in the form of one
or
more typewritten Certificates representing the Book-Entry Certificates, to
be
delivered to the Depository by or on behalf of the Depositor. Such Certificates
shall initially be registered on the Certificate Register in the name of
the
Depository or its nominee, and no Certificate Owner of such Certificates
will
receive a definitive certificate representing such Certificate Owner’s interest
in such Certificates, except as provided in Section 6.08. Unless and until
definitive, fully registered Certificates (“Definitive Certificates”) have been
issued to the Certificate Owners of such Certificates pursuant to Section
6.08:
(a) the
provisions of this Section shall be in full force and effect;
(b) the
Depositor and the Trustee may deal with the Depository and the Depository
Participants for all purposes (including the making of distributions) as
the
authorized representative of the respective Certificate Owners of such
Certificates;
(c) registration
of the Book-Entry Certificates may not be transferred by the Trustee except
to
another Depository;
(d) the
rights of the respective Certificate Owners of such Certificates shall be
exercised only through the Depository and the Depository Participants and
shall
be limited to those established by law and agreements between the Owners
of such
Certificates and the Depository and/or the Depository Participants. Pursuant
to
the Depository Agreement, unless and until Definitive Certificates are issued
pursuant to Section 6.08, the Depository will make book-entry transfers among
the Depository Participants and receive and transmit distributions of principal
and interest on the related Certificates to such Depository
Participants;
(e) the
Depository may collect its usual and customary fees, charges and expenses
from
its Depository Participants;
(f) the
Trustee may rely and shall be fully protected in relying upon information
furnished by the Depository with respect to its Depository Participants;
and
(g) to
the
extent that the provisions of this Section conflict with any other provisions
of
this Agreement, the provisions of this Section shall control.
For
purposes of any provision of this Agreement requiring or permitting actions
with
the consent of, or at the direction of, Certificateholders evidencing a
specified percentage of the aggregate unpaid principal amount of any Class
of
Certificates, such direction or consent may be given by Certificate Owners
(acting through the Depository and the Depository Participants) owning
Book-Entry Certificates evidencing the requisite percentage of principal
amount
of such Class of Certificates.
The
Private Certificates (other than the Class M-10 Certificates) shall initially
be
held in fully registered certificated form. If at any time the Holders of
all of
the Certificates of one or more such Classes request that the Trustee cause
such
Class to become Global Certificates, the Depositor (with the assistance of
the
Trustee) will take such action as may be reasonably required to cause the
Depository to accept such Class or Classes for trading if it may legally
be so
traded. If at anytime there are to be Global Certificates, the Global
Certificates shall be delivered to the Depository by the Depositor or deposited
with the Trustee as custodian for the Depository.
All
transfers by Certificate Owners of such respective Classes of Book-Entry
Certificates and any Global Certificates shall be made in accordance with
the
procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer Book-Entry Certificates of Certificate Owners it represents or of
brokerage firms for which it acts as agent in accordance with the Depository’s
normal procedures.
Section
6.07 Notices
to Depository.
Whenever
any notice or other communication is required to be given to Certificateholders
of a Class with respect to which Book-Entry Certificates have been issued,
unless and until Definitive Certificates shall have been issued to the related
Certificate Owners, the Trustee shall give all such notices and communications
to the Depository.
Section
6.08 Definitive
Certificates.
If,
after
Book-Entry Certificates have been issued with respect to any Certificates,
(a)
the Depositor or the Depository advises the Trustee that the Depository is
no
longer willing or able to discharge properly its responsibilities under the
Depository Agreement with respect to such Certificates and the Depositor
is
unable to locate a qualified successor or (b) the Depositor, with the consent
of
Depository Participants, advises the Trustee that it elects to terminate
the
book-entry system with respect to such Certificates through the Depository,
then
the Trustee shall notify all Certificate Owners of such Certificates, through
the Depository, of the occurrence of any such event and of the availability
of
Definitive Certificates to applicable Certificate Owners requesting the same.
The Depositor shall provide the Trustee with an adequate inventory of
certificates to facilitate the issuance and transfer of Definitive Certificates.
Upon surrender to the Trustee of any such Certificates by the Depository,
accompanied by registration instructions from the Depository for registration,
the Trustee shall countersign and deliver such Definitive Certificates. Neither
the Depositor nor the Trustee shall be liable for any delay in delivery of
such
instructions and each may conclusively rely on, and shall be protected in
relying on, such instructions.
In
addition, if an Event of Default has occurred and is continuing, each
Certificate Owner materially adversely affected thereby may at its option
request a Definitive Certificate evidencing such Certificate Owner’s Voting
Rights in the related Class of Certificates. In order to make such request,
such
Certificate Owner shall, subject to the rules and procedures of the Depository,
provide the Depository or the related Depository Participant with directions
for
the Trustee to exchange or cause the exchange of the Certificate Owner’s
interest in such Class of Certificates for an equivalent Voting Right in
fully
registered definitive form. Upon receipt by the Trustee of instructions from
the
Depository directing the Trustee to effect such exchange (such instructions
to
contain information regarding the Class of Certificates and the Certificate
Principal Balance being exchanged, the Depository Participant account to
be
debited with the decrease, the registered Holder of and delivery instructions
for the definitive Certificate, and any other information reasonably required
by
the Trustee), (i) the Trustee shall instruct the Depository to reduce the
related Depository Participant’s account by the aggregate Certificate Principal
Balance of the definitive Certificate, (ii) the Trustee shall execute,
authenticate and deliver, in accordance with the registration and delivery
instructions provided by the Depository, a definitive Certificate evidencing
such Certificate Owner’s Voting Rights in such Class of Certificates and (iii)
the Trustee shall execute and authenticate a new Book-Entry Certificate
reflecting the reduction in the Certificate Principal Balance of such Class
of
Certificates by the amount of the definitive Certificates.
Section
6.09 Maintenance
of Office or Agency.
The
Trustee will maintain or cause to be maintained at its expense an office
or
offices or agency or agencies at the Corporate Trust Office where Certificates
may be surrendered for registration of transfer or exchange. The Trustee
initially designates its Corporate Trust Office, as the office for such
purposes. The Trustee will give prompt written notice to the Certificateholders
of any change in such location of any such office or agency.
ARTICLE
VII
THE
DEPOSITOR AND THE MASTER SERVICER
Section
7.01 Liabilities
of the Depositor and the Master Servicer.
Each
of
the Depositor, and the Master Servicer shall be liable in accordance herewith
only to the extent of the obligations specifically imposed upon and undertaken
by it herein.
Section
7.02 Merger
or Consolidation of the Depositor or the Master Servicer.
(a) Each
of
the Depositor and the Master Servicer will keep in full force and effect
its
existence, rights and franchises as a corporation under the laws of the state
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,
the Certificates or any of the Mortgage Loans and to perform its duties under
this Agreement.
(b) Any
Person into which the Depositor or the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation
to
which the Depositor or the Master Servicer shall be a party, or any Person
succeeding to the business of the Depositor or the Master Servicer, shall
be the
successor of the Depositor or the Master Servicer hereunder, without the
execution or filing of any paper or further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
Section
7.03 Indemnification
of the Trustee and the Master Servicer.
(a) The
Master Servicer agrees to indemnify the Indemnified Persons including LaSalle
Bank National Association as Trustee and in its individual capacity only
to the
extent of its performance of its duties hereunder, and to hold them harmless
against, any loss, liability or expense (including reasonable legal fees
and
disbursements of counsel) incurred on their part that may be sustained in
connection with, arising out of, or relating to, any claim or legal action
(including any pending or threatened claim or legal action) relating to this
Agreement, including any powers of attorney delivered pursuant to this
Agreement, the Custodial Agreement or the Certificates (i) related to the
Master
Servicer’s failure to perform its duties in compliance with this Agreement
(except as any such loss, liability or expense shall be otherwise reimbursable
pursuant to this Agreement) or (ii) incurred by reason of the Master Servicer’s
willful misfeasance, bad faith or gross negligence in the performance of
duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder, provided, in each case, that with respect to any such claim or
legal
action (or pending or threatened claim or legal action), the Trustee shall
have
given the Master Servicer and the Seller written notice thereof promptly
after
the Trustee shall have with respect to such claim or legal action knowledge
thereof; provided, however that the failure to give such notice shall not
relieve the Master Servicer of its indemnification obligations hereunder.
This
indemnity shall survive the resignation or removal of the Trustee or Master
Servicer and the termination of this Agreement.
(b) The
Seller will indemnify any Indemnified Person including LaSalle Bank National
Association as Trustee and in its individual capacity only to the extent
of its
performance of its duties hereunder for any loss, liability or expense of
any
Indemnified Person not otherwise paid or covered pursuant to subsection (a)
above.
Section
7.04 Limitations
on Liability of the Depositor, the Master Servicer and Others.
Subject
to the obligation of the Master Servicer to indemnify the Indemnified Persons
pursuant to Section 7.03:
(a) Neither
the Depositor, the Master Servicer nor any of the directors, officers, employees
or agents of the Depositor and the Master Servicer shall be under any liability
to the Indemnified Persons, the Trust Fund or the Certificateholders for
taking
any action or for refraining from taking any action in good faith pursuant
to
this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Depositor, the Master Servicer or any such
Person against any breach of warranties or representations made herein or
any
liability which would otherwise be imposed by reason of such Person’s willful
misfeasance, bad faith or gross negligence in the performance of duties or
by
reason of reckless disregard of obligations and duties hereunder.
(b) The
Depositor, the Master Servicer and any director, officer, employee or agent
of
the Depositor and the Master Servicer may rely in good faith on any document
of
any kind prima facie properly executed and submitted by any Person respecting
any matters arising hereunder.
(c) The
Depositor, the Master Servicer, LaSalle Bank National Association as Trustee
and
in its individual capacity only to the extent of its performance of its duties
hereunder, the Custodian and any director, officer, employee or agent of
the
Depositor, the Master Servicer, the Trustee, the Custodian shall be indemnified
by the Trust and held harmless thereby against any loss, liability or expense
(including reasonable legal fees and disbursements of counsel) incurred on
their
part that may be sustained in connection with, arising out of, or related
to,
any claim or legal action (including any pending or threatened claim or legal
action) relating to this Agreement, the Custodial Agreement or the Certificates,
other than (i) in the case of the Master Servicer, (x) any such loss, liability
or expense related to the Master Servicer’s failure to perform its duties in
compliance with this Agreement (except as any such loss, liability or expense
shall be otherwise reimbursable pursuant to this Agreement) or (y) any such
loss, liability or expense incurred by reason of the Master Servicer’s willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder, or by reason of reckless disregard of obligations and duties
hereunder, (ii) in the case of the Trustee, any such loss, liability or expense
incurred by reason of the Trustee’s willful misfeasance, bad faith or negligence
in the performance of its duties hereunder, or by reason of its reckless
disregard of obligations and duties hereunder and (iii) in the case of the
Custodian, any such loss, liability or expense incurred by reason of the
Custodian’s willful misfeasance, bad faith or negligence in the performance of
its duties under the Custodial Agreement, or by reason of its reckless disregard
of obligations and duties thereunder.
(d) Neither
the Depositor nor the Master Servicer shall be under any obligation to appear
in, prosecute or defend any legal action that is not incidental to its duties
under this Agreement and that in its opinion may involve it in any expense
or
liability; provided, however, the Master Servicer may in its discretion,
with
the consent of the Trustee (which consent shall not be unreasonably withheld),
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto and the
interests of the Certificateholders hereunder. In such event, the legal expenses
and costs of such action and any liability resulting therefrom (expect any
loss,
liability or expense incurred by reason of reckless disregard of obligations
and
duties hereunder) shall be expenses, costs and liabilities of the Trust Fund,
and the Master Servicer shall be entitled to be reimbursed therefor out of
the
Protected Account as provided by Section 4.02. Nothing in this subsection
7.04(d) shall affect the Master Servicer’s obligation to service and administer
the Mortgage Loans pursuant to Article III.
(e) In
taking
or recommending any course of action pursuant to this Agreement, unless
specifically required to do so pursuant to this Agreement, the Master Servicer
shall not be required to investigate or make recommendations concerning
potential liabilities which the Trust might incur as a result of such course
of
action by reason of the condition of the Mortgaged Properties but shall give
notice to the Trustee if it has notice of such potential
liabilities.
Section
7.05 Master
Servicer Not to Resign.
Except
as
provided in Section 7.07, the Master Servicer shall not resign from the
obligations and duties hereby imposed on it except (i) with the prior consent
of
the Trustee (which consents shall not be unreasonably withheld) or (ii) upon
a
determination that any such duties hereunder are no longer permissible under
applicable law and such impermissibility cannot be cured. Any such determination
permitting the resignation of the Master Servicer shall be evidenced by an
Opinion of Counsel, addressed to and delivered to, the Trustee. No such
resignation by the Master Servicer shall become effective until the Trustee
or a
successor to the Master Servicer reasonably satisfactory to the Trustee shall
have assumed the responsibilities and obligations of the Master Servicer
in
accordance with Section 8.02 hereof. The Trustee shall notify the Rating
Agencies of the resignation of the Master Servicer.
Section
7.06 Successor
Master Servicer.
In
connection with the appointment of any Successor Master Servicer or the
assumption of the duties of the Master Servicer, the Trustee may make such
arrangements for the compensation of such Successor Master Servicer out of
payments on the Mortgage Loans as the Trustee and such Successor Master Servicer
shall agree. If the Successor Master Servicer does not agree that such market
value is a fair price, such Successor Master Servicer shall obtain two
quotations of market value from third parties actively engaged in the servicing
of single family mortgage loans. In no event shall the compensation of any
Successor Master Servicer exceed that permitted the Master Servicer hereunder
without the consent of all of the Certificateholders.
Section
7.07 Sale
and Assignment of Master Servicing.
The
Master Servicer may sell and assign its rights and delegate its duties and
obligations in its entirety as Master Servicer under this Agreement; provided,
however, that: (i) the purchaser or transferee accepting such assignment
and
delegation (a) shall be a Person which shall be qualified to service mortgage
loans for Xxxxxx Xxx or Xxxxxxx Mac; (b) shall have a net worth of not less
than
$15,000,000 (unless otherwise approved by each Rating Agency pursuant to
clause
(ii) below); (c) shall be reasonably satisfactory to the Trustee (as evidenced
in a writing signed by the Trustee); and (d) shall execute and deliver to
the
Trustee an agreement, in form and substance reasonably satisfactory to the
Trustee, which contains an assumption by such Person of the due and punctual
performance and observance of each covenant and condition to be performed
or
observed by it as master servicer under this Agreement, any custodial agreement
from and after the effective date of such agreement; (ii) each Rating Agency
shall be given prior written notice of the identity of the proposed successor
to
the Master Servicer and each Rating Agency’s rating of the Certificates in
effect immediately prior to such assignment, sale and delegation will not
be
downgraded, qualified or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect delivered to the Master
Servicer and the Trustee (at the expense of the Master Servicer); and (iii)
the
Master Servicer assigning and selling the master servicing shall deliver
to the
Trustee an Officer’s Certificate and an Opinion of Counsel addressed to the
Trustee, each stating that all conditions precedent to such action under
this
Agreement have been completed and such action is permitted by and complies
with
the terms of this Agreement. No such assignment or delegation shall affect
any
liability of the Master Servicer arising prior to the effective date
thereof.
ARTICLE
VIII
DEFAULT;
TERMINATION OF MASTER SERVICER
Section
8.01 Events
of Default.
“Event
of
Default,” wherever used herein, means any one of the following
events:
(i) any
failure by the Master Servicer to remit to the Trustee any amounts received
or
collected by the Master Servicer in respect of the Mortgage Loans and required
to be remitted by it hereunder (other than any Advance), which failure shall
continue unremedied for one Business Day after the date on which written
notice
of such failure shall have been given to the Master Servicer by the Trustee
or
the Depositor, or to the Trustee and the Master Servicer by the Holders of
Certificates evidencing not less than 25% of the Voting Rights evidenced
by the
Certificates;
(ii) other
than with respect to clause (vii) below, any failure by the Master Servicer
to
observe or perform in any material respect any other of the covenants or
agreements on the part of the Master Servicer contained in this Agreement
or any
breach of a representation or warranty by the Master Servicer, which failure
or
breach shall continue unremedied for a period of 60 days after the date on
which
written notice of such failure shall have been given to Master Servicer by
the
Trustee or the Depositor, or to the Trustee and the Master Servicer by the
Holders of Certificates evidencing not less than 25% of the Voting Rights
evidenced by the Certificates;
(iii) a
decree
or order of a court or agency or supervisory authority having jurisdiction
in
the premises for the appointment of a receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall have
been entered against the Master Servicer and such decree or order shall have
remained in force undischarged or unstayed for a period of 60 consecutive
days;
(iv) the
Master Servicer shall consent to the appointment of a receiver or liquidator
in
any insolvency, readjustment of debt, marshalling of assets and liabilities
or
similar proceedings of or relating to the Master Servicer or all or
substantially all of the property of the Master Servicer;
(v) the
Master Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of, or commence a
voluntary case under, any applicable insolvency or reorganization statute,
make
an assignment for the benefit of its creditors, or voluntarily suspend payment
of its obligations;
(vi) the
Master Servicer assigns or delegates its duties or rights under this Agreement
in contravention of the provisions permitting such assignment or delegation
under Sections 7.05 or 7.07;
(vii) failure
by the Master Servicer to duly perform, within the required time period,
its
obligations under Sections 3.13, 3.14 or 3.16; or
(viii) The
Master Servicer fails to deposit, or cause to be deposited, in the Distribution
Account any Advance (other than a Nonrecoverable Advance) by 5:00 p.m. New
York
City time on the Distribution Account Deposit Date.
If
an
Event of Default shall occur, then, and in each and every such case, so long
as
such Event of Default shall not have been remedied, the Trustee may, and
at the
direction of the Holders of Certificates evidencing not less than 25% of
the
Voting Rights evidenced by the Certificates, the Trustee shall in the case
of
any Event of Default described in clauses (i) through (vii) above, by notice
in
writing to the Master Servicer and the Swap Provider (with a copy to each
Rating
Agency), terminate all of the rights and obligations of the Master Servicer
under this Agreement and in and to the Mortgage Loans and the proceeds thereof,
other than its rights as a Certificateholder hereunder. Notwithstanding
anything to the contrary contained in this Agreement, the Trustee shall only
terminate the Master Servicer for an Event of Default as described in clause
(vii) above upon direction from the Depositor. On
or
after the receipt by the Master Servicer of such written notice, all authority
and power of the Master Servicer hereunder, whether with respect to the Mortgage
Loans or otherwise, shall pass to and be vested in the Trustee, or any successor
appointed pursuant to Section 8.02 (a “Successor Master Servicer”). Such
Successor Master Servicer shall thereupon if such Successor Master Servicer
is a
successor to the Master Servicer, make any Advance required by Article V,
subject, in the case of the Trustee, to Section 8.02. The Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the terminated
Master Servicer, as attorney- in-fact or otherwise, any and all documents
and
other instruments, and to do or accomplish all other acts or things necessary
or
appropriate to effect the purposes of such notice of termination, whether
to
complete the transfer and endorsement or assignment of any Mortgage Loans
and
related documents, or otherwise. Unless expressly provided in such written
notice, no such termination shall affect any obligation of the Master Servicer
to pay amounts owed pursuant to Article VII or Article IX. The Master Servicer
agrees to cooperate with the Trustee in effecting the termination of the
Master
Servicer’s responsibilities and rights hereunder, including, without limitation,
the transfer to the applicable Successor Master Servicer of all cash amounts
which shall at the time be credited to the Protected Account maintained pursuant
to Section 4.02, or thereafter be received with respect to the applicable
Mortgage Loans. The Trustee shall promptly notify the Rating Agencies of
the
occurrence of an Event of Default known to the Trustee.
Notwithstanding
any termination of the activities of the Master Servicer hereunder, the Master
Servicer shall be entitled to receive, out of any late collection of a Scheduled
Payment on a Mortgage Loan that was due prior to the notice terminating the
Master Servicer’s rights and obligations as Master Servicer hereunder and
received after such notice, that portion thereof to which the Master Servicer
would have been entitled pursuant to Sections 4.02 and to receive any other
amounts payable to the Master Servicer hereunder the entitlement to which
arose
prior to the termination of its activities hereunder.
Notwithstanding
the foregoing, if an Event of Default described in clause (viii) of this
Section
8.01 shall occur, the Trustee shall, by notice in writing to the Master
Servicer, which may be delivered by telecopy, immediately terminate all of
the
rights and obligations of the Master Servicer thereafter arising under this
Agreement, but without prejudice to any rights it may have as a
Certificateholder or to reimbursement of Advances and other advances of its
own
funds, and the Trustee shall act as provided in Section 8.02 to carry out
the
duties of the Master Servicer, including the obligation to make any Advance
the
nonpayment of which was an Event of Default described in clause (viii) of
this
Section 8.01. Any such action taken by the Trustee must be prior to the
distribution on the relevant Distribution Date.
Section
8.02 Trustee
to Act; Appointment of Successor.
On
and
after the time the Master Servicer receives a notice of termination pursuant
to
Section 8.01 hereof the Trustee shall automatically become the successor
to the
Master Servicer with respect to the transactions set forth or provided for
herein and after a transition period (not to exceed 90 days), shall be subject
to all the responsibilities, duties and liabilities relating thereto placed
on
the Master Servicer by the terms and provisions hereof; provided, however
that,
pursuant to Article V hereof, the Trustee in its capacity as Successor Master
Servicer shall be responsible for making any Advances required to be made
by the
Master Servicer immediately upon the termination of the Master Servicer and
any
such Advance shall be made on the Distribution Date on which such Advance
was
required to be made by the predecessor Master Servicer. Effective on the
date of
such notice of termination, as compensation therefor, the Trustee shall be
entitled to all compensation, reimbursement of expenses and indemnification
that
the Master Servicer would have been entitled to if it had continued to act
hereunder, provided, however, that the Trustee shall not be (i) liable for
any
acts or omissions of the Master Servicer, (ii) obligated to make Advances
if it
is prohibited from doing so under applicable law, (iii) responsible for expenses
of the Master Servicer pursuant to Section 2.03 or (iv) obligated to deposit
losses on any Permitted Investment directed by the Master Servicer.
Notwithstanding the foregoing, the Trustee may, if it shall be unwilling
to so
act, or shall, if it is prohibited by applicable law from making Advances
pursuant to Article V or if it is otherwise unable to so act, appoint, or
petition a court of competent jurisdiction to appoint, any established mortgage
loan servicing institution the appointment of which does not adversely affect
the then current rating of the Certificates by each Rating Agency as the
successor to the Master Servicer hereunder in the assumption of all or any
part
of the responsibilities, duties or liabilities of the Master Servicer hereunder.
Any Successor Master Servicer shall (i) be an institution that is a Xxxxxx
Xxx
and Xxxxxxx Mac approved seller/servicer in good standing, that has a net
worth
of at least $15,000,000, (ii) be acceptable to the Trustee (which consent
shall
not be unreasonably withheld) and (iii) be willing to act as successor servicer
of any Mortgage Loans under this Agreement, and shall have executed and
delivered to the Depositor and the Trustee an agreement accepting such
delegation and assignment, that contains an assumption by such Person of
the
rights, powers, duties, responsibilities, obligations and liabilities of
the
Master Servicer (other than any liabilities of the Master Servicer hereof
incurred prior to termination of the Master Servicer under Section 8.01 or
as
otherwise set forth herein), with like effect as if originally named as a
party
to this Agreement, provided that each Rating Agency shall have acknowledged
in
writing that its rating of the Certificates in effect immediately prior to
such
assignment and delegation will not be qualified or reduced as a result of
such
assignment and delegation. If the Trustee assumes the duties and
responsibilities of the Master Servicer in accordance with this Section 8.02,
the Trustee shall not resign as Master Servicer until a Successor Master
Servicer has been appointed and has accepted such appointment. Pending
appointment of a successor to the Master Servicer hereunder, the Trustee,
unless
the Trustee is prohibited by law from so acting, shall act in such capacity
as
hereinabove provided. In connection with such appointment and assumption,
the
Trustee may make such arrangements for the compensation of such successor
out of
payments on Mortgage Loans or otherwise as it and such successor shall agree;
provided that no such compensation unless agreed to by the Certificateholders
shall be in excess of that permitted the Master Servicer hereunder. The Trustee
and such successor shall take such action, consistent with this Agreement,
as
shall be necessary to effectuate any such succession. Neither the Trustee
nor
any other Successor Master Servicer shall be deemed to be in default hereunder
by reason of any failure to make, or any delay in making, any distribution
hereunder or any portion thereof or any failure to perform, or any delay
in
performing, any duties or responsibilities hereunder, in either case caused
by
the failure of the Master Servicer to deliver or provide, or any delay in
delivering or providing, any cash, information, documents or records to
it.
The
costs
and expenses of the Trustee in connection with the termination of the Master
Servicer, appointment of a Successor Master Servicer and, if applicable,
any
transfer of servicing, including, without limitation, all costs and expenses
associated with the complete transfer of all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
Trustee to correct any errors or insufficiencies in the servicing data or
otherwise to enable the Trustee or the Successor Master Servicer to service
the
Mortgage Loans properly and effectively, to the extent not paid by the
terminated Master Servicer, shall be payable to the Trustee pursuant to Section
9.05. Any successor to the Master Servicer as successor servicer under any
Subservicing Agreement shall give notice to the applicable Mortgagors of
such
change of servicer and shall, during the term of its service as successor
servicer maintain in force the policy or policies that the Master Servicer
is
required to maintain pursuant to Section 3.08.
Section
8.03 Notification
to Certificateholders.
(a) Upon
any
termination of or appointment of a successor to the Master Servicer, the
Trustee
shall give prompt written notice thereof to Certificateholders, the Swap
Provider and to each Rating Agency.
(b) Within
60
days after the occurrence of any Event of Default, the Trustee shall transmit
by
mail to all Certificateholders and the Swap Provider notice of each such
Event
of Default hereunder actually known to a Responsible Officer of the Trustee,
unless such Event of Default shall have been cured or waived.
Section
8.04 Waiver
of Defaults.
The
Trustee shall transmit by mail to all Certificateholders and the Swap Provider,
within 60 days after the occurrence of any Event of Default actually known
to a
Responsible Officer of the Trustee, unless such Event of Default shall have
been
cured, notice of each such Event of Default hereunder known to the Trustee.
The
Holders of Certificates evidencing over 50% of the Voting Rights may, on
behalf
of all Certificateholders, waive any default by the Master Servicer in the
performance of its obligations hereunder and the consequences thereof, except
a
default in the making of or the causing to be made of any required distribution
on the Certificates. Upon any such waiver of a past default, such default
shall
be deemed to cease to exist, and any Event of Default arising therefrom shall
be
deemed to have been timely remedied for every purpose of this Agreement.
No such
waiver shall extend to any subsequent or other default or impair any right
consequent thereon except to the extent expressly so waived. The Trustee
shall
give notice of any such waiver to the Rating Agencies.
ARTICLE
IX
CONCERNING
THE TRUSTEE
Section
9.01 Duties
of Trustee.
(a) The
Trustee, prior to the occurrence of an Event of Default and after the curing
or
waiver of all Events of Default which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this Agreement
as duties of the Trustee. If an Event of Default has occurred and has not
been
cured or waived, the Trustee shall exercise such of the rights and powers
vested
in it by this Agreement, and the same degree of care and skill in their
exercise, as a prudent person would exercise under the circumstances in the
conduct of such Person’s own affairs.
(b) Upon
receipt of all resolutions, certificates, statements, opinions, reports,
documents, orders or other instruments which are specifically required to
be
furnished to the Trustee pursuant to any provision of this Agreement, the
Trustee shall examine them to determine whether they are in the form required
by
this Agreement; provided, however, that the Trustee shall not be responsible
for
the accuracy or content of any resolution, certificate, statement, opinion,
report, document, order or other instrument furnished by the Master Servicer;
provided, further, that the Trustee shall not be responsible for the accuracy
or
verification of any calculation provided to it pursuant to this
Agreement.
(c) On
each
Distribution Date, the Trustee shall make monthly distributions and the final
distribution to the Certificateholders from funds in the Distribution Account
as
provided in Sections 5.04 and 10.01 herein.
(d) 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) Prior
to
the occurrence of an Event of Default, and after the curing or waiver of
all
such Events of Default which may have occurred, the duties and obligations
of
the Trustee shall be determined solely by the express provisions of this
Agreement, the Trustee shall not be liable except for the performance of
their
respective duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this Agreement
against the Trustee and, in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of the statements and
the
correctness of the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Agreement;
(ii) The
Trustee shall not be liable in its individual capacity 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 liable with respect to any action taken, suffered or
omitted to be taken by it in good faith in accordance with the directions
of the
Holders of Certificates evidencing not less than 25% of the aggregate Voting
Rights of the Certificates (or such other percentage as specifically set
forth
herein), if such action or non-action relates to the time, method and place
of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or other power conferred upon the Trustee under this
Agreement;
(iv) The
Trustee shall not be required to take notice or be deemed to have notice
or
knowledge of any default or Event of Default unless a Responsible Officer
of the
Trustee shall have actual knowledge thereof. In the absence of such knowledge,
the Trustee may conclusively assume there is no such default or Event of
Default;
(v) The
Trustee shall not in any way be liable by reason of any insufficiency in
any
Account held by or in the name of Trustee unless it is determined by a court
of
competent jurisdiction in a non-appealable judgment that the Trustee’s
negligence or willful misconduct was the primary cause of such insufficiency
(except to the extent that the Trustee is obligor and has defaulted
thereon);
(vi) Anything
in this Agreement to the contrary notwithstanding, in no event shall the
Trustee
be liable for special, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Trustee
has
been advised of the likelihood of such loss or damage and regardless of the
form
of action; and
(vii) None
of
the Master Servicer, the Seller, the Depositor or the Trustee shall be
responsible for the acts or omissions of the other, it being understood that
this Agreement shall not be construed to render them partners, joint venturers
or agents of one another.
The
Trustee shall not be required to expend or risk its own funds or otherwise
incur
financial liability in the performance of any of its duties hereunder, or
in the
exercise of any of its rights or powers, if there is reasonable ground for
believing that the repayment of such funds or adequate indemnity against
such
risk or liability is not reasonably assured to it, and none of the provisions
contained in this Agreement shall in any event require the Trustee to perform,
or be responsible for the manner of performance of, any of the obligations
of
the Master Servicer.
(e) All
funds
received by the Trustee and required to be deposited in the Distribution
Account
pursuant to this Agreement will be promptly so deposited by the
Trustee.
Section
9.02 Certain
Matters Affecting the Trustee.
(a) Except
as
otherwise provided in Section 9.01:
(i) The
Trustee may rely and shall be protected in acting or refraining from acting
in
reliance on any resolution or certificate of the Seller or the Master Servicer,
any certificates of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper
or document 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 advice of such counsel or any Opinion
of Counsel shall be full and complete authorization and protection with respect
to any action taken or suffered or omitted by it hereunder in good faith
and in
accordance with such advice or Opinion of Counsel;
(iii) The
Trustee shall not be under any obligation to exercise any of the trusts or
powers vested in it by this Agreement, other than its obligation to give
notices
pursuant to 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. Nothing contained herein shall, however, relieve the
Trustee
of the obligation, upon the occurrence of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge (which has not been
cured or waived), to exercise such of the rights and powers vested in it
by this
Agreement, and to use the same degree of care and skill in their exercise,
as a
prudent person would exercise under the circumstances in the conduct of his
own
affairs;
(iv) The
Trustee shall not be liable in its individual capacity for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized
or
within the discretion or rights or powers conferred upon it by this
Agreement;
(v) 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, consent, order, approval, bond or other paper or document,
unless requested in writing to do so by Holders of Certificates evidencing
not
less than 25% of the aggregate Voting Rights of the Certificates and provided
that the payment within a reasonable time to the Trustee of the costs, expenses
or liabilities likely to be incurred by it in the making of such investigation
is, in the opinion of the Trustee reasonably assured to the Trustee by the
security afforded to it by the terms of this Agreement. The Trustee may require
reasonable indemnity against such expense or liability as a condition to
taking
any such action. The reasonable expense of every such examination shall be
paid
by the Certificateholders requesting the investigation;
(vi) The
Trustee may execute any of the trusts or powers hereunder or perform any
duties
hereunder either directly or through Affiliates, agents or attorneys; provided,
however, that the Trustee may not appoint any paying agent to perform any
paying
agent functions under this Agreement without the express written consent
of the
Master Servicer, which consents will not be unreasonably withheld. The Trustee
shall not be liable or responsible for the misconduct or negligence of any
of
the Trustee’s agents or attorneys or paying agent appointed hereunder by the
Trustee with due care and, when required, with the consent of the Master
Servicer;
(vii) Should
the Trustee deem the nature of any action required on its part to be unclear,
the Trustee may require prior to such action that it be provided by the
Depositor with reasonable further instructions; the right of the Trustee
to
perform any discretionary act enumerated in this Agreement shall not be
construed as a duty, and the Trustee shall not be accountable for other than
its
negligence or willful misconduct in the performance of any such
act;
(viii) The
Trustee shall not be required to give any bond or surety with respect to
the
execution of the trust created hereby or the powers granted hereunder, except
as
provided in subsection 9.07; and
(ix) The
Trustee shall not have any duty to conduct any affirmative investigation
as to
the occurrence of any condition requiring the repurchase of any Mortgage
Loan by
any Person pursuant to this Agreement, or the eligibility of any Mortgage
Loan
for purposes of this Agreement.
(b) The
Trustee, the Swap Administrator and the Supplemental Interest Trust Trustee
are
hereby directed by the Depositor to execute, deliver and perform its respective
obligations under the Swap Administration Agreement and to perform the
obligations of the Trustee, the Swap Administrator and the Supplemental Interest
Trust Trustee, respectively, thereunder on the Closing Date and thereafter
on
behalf of the Holders of the Certificates (and any amendments or supplements
to
the Swap Administration Agreement as may be requested by the Majority Class
CE
Certificateholder regarding the distributions to be made to it or its designees
thereunder). The Seller, the Master Servicer, the Depositor and the
Certificateholders by acceptance of their Certificates acknowledge and agree
that the Trustee, the Swap Administrator and the Supplemental Interest Trust
Trustee shall execute, deliver and perform its respective obligations under
the
Swap Administration Agreement and shall do so solely in its capacity as Trustee,
the Swap Administrator and the Supplemental Interest Trust Trustee and not
in
its individual capacity. Amounts payable by the Trustee on any Distribution
Date
to the Swap Administrator shall be paid by the Trustee as provided herein.
The
Trustee, the Swap Administrator and the Supplemental Interest Trust Trustee
in
its individual capacity shall have no responsibility for any of the
undertakings, agreements or representations by it with respect to the Swap
Administration Agreement, including, without limitation, for making any payments
thereunder.
It
is
acknowledged and agreed that the Person serving as Trustee hereunder shall
also
serve as Swap Administrator under the Swap Administration Agreement and act
as a
Supplemental Interest Trust Trustee under the Swap Agreement. The Swap
Administrator shall not have any liability for any failure or delay in payments
to the Trust which are required under the Swap Administration Agreement where
such failure or delay is due to the failure or delay of the Swap Provider
in
making such payment to the Swap Administrator. LaSalle Bank National Association
in its individual capacity and as Swap Administrator, the Trustee and the
Supplemental Interest Trust Trustees shall be entitled to be indemnified
and
held harmless by the Trust from and against any and all losses, claims, expenses
or other liabilities that arise by reason of or in connection with the
performance or observance by each of the Swap Administrator, the Trustee
and the
Supplemental Interest Trust Trustees of its duties or obligations under the
Swap
Agreement or the Swap Administration Agreement, except to the extent that
the
same is due to the Swap Administrator’s, the Trustee’s or the Supplemental
Interest Trust Trustees’ gross negligence, willful misconduct or fraud. Any
Person appointed as successor trustee pursuant to Section 9.09 shall also
be
required to serve as successor Swap Administrator and successor supplemental
interest trust trustee under the Swap Agreement and the Swap Administration
Agreement.
Section
9.03 Trustee
Not Liable for Certificates or Mortgage Loans.
The
recitals contained herein and in the Certificates (other than the signature
and
countersignature of the Trustee on the Certificates) shall be taken as the
statements of the Depositor, and the Trustee shall not have any responsibility
for their correctness. The Trustee makes no representation as to the validity
or
sufficiency of the Certificates (other than the signature and countersignature
of the Trustee on the Certificates) or of any Mortgage Loan except as expressly
provided in Sections 2.02 and 2.06 hereof; provided, however, that the foregoing
shall not relieve the Trustee, or the Custodian on its behalf, of the obligation
to review the Mortgage Files pursuant to Section 2.02 of this Agreement.
The
Trustee’s signature and countersignature (or countersignature of its agent) on
the Certificates shall be solely in its capacity as Trustee and shall not
constitute the Certificates an obligation of the Trustee in any other capacity.
The Trustee shall not be accountable for the use or application by the Depositor
of any of the Certificates or of the proceeds of such Certificates, or for
the
use or application of any funds paid to the Depositor with respect to the
Mortgage Loans. Subject to Section 2.06, the Trustee shall not be responsible
for the legality or validity of this Agreement or any document or instrument
relating to this Agreement, the validity of the execution of this Agreement
or
of any supplement hereto or instrument of further assurance, or the validity,
priority, perfection or sufficiency of the security for the Certificates
issued
hereunder or intended to be issued hereunder. The Trustee shall not at any
time
have any responsibility or liability for or with respect to the legality,
validity and enforceability of any Mortgage or any Mortgage Loan, or the
perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the
Trust
Fund or its ability to generate the payments to be distributed to
Certificateholders, under this Agreement. The Trustee shall not be responsible
for filing any financing or continuation statement in any public office at
any
time or to otherwise perfect or maintain the perfection of any security interest
or lien granted to it hereunder or to record this Agreement.
Section
9.04 Trustee
May Own Certificates.
The
Trustee in its individual capacity or in any capacity other than as Trustee
hereunder may become the owner or pledgee of any Certificates with the same
rights it would have if it were not the Trustee and may otherwise deal with
the
parties hereto.
Section
9.05 Trustee’s
Fees and Expenses.
The
Trustee will be entitled to recover from the Distribution Account pursuant
to
Section 4.05, the Trustee Fee, all reasonable out of pocket expenses,
disbursements and advances and the expenses of the Trustee in connection
with
any Event of Default (or anything related thereto, including any determination
that an Event of Default does or does not exist), any breach of this Agreement
or any claim or legal action (including any pending or threatened claim or
legal
action) incurred or made by the Trustee in the administration of the trusts
hereunder (including the reasonable compensation, expenses and disbursements
of
its counsel) except any such expense, disbursement or advance as may arise
from
its negligence or intentional misconduct or which is the responsibility of
the
Certificateholders hereunder. If funds in the Distribution Account are
insufficient therefor, the Trustee shall recover such expenses, disbursements
or
advances from the Depositor and the Depositor hereby agrees to pay such
expenses, disbursements or advances. Such compensation and reimbursement
obligation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust.
Section
9.06 Eligibility
Requirements for Trustee.
The
Trustee and any successor Trustee shall during the entire duration of this
Agreement be a state bank or trust company or a national banking association
organized and doing business under the laws of a state or the United States
of
America, authorized under such laws to exercise corporate trust powers, having
a
combined capital and surplus and undivided profits of at least $50,000,000,
subject to supervision or examination by federal or state authority and rated
“BBB” or higher by Fitch with respect to their long-term rating and rated “BBB”
or higher by S&P and “Baa2” or higher by Xxxxx’x with respect to any
outstanding long-term unsecured unsubordinated debt, and, in the case of
a
successor Trustee other than pursuant to Section 9.10, rated in one of the
two
highest long-term debt categories by each Rating Agency (at least “AA-” in the
case of S&P) or otherwise acceptable to, each of the Rating Agencies and
have a short-term debt rating of at least “A-1” from S&P, or otherwise
acceptable to, S&P. The Trustee shall not be an Affiliate of the Master
Servicer. If the Trustee 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 9.06 the combined capital
and
surplus of such corporation shall be deemed to be its total equity capital
(combined capital and surplus) as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 9.06, the Trustee
shall resign immediately in the manner and with the effect specified in Section
9.08.
Section
9.07 Insurance.
The
Trustee, at its own expense, shall at all times maintain and keep in full
force
and effect: (i) fidelity insurance, (ii) theft of documents insurance and
(iii)
forgery insurance (which may be collectively satisfied by a “Financial
Institution Bond” and/or a “Bankers’ Blanket Bond”); provided, that such
insurance may be provided through self-insurance so long as the Trustee is
rated
“A” or better by S&P and “A1” or better by Xxxxx’x. All such insurance shall
be in amounts, with standard coverage and subject to deductibles, as are
customary for insurance typically maintained by banks or their affiliates
which
act as custodians for investor-owned mortgage pools. A certificate of an
officer
of the Trustee as to the Trustee’s compliance with this Section 9.07 shall be
furnished to any Certificateholder upon reasonable written request.
Section
9.08 Resignation
and Removal of Trustee.
The
Trustee may at any time resign and be discharged from the Trust hereby created
by giving written notice thereof to the Depositor, the Seller and the Master
Servicer, with a copy to the Rating Agencies and the Swap Provider. Upon
receiving such notice of resignation, the Depositor shall promptly appoint
a
successor trustee by written instrument, in triplicate, one copy of which
instrument shall be delivered to each of the resigning Trustee and 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.
If
at any
time (i) the Trustee shall cease to be eligible in accordance with the
provisions of Section 9.06 hereof and shall fail to resign after written
request
thereto by the Depositor, (ii) the Trustee shall become incapable of acting,
or
shall be adjudged as 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, or (iii)(A) a tax is imposed
with
respect to the Trust Fund by any state in which the Trustee or the Trust
Fund is
located, (B) the imposition of such tax would be avoided by the appointment
of a
different trustee and (C) the Trustee fails to indemnify the Trust Fund against
such tax, then the Depositor or the Master Servicer may remove the Trustee
and
appoint a successor trustee by written instrument, in multiple copies, a
copy of
which instrument shall be delivered to the Trustee, the Master Servicer and
the
successor trustee.
The
Holders evidencing more than 50% of the Voting Rights of each Class of
Certificates may at any time remove the Trustee and appoint a successor trustee
by written instrument or instruments, in multiple copies, signed by such
Holders
or their attorneys-in-fact duly authorized, one complete set of which
instruments shall be delivered by the successor trustee to the Master Servicer,
the Trustee so removed and the successor trustee so appointed. Notice of
any
removal of the Trustee shall be given to each Rating Agency by the Trustee
or
successor trustee.
Any
resignation or removal of LaSalle Bank National Association as Trustee shall
also result in the resignation or removal, as applicable, of LaSalle Bank
National Association as Swap Administrator. Any resignation or removal of
the
Trustee and appointment of a successor trustee pursuant to any of the provisions
of this Section 9.08 shall become effective upon acceptance of appointment
by
the successor trustee as provided in Section 9.09 hereof and upon acceptance
of
appointment by a successor Swap Administrator under the Swap Administration
Agreement.
Section
9.09 Successor
Trustee.
Any
successor trustee appointed as provided in Section 9.08 hereof shall execute,
acknowledge and deliver to the Depositor, to its predecessor trustee, the
Master
Servicer an instrument accepting such appointment hereunder and thereupon
the
resignation or removal of the predecessor trustee shall become effective
and
such successor trustee without any further act, deed or conveyance, shall
become
fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as trustee
herein.
No
successor trustee shall accept appointment as provided in this Section 9.09
unless at the time of such acceptance such successor trustee shall be eligible
under the provisions of Section 9.07 hereof and its appointment shall not
adversely affect the then current rating of the Certificates.
Upon
acceptance of appointment by a successor trustee as provided in this Section
9.09, the successor trustee shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates. If the successor trustee fails
to mail
such notice within ten days after acceptance of appointment, the Depositor
shall
cause such notice to be mailed at the expense of the Trust Fund.
Section
9.10 Merger
or Consolidation of Trustee.
Any
corporation, state bank or national banking association into which the Trustee
may be merged or converted or with which it may be consolidated or any
corporation, state bank or national banking association resulting from any
merger, conversion or consolidation to which the Trustee shall be a party,
or
any corporation, state bank or national banking association succeeding to
substantially all of the corporate trust business of the Trustee, shall be
the
successor of the Trustee hereunder, provided that such corporation shall
be
eligible under the provisions of Section 9.06 hereof without the execution
or
filing of any paper or further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
Section
9.11 Appointment
of Co-Trustee or Separate Trustee.
Notwithstanding
any other provisions of this Agreement, 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 any Mortgage Note may at the time be located, the Master
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund,
and
to vest in such Person or Persons, in such capacity and for the benefit of
the
Certificateholders, such title to the Trust Fund or any part thereof, whichever
is applicable, and, subject to the other provisions of this Section 9.11,
such
powers, duties, obligations, rights and trusts as the Master Servicer and
the
Trustee may consider necessary or desirable. If the Master Servicer shall
not
have joined in such appointment within 15 days after the receipt by it of
a
request to do so, or in the case an Event of Default shall have occurred
and be
continuing, the Trustee alone shall have the power to make such appointment.
No
co-trustee or separate trustee hereunder shall be required to meet the terms
of
eligibility as a successor trustee under Section 9.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 9.09.
Every
separate trustee and co-trustee shall, to the extent permitted by law, be
appointed and act subject to the following provisions and
conditions:
(i) All
rights, powers, duties and obligations conferred or imposed upon the Trustee,
except for the obligation of the Trustee under this Agreement to advance
funds
on behalf of the Master Servicer, shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is
not
authorized to act separately without the Trustee joining in such act), except
to
the extent that under any law of any jurisdiction in which any particular
act or
acts are to be performed (whether a Trustee hereunder or as a Successor Master
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust Fund or any portion thereof
in any
such jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) No
trustee hereunder shall be held personally liable by reason of any act or
omission of any other trustee hereunder; and
(iii) The
Trustee may at any time accept the resignation of or remove any separate
trustee
or co-trustee.
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
IX.
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 and a copy thereof given
to the
Master Servicer and the Depositor.
Any
separate trustee or co-trustee may, at any time, constitute the Trustee its
agent or attorney-in-fact, with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement
on
its behalf and in its name. If any separate trustee or co- trustee shall
die,
become incapable of acting, resign or be removed, all 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.
Section
9.12 Tax
Matters.
It
is
intended that the Trust Fund shall constitute, and that the affairs of the
Trust
Fund shall be conducted so that each REMIC formed hereunder qualifies as,
a
“real estate mortgage investment conduit” as defined in and in accordance with
the REMIC Provisions. In furtherance of such intention, the Trustee covenants
and agrees that it shall act as agent (and the Trustee is hereby appointed
to
act as agent) on behalf of the Trust Fund. The Trustee, as agent on behalf
of
the Trust Fund, shall do or refrain from doing, as applicable, the following:
(a) the Trustee shall prepare and file, or cause to be prepared and filed,
in a
timely manner, U.S. Real Estate Mortgage Investment Conduit Income Tax Returns
(Form 1066 or any successor form adopted by the Internal Revenue Service)
and
prepare and file or cause to be prepared and filed with the Internal Revenue
Service and applicable state or local tax authorities income tax or information
returns for each taxable year with respect to each such REMIC containing
such
information and at the times and in the manner as may be required by the
Code or
state or local tax laws, regulations, or rules, and furnish or cause to be
furnished to Certificateholders the schedules, statements or information
at such
times and in such manner as may be required thereby; (b) the Trustee shall
apply
for an employer identification number with the Internal Revenue Service via
a
Form SS-4 or other comparable method for each REMIC that is or becomes a
taxable
entity, and within thirty days of the Closing Date, furnish or cause to be
furnished to the Internal Revenue Service, on Forms 8811 or as otherwise
may be
required by the Code, the name, title, address, and telephone number of the
Person that the Holders of the Certificates may contact for tax information
relating thereto, together with such additional information as may be required
by such Form, and update such information at the time or times in the manner
required by the Code for the Trust Fund; (c) the Trustee shall make or cause
to
be made elections, on behalf of each REMIC formed hereunder to be treated
as a
REMIC on the federal tax return of such REMIC for its first taxable year
(and,
if necessary, under applicable state law); (d) the Trustee shall prepare
and
forward, or cause to be prepared and forwarded, to the Certificateholders
and to
the Internal Revenue Service and, if necessary, state tax authorities, all
information returns and reports as and when required to be provided to them
in
accordance with the REMIC Provisions, including without limitation, the
calculation of any original issue discount using the Prepayment Assumption;
(e)
the Trustee shall provide information necessary for the computation of tax
imposed on the Transfer of a Residual Certificate to a Person that is not
a
Permitted Transferee, or an agent (including a broker, nominee or other
middleman) of a Person that is not a Permitted Transferee, or a pass-through
entity in which a Person that is not a Permitted Transferee is the record
Holder
of an interest (the reasonable cost of computing and furnishing such information
may be charged to the Person liable for such tax); (f) the Trustee shall,
to the
extent under its control, conduct the affairs of the Trust Fund at all times
that any Certificates are outstanding so as to maintain the status of each
REMIC
formed hereunder as a REMIC under the REMIC Provisions; (g) the Trustee shall
not knowingly or intentionally take any action or omit to take any action
that
could (i) cause the termination of the REMIC status of any REMIC formed
hereunder or (ii) result in the imposition of a tax upon the Trust Fund
(including but not limited to the tax on prohibited transactions as defined
in
Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set
forth
in Section 860G(d) of the Code); (h) the Trustee shall pay, from the sources
specified in this Section 9.12, the amount of any federal, state and local
taxes, including prohibited transaction taxes as described below, imposed
on any
REMIC formed hereunder prior to the termination of the Trust Fund when and
as
the same shall be due and payable (but such obligation shall not prevent
the
Trustee or any other appropriate Person from contesting any such tax in
appropriate proceedings and shall not prevent the Trustee from withholding
payment of such tax, if permitted by law, pending the outcome of such
proceedings); (i) the Trustee shall sign or cause to be signed federal, state
or
local income tax or information returns or any other document prepared pursuant
to this Section 9.12 requiring a signature thereon by the relevant tax
authorities or other governmental entity; (j) the Trustee shall maintain
records
relating to each REMIC formed hereunder including but not limited to the
income,
expenses, assets and liabilities of each such REMIC and adjusted basis of
the
Trust Fund property determined at such intervals as may be required by the
Code,
as may be necessary to prepare the foregoing returns, schedules, statements
or
information; (k) the Trustee shall, for federal income tax purposes, maintain
books and records with respect to the REMICs on a calendar year and on an
accrual basis; (l) the Trustee shall not enter into any arrangement not
otherwise provided for in this Agreement by which the REMICs will receive
a fee
or other compensation for services nor permit the REMICs to receive any income
from assets other than “qualified mortgages” as defined in Section 860G(a)(3) of
the Code or “permitted investments” as defined in Section 860G(a)(5) of the
Code; and (m) as and when necessary and appropriate, the Trustee, at the
expense
of the Trust Fund, shall represent the Trust Fund in any administrative or
judicial proceedings relating to an examination or audit by any governmental
taxing authority, request an administrative adjustment as to any taxable
year of
any REMIC formed hereunder, enter into settlement agreements with any
governmental taxing agency, extend any statute of limitations relating to
any
tax item of the Trust Fund, and otherwise act on behalf of each REMIC formed
hereunder in relation to any tax matter involving any such REMIC.
In
order
to enable the Trustee to perform its duties as set forth herein, the Depositor
shall provide, or cause to be provided, to the Trustee within 10 days after
the
Closing Date all information or data that the Trustee requests in writing
and
determines to be relevant for tax purposes to the valuations and offering
prices
of the Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flows of the Certificates and the Mortgage
Loans.
Thereafter, the Depositor shall provide to the Trustee promptly upon written
request therefor, any such additional information or data that the Trustee
may,
from time to time, request in order to enable the Trustee to perform its
duties
as set forth herein. The Depositor hereby indemnifies the Trustee for any
losses, liabilities, damages, claims or expenses of the Trustee arising from
any
errors or miscalculations of the Trustee that result from any failure of
the
Depositor to provide, or to cause to be provided, accurate information or
data
to the Trustee on a timely basis.
In
the
event that any tax is imposed on “prohibited transactions” of any of REMIC I,
REMIC II, REMIC III, REMIC IV, REMIC V or REMIC VI as defined in Section
860F(a)(2) of the Code, on the “net income from foreclosure property” of the
Trust Fund as defined in Section 860G(c) of the Code, on any contribution
to any
of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or REMIC VI after the
Startup
Day pursuant to Section 860G(d) of the Code, or any other tax is imposed,
including, without limitation, any federal, state or local tax or minimum
tax
imposed upon any of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or REMIC
VI
and
is
not
paid as otherwise provided for herein, such tax shall be paid (i) by the
Master
Servicer or Trustee, if any such tax arises out of or results from a breach
by
the Master Servicer or Trustee of any of its obligations under this Agreement,
provided, however, in no event shall the Master Servicer have any liability
(1)
for any action or omission that is taken in accordance with and compliance
with
the express terms of, or which is expressly permitted by the terms of, this
Agreement, (2) for any losses other than those arising out of a negligent
performance by the Master Servicer of its duties and obligations set forth
herein, or (3) for any special or consequential damages to Certificateholders
(in addition to payment of principal and interest on the Certificates), (ii)
by
any party hereto (other than the Master Servicer or Trustee) to the extent
any
such tax arises out of or results from a breach by such other party of any
of
its obligations under this Agreement or (iii) in all other cases, or in the
event that any liable party hereto fails to honor its obligations under the
preceding clauses (i) or (ii), first with amounts otherwise to be distributed
to
the Class R Certificateholders, and second with amounts otherwise to be
distributed to the Holders of the following other Certificates in the following
order of priority: first,
to
the
Class M-10 Certificates, second, to the Class M-9 Certificates, third, to
the
Class M-8 Certificates, fourth, to the Class M-7 Certificates, fifth, to
the
Class M-6 Certificates, sixth, to the Class M-5 Certificates, seventh, to
the
Class M-4 Certificates, eighth, to the Class M-3 Certificates, ninth, to
the
Class M-2 Certificates, tenth, to the Class M-1 Certificates, and eleventh,
to
the Class A Certificates (on a pro
rata
basis
based on the amounts to be distributed). Notwithstanding anything to the
contrary contained herein, to the extent that such tax is payable by the
Holder
of any such Certificates, the Trustee is hereby authorized to retain on any
Distribution Date, from the Holders of the Class R Certificates (and, if
necessary, second, from the Holders of the other relevant Certificates in
the
priority specified in the preceding sentence), funds otherwise distributable
to
such Holders in an amount sufficient to pay such tax.
The
Trustee
shall
include in its Monthly Statement amounts allocated to the relevant Certificates,
taking into account the priorities described in the second preceding sentence.
The
Trustee shall promptly notify in writing the party liable for any such tax
of
the amount thereof and the due date for the payment thereof.
The
Trustee and the Master Servicer agree that, in the event it should obtain
any
information necessary for the other party to perform its obligations pursuant
to
this Section 9.12, it will promptly notify and provide such information to
such
other party.
Notwithstanding
any other provision of this Agreement, the Trustee shall comply with all
federal
withholding requirements respecting payments to Certificateholders of interest
or original issue discount that the Trustee reasonably believes are applicable
under the Code. The consent of Certificateholders shall not be required for
such
withholding. In the event the Trustee does withhold any amount from interest
or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee shall indicate
the
amount withheld to such Certificateholders.
For
as
long as each REMIC shall exist, the Trustee and the Master Servicer shall
act in
accordance herewith to assure continuing treatment of such REMIC as a REMIC,
and
the Trustee shall comply with any directions of the Seller or the Master
Servicer to assure such continuing treatment. In furtherance, but not in
limitation, of the foregoing, the Trustee and Master Servicer shall not (unless
expressly permitted under the terms of this Agreement) (a) sell or permit
the
sale of all or any portion of the Mortgage Loans or of any investment of
deposits in an Account unless such sale is as a result of a repurchase of
the
Mortgage Loans pursuant to this Agreement or the Trustee has received a REMIC
Opinion addressed to the Trustee prepared at the expense of the Trust Fund;
(b)
other than with respect to a substitution pursuant to the Mortgage Loan Purchase
Agreement or Section 2.03 of this Agreement, as applicable, accept any
contribution to any REMIC after the Startup Day without receipt of a REMIC
Opinion; or (c) acquire any assets for any REMIC other than any REO Property
after the Startup Day without receipt of a REMIC Opinion.
For
the
avoidance of doubt, notwithstanding anything stated to the contrary herein,
neither the Supplemental Interest Trust Trustee nor the Swap Administrator
nor
the Trustee shall have any responsibility for the entity-level tax filing
or tax
preparation of the Supplemental Interest Trust.
ARTICLE
X
TERMINATION
Section
10.01 Termination
upon Liquidation or Repurchase of all Mortgage Loans.
(a) Subject
to Section 10.03, the obligations and responsibilities of the Depositor,
the
Master Servicer, the Seller and the Trustee created hereby with respect to
the
Trust Fund shall terminate upon the earlier of (a) the exercise of the Majority
Class CE Certificateholder (or its designee) or the Master Servicer, as
applicable, pursuant to clause (b) below of its right to repurchase all of
the
Mortgage Loans (and REO Properties) remaining in the Trust Fund at a price
(the
“Mortgage Loan Purchase Price”) equal to the sum of (i) 100% of the Stated
Principal Balance of each Mortgage Loan (other than in respect of REO Property),
(ii) accrued interest thereon at the applicable Mortgage Rate to, but not
including, the first day of the month of such purchase, (iii) the appraised
value of any REO Property in the Trust Fund (up to the Stated Principal Balance
of the related Mortgage Loan), such appraisal to be conducted by an appraiser
mutually agreed upon by the Master Servicer and the Trustee, (iv) unreimbursed
out-of pocket costs of the Master Servicer, including unreimbursed Servicing
Advances and the principal portion of any unreimbursed Advances, made on
the
Mortgage Loans prior to the exercise of such repurchase right, (v) any
unreimbursed costs and expenses of the Trustee payable pursuant to Section
9.05
or of the Custodian pursuant to the Custodial Agreement, (vi) any Swap
Termination Payment (which shall include any Net Swap Payment payable to
the
Trust Fund for the final Distribution Date) payable to the Swap Provider
which
remains unpaid or which is due to the exercise of such option (the “Swap
Optional Termination Payment”) and (b) the later of (i) the maturity or other
liquidation (or any Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and the disposition of all REO Property and (ii)
the
distribution to Certificateholders of all amounts required to be distributed
to
them pursuant to this Agreement, as applicable. In no event shall the Trust
Fund
created hereby continue beyond the earlier of (i) the expiration of 21 years
from the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx,
the
late Ambassador of the United States to the Court of St. Xxxxx, living on
the
date hereof and (ii) the Latest Possible Maturity Date.
(b) The
Majority Class CE Certificateholder shall have right to repurchase all Mortgage
Loans and related REO Properties at any time at which the aggregate Stated
Principal Balance of all of the Mortgage Loans in the Trust Fund is not more
than 10% of the aggregate Cut-off Date Principal Balance of all of the Mortgage
Loans. If the Majority Class CE Certificateholder does not exercise this
option,
the Master Servicer has the right to repurchase all Mortgage Loans and related
REO Properties pursuant to clause (a) in Section 10.01(a), conditioned upon
the
Stated Principal Balance of all of the Mortgage Loans in the Trust Fund,
at the
time of any such repurchase, aggregating 5% or less of the aggregate Cut-off
Date Principal Balance of all of the Mortgage Loans. If the Majority Class
CE
Certificateholder or the Master Servicer elects to terminate the Trust Fund
pursuant to this Section 10.01 (such termination, an “Optional Termination”),
the Majority Class CE Certificateholder or the Master Servicer, as applicable,
shall, at least 20 days prior to the last date on which notice of such Optional
Termination is required to be mailed to the Certificateholders pursuant to
10.02(ii), notify in writing (which may be done in electronic format) the
Depositor, the Master Servicer, the Trustee and the Swap Provider of the
final
Distribution Date on which the Majority Class CE Certificateholder or the
Master
Servicer, as applicable, intends to terminate the Trust Fund.
(c) In
connection with any Optional Termination, four Business Days prior to the
final
Distribution Date specified in the notice required pursuant to Section 10.01(b),
the Trustee shall, no later than 4:00 pm New York City time on such day,
request
in writing (which may be done by facsimile) and by phone from the Swap Provider
the amount of the Estimated Swap Termination Payment (as defined in the Swap
Agreement) and otherwise in accordance with the notice requirements of Part
5(c)(v) of the Swap Agreement. The Swap Provider shall, no later than 2:00
pm on
the following Business Day, notify in writing (which may be done in electronic
format) the Trustee of the amount of the Estimated Swap Termination Payment
(as
defined in the Swap Agreement) the Trustee shall promptly on the same day
notify
the Majority Class CE Certificateholder or the Master Servicer, as applicable,
of the amount of the Estimated Swap Termination Payment.
(d) Two
Business Days prior to the final Distribution Date specified in the notice
required pursuant to Section 10.01(b), (i) the Majority Class CE
Certificateholder or the Master Servicer, as applicable, shall, no later
than
1:00 pm New York City time on such day, deposit funds in the Distribution
Account in an amount equal to the sum of the Mortgage Loan Purchase Price
(other
than the Swap Optional Termination Payment) and the Estimated Swap Termination
Payment, and (ii) if the Trustee shall have determined that the aggregate
Stated
Principal Balance of all of the Mortgage Loans in the Trust Fund as of the
related Determination Date is not more than 10% of the aggregate Cut-off
Date
Principal Balance of all of the Mortgage Loans or 5% of the aggregate Cut-off
Date Principal Balance of all of the Mortgage Loans, as applicable, and that
all
other requirements of the Optional Termination have been met, including without
limitation, the deposit required pursuant to this clause (d) as well as the
requirements specified in Section 10.03, then the Trustee shall, on the same
Business Day, provide written notice to the Majority Class CE Certificateholder,
the Depositor, the Master Servicer, the Supplemental Interest Trust Trustee,
the
Trustee, the Custodian and the Swap Provider (in accordance with the applicable
provision of the Swap Agreement) confirming (a) its receipt of the Mortgage
Loan
Purchase Price (other than the Swap Optional Termination Payment) and the
Estimated Swap Termination Payment and (b) that all other requirements of
the
Optional Termination have been met. Upon the Trustee’s providing the notice
described in the preceding sentence, the Optional Termination shall become
irrevocable, the notice to Certificateholders of such Optional Termination
provided pursuant to the second paragraph of Section 10.02 shall become
unrescindable, the Swap Provider shall determine the Swap Optional Termination
Payment in accordance with the Swap Agreement, and the Swap Provider shall
provide to the Trustee written notice of the amount of the Swap Optional
Termination Payment not later than one Business Day prior to the final
Distribution Date specified in the notice required pursuant to Section 10.02(ii)
and in the event that the Trustee fails to provide the notice described in
the
preceding sentence, any notice provided under Section 10.01(b) shall be deemed
rescinded.
(e) In
connection with any Optional Termination, only an amount equal to the Mortgage
Loan Purchase Price less any Swap Optional Termination Payment shall be made
available for distribution to the Regular Certificates. Any Estimated Swap
Termination Payment deposited into the Distribution Account by the Majority
Class CE Certificateholder or the Master Servicer, as applicable, shall be
withdrawn by the Trustee from the Distribution Account on the related final
Distribution Date and distributed as follows: (i) to the Supplemental Interest
Trust for payment to the Swap Provider in accordance with Section 3.21(c),
an
amount equal to the Swap Optional Termination Amount calculated pursuant
to the
Swap Agreement, provided that in no event shall the amount distributed to
the
Swap Provider in respect of the Swap Optional Termination Amount exceed the
Estimated Swap Termination Payment, and (ii) to the Majority Class CE
Certificateholder or the Master Servicer, as applicable, an amount equal
to the
excess, if any, of the Estimated Swap Termination Payment over the Swap Optional
Termination Payment. The Swap Optional Termination Payment shall not be part
of
any REMIC and shall not be paid into any account which is part of any
REMIC.
(f) Upon
receipt by the Custodian of notice from the Trustee pursuant to Section 10.01(d)
and the receipt by the Custodian of a Request for Release therefor, the
Custodian shall promptly release to the Master Servicer, as applicable the
Mortgage Files for the Mortgage Loans and the Trustee shall execute and deliver
any documents prepared and delivered to it which are necessary to transfer
any
REO Property.
(g)
Notwithstanding
the foregoing, the provisions of Section 7.03 hereof shall survive the
termination of this Agreement.
Section
10.02 Final
Distribution on the Certificates.
(i) If
on any
Determination Date, (i) the Master Servicer determines that there are no
Outstanding Mortgage Loans and no other funds or assets in the Trust Fund
other
than the funds in the Protected Account, the Master Servicer shall direct
the
Trustee to send a final distribution notice promptly to each Certificateholder
or (ii) the Trustee determines that a Class of Certificates shall be retired
after a final distribution on such Class, the Trustee shall notify the
Certificateholders within five (5) Business Days after such Determination
Date
that the final distribution in retirement of such Class of Certificates is
scheduled to be made on the immediately following Distribution Date. Any
final
distribution made pursuant to the immediately preceding sentence will be
made
only upon presentation and surrender of the related Certificates at the
Corporate Trust Office of the Trustee. If the Majority Class CE
Certificateholder or the Master Servicer, as applicable, elects to terminate
the
Trust Fund pursuant to Section 10.01, at least 20 days prior to the date
notice
is to be mailed to the Certificateholders, the Majority Class CE
Certificateholder or the Master Servicer, as applicable, shall notify the
Depositor, the Swap Provider and the Trustee of the date the Majority Class
CE
Certificateholder or the Master Servicer, as applicable, intends to terminate
the related Sub-Trust. The Majority Class CE Certificateholder or the Master
Servicer, as applicable, shall remit the Mortgage Loan Purchase Price to
the
Trustee two Business Days prior to the Distribution Date for such Optional
Termination by the Majority Class CE Certificateholder or the Master Servicer,
as applicable.
(ii) Notice
of
any termination of the Trust Fund, specifying the Distribution Date on which
Certificateholders may surrender their Certificates for payment of the final
distribution and cancellation, shall be given promptly by the Trustee by
letter
to Certificateholders mailed not later than two Business Days after the
Determination Date in the month of such final distribution. Any such notice
shall specify (a) the Distribution Date upon which final distribution on
the
Certificates will be made upon presentation and surrender of Certificates
at the
office therein designated, (b) the amount of such final distribution, (c)
the
location of the office or agency at which such presentation and surrender
must
be made and (d) that the Record Date otherwise applicable to such Distribution
Date is not applicable, distributions being made only upon presentation and
surrender of the Certificates at the office therein specified. The Trustee
will
give such notice to each Rating Agency at the time such notice is given to
Certificateholders.
(iii) In
the
event such notice is given, the Master Servicer shall cause all funds in
the
Protected Account to be remitted to the Trustee for deposit in the Distribution
Account on two Business Days prior to the applicable Distribution Date in
an
amount equal to the final distribution in respect of the Certificates. Upon
such
final deposit with respect to the Trust Fund and the receipt by the Trustee
of a
Request for Release therefor, the Trustee or the Custodian shall promptly
release to the Seller as applicable the Mortgage Files for the Mortgage Loans
and the Trustee shall execute and deliver any documents prepared and delivered
to it which are necessary to transfer any REO Property.
(iv) Upon
presentation and surrender of the related Certificates, the Trustee shall
cause
to be distributed to Certificateholders of each Class the amounts allocable
to
such Certificates held in the Distribution Account in the order and priority
set
forth in Section 5.04 hereof on the final Distribution Date and in proportion
to
their respective Percentage Interests.
(v) In
the
event that any affected Certificateholders shall not surrender Certificates
for
cancellation within six months after the date specified in the above mentioned
written notice, the Trustee shall give a second written notice to the remaining
Certificateholders to surrender their Certificates for cancellation and receive
the final distribution with respect thereto. If within six months after the
second notice all the applicable Certificates shall not have been surrendered
for cancellation, the Trustee may take appropriate steps, or may appoint
an
agent to take appropriate steps, to contact the remaining Certificateholders
concerning surrender of their Certificates, and the cost thereof shall be
paid
out of the funds and other assets that remain a part of the Trust Fund. If
within one year after the second notice all Certificates shall not have been
surrendered for cancellation, the Class R Certificateholders shall be entitled
to all unclaimed funds and other assets of the Trust Fund that remain subject
hereto.
Section
10.03 Additional
Termination Requirements.
(a) Upon
exercise by the Majority Class CE Certificateholder or the Master Servicer,
as
applicable, of its purchase option as provided in Section 10.01, the Trust
Fund
shall be terminated in accordance with the following additional requirements,
unless the Trustee has been supplied with an Opinion of Counsel addressed
to the
Trustee, at the expense of the Majority Class CE Certificateholder or the
Master
Servicer, as applicable, to the effect that the failure of the Trust Fund
to
comply with the requirements of this Section 10.03 will not (i) result in
the
imposition of taxes on “prohibited transactions” of a REMIC, or (ii) cause a
REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding:
(1) The
Majority Class CE Certificateholder or the Master Servicer, as applicable,
shall
establish a 90-day liquidation period and notify the Trustee thereof, and
the
Trustee shall in turn specify the first day of such period in a statement
attached to the tax return for each of REMIC I, REMIC II, REMIC III, REMIC
IV,
REMIC V and REMIC VI pursuant to Treasury Regulation Section 1.860F-1. The
Majority Class CE Certificateholder or the Master Servicer, as applicable,
shall
satisfy all the requirements of a qualified liquidation under Section 860F
of
the Code and any regulations thereunder, as evidenced by an Opinion of Counsel
obtained at the expense of the Majority Class CE Certificateholder or the
Master
Servicer, as applicable;
(2) During
such 90-day liquidation period, and at or prior to the time of making the
final
payment on the Certificates, the Trustee shall sell all of the assets of
REMIC I
for cash; and
(3) At
the
time of the making of the final payment on the Certificates, the Trustee
shall
distribute or credit, or cause to be distributed or credited, to the Holders
of
the Residual Certificates all cash on hand (other than cash retained to meet
claims), and REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V and REMIC VI
shall
terminate at that time.
(b) By
their
acceptance of the Certificates, the Holders thereof hereby authorize the
adoption of a 90-day liquidation period and the adoption of a plan of complete
liquidation for the REMICs, which authorization shall be binding upon all
successor Certificateholders.
(c) The
Trustee as agent for each REMIC hereby agrees to adopt and sign such a plan
of
complete liquidation meeting the requirements for a qualified liquidation
under
Section 860F of the Code and any regulations thereunder upon the written
request
of the Majority Class CE Certificateholder or the Master Servicer, as
applicable, and the receipt of the Opinion of Counsel referred to in Section
10.03(a)(1) and to take such other action in connection therewith as may
be
reasonably requested by the Majority Class CE Certificateholder or the Master
Servicer, as applicable.
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
Section
11.01 Amendment.
This
Agreement may be amended from time to time by parties hereto without the
consent
of any of the Certificateholders to cure any ambiguity, to correct or supplement
any provisions herein (including to give effect to the expectations of
investors), to comply with any changes in the Code, to revise any provisions
to
reflect the obligations of the parties to this Agreement as they relate to
Regulation AB, to change the manner in which the Protected Account is maintained
or to make such other provisions with respect to matters or questions arising
under this Agreement as shall not be inconsistent with any other provisions
herein if such action shall not, as evidenced by an Opinion of Counsel addressed
to the Trustee, adversely affect in any material respect the interests of
any
Certificateholder; provided that any such amendment shall be deemed not to
adversely affect in any material respect the interests of the Certificateholders
and no such Opinion of Counsel shall be required if the Person requesting
such
amendment obtains a letter from each Rating Agency stating that such amendment
would not result in the downgrading or withdrawal of the respective ratings
then
assigned to the Certificates.
Notwithstanding
the foregoing, without the consent of the Certificateholders, the parties
hereto
may at any time and from time to time amend this Agreement to modify, eliminate
or add to any of its provisions to such extent as shall be necessary or
appropriate to maintain the qualification of any of REMIC I, REMIC II, REMIC
III, REMIC IV, REMIC V or REMIC VI as a REMIC under the Code or to avoid
or
minimize the risk of the imposition of any tax on any of REMIC I, REMIC II,
REMIC III, REMIC IV, REMIC V or REMIC VI pursuant to the Code that would
be a
claim against any of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC V or REMIC
VI
at any time prior to the final redemption of the Certificates, provided that
the
Trustee has been provided an Opinion of Counsel addressed to the Trustee,
which
opinion shall be an expense of the party requesting such opinion but in any
case
shall not be an expense of the Trustee or the Trust Fund, to the effect that
such action is necessary or appropriate to maintain such qualification or
to
avoid or minimize the risk of the imposition of such a tax.
This
Agreement may also be amended from time to time by the parties hereto with
the
consent of Holders of the Certificates evidencing over 50% of the Voting
Rights,
or with the consent of Holders of each Class of Certificates affected thereby,
evidencing over 50% of the Voting Rights of that Class, as applicable, for
the
purpose of adding any provisions to or changing in any manner or eliminating
any
of the provisions of this Agreement or of modifying in any manner the rights
of
the Holders of Certificates; provided that no such amendment shall (i) reduce
in
any manner the amount of, or delay the timing of, payments required to be
distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) cause any of REMIC I, REMIC II, REMIC III, REMIC IV, REMIC
or
REMIC VI to cease to qualify as a REMIC or (iii) reduce the aforesaid
percentages of Certificates of each Class the Holders of which are required
to
consent to any such amendment without the consent of the Holders of all
Certificates of such Class then outstanding.
Notwithstanding
any contrary provision of this Agreement, the Trustee shall not consent to
any
amendment to this Agreement unless it shall have first received an Opinion
of
Counsel addressed to the Trustee, which opinion shall be an expense of the
party
requesting such amendment but in any case shall not be an expense of the
Trustee, to the effect that such amendment will not (other than an amendment
pursuant to clause (ii) of, and in accordance with, the preceding paragraph)
cause the imposition of any tax on any of REMIC I, REMIC II, REMIC III, REMIC
IV, REMIC V or REMIC VI or the Certificateholders or cause any of REMIC I,
REMIC
II, REMIC III, REMIC IV, REMIC V or REMIC VI to cease to qualify as a REMIC
at
any time that any Certificates are outstanding. Further, nothing in this
Agreement shall require the Trustee to enter into an amendment without receiving
an Opinion of Counsel, satisfactory to the Trustee that (i) such amendment
is
permitted and is not prohibited by this Agreement and that all requirements
for
amending this Agreement (including any consent of the applicable
Certificateholders) have been complied with.
Notwithstanding
any of the other provisions of this Section 11.01, none of the Depositor,
the
Master Servicer or the Trustee shall enter into any amendment that could
reasonably be expected to have a material adverse effect on the interests
of the
Swap Provider (excluding, for the avoidance of doubt, any amendment to the
Pooling and Servicing Agreement that is entered into solely for the purpose
of
appointing a successor servicer, master servicer, trustee or other service
provider) without the prior written consent of the Swap Provider, which consent
shall not be unreasonably withheld, conditioned or delayed.
Promptly
after the execution of any amendment to this Agreement requiring the consent
of
Certificateholders, the Trustee shall furnish written notification of the
substance of such amendment to each Certificateholder, the Swap Provider
and
each Rating Agency.
It
shall
not be necessary for the consent of Certificateholders under this Section
to
approve the particular form of any proposed amendment, but it shall be
sufficient if such consent shall approve the substance thereof. The manner
of
obtaining such consents and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable regulations
as
the Trustee may prescribe.
Section
11.02 Recordation
of Agreement; Counterparts.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all of the counties
or other comparable jurisdictions in which any or all of the Mortgaged
Properties are situated, and in any other appropriate public recording office
or
elsewhere. The Master Servicer shall effect such recordation at the Trust’s
expense upon the request in writing of a Certificateholder, but only if such
direction is accompanied by an Opinion of Counsel (provided at the expense
of
the Certificateholder requesting recordation) to the effect that such
recordation would materially and beneficially affect the interests of the
Certificateholders or is required by law.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, 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
11.03 Governing
Law.
THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE SUBSTANTIVE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES
HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH
LAWS WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF (OTHER THAN
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAWS).
Section
11.04 Intention
of Parties.
It
is the
express intent of the parties hereto that the conveyance of the Mortgage
Notes,
Mortgages, assignments of Mortgages, title insurance policies and any
modifications, extensions and/or assumption agreements and private mortgage
insurance policies relating to the Mortgage Loans by the Sellers to the
Depositor, and by the Depositor to the Trustee be, and be construed as, an
absolute sale thereof to the Depositor or the Trustee, as applicable. It
is,
further, not the intention of the parties that such conveyance be deemed
a
pledge thereof by the Seller to the Depositor, or by the Depositor to the
Trustee. However, in the event that, notwithstanding the intent of the parties,
such assets are held to be the property of the Mortgage Loan Sellers or the
Depositor, as applicable, or if for any other reason the Mortgage Loan Purchase
Agreement or this Agreement is held or deemed to create a security interest
in
such assets, then (i) the Mortgage Loan Purchase Agreement and this Agreement
shall each be deemed to be a security agreement within the meaning of the
Uniform Commercial Code of the State of New York and (ii) the conveyance
provided for in the Mortgage Loan Purchase Agreement from the Mortgage Loan
Sellers to the Depositor, and the conveyance provided for in this Agreement
from
the Depositor to the Trustee, shall be deemed to be an assignment and a grant
by
the Mortgage Loan Sellers or the Depositor, as applicable, for the benefit
of
the Certificateholders of a security interest in all of the assets that
constitute the Trust Fund, whether now owned or hereafter acquired.
The
Depositor for the benefit of the Certificateholders shall, to the extent
consistent with this Agreement, take such actions as may be necessary to
ensure
that, if this Agreement were deemed to create a security interest in the
assets
of the Trust Fund, 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 the Agreement.
Section
11.05 Notices.
(a) The
Trustee shall use its best efforts to promptly provide notice to each Rating
Agency with respect to each of the following of which a Responsible Officer
of
the Trustee has actual knowledge:
(i) Any
material change or amendment to this Agreement;
(ii) The
occurrence of any Event of Default that has not been cured;
(iii) The
resignation or termination of the Master Servicer or the Trustee and the
appointment of any successor;
(iv) The
repurchase or substitution of Mortgage Loans pursuant to Sections 2.02, 2.03,
3.19 and 10.01; and
(v) The
final
payment to Certificateholders.
(b) All
directions, demands and notices hereunder shall be in writing and shall be
deemed to have been duly given when delivered at or mailed by registered
mail,
return receipt requested, postage prepaid, or by recognized overnight courier,
or by facsimile transmission to a number provided by the appropriate party
if
receipt of such transmission is confirmed to (i) in the case of the Depositor,
Bear Xxxxxxx Asset Backed Securities I LLC, 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
Xxx
Xxxx 00000, Attention: Chief Counsel, and with respect to Regulation AB
notifications to the Depositor at xxxxxxxxxxxxxxxxxx@xxxx.xxx; (ii) in the
case
of the Seller, EMC Mortgage Corporation, 0000 Xxxx Xxxxx Xxxxx, Xxxxxxxxxx,
Xxxxx 00000 (Facsimile: (000) 000-0000), attention: President or General
Counsel, (iii) in the case of the Master Servicer, 0000 Xxxx Xxxxx Xxxxx,
Xxxxxxxxxx, Xxxxx 00000 (Facsimile: (000) 000-0000), attention: Xxxxxxxx
Xxxxx;
(iv) in
the
case of the Trustee, at each Corporate Trust Office or such other address
as the
Trustee may hereafter furnish to the other parties hereto, (v) in the case
of
Wachovia
Bank, N.A., 000 Xxxxx Xxxxxxx Xxxxxx, XX-0, Xxxxxxxxx, XX 00000-0000, Attention:
Xxxxx X. Xxxxx
and (vi)
in the case of Standard & Poor’s, 00 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, the Master Servicer or the Trustee under this Agreement shall
be
effective only upon receipt. Any notice required or permitted to be mailed
to a
Certificateholder, unless otherwise provided herein, shall be given by
first-class mail, postage prepaid, at the address of such Certificateholder
as
shown in the Certificate Register; any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been
duly
given, whether or not the Certificateholder receives such notice.
Section
11.06 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.
Section
11.07 Assignment.
Notwithstanding
anything to the contrary contained herein, except as provided pursuant to
Section 7.02, this Agreement may not be assigned by the Master Servicer,
EMC (on
its own behalf as Seller and on behalf of Master Funding) or the
Depositor.
Section
11.08 Limitation
on Rights of Certificateholders.
The
death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder’s legal
representative or heirs to claim an accounting or to take any action or commence
any proceeding in any court for a petition or winding up of the Trust Fund,
or
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No
Certificateholder shall have any right to vote (except as provided 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.
No
Certificateholder shall have any right by virtue or by availing itself of
any
provisions 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 a written notice of an
Event
of Default and of the continuance thereof, as hereinbefore provided, the
Holders
of Certificates evidencing not less than 25% of the Voting Rights evidenced
by
the Certificates shall also have made written request to 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 60 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; it being understood and intended, and being
expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself
or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain
or seek
to obtain priority over or preference to any other such Holder or to enforce
any
right under this Agreement, except in the manner herein provided and for
the
common benefit of all Certificateholders. For the protection and enforcement
of
the provisions of this Section 11.08, each and every Certificateholder or
the
Trustee shall be entitled to such relief as can be given either at law or
in
equity.
Section
11.09 Inspection
and Audit Rights.
The
Master Servicer agrees that, on reasonable prior notice, it will permit any
representative of the Depositor or the Trustee during the Master Servicer’s
normal business hours, to examine all the books of account, records, reports
and
other papers of the Master Servicer relating to the Mortgage Loans, to make
copies and extracts therefrom, to cause such books to be audited by independent
certified public accountants selected by the Depositor and the Trustee and
to
discuss its affairs, finances and accounts relating to such Mortgage Loans
with
its officers, employees and independent public accountants (and by this
provision the Master Servicer hereby authorizes such accountants to discuss
with
such representative such affairs, finances and accounts), all at such reasonable
times and as often as may be reasonably requested. Any out-of-pocket expense
incident to the exercise by the Depositor or the Trustee of any right under
this
Section 11.09 shall be borne by the party requesting such inspection, subject
to
such party’s right to reimbursement hereunder (in the case of the Trustee,
pursuant to Section 9.05 hereof.
Section
11.10 Certificates
Nonassessable and Fully Paid.
It
is the
intention of the Depositor that Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests in the Trust
Fund
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates, upon due authentication thereof by
the
Trustee pursuant to this Agreement, are and shall be deemed fully
paid.
Section
11.11 Third
Party Rights.
The
Swap
Provider shall be an express third-party beneficiary of this Agreement to
the
extent of its express rights to receive any payments under this Agreement
or
any
other express
rights of
the
Swap Provider explicitly
stated in this Agreement,
and
shall have the right to enforce such rights under this Agreement as if it
were a
party hereto. The Swap Administrator shall be an express third-party beneficiary
of this Agreement to the extent of its express rights to receive any payments
under this Agreement or
any
other express
rights of
the
Swap Administrator explicitly
stated in this Agreement,
and
shall have the right to enforce such rights under this Agreement as if it
were a
party hereto.
*
*
*
IN
WITNESS WHEREOF, the Depositor, the Master Servicer, the Seller and the Trustee
have caused their names to be signed hereto by their respective officers
thereunto duly authorized as of the day and year first above
written.
|
BEAR
XXXXXXX ASSET BACKED
SECURITIES
I LLC,
as
Depositor
|
|||||||||||||
|
By:
|
/s/
Xxxxx Xxxxxxxxxxx
|
||||||||||||
|
Name:
|
Xxxxx
Xxxxxxxxxxx
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
|
EMC
MORTGAGE CORPORATION,
as
Seller and as Master Servicer
|
|||||||||||||
|
By:
|
/s/
Xxxxx Xxxx
|
||||||||||||
|
Name:
|
Xxxxx
Xxxx
|
||||||||||||
|
Title:
|
Senior
Vice President
|
||||||||||||
|
LASALLE
BANK NATIONAL ASSOCIATION,
as
Trustee
|
|||||||||||||
|
By:
|
/s/
Xxxxx X. Xxxx
|
||||||||||||
|
Name:
|
Xxxxx
X. Xxxx
|
||||||||||||
|
Title:
|
Assistant
Vice President
|
||||||||||||
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
this
30th
day of
January, 2007, before me, a notary public in and for said State, appeared
Xxxxx
Xxxxxxxxxxx, personally known to me on the basis of satisfactory evidence
to be
an authorized representative of Bear Xxxxxxx Asset Backed Securities I LLC,
one
of the companies that executed the within instrument, and also known to me
to be
the person who executed it on behalf of such limited liability company and
acknowledged to me that such limited liability 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]
|
STATE
OF TEXAS
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF DALLAS
|
)
|
On
this
30th
day of
January, 2007, before me, a notary public in and for said State, appeared
__________________, personally known to me on the basis of satisfactory evidence
to be an authorized representative of EMC Mortgage Corporation, one of the
corporations that executed the within instrument, and also known to me to
be the
person who executed it on behalf of such 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]
|
STATE
OF ILLINOIS
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF XXXX
|
)
|
On
this
30th
day of
January, 2007, before me, a notary public in and for said State, appeared
______________, personally known to me on the basis of satisfactory evidence
to
be an authorized representative of LaSalle Bank National Association that
executed the within instrument, and also known to me to be the person who
executed it on behalf of such 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]
EXHIBIT
A-1
Form
of
Class A Certificates
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986 (THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY
THE
PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN
BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL
BALANCE BY INQUIRY OF THE TRUSTEE NAMED HEREIN.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS 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.
PRIOR
TO THE TERMINATION OF THE SUPPLEMENTAL INTEREST TRUST, ANY PERSON ACQUIRING
A
CERTIFICATE SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS IN SECTION
6.02(h)
OF THE POOLING AND SERVICING AGREEMENT.
|
Certificate
No. 1
|
Adjustable
Rate
|
|
Class
[A-1][A-2][A-3] Senior
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: January 1, 2007
|
Aggregate
Initial Certificate Principal Balance of this Certificate as
of the
Cut-off Date:
$[__________]
|
|
First
Distribution Date:
February
26, 2007
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$[__________]
|
|
Master
Servicer:
EMC
Mortgage Corporation
|
CUSIP:
[_____]
|
|
Last
Scheduled Distribution Date:
[____________]
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-AQ1
evidencing
a fractional undivided interest in the distributions allocable to the Class
[A-1][A-2][A-3] Certificates with respect to a Trust Fund consisting primarily
of a pool of conventional, closed-end, first lien, subprime, one- to four-family
fixed and adjustable interest rate mortgage loans sold by BEAR XXXXXXX
ASSET
BACKED SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer or the Trustee referred to below or any of their
affiliates or any other person. Neither this Certificate nor the underlying
Mortgage Loans are guaranteed or insured by any governmental entity or
by Bear
Xxxxxxx Asset Backed Securities I LLC, the Master Servicer or the Trustee
or any
of their affiliates or any other person. None of Bear Xxxxxxx Asset Backed
Securities I LLC, the Master Servicer or any of their affiliates will have
any
obligation with respect to any certificate or other obligation secured
by or
payable from payments on the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional, closed-end, first lien, subprime, fixed and
adjustable rate mortgage loans secured by one- to four- family residences
(collectively, the “Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed
Securities I LLC (“BSABS I”). The Mortgage Loans were sold by EMC Mortgage
Corporation (“EMC”) and Master Funding LLC to BSABS I. EMC will act as master
servicer of the Mortgage Loans (in that capacity, the “Master Servicer,” which
term includes any successors thereto under the Agreement referred to below).
The
Trust Fund was created pursuant to the Pooling and Servicing Agreement,
dated as
of the Cut-off Date specified above (the “Agreement”), among BSABS I, as
depositor (the “Depositor”), EMC Mortgage Corporation, as seller and as Master
Servicer, and LaSalle Bank 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 Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Interest
on this Certificate will accrue from and including the immediately preceding
Distribution Date (or with respect to the First Distribution Date, the
Closing
Date) to and including the day prior to the current Distribution Date on
the
Certificate Principal Balance hereof at a per annum rate equal to the
Pass-Through Rate set forth above. The Trustee will distribute on the 25th
day
of each month, or, if such 25th day is not a Business Day, the immediately
following Business Day (each, a “Distribution Date”), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the Business Day immediately
preceding
such Distribution Date so long as such Certificate remains in book-entry
form
(and otherwise, the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date), an amount equal
to
the product of the Percentage Interest evidenced by this Certificate and
the
amount (of interest and principal, if any) required to be distributed to
the
Holders of Certificates of the same Class as this Certificate. The Assumed
Final
Distribution Date is the Distribution Date in the month following the latest
scheduled maturity date of any Mortgage Loan.
Distributions
on this 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, by wire transfer. Notwithstanding
the
above, the final distribution on this Certificate will be made after due
notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency appointed by
the
Trustee for that purpose and designated in such notice. The initial Certificate
Principal Balance of this Certificate is set forth above. The Certificate
Principal Balance hereof will be reduced to the extent of distributions
allocable to principal hereon and any Realized Losses allocable
hereto.
This
Certificate is one of a duly authorized issue of 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
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
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 and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of Certificates evidencing
over 50% of the Voting Rights of the Certificates, or with the consent
of the
Holders of each Class of Certificates affected thereby evidencing over
50% of
the Voting Rights of such Class or Classes, as applicable. Any such consent
by
the Holder of this 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 Certificate is registrable with the Trustee upon surrender
of this Certificate for registration of transfer at the offices or agencies
maintained by the Trustee for such purposes, 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 Certificates in authorized denominations
representing a like aggregate Percentage Interest will be issued to the
designated transferee.
Prior
to
the termination of the Supplemental Interest Trust, any transferee of this
Certificate shall be deemed to make the representations in Section 6.02(h)
of
the Agreement.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the 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
Depositor, the Master Servicer, the Trustee and any agent of any of them
may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of Depositor, the Master Servicer, the
Trustee
or any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby
(other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all
the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after
the
first Distribution Date on which the aggregate Stated Principal Balance
of the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust created
by
the Agreement continue beyond the earlier of
(i)
the expiration of 21 years after the death of certain persons identified
in the
Agreement and (ii) the Latest Possible Maturity Date (as defined in the
Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Trustee by manual signature, this Certificate shall not be entitled to
any
benefit under the Agreement, or be valid for any purpose.
IN
WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
|
Dated: _________,
____
|
LASALLE
BANK NATIONAL ASSOCIATION
not
in its individual capacity but solely as Trustee
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class [A-1][A-2][A-3] Certificates referred to in the
within-mentioned Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION
Authorized
signatory of LaSalle Bank National Association, not in its individual
capacity but solely as Trustee
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and
address
including postal zip code of assignee) a Percentage Interest evidenced
by the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of
a like
denomination and Class, to the above named assignee and deliver such 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
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-2
Form
of
Class M Certificates
[For
the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7,
Class M-8, Class M-9 and Class M-10] THIS CERTIFICATE IS SUBORDINATED IN
RIGHT
OF PAYMENT TO THE SENIOR CERTIFICATES [,] [AND] [CLASS M-1 CERTIFICATES]
[,]
[AND] [CLASS M-2 CERTIFICATES] [,] [AND] [CLASS M-3 CERTIFICATES] [,] [AND]
[CLASS M-4 CERTIFICATES] [,] [AND] [CLASS M-5 CERTIFICATES] [,] [AND] [CLASS
M-6
CERTIFICATES] [,] [AND] [CLASS M-7 CERTIFICATES] [,] [AND] [CLASS M-8
CERTIFICATES] [,] [AND] [CLASS M-9 CERTIFICATES] AS DESCRIBED IN THE AGREEMENT
(AS DEFINED BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986 (THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY
THE
PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION SHOWN
BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL
BALANCE BY INQUIRY OF THE TRUSTEE NAMED HEREIN.
[For
the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7,
Class M-8 and Class M-9 Certificates] EACH
HOLDER OF A CERTIFICATE OR BENEFICIAL OWNERSHIP SHALL BE DEEMED TO HAVE
MADE THE
REPRESENTATIONS SET FORTH IN SECTION 6.02(h)
OF THE POOLING AND SERVICING AGREEMENT.
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS 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.
[For
the Class M-10 Certificates]
[THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES
LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS
CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE
MEANING OF RULE 144A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH
CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE
ON
RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE
144
UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO
AN
“INSTITUTIONAL ACCREDITED INVESTOR” WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY
IN WHICH
ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT
BY
THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT
AND
(B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE
TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE
WITH ALL
APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION.]
[For
the
Class M-10 Certificates] [NOTWITHSTANDING
THE PREVIOUS PARAGRAPH, A CERTIFICATION WILL NOT BE REQUIRED WITH RESPECT
TO THE
TRANSFER OF THIS CERTIFICATE TO A DEPOSITORY, OR FOR ANY SUBSEQUENT TRANSFER
OF
THIS CERTIFICATE FOR SO LONG AS THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE WILL BE DEEMED TO HAVE REPRESENTED BY
VIRTUE
OF ITS PURCHASE OR HOLDING OF THIS CERTIFICATE (OR INTEREST HEREIN) THAT
SUCH
TRANSFEREE IS A “QUALIFIED INSTITUTIONAL BUYER” WITHIN THE MEANING OF RULE 144A
UNDER THE 1933 ACT.]
[For
the Class M-10 Certificates]
[THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF
OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT
TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED,
OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, UNLESS THE
TRANSFEREE CERTIFIES OR REPRESENTS THAT THE PROPOSED TRANSFER AND HOLDING
OF A
CERTIFICATE AND THE SERVICING, MANAGEMENT AND OPERATION OF THE TRUST AND
ITS
ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH IS NOT
COVERED
UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION, INCLUDING,
BUT
NOT LIMITED TO PROHIBITED TRANSACTION CLASS EXEMPTION (“PTCE”) 84-14, XXXX
00-00, XXXX 00-0, XXXX 95-60 OR PTCE 96-23 AND (II) WILL NOT GIVE RISE
TO ANY
ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE MASTER SERVICER
OR THE
TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY
CERTIFICATE OR A GLOBAL CERTIFICATE OR UNLESS AN OPINION SPECIFIED IN SECTION
6.02 OF THE AGREEMENT IS PROVIDED.]
|
Certificate
No.1
|
Adjustable
Rate
|
|
Class
M-[1][2][3][4][5][6][7][8][9][10]
Subordinate
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: January 1, 2007
|
Aggregate
Initial Certificate Principal Balance of this Certificate as
of the
Cut-off Date:
$[__________]
|
|
First
Distribution Date:
February
26, 2007
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$[__________]
|
|
Master
Servicer:
EMC
Mortgage Corporation
|
CUSIP:
[_____]
|
|
Last
Scheduled Distribution Date:
December
25, 2036
|
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-AQ1
evidencing
a fractional undivided interest in the distributions allocable to the Class
M-[1][2][3][4][5][6][7][8][9][10] Certificates with respect to a Trust
Fund
consisting primarily of a pool of conventional, closed-end, first lien,
subprime, one- to four-family fixed and adjustable interest rate mortgage
loans
sold by BEAR XXXXXXX ASSET BACKED SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer or the Trustee referred to below or any of their
affiliates or any other person. Neither this Certificate nor the underlying
Mortgage Loans are guaranteed or insured by any governmental entity or
by Bear
Xxxxxxx Asset Backed Securities I LLC, the Master Servicer or the Trustee
or any
of their affiliates or any other person. None of Bear Xxxxxxx Asset Backed
Securities I LLC, the Master Servicer or any of their affiliates will have
any
obligation with respect to any certificate or other obligation secured
by or
payable from payments on the Certificates.
This
certifies that Cede & Co. is the registered owner of the Percentage Interest
evidenced hereby in the beneficial ownership interest of Certificates of
the
same Class as this Certificate in a trust (the “Trust Fund”) generally
consisting of conventional, closed-end, first lien, subprime, fixed and
adjustable rate mortgage loans secured by one- to four- family residences
(collectively, the “Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed
Securities I LLC (“BSABS I”). The Mortgage Loans were sold by EMC Mortgage
Corporation (“EMC”) and Master Funding LLC to BSABS I. EMC will act as master
servicer of the Mortgage Loans (in that capacity, the “Master Servicer,” which
term includes any successors thereto under the Agreement referred to below).
The
Trust Fund was created pursuant to the Pooling and Servicing Agreement,
dated as
of the Cut-off Date specified above (the “Agreement”), among BSABS I, as
depositor (the “Depositor”), EMC Mortgage Corporation, as seller and as Master
Servicer, and LaSalle Bank 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 Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Interest
on this Certificate will accrue from and including the immediately preceding
Distribution Date (or with respect to the First Distribution Date, the
Closing
Date) to and including the day prior to the current Distribution Date on
the
Certificate Principal Balance hereof at a per annum rate equal to the
Pass-Through Rate set forth above. The Trustee will distribute on the 25th
day
of each month, or, if such 25th day is not a Business Day, the immediately
following Business Day (each, a “Distribution Date”), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the Business Day immediately
preceding
such Distribution Date so long as such Certificate remains in book-entry
form
(and otherwise, the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date), an amount equal
to
the product of the Percentage Interest evidenced by this Certificate and
the
amount (of interest and principal, if any) required to be distributed to
the
Holders of Certificates of the same Class as this Certificate. The Assumed
Final
Distribution Date is the Distribution Date in the month following the latest
scheduled maturity date of any Mortgage Loan.
Distributions
on this 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, by wire transfer. Notwithstanding
the
above, the final distribution on this Certificate will be made after due
notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency appointed by
the
Trustee for that purpose and designated in such notice. The initial Certificate
Principal Balance of this Certificate is set forth above. The Certificate
Principal Balance hereof will be reduced to the extent of distributions
allocable to principal hereon and any Realized Losses allocable
hereto
[For
the
Class M-10 Certificate] No
transfer of this Class M-10 Certificate will be made unless such transfer
is (i)
exempt from the registration requirements of the Securities Act of 1933,
as
amended, and any applicable state securities laws or is made in accordance
with
said Act and laws and (ii) made in accordance with Section 6.02 of the
Agreement. In the event that such transfer is to be made the Trustee shall
register such transfer if, (i) made to a transferee who has provided the
Trustee
with evidence as to its QIB status; or (ii) (A) the transferor has advised
the
Trustee in writing that the Certificate is being transferred to an Institutional
Accredited Investor and (B) prior to such transfer the transferee furnishes
to
the Trustee an Investment Letter; provided that if based upon an Opinion
of
Counsel to the effect that (A) and (B) above are not sufficient to confirm
that
such transfer is being made pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act and
other
applicable laws, the Trustee shall as a condition of the registration of
any
such transfer require the transferor to furnish such other certifications,
legal
opinions or other information prior to registering the transfer of this
Certificate as shall be set forth in such Opinion of Counsel.]
[For
the
Class M-10 Certificates] [Notwithstanding the foregoing, the certifications
will
not be required with respect to the transfer of this Certificate to a
Depository, or for any subsequent transfer of this Certificate for so long
as
this Certificate is a Book-Entry Certificate.]
This
Certificate is one of a duly authorized issue of 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
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
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 and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of Certificates evidencing
over 50% of the Voting Rights of the Certificates, or with the consent
of the
Holders of each Class of Certificates affected thereby evidencing over
50% of
the Voting Rights of such Class or Classes, as applicable. Any such consent
by
the Holder of this 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 Certificate is registrable with the Trustee upon surrender
of this Certificate for registration of transfer at the offices or agencies
maintained by the Trustee for such purposes, 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 Certificates in authorized denominations
representing a like aggregate Percentage Interest will be issued to the
designated transferee.
[For
the
Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7,
Class M-8 and Class M-9 Certificates] Each holder of a Certificate or beneficial
ownership shall be deemed to have made the representations set forth in
Section
6.02(h) of the Pooling and Servicing Agreement.
[For
the
Class M-10 Certificates] [This Certificate may not be acquired directly
or
indirectly by, or on behalf of, an employee benefit plan or other retirement
arrangement which is subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended, or Section 4975 of the Internal Revenue
Code
of 1986, as amended, unless the transferee certifies or represents that
the
proposed transfer and holding of a Certificate and the servicing, management
and
operation of the trust and its assets: (i) will not result in any prohibited
transaction which is not covered under an individual or class prohibited
transaction exemption, including, but not limited to, Prohibited Transaction
Class Exemption (“PTCE”) 84-14, XXXX 00-00, XXXX 00-0, XXXX 95-60 or PTCE 96-23
and (ii) will not give rise to any additional obligations on the part of
the
Depositor, the Master Servicer or the Trustee, which will be deemed represented
by an owner of a Book-Entry Certificate or a Global Certificate or unless
an
Opinion of Counsel specified in section 6.02 of the Agreement is provided.
This
Certificate is one of a duly authorized issue of 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
Fund
formed pursuant to the Agreement.]
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the 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
Depositor, the Master Servicer, the Trustee and any agent of any of them
may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Master Servicer,
the
Trustee or any such agent shall be affected by notice to the
contrary.
The
obligations created by the Agreement and the Trust Fund created thereby
(other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all
the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after
the
first Distribution Date on which the aggregate Stated Principal Balance
of the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust created
by
the Agreement continue beyond the earlier of (i) the expiration of 21 years
after the death of certain persons identified in the Agreement and (ii)
the
Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Trustee by manual signature, this Certificate shall not be entitled to
any
benefit under the Agreement, or be valid for any purpose.
IN
WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
|
Dated: _________,
____
|
LASALLE
BANK NATIONAL ASSOCIATION,
not
in its individual capacity but solely as Trustee
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class M-[1][2][3][4][5][6][7][8][9][10] Certificates referred
to in
the within-mentioned Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION
Authorized
signatory of LaSalle Bank National Association, not in its individual
capacity but solely as Trustee
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and
address
including postal zip code of assignee) a Percentage Interest evidenced
by the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of
a like
denomination and Class, to the above named assignee and deliver such 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
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-3
Form
of
Class P Certificate
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986 (THE “CODE”).
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY
THE
PRINCIPAL PAYMENTS HEREON. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE
OF THE
CERTIFICATES, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL
BE
DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE
MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE BY INQUIRY OF THE TRUSTEE
NAMED
HEREIN.
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A (A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN “INSTITUTIONAL ACCREDITED INVESTOR”
WITHIN THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION
D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN
SUCH
PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT,
SUBJECT TO (A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN
THE FORM
PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER
EVIDENCE ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR
TRANSFER
IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN
EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES
AND
ANY OTHER APPLICABLE JURISDICTION.
NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 6.02(h) OF THE AGREEMENT
OR
AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE AND
HOLDING
OF THIS CERTIFICATE ARE PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE
OR
RESULT IN ANY NON-EXEMPT PROHIBITED TRANSACTIONS UNDER SECTION 406 OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION
4975 OF THE CODE AND WILL NOT SUBJECT THE TRUSTEE, MASTER SERVICER OR THE
DEPOSITOR TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN
IN THE
AGREEMENT.
|
Certificate
No.1
|
Percentage
Interest: 100%
|
|
Class
P
|
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date: January
1,
2007
|
Aggregate
Initial Certificate Principal Balance of this Certificate as
of the
Cut-off Date:
$100.00
|
|
First
Distribution Date:
February
26, 2007
|
Initial
Certificate Principal Balance of this Certificate as of the Cut-off
Date:
$100.00
|
|
Master
Servicer:
EMC
Mortgage Corporation
|
CUSIP:
[_____]
|
|
Last
Scheduled Distribution Date:
December
25, 2036
|
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-AQ1
evidencing
a fractional undivided interest in the distributions allocable to the Class
P
Certificates with respect to a Trust Fund consisting primarily of a pool
of
conventional, closed-end, first lien, subprime, one-to-four-family fixed
and
adjustable interest rate mortgage loans sold by BEAR XXXXXXX ASSET BACKED
SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer or the Trustee referred to below or any of their
affiliates or any other person. Neither this Certificate nor the underlying
Mortgage Loans are guaranteed or insured by any governmental entity or
by Bear
Xxxxxxx Asset Backed Securities I LLC, the Master Servicer or the Trustee
or any
of their affiliates or any other person. None of Bear Xxxxxxx Asset Backed
Securities I LLC, the Master Servicer or any of their affiliates will have
any
obligation with respect to any certificate or other obligation secured
by or
payable from payments on the Certificates.
This
certifies that Bear, Xxxxxxx Securities Corp. is the registered owner of
the
Percentage Interest evidenced hereby in the beneficial ownership interest
of
Certificates of the same Class as this Certificate in a trust (the “Trust Fund”)
generally consisting of conventional, closed-end, first lien, subprime,
fixed
and adjustable rate mortgage loans secured by one- to four-family residences
(collectively, the “Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed
Securities I LLC (“BSABS I”). The Mortgage Loans were sold by EMC Mortgage
Corporation (“EMC”) and Master Funding LLC (“Master Funding LLC”, and together
with EMC, the “Sellers”) to BSABS I. EMC will act as master servicer of the
Mortgage Loans (in that capacity, the “Master Servicer,” which term includes any
successors thereto under the Agreement referred to below). The Trust Fund
was
created pursuant to the Pooling and Servicing Agreement, dated as of the
Cut-off
Date specified above (the “Agreement”), among BSABS I, as depositor (the
“Depositor”), EMC Mortgage Corporation, as seller and as Master Servicer, and
LaSalle Bank 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 Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
The
Trustee will distribute on the 25th day of each month, or, if such 25th
day is
not a Business Day, the immediately following Business Day (each, a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close
of
business on the last day (or if such last day is not a Business Day, the
Business Day immediately preceding such last day) of the calendar month
immediately preceding the month in which the Distribution Date occurs,
an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate.
Distributions
on this 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, by wire transfer. Notwithstanding
the
above, the final distribution on this Certificate will be made after due
notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency appointed by
the
Trustee for that purpose and designated in such notice.
No
transfer of this Certificate shall be made unless the transfer is made
pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does
not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Trustee shall require receipt of (i) if such transfer is purportedly being
made
in reliance upon Rule 144A under the 1933 Act, written certifications from
the
Holder of the Certificate desiring to effect the transfer, and from such
Holder’s prospective transferee, substantially in the forms attached to the
Agreement as Exhibit D and either Exhibit E or Exhibit F, as applicable,
and
(ii) in all other cases, an Opinion of Counsel satisfactory to it that
such
transfer may be made without such registration or qualification (which
Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor,
the
Trustee or the Master Servicer in their respective capacities as such),
together
with copies of the written certification(s) of the Holder of the Certificate
desiring to effect the transfer and/or such Holder’s prospective transferee upon
which such Opinion of Counsel is based. Neither the Depositor nor the Trustee
is
obligated to register or qualify the Class of Certificates specified on
the face
hereof under the 1933 Act or any other securities law or to take any action
not
otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any Holder desiring
to
effect a transfer of this Certificate shall be required to indemnify the
Trustee, the Depositor, the Sellers and the Master Servicer against any
liability that may result if the transfer is not so exempt or is not made
in
accordance with such federal and state laws.
No
transfer of this Class P Certificate will be made unless either (i) the
Trustee
shall have received the Opinion of Counsel set forth in Section 6.02(h)
of the
Agreement or (ii) the transferee of such Certificate provides a representation,
or a deemed representation in the case of a Global Certificate, under Section
6.02(h) of the Agreement, in the form as described by the Agreement, to
the
effect that the transferee is not an employee benefit or other plan subject
to
the prohibited transaction provisions of ERISA or Section 4975 of the Code
(a
“Plan”), or any other person (including an investment manager, a named fiduciary
or a trustee of any Plan) acting, directly or indirectly, on behalf of
or
purchasing any Certificate with “plan assets” of any Plan.
This
Certificate is one of a duly authorized issue of 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
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
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 and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of Certificates evidencing
over 50% of the Voting Rights of the Certificates, or with the consent
of the
Holders of each Class of Certificates affected thereby evidencing over
50% of
the Voting Rights of such Class or Classes, as applicable. Any such consent
by
the Holder of this 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 Certificate is registrable with the Trustee upon surrender
of this Certificate for registration of transfer at the offices or agencies
maintained by the Trustee for such purposes, 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 Certificates in authorized denominations
representing a like aggregate Percentage Interest will be issued to the
designated transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the 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
Depositor, the Master Servicer, the Trustee and any agent of any of them
may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Master Servicer,
the
Trustee or any such agent shall be affected by notice to the
contrary.
The
obligations created by the Agreement and the Trust Fund created thereby
(other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all
the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after
the
first Distribution Date on which the aggregate Stated Principal Balance
of the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust created
by
the Agreement continue beyond the earlier of (i) the expiration of 21 years
after the death of certain persons identified in the Agreement and (ii)
the
Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Trustee by manual signature, this Certificate shall not be entitled to
any
benefit under the Agreement, or be valid for any purpose.
IN
WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
|
Dated: _________,
____
|
LASALLE
BANK NATIONAL ASSOCIATION,
not
in its individual capacity but solely as Trustee
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class P Certificates referred to in the within-mentioned
Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION
Authorized
signatory of LaSalle Bank National Association, not in its individual
capacity but solely as Trustee
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and
address
including postal zip code of assignee) a Percentage Interest evidenced
by the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of
a like
denomination and Class, to the above named assignee and deliver such 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
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-4
Form
of
Class CE Certificates
THIS
CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES
AND
THE CLASS M CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DEFINED
BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A “REGULAR
INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE OF
1986 (THE “CODE”).
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE
MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE
WITH
THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE
144A
UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A (A
“QIB”), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF
A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT
TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF
AVAILABLE) OR (3) IN CERTIFICATED FORM TO AN “INSTITUTIONAL ACCREDITED INVESTOR”
WITHIN THE MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION
D
UNDER THE ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN
SUCH
PARAGRAPHS PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT,
SUBJECT TO (A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN
THE FORM
PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER
EVIDENCE ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR
TRANSFER
IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN
EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES
AND
ANY OTHER APPLICABLE JURISDICTION.
NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 6.02(h) OF THE AGREEMENT
OR
AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE AND
HOLDING
OF THIS CERTIFICATE ARE PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE
OR
RESULT IN ANY NON-EXEMPT PROHIBITED TRANSACTIONS UNDER SECTION 406 OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION
4975 OF THE CODE AND WILL NOT SUBJECT THE TRUSTEE, MASTER SERVICER OR THE
DEPOSITOR TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN
IN THE
AGREEMENT.
NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE PROPOSED TRANSFEREE
OF
SUCH CERTIFICATE (1) PROVIDES TO THE TRUSTEE THE APPROPRIATE TAX CERTIFICATION
FORM THAT WOULD ELIMINATE ANY WITHHOLDING OR DEDUCTION FOR TAXES FROM AMOUNTS
PAYABLE BY THE SWAP PROVIDER, PURSUANT TO THE SWAP AGREEMENT, TO THE SWAP
ADMINISTRATOR ON BEHALF OF THE SUPPLEMENTAL INTEREST TRUST (I.E., IRS FORM
W-9
OR IRS FORM W-8BEN, W-8IMY, W-8EXP OR W-8ECI, AS APPLICABLE (OR ANY SUCCESSOR
FORM THERETO), TOGETHER WITH ANY APPLICABLE ATTACHMENTS) AND (2) AGREES
TO
UPDATE SUCH FORM (A) UPON EXPIRATION OF ANY SUCH FORM, (B) AS REQUIRED
UNDER
THEN APPLICABLE U.S. TREASURY REGULATIONS AND (C) PROMPTLY UPON LEARNING
THAT
SUCH FORM HAS BECOME OBSOLETE OR INCORRECT, EACH AS A CONDITION TO SUCH
TRANSFER. IN ADDITION, NO TRANSFER OF THIS CERTIFICATE SHALL BE MADE IF
SUCH
TRANSFER WOULD CAUSE THE SUPPLEMENTAL INTEREST TRUST TO BE BENEFICIALLY
OWNED BY
TWO OR MORE PERSONS FOR FEDERAL INCOME TAX PURPOSES, OR CONTINUE TO BE
SO
TREATED, UNLESS (I) EACH PROPOSED TRANSFEREE OF SUCH CERTIFICATE COMPLIES
WITH
THE FOREGOING CONDITIONS, (II) THE PROPOSED MAJORITY HOLDER OF THE CLASS
CE
CERTIFICATES (OR EACH HOLDER, IF THERE IS OR WOULD BE NO MAJORITY HOLDER)
(X)
PROVIDES, OR CAUSES TO BE PROVIDED, ON BEHALF OF THE SUPPLEMENTAL INTEREST
TRUST, IF APPLICABLE, TO THE TRUSTEE, THE APPROPRIATE TAX CERTIFICATION
FORM
THAT WOULD BE REQUIRED FROM THE SUPPLEMENTAL INTEREST TRUST TO ELIMINATE
ANY
WITHHOLDING OR DEDUCTION FOR TAXES FROM AMOUNTS PAYABLE BY THE SWAP PROVIDER,
PURSUANT TO THE SWAP AGREEMENT, TO THE SWAP ADMINISTRATOR ON BEHALF OF
THE
SUPPLEMENTAL INTEREST TRUST (I.E., IRS FORM W-9 OR IRS FORM W-8BEN, W-8IMY,
W-8EXP OR W-8ECI, AS APPLICABLE (OR ANY SUCCESSOR FORM THERETO), TOGETHER
WITH
ANY APPLICABLE ATTACHMENTS) AND (III) AGREES TO UPDATE SUCH FORM (A) UPON
EXPIRATION OF SUCH FORM, (B) AS REQUIRED UNDER THEM APPLICABLE U.S. TREASURY
REGULATIONS AND (C) PROMPTLY UPON LEARNING THAT SUCH FORM HAS BECOME OBSOLETE
OR
INCORRECT. UNDER THE AGREEMENT, UPON RECEIPT OF ANY TAX CERTIFICATION FORM
PURSUANT TO THESE TRANSFER RESTRICTIONS FROM A HOLDER OF THIS CERTIFICATE,
THE
TRUSTEE SHALL FORWARD SUCH TAX CERTIFICATION FORM TO THE SUPPLEMENTAL INTEREST
TRUST TRUSTEE. THE SUPPLEMENTAL INTEREST TRUST TRUSTEE SHALL FORWARD SUCH
TAX
CERTIFICATION FORM PROVIDED TO IT TO THE SWAP PROVIDER. EACH HOLDER OF
THIS
CERTIFICATE AND EACH TRANSFEREE THEREOF SHALL BE DEEMED TO HAVE CONSENTED
TO THE
SUPPLEMENTAL INTEREST TRUST TRUSTEE FORWARDING TO THE SWAP PROVIDER ANY
TAX
CERTIFICATION FORM IT HAS PROVIDED AND UPDATED IN ACCORDANCE WITH THESE
TRANSFER
RESTRICTIONS. ANY PURPORTED SALES OR TRANSFERS OF THIS CERTIFICATE TO A
TRANSFEREE WHICH DOES NOT COMPLY WITH THESE REQUIREMENTS SHALL BE DEEMED
NULL
AND VOID UNDER THE AGREEMENT.
|
Certificate
No. 1
|
Percentage
Interest: 100%
|
|
Class
CE
|
Adjustable
Rate
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: January 1, 2007
|
Initial
Certificate Notional Amount of this Certificate as of the Cut-off
Date:
$[__________]
|
|
First
Distribution Date:
February
26, 2007
|
Aggregate
Certificate Notional Amount of this Certificate as of the Cut-off
Date:
$[__________]
|
|
Master
Servicer:
EMC
Mortgage Corporation
|
CUSIP:
[_____]
|
|
Last
Scheduled Distribution Date:
December
25, 2036
|
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-AQ1
evidencing
a fractional undivided interest in the distributions allocable to the Class
CE
Certificates with respect to a Trust Fund consisting primarily of a pool
of
conventional, closed-end, first lien, subprime, one-to-four family fixed
and
adjustable interest rate mortgage loans sold by BEAR XXXXXXX ASSET BACKED
SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer or the Trustee referred to below or any of their
affiliates or any other person. Neither this Certificate nor the underlying
Mortgage Loans are guaranteed or insured by any governmental entity or
by Bear
Xxxxxxx Asset Backed Securities I LLC, the Master Servicer or the Trustee
or any
of their affiliates or any other person. None of Bear Xxxxxxx Asset Backed
Securities I LLC, the Master Servicer or any of their affiliates will have
any
obligation with respect to any certificate or other obligation secured
by or
payable from payments on the Certificates.
This
certifies that Bear, Xxxxxxx Securities Corp. is the registered owner of
the
Percentage Interest evidenced hereby in the beneficial ownership interest
of
Certificates of the same Class as this Certificate in a trust (the “Trust Fund”)
generally consisting conventional, closed-end, first lien, fixed and adjustable
rate mortgage loans secured by one- to four-family residences (collectively,
the
“Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed Securities I LLC (“BSABS
I”). The Mortgage Loans were sold by EMC Mortgage Corporation (“EMC”) and Master
Funding LLC (“Master Funding LLC”, and together with EMC, the “Sellers”) to
BSABS I. EMC will act as master servicer of the Mortgage Loans (in that
capacity, the “Master Servicer,” which term includes any successors thereto
under the Agreement referred to below). The Trust Fund was created pursuant
to
the Pooling and Servicing Agreement, dated as of the Cut-off Date specified
above (the “Agreement”), among BSABS I, as depositor (the “Depositor”), EMC
Mortgage Corporation, as seller and as Master Servicer, and LaSalle Bank
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 Certificate by virtue of its acceptance hereof assents and by which
such
Holder is bound.
The
Trustee will distribute on the 25th day of each month, or, if such 25th
day is
not a Business Day, the immediately following Business Day (each, a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close
of
business on the last day (or if such last day is not a Business Day, the
Business Day immediately preceding such last day) of the calendar month
immediately preceding the month in which the Distribution Date occurs,
an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate.
Distributions
on this 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, by wire transfer. Notwithstanding
the
above, the final distribution on this Certificate will be made after due
notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency appointed by
the
Trustee for that purpose and designated in such notice.
No
transfer of this Certificate shall be made unless the transfer is made
pursuant
to an effective registration statement under the Securities Act of 1933,
as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does
not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Trustee shall require receipt of (i) if such transfer is purportedly being
made
in reliance upon Rule 144A under the 1933 Act, written certifications from
the
Holder of the Certificate desiring to effect the transfer, and from such
Holder’s prospective transferee, substantially in the forms attached to the
Agreement as Exhibit D and either Exhibit E or Exhibit F, as applicable,
and
(ii) in all other cases, an Opinion of Counsel satisfactory to it that
such
transfer may be made without such registration or qualification (which
Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor,
the
Trustee, or the Master Servicer in their respective capacities as such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. Neither the Depositor
nor the Trustee is obligated to register or qualify the Class of Certificates
specified on the face hereof under the 1933 Act or any other securities
law or
to take any action not otherwise required under the Agreement to permit
the
transfer of such Certificates without registration or qualification. Any
Holder
desiring to effect a transfer of this Certificate shall be required to
indemnify
the Trustee, the Depositor, the Sellers and the Master Servicer against
any
liability that may result if the transfer is not so exempt or is not made
in
accordance with such federal and state laws.
No
transfer of this Class CE Certificate will be made unless either (i) the
Trustee
shall have received the Opinion of Counsel set forth in Section 6.02(h)
of the
Agreement or (ii) the transferee of such Certificate provides a representation,
or a deemed representation in the case of a Global Certificate, under Section
6.02(h) of the Agreement, in the form as described by the Agreement, to
the
effect that the transferee is not an employee benefit or other plan subject
to
the prohibited transaction provisions of ERISA or Section 4975 of the Code
(a
“Plan”), or any other person (including an investment manager, a named fiduciary
or a trustee of any Plan) acting, directly or indirectly, on behalf of
or
purchasing any Certificate with “plan assets” of any Plan.
This
Certificate is one of a duly authorized issue of 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
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
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 and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of Certificates evidencing
over 50% of the Voting Rights of the Certificates, or with the consent
of the
Holders of each Class of Certificates affected thereby evidencing over
50% of
the Voting Rights of such Class or Classes, as applicable. Any such consent
by
the Holder of this 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 Certificate is registrable with the Trustee upon surrender
of this Certificate for registration of transfer at the offices or agencies
maintained by the Trustee for such purposes, 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 Certificates in authorized denominations
representing a like aggregate Percentage Interest will be issued to the
designated transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the 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
Depositor, the Master Servicer, the Trustee and any agent of any of them
may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Master Servicer,
the
Trustee or any such agent shall be affected by notice to the
contrary.
The
obligations created by the Agreement and the Trust Fund created thereby
(other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all
the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after
the
first Distribution Date on which the aggregate Stated Principal Balance
of the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust created
by
the Agreement continue beyond the earlier of (i) the expiration of 21 years
after the death of certain persons identified in the Agreement and (ii)
the
Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Trustee by manual signature, this Certificate shall not be entitled to
any
benefit under the Agreement, or be valid for any purpose.
IN
WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
|
Dated: _________,
____
|
LASALLE
BANK NATIONAL ASSOCIATION,
not
in its individual capacity but solely as Trustee
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class CE Certificates referred to in the within-mentioned
Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION
Authorized
signatory of LaSalle Bank National Association, not in its individual
capacity but solely as Trustee
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and
address
including postal zip code of assignee) a Percentage Interest evidenced
by the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of
a like
denomination and Class, to the above named assignee and deliver such 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
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
A-5
Form
of
Class R Certificates
THIS
CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A NON-UNITED STATES PERSON
OR A
DISQUALIFIED ORGANIZATION (AS DEFINED BELOW).
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “RESIDUAL INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986
(THE “CODE”).
NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION 6.02(h) OF THE AGREEMENT
OR
AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE AND
HOLDING
OF THIS CERTIFICATE ARE PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT CONSTITUTE
OR
RESULT IN ANY NON-EXEMPT PROHIBITED TRANSACTIONS UNDER SECTION 406 OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION
4975 OF THE CODE AND WILL NOT SUBJECT THE TRUSTEE, MASTER SERVICER OR THE
DEPOSITOR TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE UNDERTAKEN
IN THE
AGREEMENT.
ANY
RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF
THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE MASTER SERVICER
AND
THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY
STATE OR
POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE UNITED STATES, OR
ANY
AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN INSTRUMENTALITY
WHICH IS A CORPORATION IF ALL OF ITS ACTIVITIES ARE SUBJECT TO TAX AND
EXCEPT
FOR XXXXXXX MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT SELECTED BY
SUCH
GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION,
OR
ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING, (C) ANY ORGANIZATION
(OTHER THAN CERTAIN FARMERS’ COOPERATIVES DESCRIBED IN SECTION 521 OF THE CODE)
WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE (INCLUDING
THE TAX IMPOSED BY SECTION 511 OF THE CODE ON UNRELATED BUSINESS TAXABLE
INCOME), (D) RURAL ELECTRIC AND TELEPHONE COOPERATIVES DESCRIBED IN SECTION
1381(a)(2)(C) OF THE CODE, (E) AN ELECTING LARGE PARTNERSHIP UNDER SECTION
775(a) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES
(A), (B),
(C), (D) OR (E) BEING HEREIN REFERRED TO AS A “DISQUALIFIED ORGANIZATION”), OR
(F) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) SUCH TRANSFEREE IS A UNITED
STATES PERSON UNDER SECTION 7701 OF THE CODE, (3) NO PURPOSE OF SUCH TRANSFER
IS
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (4) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE
TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER
AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS
ON THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
|
Certificate
No.1
|
|
|
Class
[R-1][R-2][R-3][RX]
|
Percentage
Interest: 100%
|
|
Date
of Pooling and Servicing Agreement and Cut-off Date: January
1,
2007
|
|
|
First
Distribution Date:
February
26, 2007
|
|
|
Master
Servicer:
EMC
Mortgage Corporation
|
CUSIP:
[_____]
|
|
Last
Scheduled Distribution Date:
December
25, 2036
|
|
ASSET-BACKED
CERTIFICATE
SERIES
2007-AQ1
evidencing
a fractional undivided interest in the distributions allocable to the Class
[R-1][R-2][R-3][RX] Certificates with respect to a Trust Fund consisting
primarily of a pool of conventional, closed-end, first lien, subprime,
one- to
four-family fixed and adjustable interest rate mortgage loans sold by BEAR
XXXXXXX ASSET BACKED SECURITIES I LLC.
This
Certificate is payable solely from the assets of the Trust Fund, and does
not
represent an obligation of or interest in Bear Xxxxxxx Asset Backed Securities
I
LLC, the Master Servicer or the Trustee referred to below or any of their
affiliates or any other person. Neither this Certificate nor the underlying
Mortgage Loans are guaranteed or insured by any governmental entity or
by Bear
Xxxxxxx Asset Backed Securities I LLC, the Master Servicer, the Trustee
or any
of their affiliates or any other person. None of Bear Xxxxxxx Asset Backed
Securities I LLC, the Master Servicer or any of their affiliates will have
any
obligation with respect to any certificate or other obligation secured
by or
payable from payments on the Certificates.
This
certifies that Bear, Xxxxxxx Securities Corp. is the registered owner of
the
Percentage Interest evidenced hereby in the beneficial ownership interest
of
Certificates of the same Class as this Certificate in a trust (the “Trust Fund”)
generally consisting of conventional, closed-end, first lien, subprime,
fixed
and adjustable rate mortgage loans secured by one- to four- family residences
(collectively, the “Mortgage Loans”) sold by Bear Xxxxxxx Asset Backed
Securities I LLC (“BSABS I”). The Mortgage Loans were sold by EMC Mortgage
Corporation (“EMC”) and Master Funding LLC to BSABS I. EMC will act as master
servicer of the Mortgage Loans (in that capacity, the “Master Servicer,” which
term includes any successors thereto under the Agreement referred to below).
The
Trust Fund was created pursuant to the Pooling and Servicing Agreement,
dated as
of the Cut-off Date specified above (the “Agreement”), among BSABS I, as
depositor (the “Depositor”), EMC Mortgage Corporation, as seller and as Master
Servicer, and LaSalle Bank 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 Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Each
Holder of this Certificate will be deemed to have agreed to be bound by
the
restrictions
set forth in the Agreement to the effect that (i) each person holding or
acquiring any Ownership Interest in this Certificate must be a Permitted
Transferee, (ii) the transfer of any Ownership Interest in this Certificate
will
be conditioned upon the delivery to the Trustee of, among other things,
an
affidavit to the effect that it is a Permitted Transferee, (iii) any attempted
or purported transfer of any Ownership Interest in this Certificate in
violation
of such restrictions will be absolutely null and void and will vest no
rights in
the purported transferee, and (iv) if any person other than a Permitted
Transferee acquires any Ownership Interest in this Certificate in violation
of
such restrictions, then the Depositor will have the right, in its sole
discretion and without notice to the Holder of this Certificate, to sell
this
Certificate to a purchaser selected by the Depositor, which purchaser may
be the
Depositor, or any affiliate of the Depositor, on such terms and conditions
as
the Depositor may choose.
The
Trustee will distribute on the 25th day of each month, or, if such 25th
day is
not a Business Day, the immediately following Business Day (each, a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered at the close
of
business on the last day (or if such last day is not a Business Day, the
Business Day immediately preceding such last day) of the calendar month
immediately preceding the month in which the Distribution Date occurs,
an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amounts required to be distributed to the Holders of Certificates
of the
same Class as this Certificate.
Distributions
on this 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, by wire transfer. Notwithstanding
the
above, the final distribution on this Certificate will be made after due
notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Certificate at the office or agency appointed by
the
Trustee for that purpose and designated in such notice.
No
transfer of this Class [R-1][ R-2][R-3][RX] Certificate will be made unless
either (i) the Trustee shall have received the Opinion of Counsel set forth
in
Section 6.02(h) of the Agreement or (ii) the transferee of such Certificate
provides a representation, or a deemed representation in the case of a
Global
Certificate, under Section 6.02(h) of the Agreement, in the form as described
by
the Agreement, to the effect that the transferee is not an employee benefit
or
other plan subject to the prohibited transaction provisions of ERISA or
Section
4975 of the Code (a “Plan”), or any other person (including an investment
manager, a named fiduciary or a trustee of any Plan) acting, directly or
indirectly, on behalf of or purchasing any Certificate with “plan assets” of any
Plan.
This
Certificate is one of a duly authorized issue of 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
Fund
formed pursuant to the Agreement.
The
Certificateholder, by its acceptance of this Certificate, agrees that it
will
look solely to the Trust Fund for payment hereunder and that the Trustee
is not
liable to the Certificateholders for any amount payable under this Certificate
or the Agreement or, except as expressly provided in the Agreement, subject
to
any liability under the Agreement.
This
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 and obligations of the Depositor
and
the rights of the Certificateholders under the Agreement from time to time
by
the parties thereto with the consent of the Holders of Certificates evidencing
over 50% of the Voting Rights of the Certificates, or with the consent of the
Holders of each Class of Certificates affected thereby evidencing over
50% of
the Voting Rights of such Class or Classes, as applicable. Any such consent
by
the Holder of this 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 Certificate is registrable with the Trustee upon surrender
of this Certificate for registration of transfer at the offices or agencies
maintained by the Trustee for such purposes, 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 Certificates in authorized denominations
representing a like aggregate Percentage Interest will be issued to the
designated transferee.
The
Certificates are issuable only as registered Certificates without coupons
in the
Classes and denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, this Certificate
is exchangeable for one or more new Certificates evidencing the same Class
and
in the same aggregate Percentage Interest, as requested by the Holder
surrendering the same.
No
service charge will be made to the 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
Depositor, the Master Servicer, the Trustee and any agent of any of them
may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of Depositor, the Master Servicer, the
Trustee
or any such agent shall be affected by notice to the contrary.
The
obligations created by the Agreement and the Trust Fund created thereby
(other
than the obligations to make payments to Certificateholders with respect
to the
termination of the Agreement) shall terminate upon the earlier of (i) the
later
of (A) the maturity or other liquidation (or Advance with respect thereto)
of
the last Mortgage Loan remaining in the Trust Fund and disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and (B) the remittance of all funds due under the Agreement,
or
(ii) the optional repurchase by the party named in the Agreement of all
the
Mortgage Loans and other assets of the Trust Fund in accordance with the
terms
of the Agreement. Such optional repurchase may be made only on or after
the
first Distribution Date on which the aggregate Stated Principal Balance
of the
Mortgage Loans is less than or equal to a certain percentage of the aggregate
Stated Principal Balance of the Mortgage Loans as of the Cut-off Date as
set
forth in the Agreement. The exercise of such right will effect the early
retirement of the Certificates. In no event, however, will the Trust created
by
the Agreement continue beyond the earlier of (i) the expiration of 21 years
after the death of certain persons identified in the Agreement and (ii)
the
Latest Possible Maturity Date (as defined in the Agreement).
Unless
this Certificate has been countersigned by an authorized signatory of the
Trustee by manual signature, this Certificate shall not be entitled to
any
benefit under the Agreement, or be valid for any purpose.
IN
WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
|
Dated: _________,
____
|
LASALLE
BANK NATIONAL ASSOCIATION,
not
in its individual capacity but solely as Trustee
|
||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class [R-1][R-2][R-3][RX] Certificates referred to in the
within-mentioned Agreement.
|
LASALLE
BANK NATIONAL ASSOCIATION
Authorized
signatory of LaSalle Bank National Association, not in its individual
capacity but solely as Trustee
|
|||||||||||||
|
By:
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
ASSIGNMENT
FOR
VALUE
RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
__________________________________ (Please print or typewrite name and
address
including postal zip code of assignee) a Percentage Interest evidenced
by the
within Asset-Backed Certificate and hereby authorizes the transfer of
registration of such interest to assignee on the Certificate Register of
the
Trust Fund.
I
(We)
further direct the Certificate Registrar to issue a new Certificate of
a like
denomination and Class, to the above named assignee and deliver such 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
|
|||||||
|
for
the account of
|
|||||||
|
account
number
|
or,
if mailed by check, to
|
||||||
|
Applicable
statements should be mailed to
|
|||||||
|
This
information is provided by
|
|||||||
|
assignee
named above, or
|
|||||||
|
its
agent.
|
|||||||
EXHIBIT
B
MORTGAGE
LOAN SCHEDULE
MLS
HERE
EXHIBIT
C
FORM
OF
TRANSFER AFFIDAVIT
Affidavit
pursuant to Section 860E(e)(4) of the Internal Revenue Code of 1986, as
amended,
and for other purposes
|
STATE
OF
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF
|
)
|
[NAME
OF
OFFICER], being first duly sworn, deposes and says:
1. That
he/she is [Title of Officer] of [Name of Investor] (the “Investor”), a [savings
institution] [corporation] duly organized and existing under the laws of
[the
State of _____] [the United States], on behalf of which he makes this
affidavit.
2. That
(i)
the Investor is not a “disqualified organization” as defined in Section
860E(e)(5) of the Internal Revenue Code of 1986, as amended (the “Code”), or an
electing large partnership as defined in Section 775(a) of the Code, and
will
not be a disqualified organization or an electing large partnership as
of
[Closing Date] [date of purchase]; (ii) it is not acquiring the Bear Xxxxxxx
Asset Backed Securities I LLC, Asset-Backed Certificates, Series 2007-AQ1,
Class
[R-1][R-2][R-3][RX] Certificates (the “Residual Certificates”) for the account
of a disqualified organization or an electing large partnership; (iii)
it
consents to any amendment of the Pooling and Servicing Agreement that shall
be
deemed necessary by Bear Xxxxxxx Asset Backed Securities I LLC (upon advice
of
counsel) to constitute a reasonable arrangement to ensure that the Residual
Certificates will not be owned directly or indirectly by a disqualified
organization or an electing large partnership; and (iv) it will not transfer
such Residual Certificates unless (a) it has received from the transferee
an
affidavit in substantially the same form as this affidavit containing these
same
seven representations and (b) as of the time of the transfer, it does not
have
actual knowledge that such affidavit is false.
3. That
the
Investor is one of the following: (i) a citizen or resident of the United
States, (ii) a corporation or partnership (including an entity treated
as a
corporation or partnership for federal income tax purposes) created or
organized
in, or under the laws of, the United States or any state thereof or the
District
of Columbia (except, in the case of a partnership, to the extent provided
in
regulations), provided that no partnership or other entity treated as a
partnership for United States federal income tax purposes shall be treated
as a
United States person within the meaning of the Code unless all persons
that own
an interest in such partnership either directly or through any entity that
is
not a corporation for United States federal income tax purposes are United
States persons, (iii) an estate whose income is subject to United States
federal
income tax regardless of its source, or (iv) a trust other than a “foreign
trust” as defined in Section 7701 (a)(31) of the Code.
4. That
the
Investor’s taxpayer identification number is
______________________.
5. That
no
purpose of the acquisition of the Residual Certificates is to avoid or
impede
the assessment or collection of tax.
6. That
the
Investor understands that, as the holder of the Residual Certificates,
the
Investor may incur tax liabilities in excess of any cash flows generated
by such
Residual Certificates.
7. That
the
Investor intends to pay taxes associated with holding the Residual Certificates
as they become due.
IN
WITNESS WHEREOF, the Investor has caused this instrument to be executed
on its
behalf, pursuant to authority of its Board of Directors, by its [Title
of
Officer] this ____ day of _________, 20__.
|
[NAME
OF INVESTOR]
|
||||||||||||
|
By:
|
||||||||||||
|
Name:
|
[Name
of Officer]
|
|||||||||||
|
Title:
|
[Title
of Officer]
|
|||||||||||
|
[Address
of Investor for receipt of distributions]
|
||||||||||||
|
Address
of Investor for receipt of tax
information:
|
||||||||||||
Personally
appeared before me the above-named [Name of Officer], known or proved to
me to
be the same person who executed the foregoing instrument and to be the
[Title of
Officer] of the Investor, and acknowledged to me that he/she executed the
same
as his/her free act and deed and the free act and deed of the
Investor.
Subscribed
and sworn before me this ___ day of _________, 20___.
NOTARY
PUBLIC
COUNTY
OF
STATE
OF
My
commission expires the ___ day of ___________________, 20___.
EXHIBIT
D
FORM
OF
TRANSFEROR CERTIFICATE
______________,
200___
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attention:
Bear Xxxxxxx Asset Backed Securities Trust 2007-AQ1
|
Re:
|
Bear
Xxxxxxx Asset Backed Securities I Trust 2007-AQ1,
Asset-Backed
Certificates,
Series 2007-AQ1 (the “Certificates”), including the Class ___
Certificates
(the “Privately Offered
Certificates”)
|
Ladies
and Gentlemen:
In
connection with the sale by ___________ (the “Seller”) to ________ (the
“Purchaser”) of $_________ Initial Certificate Principal Balance of Asset-Backed
Certificates, Series 2007-AQ1, Class _____ (the “Certificates”), issued pursuant
to the Pooling and Servicing Agreement (the “Pooling and Servicing Agreement”),
dated as of January 1, 2007, among Bear Xxxxxxx Asset Backed Securities
I LLC,
as depositor (the “Depositor”), EMC Mortgage Corporation, as seller and as
master servicer, and LaSalle Bank National Association, as trustee (the
“Trustee”). The Seller hereby certifies, represents and warrants to, a covenants
with, the Depositor and the Trustee that:
Neither
the Seller nor anyone acting on its behalf (a) has offered, pledged, sold,
disposed of or otherwise transferred any Certificate, any interest in any
Certificate or any other similar security to any person in any manner,
(b) has
solicited any offer to buy or to accept a pledge, disposition or other
transfer
of any Certificate, any interest in any Certificate or any other similar
security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate
or
any other similar security with any person in any manner, (d) has made
any
general solicitation by means of general advertising or in any other manner,
or
(e) has taken any other action, that (as to any of (a) through (e) above)
would
constitute a distribution of the Certificates under the Securities Act
of 1933
(the “Act”), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Seller will not act
in any
manner set forth in the foregoing sentence with respect to any Certificate.
The
Seller has not and will not sell or otherwise transfer any of the Certificates,
except in compliance with the provisions of the Pooling and Servicing
Agreement.
|
Very
truly yours,
|
||||||||
|
___________________________________________
|
||||||||
|
(Seller)
|
||||||||
|
By:
|
||||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
EXHIBIT
E
FORM
OF
INVESTMENT LETTER (NON RULE 144A)
[Date]
[SELLER]
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
Re:
|
Bear
Xxxxxxx Asset Backed Securities I Trust 2007-AQ1,
Asset-Backed
Certificates,
Series 2007-AQ1 (the “Certificates”), including the Class ___
Certificates
(the “Privately Offered
Certificates”)
|
Dear
Ladies and Gentlemen:
In
connection with our purchase of Privately Offered Certificates, we confirm
that:
|
(i)
|
we
understand that the Privately Offered Certificates are not being
registered under the Securities Act of 1933, as amended (the
“Act”) or any
applicable state securities or “Blue Sky” laws, and are being sold to us
in a transaction that is exempt from the registration requirements
of such
laws;
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(ii)
|
any
information we desired concerning the Certificates, including
the
Privately Offered Certificates, the trust in which the Certificates
represent the entire beneficial ownership interest (the “Trust”) or any
other matter we deemed relevant to our decision to purchase Privately
Offered Certificates has been made available to us;
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(iii)
|
we
are able to bear the economic risk of investment in Privately
Offered
Certificates; we are an institutional “accredited investor” as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated under
the Act
and a sophisticated institutional investor;
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(iv)
|
we
are acquiring Privately Offered Certificates for our own account,
not as
nominee for any other person, and not with a present view to
any
distribution or other disposition of the Privately Offered
Certificates;
|
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|
(v)
|
we
agree the Privately Offered Certificates must be held indefinitely
by us
(and may not be sold, pledged, hypothecated or in any way disposed
of)
unless subsequently registered under the Act and any applicable
state
securities or “Blue Sky” laws or an exemption from the registration
requirements of the Act and any applicable state securities or
“Blue Sky”
laws is available;
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(vi)
|
we
agree that in the event that at some future time we wish to dispose
of or
exchange any of the Privately Offered Certificates (such disposition
or
exchange not being currently foreseen or contemplated), we will
not
transfer or exchange any of the Privately Offered Certificates
unless:
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(A)
(1) the sale is to an Eligible Purchaser (as defined below),
(2) if
required by the Pooling and Servicing Agreement (as defined below)
a
letter to substantially the same effect as either this letter
or, if the
Eligible Purchaser is a Qualified Institutional Buyer as defined
under
Rule 144A of the Act, the Rule 144A and Related Matters Certificate
in the
form attached to the Pooling and Servicing Agreement (as defined
below)
(or such other documentation as may be acceptable to the Trustee)
is
executed promptly by the purchaser and delivered to the addressees
hereof
and (3) all offers or solicitations in connection with the sale,
whether
directly or through any agent acting on our behalf, are limited
only to
Eligible Purchasers and are not made by means of any form of
general
solicitation or general advertising whatsoever; and
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(B)
if the Privately Offered Certificate is not registered under
the Act (as
to which we acknowledge you have no obligation), the Privately
Offered
Certificate is sold in a transaction that does not require registration
under the Act and any applicable state securities or “blue sky” laws and,
if LaSalle Bank National Association (the “Trustee”) so requests, a
satisfactory Opinion of Counsel is furnished to such effect,
which Opinion
of Counsel shall be an expense of the transferor or the
transferee;
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(vii)
|
we
agree to be bound by all of the terms (including those relating
to
restrictions on transfer) of the Pooling and Servicing, pursuant
to which
the Trust was formed; we have reviewed carefully and understand
the terms
of the Pooling and Servicing Agreement;
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(viii)
|
we
either: (i) are not acquiring the Privately Offered Certificate
directly
or indirectly by, or on behalf of, an employee benefit plan or
other
retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section
4975 of
the Internal Revenue Code of 1986, as amended, or (ii) in the
case of the
Privately Offered Certificates, have provided the Opinion of
Counsel
required by the Agreement, or (iii) in the case of the Class
M-10
Certificates, the transfer (1) will not result in a prohibited
transaction
which is not covered under an individual or class prohibited
transaction
exemption, including, but not limited to, Prohibited Transaction
Class
Exemption (“PTCE”) 84-14, XXXX 00-00, XXXX 00-0, XXXX 95-60 or PTCE 96-23
and (2) will not give rise to any additional obligations on the
part of
the Depositor, the Master Servicer or the Trustee.
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(ix)
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We
understand that each of the Privately Offered Certificates bears,
and will
continue to bear, a legend to substantiate the following effect:
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES
ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE
SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES
THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE
SECURITIES
ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
(A “QIB”),
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT
OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER,
RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(2)
PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (3) IN CERTIFICATED FORM TO
AN
“INSTITUTIONAL ACCREDITED INVESTOR” WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR ANY
ENTITY IN
WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING
NOT
FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT
TO (A) THE
RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM
PROVIDED IN
THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER
EVIDENCE
ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR
TRANSFER IS
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS
OR IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE
UNITED
STATES AND ANY OTHER APPLICABLE JURISDICTION. [In
the case of the Class M-10 Certificates]: THIS
CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR
ON BEHALF
OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974,
AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS
AMENDED, UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE
PROPOSED
TRANSFER AND HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT
AND
OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN
ANY
PROHIBITED TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL
OR CLASS
PROHIBITED TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED
TO,
PROHIBITED TRANSACTION CLASS EXEMPTION (“PTCE”) 84-14, XXXX 00-00, XXXX
00-0, XXXX 95-60 OR PTCE 96-23 AND (II) WILL NOT GIVE RISE TO
ANY
ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE MASTER
SERVICER
OR THE TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER
OF A
BOOK-ENTRY CERTIFICATE OR A GLOBAL CERTIFICATE OR UNLESS AN OPINION
SPECIFIED IN SECTION 6.02 OF THE AGREEMENT IS PROVIDED. NOTWITHSTANDING
THE PREVIOUS PARAGRAPH, A CERTIFICATION WILL NOT BE REQUIRED
WITH RESPECT
TO THE TRANSFER OF THIS CERTIFICATE TO A DEPOSITORY, OR FOR ANY
SUBSEQUENT
TRANSFER OF THIS CERTIFICATE FOR SO LONG AS THIS CERTIFICATE
IS A
BOOK-ENTRY CERTIFICATE. ANY TRANSFEREE OF THIS CERTIFICATE WILL
BE DEEMED
TO HAVE REPRESENTED BY VIRTUE OF ITS PURCHASE OR HOLDING OF THIS
CERTIFICATE (OR INTEREST HEREIN) THAT SUCH TRANSFEREE IS A “QUALIFIED
INSTITUTIONAL BUYER” WITHIN THE MEANING OF RULE 144A UNDER THE 1933
ACT.
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[In
the case of the Class P, Class CE, Class R-1, Class R-2, Class
R-3 and
Class RX Certificates]:
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NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS
THE
TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO SECTION
6.02(h) OF
THE AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE
THAT
THE PURCHASE AND HOLDING OF THIS CERTIFICATE ARE PERMISSIBLE
UNDER
APPLICABLE LAW, WILL NOT CONSTITUTE OR RESULT IN ANY NON-EXEMPT
PROHIBITED
TRANSACTIONS UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME
SECURITY
ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION 4975 OF THE CODE AND WILL NOT
SUBJECT THE TRUSTEE, MASTER SERVICER OR THE DEPOSITOR TO ANY
OBLIGATION OR
LIABILITY IN ADDITION TO THOSE UNDERTAKEN IN THE
AGREEMENT.
[In
the case of the Class CE Certificates]: NO
TRANSFER OF ANY CLASS CE CERTIFICATE SHALL BE MADE UNLESS THE
PROPOSED
TRANSFEREE OF SUCH CLASS CE CERTIFICATE PROVIDES TO THE TRUSTEE
THE
APPROPRIATE TAX CERTIFICATION FORM THAT WOULD ELIMINATE ANY WITHHOLDING
OR
DEDUCTION FOR TAXES FROM AMOUNTS PAYABLE TO THE SWAP ADMINISTRATOR,
ON
BEHALF OF THE SUPPLEMENTAL INTEREST TRUST, PURSUANT TO THE INTEREST
RATE
SWAP AGREEMENT BY THE SWAP PROVIDER (I.E., IRS FORM W-9 OR IRS
FORM
W-8BEN, W-8IMY, W-8EXP OR W-8ECI, AS APPLICABLE (OR ANY SUCCESSOR
FORM
THERETO)) AND AGREES TO UPDATE SUCH FORMS (I) UPON EXPIRATION
OF ANY SUCH
FORM, (II) AS REQUIRED UNDER THEN APPLICABLE U.S. TREASURY REGULATIONS
AND
(III) PROMPTLY UPON LEARNING THAT SUCH FORM HAS BECOME OBSOLETE
OR
INCORRECT, AND IN THE CASE OF ANY TRANSFER OF THE CLASS CE CERTIFICATES
THAT WOULD CAUSE THE SUPPLEMENTAL INTEREST TRUST TO BE BENEFICIALLY
OWNED
BY TWO OR MORE PERSONS FOR FEDERAL INCOME TAX PURPOSES, AGREES
TO COMPLY
WITH SUCH OTHER PROVISIONS IN THE AGREEMENT AS MAY APPLY IN SUCH
CASE,
EACH AS A CONDITION TO SUCH TRANSFER. UNDER THE AGREEMENT, UPON
RECEIPT OF
ANY SUCH TAX CERTIFICATION FORM FROM A TRANSFEREE OF ANY CLASS
CE
CERTIFICATE, THE TRUSTEE SHALL FORWARD SUCH TAX CERTIFICATION
FORM
PROVIDED TO IT TO THE SUPPLEMENTAL INTEREST TRUST TRUSTEE. THE
SUPPLEMENTAL INTEREST TRUST TRUSTEE SHALL FORWARD SUCH TAX CERTIFICATION
FORM PROVIDED TO IT TO THE SWAP PROVIDER. EACH HOLDER OF A CLASS
CE
CERTIFICATE AND EACH TRANSFEREE THEREOF SHALL BE DEEMED TO HAVE
CONSENTED
TO THE SUPPLEMENTAL INTEREST TRUST TRUSTEE FORWARDING TO THE
SWAP PROVIDER
ANY SUCH TAX CERTIFICATION FORM IT HAS PROVIDED AND UPDATED IN
ACCORDANCE
WITH THESE TRANSFER RESTRICTIONS. ANY PURPORTED SALES OR TRANSFERS
OF ANY
CLASS CE CERTIFICATE TO A TRANSFEREE WHICH DOES NOT COMPLY WITH
THESE
REQUIREMENTS SHALL BE DEEMED NULL AND VOID UNDER THE
AGREEMENT.
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“Eligible
Purchaser”
means
a
corporation, partnership or other entity which we have reasonable grounds
to
believe and do believe (i) can make representations with respect to itself
to
substantially the same effect as the representations set forth herein,
and (ii)
is either a Qualified Institutional Buyer as defined under Rule 144A of
the Act
or an institutional “Accredited Investor” as defined under Rule 501 of the
Act.
Terms
not
otherwise defined herein shall have the meanings assigned to them in the
Pooling
and Servicing Agreement, dated as of January 1, 2007, among Bear Xxxxxxx
Asset
Backed Securities I LLC, as depositor, EMC Mortgage Corporation, as seller
and
as master servicer and LaSalle Bank National Association, as Trustee (the
“Pooling and Servicing Agreement’).
If
the
Purchaser proposes that its Certificates be registered in the name of a
nominee
on its behalf, the Purchaser has identified such nominee below, and has
caused
such nominee to complete the Nominee Acknowledgment at the end of this
letter.
Name
of
Nominee (if any): __________________________
IN
WITNESS WHEREOF, this document has been executed by the undersigned who
is duly
authorized to do so on behalf of the undersigned Eligible Purchaser on
the ___
day of ________, 20___.
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Very
truly yours,
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[PURCHASER]
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By:
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(Authorized
Officer)
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By:
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(Attorney-in-fact)
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Nominee
Acknowledgment
The
undersigned hereby acknowledges and agrees that as to the Certificates
being
registered in its name, the sole beneficial owner thereof is and shall
be the
Purchaser identified above, for whom the undersigned is acting as
nominee.
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[NAME
OF NOMINEE]
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By:
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(Authorized
Officer)
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By:
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(Attorney-in-fact)
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EXHIBIT
F
FORM
OF
RULE 144A AND RELATED MATTERS CERTIFICATE
[SELLER]
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
|
Re:
|
Bear
Xxxxxxx Asset Backed Securities I Trust 2007-AQ1,
Asset-Backed
Certificates,
Series 2007-AQ1 (the “Certificates”), including the Class __
Certificates
(the “Privately Offered
Certificates”)
|
Dear
Ladies and Gentlemen:
In
connection with our purchase of Privately Offered Certificates, the undersigned
certifies to each of the parties to whom this letter is addressed that
it is a
qualified institutional buyer (as defined in Rule 144A under the Securities
Act
of 1933, as amended (the “Act”)) as follows:
1.
It
owned
and/or invested on a discretionary basis eligible securities (excluding
affiliate’s securities, bank deposit notes and CD’s, loan participations,
repurchase agreements, securities owned but subject to a repurchase agreement
and swaps), as described below:
Date:
______________, 20__ (must be on or after the close of its most recent
fiscal
year)
Amount:
$
_____________________; and
2.
The
dollar amount set forth above is:
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a.
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greater
than $100 million and the undersigned is one of the following
entities:
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(1)
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[
]
|
an
insurance company as defined in Section 2(13) of the Act1 ;
or
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(2)
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[
]
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an
investment company registered under the Investment Company Act
or any
business development company as defined in Section 2(a)(48) of
the
Investment Company Act of 1940; or
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(3)
|
[
]
|
a
Small Business Investment Company licensed by the U.S. Small
Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; or
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(4)
|
[
]
|
a
plan (i) established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a state or
its political
subdivisions, the laws of which permit the purchase of securities
of this
type, for the benefit of its employees and (ii) the governing
investment
guidelines of which permit the purchase of securities of this
type;
or
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(5)
|
[
]
|
a
business development company as defined in Section 202(a)(22)
of the
Investment Advisers Act of 1940; or
|
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(6)
|
[
]
|
a
corporation (other than a U.S. bank, savings and loan association
or
equivalent foreign institution), partnership, Massachusetts or
similar
business trust, or an organization described in Section 501(c)(3)
of the
Internal Revenue Code; or
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(7)
|
[
]
|
a
U.S. bank, savings and loan association or equivalent foreign
institution,
which has an audited net worth of at least $25 million as demonstrated
in
its latest annual financial statements; or
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(8)
|
[
]
|
an
investment adviser registered under the Investment Advisers Act;
or
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b.
|
[
]
|
greater
than $10 million, and the undersigned is a broker-dealer registered
with
the SEC; or
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c.
|
[
]
|
less
than $10 million, and the undersigned is a broker-dealer registered
with
the SEC and will only purchase Rule 144A securities in transactions
in
which it acts as a riskless principal (as defined in Rule 144A);
or
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d.
|
[
]
|
less
than $100 million, and the undersigned is an investment company
registered
under the Investment Company Act of 1940, which, together with
one or more
registered investment companies having the same or an affiliated
investment adviser, owns at least $100 million of eligible securities;
or
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e.
|
[
]
|
less
than $100 million, and the undersigned is an entity, all the
equity owners
of which are qualified institutional
buyers.
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The
undersigned further certifies that it is purchasing a Privately Offered
Certificate for its own account or for the account of others that independently
qualify as “Qualified Institutional Buyers” as defined in Rule 144A. It is aware
that the sale of the Privately Offered Certificates is being made in reliance
on
its continued compliance with Rule 144A. It is aware that the transferor
may
rely on the exemption from the provisions of Section 5 of the Act provided
by
Rule 144A. The undersigned understands that the Privately Offered Certificates
may be resold, pledged or transferred only to (i) a person reasonably believed
to be a Qualified Institutional Buyer that purchases for its own account
or for
the account of a Qualified Institutional Buyer to whom notice is given
that the
resale, pledge or transfer is being made in reliance in Rule 144A, or (ii)
an
institutional “accredited investor,” as such term is defined under Rule 501 of
the Act in a transaction that otherwise does not constitute a public
offering.
The
undersigned agrees that if at some future time it wishes to dispose of
or
exchange any of the Privately Offered Certificates, it will not transfer
or
exchange any of the Privately Offered Certificates to a Qualified Institutional
Buyer without first obtaining a Rule 144A and Related Matters Certificate
in the
form hereof from the transferee and delivering such certificate to the
addressees hereof. Prior to making any transfer of Privately Offered
Certificates, if the proposed Transferee is an institutional “accredited
investor,” the transferor shall obtain from the transferee and deliver to the
addressees hereof an Investment Letter in the form attached to the Pooling
and
Servicing Agreement, dated as of January 1, 2007, among Bear Xxxxxxx Asset
Backed Securities I LLC, as depositor, EMC Mortgage Corporation, as seller
and
as master servicer, and LaSalle Bank National Association, as Trustee,
pursuant
to which the Certificates were issued.
The
undersigned certifies that it either: (i) is not acquiring the Privately
Offered
Certificate directly or indirectly by, or on behalf of, an employee benefit
plan
or other retirement arrangement which is subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended, and/or section 4975
of the
Internal Revenue Code of 1986, as amended, or (ii) in the case of the Privately
Offered Certificates, has provided the Opinion of Counsel required by the
Agreement, or (iii) in the case of the Class M-10 Certificates, the transfer
(1)
will not result in a prohibited transaction which is not covered under
an
individual or class prohibited transaction exemption, including, but not
limited
to, Prohibited Transaction Class Exemption (“PTCE”) 84-14, XXXX 00-00, XXXX
00-0, XXXX 95-60 or PTCE 96-23 and (2) will not give rise to any additional
obligations on the part of the Depositor, the Master Servicer or the
Trustee.
If
the
Purchaser proposes that its Certificates be registered in the name of a
nominee
on its behalf, the Purchaser has identified such nominee below, and has
caused
such nominee to complete the Nominee Acknowledgment at the end of this
letter.
Name
of
Nominee (if any): _______________________________________
1 A
purchase by an insurance company for one or more of its separate accounts,
as
defined by Section 2(a)(37) of the Investment Company Act of 1940,
which are
neither registered nor required to be registered thereunder, shall
be deemed to
be a purchase for the account of such insurance
company.
IN
WITNESS WHEREOF, this document has been executed by the undersigned who
is duly
authorized to do so on behalf of the undersigned Eligible Purchaser on
the ____
day of ___________, 20___.
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Very
truly yours,
|
||||||||
|
[PURCHASER]
|
||||||||
|
By:
|
||||||||
|
(Authorized
Officer)
|
||||||||
|
By:
|
||||||||
|
(Attorney-in-fact)
|
||||||||
Nominee
Acknowledgment
The
undersigned hereby acknowledges and agrees that as to the Certificates
being
registered in its name, the sole beneficial owner thereof is and shall
be the
Purchaser identified above, for whom the undersigned is acting as
nominee.
|
[NAME
OF NOMINEE]
|
||||||||
|
By:
|
||||||||
|
(Authorized
Officer)
|
||||||||
|
By:
|
||||||||
|
(Attorney-in-fact)
|
||||||||
EXHIBIT
G
FORM
OF
REQUEST FOR RELEASE
|
To:
|
LaSalle
Bank National Association
|
|
000
Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
|
|
Xxxxxxx,
Xxxxxxxx 00000
|
|
RE:
|
Pooling
and Servicing Agreement, dated as of January 1, 2007, among Bear
Xxxxxxx
Asset Backed Securities I LLC, as Depositor, EMC Mortgage Corporation,
as
seller and as master servicer, and LaSalle Bank National Association,
as
Trustee
|
In
connection with the administration of the Mortgage Loans held by you pursuant
to
the above-captioned Pooling and Servicing Agreement, we request the release,
and
hereby acknowledge receipt, of the Mortgage File for the Mortgage Loan
described
below, for the reason indicated.
Mortgagor’s
Name, Address & Zip Code:
Mortgage
Loan Number:
Reason
for Requesting Documents (check one):
|
_____
|
1.
|
Mortgage
Loan paid in full. ([The Master Servicer] [The Trustee] hereby
certifies
that all amounts received in connection therewith have been credited
to
______________________________.)
|
|
|
_____
|
2.
|
Mortgage
Loan in foreclosure.
|
|
|
_____
|
3.
|
Repurchase.
(The [Master Servicer] [Trustee] hereby certifies that the repurchase
price has been credited to ________________________.)
|
|
|
_____
|
4.
|
A
Mortgage Loan liquidated by _________________________. ([The
Master
Servicer] [The Trustee] hereby certifies that all proceeds of
the
foreclosure, insurance, condemnation or other liquidation have
been
finally received and credited to
______________________.)
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|
_____
|
5.
|
Other
(explain)
|
|
By:
|
||||||||
|
(authorized
signer)
|
||||||||
|
Issuer:
|
||||||||
|
Address:
|
||||||||
|
Date:
|
EXHIBIT
H
DTC
Letter of Representations
See
Tabs
#28 and #68
EXHIBIT
I
Schedule
of Mortgage Loans with Lost Notes
[Provided
upon request]
EXHIBIT
J
FORM
OF CUSTODIAL AGREEMENT
THIS
CUSTODIAL AGREEMENT (as amended and supplemented from time to time, the
“Agreement”), dated as of January 30, 2007, by and among LASALLE BANK NATIONAL
ASSOCIATION, not individually but solely as trustee under the Pooling and
Servicing Agreement defined below (in such capacity, including its successors
under the Pooling and Servicing Agreement defined below, the “Trustee”) and as
custodian (in such capacity, together with any successor in interest or
any
successor appointed hereunder, the “Custodian”), BEAR XXXXXXX ASSET BACKED
SECURITIES I LLC, as depositor (together with any successor in interest,
the
“Depositor”), EMC MORTGAGE CORPORATION, as a seller (in such capacity, “EMC”)
and as master servicer (in such capacity, together with any successor in
interest or successor under the Pooling and Servicing Agreement referred
to
below, the “Master Servicer”) and MASTER FUNDING LLC, as a seller (“Master
Funding”, and together with EMC, the “Sellers”).
WITNESSETH
THAT:
WHEREAS,
the Depositor, EMC, the Master Servicer and the Trustee have entered into
a
Pooling and Servicing Agreement, dated as of January 1, 2007, relating
to the
issuance of Bear Xxxxxxx Asset Backed Securities I Trust 2007-AQ1, Asset-Backed
Certificates, Series 2007-AQ1 (as in effect on the date of this Agreement,
the
“Original Pooling and Servicing Agreement,” and as amended and supplemented from
time to time, the “Pooling and Servicing Agreement”).
WHEREAS,
the Custodian has agreed to act as agent for the Trustee on behalf of the
Certificateholders for the purposes of receiving and holding certain documents
and other instruments delivered by the Depositor, the Sellers or the Master
Servicer under the Pooling and Servicing Agreement, all upon the terms,
conditions and obligations and subject to the limitations hereinafter set
forth.
In the event any custodian terms, conditions and obligations are defined
in the
Pooling and Servicing Agreement, this custodial agreement shall supercede;
NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
agreements hereinafter set forth, the Trustee, the Depositor, the Sellers,
the
Master Servicer and the Custodian hereby agree as follows:
ARTICLE
I.
DEFINITIONS
Section
1.1. Definitions.
For
purposes of this Agreement, the following terms shall have the indicated
meanings unless the context or use indicates another or different meaning
and
intent, the definitions of such terms are equally applicable to the singular
and
the plural forms of such terms, the words “herein,” “hereof” and “hereunder” and
other words of similar import refer to this Agreement as a whole and not
to any
particular section or other subdivision, and section references refer to
sections of this Agreement.
"Business
Day"
shall
mean any day other than (i) a Saturday or a Sunday, or (ii) a day on which
banking institutions in The City of New York, New York, Chicago, Illinois,
Minneapolis, Minnesota or any city in which the Corporate Trust Office
of the
Trustee or the principal office of the Master Servicer is located are authorized
or obligated by law or executive order to be closed.
“Closing
Date”
shall
mean January 30, 2007.
“EMC
Flow Loans”
shall
mean the Mortgage Loans purchased by EMC pursuant to a flow loan agreement.
“MERS”
shall
mean Mortgage Electronic Registration Systems, Inc., a corporation organized
and
existing under the laws of the State of Delaware, or any successor
thereto.
“MERS
Mortgage Loan”
shall
mean any Mortgage Loan registered with MERS on the MERS® system.
“MERS®
System”
shall
mean the system of recording transfers of Mortgages electronically maintained
by
MERS.
“MIN”
shall
mean the Mortgage Identification Number for Mortgage Loans registered with
MERS
on the MERS System.
“MOM
Loan”
shall
mean with respect to any Mortgage Loan, MERS acting as the mortgagee of
such
Mortgage Loan, solely as nominee for the originator of such Mortgage Loan
and
its successors and assigns, at the origination thereof.
“Mortgage”
shall
mean the mortgage, deed of trust or other instrument creating a first lien
on or
first priority ownership interest in an estate in fee simple in real property
securing a Mortgage Note.
“Mortgage
Assignment”
shall
mean an assignment of the Mortgage in recordable form, sufficient under
the laws
of the jurisdiction wherein the Mortgaged Property is located to reflect
the
sale of the Mortgage.
“Mortgage
File”
shall
have the meaning set forth in Section 2 hereof.
“Mortgage
Loan”
shall
mean a first lien mortgage loan on a one-to-four family residential
property.
“Mortgage
Loan Schedule”
shall
mean the electronic schedule of Mortgage Loans identified in Schedule
A.
“Mortgaged
Property”
shall
mean the real property securing repayment of a Mortgage Loan.
“Mortgagor”
shall
mean the obligor on a Mortgage Note.
“Note”
shall
mean any promissory note or other evidence of indebtedness evidencing the
indebtedness of a Mortgagor under a Mortgage Loan.
“Servicer”
shall
mean the related servicer of the Mortgage Loans as designated by
Owner.
Any
capitalized terms used in this Agreement and not defined herein shall have
the
meanings assigned in the Original Pooling and Servicing Agreement, unless
otherwise required by the context herein.
ARTICLE
II.
CUSTODY
OF MORTGAGE DOCUMENTS
Section
2.1. Custodian
to Act as Agent: Acceptance of Mortgage Files.
The
Custodian, as the duly appointed custodial agent of the Trustee for these
purposes, acknowledges (subject to any exceptions noted in the Initial
Certification referred to in Section 2.3(a)) receipt of the Mortgage Files
relating to the Mortgage Loans identified on the Schedule attached hereto
(the
“Mortgage Loan Schedule”) and declares that it holds and will hold such Mortgage
Files as agent for the Trustee, in trust, for the use and benefit of all
present
and future Certificateholders.
Section
2.2. Recordation
of Assignments.
If any
Mortgage File includes one or more assignments of Mortgage that have not
been
recorded and the related Mortgage Loan is not a MERS Loan or the Custodian
has
not received written instructions from the related Seller or the Trustee
that
the related Mortgaged Properties are located in jurisdictions under the
laws of
which the recordation of such assignment is not necessary to protect the
Trustee’s interest therein, each such assignment shall be delivered by the
Custodian to the related Seller for the purpose of recording it in the
appropriate public office for real property records, and the Sellers, at
no
expense to the Custodian, shall promptly cause to be recorded in the appropriate
public office for real property records each such assignment of Mortgage
and,
upon receipt thereof from such public office, shall return each such assignment
of Mortgage to the Custodian.
Section
2.3. Review
of Mortgage Files.
(a) The
documents set forth in the definition “Mortgage File” herein shall be delivered
and released to the Custodian relating to each of the Mortgage Loans to
be
purchased on a Closing Date. The related Mortgage Loans shall be identified
in
the Mortgage Loan Schedule in electronic format which shall be delivered
to the
Custodian at least two Business Days prior to each Closing Date. On or
prior to
the Closing Date, the Custodian shall deliver to EMC and the Trustee an
Initial
Certification in the form annexed hereto as Exhibit One evidencing receipt
(subject to any exceptions noted therein) of a Mortgage File for each of
the
Mortgage Loans listed on Schedule A attached hereto (the “Mortgage Loan
Schedule”).
(b) Within
90
days thereafter, the Custodian agrees, for the benefit of Certificateholders,
to
review each such document, and shall deliver to EMC, the Master Servicer
and the
Trustee an Interim Certification in the form annexed hereto as Exhibit
Two to
the effect that all such documents have been executed and received and
that such
documents relate to the Mortgage Loans identified on the Mortgage Loan
Schedule,
except for any exceptions listed on Schedule A attached to such Interim
Certification. The Custodian shall be under no duty or obligation to inspect,
review or examine said documents, instruments, certificates or other papers
to
determine that the same are genuine, enforceable, or appropriate for the
represented purpose or that they have actually been recorded or that they
are
other than what they purport to be on their face.
(c) Not
later
than 180 days after the Closing Date, the Custodian shall review, for the
benefit of Certificateholders, the Mortgage Files and deliver to EMC, the
Master
Servicer and the Trustee a Final Certification in the form annexed hereto
as
Exhibit Three evidencing whether each document required to be recorded
has been
returned from the recording office with evidence of recording thereon and
the
Custodian has received either an original or a copy thereof. If the Custodian
finds any document missing, or to be unrelated, determined on the basis
of the
mortgagor name, original principal balance and loan number, to the mortgage
loans identified on the Mortgage Loan Schedule or to appear defective on
its
face, the Custodian shall note such defect in the exception report attached
to
the Final Certification and shall promptly notify the Trustee.
(d) In
reviewing the Mortgage Files as provided herein, the Custodian shall make
no
representation as to and shall not be responsible to verify (i) the validity,
legality, enforceability, due authorization, recordability, sufficiency
or
genuineness of any of the documents included in any Mortgage File or (ii)
the
collectibility, insurability, effectiveness or suitability of any of the
documents in any Mortgage File.
In
performing any such review, the Custodian may conclusively rely on the
purported
due execution and genuineness of any such document and on the purported
genuineness of any signature thereon.
Upon
receipt of written request from the Trustee, the Custodian shall as soon
as
practicable supply the Trustee with a list of all of the documents relating
to
the Mortgage Loans missing from the Mortgage Files.
Section
2.4. Custodian
to Cooperate: Release of Mortgage Files.
Upon
receipt of written notice per Exhibit Four or Electronic Release Request
per
Exhibit Six from the Trustee that EMC has repurchased a Mortgage Loan pursuant
to Article II of the Pooling and Servicing Agreement, and a request for
release
(a “Request for Release”) confirming that the purchase price therefor has been
paid as required under the Pooling and Servicing Agreement, then the Custodian
agrees to promptly release to EMC the related Mortgage File.
Upon
the
Custodian’s receipt of a Request for Release substantially in the form of
Exhibit Four attached hereto or Electronic Release Request per Exhibit
Six,
stating that it has received payment in full of a Mortgage Loan or that
payment
in full will be escrowed in a manner customary for such purposes, the Custodian
agrees promptly to release to the Master Servicer, the related Mortgage
File.
The Depositor shall deliver to the Custodian and the Custodian agrees to
review
in accordance with the provisions of the Custodial Agreement the Mortgage
Note
and other documents constituting the Mortgage File with respect to any
Replacement Mortgage Loan.
From
time
to time as is appropriate for the servicing or foreclosure of any Mortgage
Loan,
the Master Servicer shall deliver to the Custodian a Request for Release
per
Exhibit Four or Electronic Release Request per Exhibit Five requesting
that
possession of all of the Mortgage File be released to the Master Servicer
and
certifying as to the reason for such release. Upon receipt of the foregoing,
the
Custodian shall deliver the Mortgage File to the Master Servicer. All Mortgage
Files so released to the Master Servicer shall be held by it in trust for
the
Trustee for the use and benefit of all present and future Certificateholders.
The Master Servicer shall cause each Mortgage File or any document therein
so
released to be returned to the Custodian when the need therefore by the
Master
Servicer no longer exists, unless (i) the Mortgage Loan has been liquidated,
or
(ii) the Mortgage File or such document has been delivered to an attorney,
or to
a public trustee or other public official as required by law, for purposes
of
initiating or pursuing legal action or other proceedings for the foreclosure
of
the Mortgaged Property.
Section
2.5. Assumption
Agreements.
In the
event that any assumption agreement, substitution of liability agreement
or sale
of servicing agreement is entered into with respect to any Mortgage Loan
subject
to this Agreement, the Master Servicer shall notify the Custodian that
such
assumption or substitution agreement has been completed by forwarding to
the
Custodian the original of such assumption or substitution agreement, which
shall
be added to the related Mortgage File and, for all purposes, shall be considered
a part of such Mortgage File to the same extent as all other documents
and
instruments constituting parts thereof.
ARTICLE
III.
CONCERNING
THE CUSTODIAN
Section
3.1. Custodian
a Bailee and Agent of the Trustee.
With
respect to each Mortgage Note, Mortgage and other documents constituting
each
Mortgage File which are delivered to the Custodian, the Custodian is exclusively
the bailee and custodial agent of the Trustee and has no instructions to
hold
any Mortgage Note or Mortgage for the benefit of any person other than
the
Trustee and the Certificateholders and undertakes to perform such duties
and
only such duties as are specifically set forth in this Agreement. Except
upon
compliance with the provisions of Section 2.4 of this Agreement, no Mortgage
Note, Mortgage or Mortgage File shall be delivered by the Custodian to
the
Sellers, the Depositor or the Master Servicer or otherwise released from
the
possession of the Custodian.
Section
3.2. Custodian
May Own Certificates.
The
Custodian in its individual or any other capacity may become the owner
or
pledgee of interests in the Mortgage Loans with the same rights it would
have if
it were not Custodian.
Section
3.3. Trustee
to Pay Custodian’s Fees.
The
Trustee covenants and agrees to pay to the Custodian from time to time,
and the
Custodian shall be entitled to, reasonable compensation for all services
rendered by it in the exercise and performance of any of the powers and
duties
hereunder of the Custodian.
Section
3.4. Custodian
May Resign; Trustee May Remove Custodian.
The
Custodian may resign from the obligations and duties hereby imposed upon
it as
such obligations and duties relate to its acting as Custodian of the Mortgage
Loans. Upon receiving such written notice of resignation, the Trustee shall
either take custody of the Mortgage Files itself and give prompt written
notice
thereof to the Depositor, the Master Servicer and the Custodian, or promptly
appoint a successor Custodian by written instrument, in duplicate, one
copy of
which instrument shall be delivered to the resigning Custodian and one
copy to
the successor Custodian. If the Trustee shall not have taken custody of
the
Mortgage Files and no successor Custodian shall have been so appointed
and have
accepted appointment within 30 days after the giving of such written notice
of
resignation, the resigning Custodian may petition any court of competent
jurisdiction for the appointment of a successor Custodian.
The
Trustee may remove the Custodian at any time upon 60 days prior written
notice
to Custodian. In such event, the Trustee shall appoint, or petition a court
of
competent jurisdiction to appoint, a successor Custodian hereunder. Any
successor Custodian shall be a depository institution subject to supervision
or
examination by federal or state authority shall be able to satisfy the
other
requirements contained in Section 3.6 and shall be unaffiliated with the
Master
Servicer and the Depositor.
Any
resignation or removal of the Custodian and appointment of a successor
Custodian
pursuant to any of the provisions of this Section 3.4 shall become effective
upon acceptance of appointment by the successor Custodian. The Trustee
shall
give prompt notice to the Depositor and the Master Servicer of the appointment
of any successor Custodian. Notwithstanding anything to the contrary set
forth
herein, no successor Custodian shall be appointed by the Trustee without
the
prior approval of the Depositor and the Master Servicer.
Section
3.5. Merger
or Consolidation of Custodian.
Any
Person into which the Custodian may be merged or converted or with which
it may
be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Custodian shall be a party, or any Person succeeding
to the business of the Custodian, shall be the successor of the Custodian
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; provided that such successor is a depository institution
subject to supervision or examination by federal or state authority and
is able
to satisfy the other requirements contained in Section 3.6.
Section
3.6. Representations
of the Custodian.
The
Custodian hereby represents that it is a depository institution subject
to
supervision or examination by a federal or state authority, has a combined
capital and surplus of at least $15,000,000 and is qualified to do business
in
the jurisdictions in which it will hold any Mortgage File.
Section
3.7. Limitation
on Liability.
Neither
the Custodian nor any of its directors, officers, agents or employees,
shall be
liable for any action taken or omitted to be taken by it or them hereunder
or in
connection herewith in good faith and believed (which belief may be based
upon
the opinion or advice of counsel selected by it in the exercise of reasonable
care) by it or them to be within the purview of this Agreement, except
for its
or their own negligence, lack of good faith or willful
misconduct. The Custodian and any director, officer, employee or
agent of the Custodian may rely in good faith on any document of any kind
prima
facie properly executed and submitted by any person respecting any matters
arising hereunder. In no event shall the Custodian or its directors, officers,
agents and employees be held liable for any special, indirect or consequential
damages resulting from any action taken or omitted to be taken by it or
them
hereunder or in connection herewith even if advised of the possibility
of such
damages.
Notwithstanding
anything herein to the contrary, the Custodian agrees to indemnify the
Trust
Fund, the Trustee and each of their respective officers, directors and
agents
for any and all liabilities, obligations, losses, damages, payments, costs
or
expenses of any kind whatsoever that may be imposed on, incurred by or
asserted
against the Trustee or the Trust Fund, due to any negligent performance
by the
Custodian of its duties and responsibilities under this Agreement; provided,
however, that the Custodian shall not be liable to any of the foregoing
Persons
for any amount and any portion of any such amount resulting from the willful
misfeasance, bad faith or negligence of such person or the Custodian’s reliance
on instructions from the Trustee or the Master Servicer. The provisions
of this
Section 3.7 shall survive the termination of this Custodial
Agreement.
LaSalle
Bank National Association, as Custodian and in its individual capacity,
and its
directors, officers, employees and agents shall be entitled to indemnification
and defense from the Trust Fund for any loss, liability or expense incurred
without negligence, willful misconduct, bad faith on their part, arising
out of,
or in connection with, the acceptance or administration of the custodial
arrangement created hereunder, including the costs and expenses of defending
themselves against any claim or liability in connection with the exercise
or
performance of any of their powers or duties hereunder.
Section
3.8. Limitation
of Duties.
The
Custodian in its capacity as such:
(a) in
the
course of its review of the Mortgage Files, shall not be required to make
determinations (1) of a legal nature or (2) as to the authority of any
officer
or agent of the Master Servicer, Trustee or other entity who has executed
(or
certified with respect to) any document which is part of the Mortgage File;
(b) shall
have no duties or obligations other than those specifically set forth herein
or
as may subsequently be agreed upon in writing by the parties hereto and
shall
use the same degree of care and skill as is reasonably expected of financial
institutions acting in comparable capacities;
(c) will
be
regarded as making no representations and having no responsibilities as
to the
validity, sufficiency, value, genuineness, ownership or transferability
of any
Mortgage Loans and will not be required to and will not make any representations
as to the validity, value or genuineness of the Mortgage Loans;
(d) shall
not
be obligated to take any legal action hereunder which might in its judgment
involve any expense or liability unless it has been furnished with reasonable
indemnity;
(e) may
rely
on and shall be protected in acting upon any certificate, instrument, opinion,
notice, letter, telegram or other document, or any security, delivered
to it and
reasonably believed by it to be genuine and to have been signed by the
Master
Servicer or the Trustee;
(f) may
rely
on and shall be protected in acting upon the written instructions of the
Master
Servicer or the Trustee and such employees and representatives of the Master
Servicer and the Trustee, as applicable, may hereinafter designate in
writing;
(g) may
consult counsel satisfactory to it (including counsel for the Trustee or
the
Master Servicer) and the opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered,
or
omitted by it hereunder in good faith and in accordance with the opinion
of such
counsel (provided that the fees of such counsel in connection with such
consultation and opinion shall be paid by the Custodian); and
(h) shall
not
be liable for any error of judgment, or for any act done or step taken
or
omitted by it, in good faith, or for any mistake of fact or law, or for
anything
which it may do or refrain from doing in connection therewith, except in
the
case of a breach of any of the Custodian’s obligations hereunder, negligence or
willful misconduct.
The
Custodian shall be held to the same standard of conduct, and shall be entitled
to the same protections, privileges and immunities as other custodians
acting in
a custodial capacity are generally afforded.
No
covenant or agreement contained herein shall be deemed to be the covenant
or
agreement of any member of the Board of Directors, or any director, officer,
agent, employee or representative of the Trustee, Master Servicer or the
Custodian in his or her individual capacity and none of such persons shall
be
subject to any personal liability or accountability by reason of the execution
of this Agreement, whether by virtue of any constitution, statute or rule
of law
or by the enforcement of any assessment or penalty, or otherwise.
ARTICLE
IV.
Compliance
with Regulation AB
Section
4.1. Intent
of the Parties; Reasonableness.
The
parties hereto acknowledge and agree that the purpose of this Article IV
is to
facilitate compliance by the Depositor with the provisions of Regulation
AB and
related rules and regulations of the Commission. The Depositor shall not
exercise its right to request delivery of information or other performance
under
these provisions other than in good faith, or for purposes other than compliance
with the Securities Act, the Exchange Act and the rules and regulations
of the
Commission under the Securities Act and the Exchange Act. Each of the parties
hereto acknowledges that interpretations of the requirements of Regulation
AB
may change over time, whether due to interpretive guidance provided by
the
Commission or its staff, consensus among participants in the mortgage-backed
securities markets, advice of counsel, or otherwise, and agrees to comply
with
requests made by the Depositor in good faith for delivery of information
under
these provisions on the basis of evolving interpretations of Regulation
AB. The
Custodian shall cooperate reasonably with the Depositor to deliver to the
Depositor (including any of its assignees or designees), any and all disclosure,
statements, reports, certifications, records and any other information
necessary
in the reasonable, good faith determination of the Depositor to permit
the
Depositor to comply with the provisions of Regulation AB.
Section
4.2. Additional
Representations and Warranties of the Custodian.
(a) The
Custodian shall be deemed to represent to the Depositor as of the date
hereof
and on each date on which information is provided to the Trustee under
Section
4.3 that, except as disclosed in writing to the Depositor prior to such
date:
(i) there are no aspects of its financial condition that could have a material
adverse effect on the performance by it of its Custodian obligations under
this
Agreement or any other Securitization Transaction as to which it is the
custodian; (ii) there are no material legal or governmental proceedings
pending
(or known to be contemplated) against it; and (iii) there are no affiliations,
relationships or transactions relating to the Custodian with respect to
the
Depositor or any sponsor, issuing entity, servicer, originator, significant
obligor, enhancement or support provider or other material transaction
party
(other than the Trustee, which is the same entity as the Custodian) (as
such
terms are used in Regulation AB) relating to the Securitization Transaction
contemplated by the Agreement, as identified by the Depositor to the Custodian
in writing as of the Closing Date (each, a "Transaction Party").
(b) If
so
requested by the Depositor on any date following the Closing Date, the
Custodian
shall, within five Business Days following such request, confirm in writing
the
accuracy of the representations and warranties set forth in paragraph (a)
of
this Section or, if any such representation and warranty is not accurate
as of
the date of such confirmation, provide reasonably adequate disclosure of
the
pertinent facts, in writing, to the requesting party. Any such request
from the
Depositor shall not be given more than once each calendar quarter, unless
the
Depositor shall have a reasonable basis for a determination that any of
the
representations and warranties may not be accurate.
Section
4.3. Additional
Information to Be Provided by the Custodian.
For so
long as the Trust is subject to the reporting obligations under the Exchange
Act, for the purpose of satisfying the Depositor 's reporting obligation
under
the Exchange Act with respect to any class of publicly offered Certificates,
the
Custodian shall (a) notify the Depositor in writing of any material litigation
or governmental proceedings pending against the Custodian that would be
material
to Certificateholders, and (b) provide to the Depositor (and the Trustee)
unless
the Custodian and the Trustee are the same party a written description
of such
proceedings. Any notices and descriptions required under this Section 4.3
shall
be given no later than five Business Days prior to the Determination Date
following the month in which the Custodian has knowledge of the occurrence
of
the relevant event. As of the date the Trustee files each Report on Form
10-D or
Form 10-K with respect to the Certificates, the Custodian will be deemed
to
represent that any information previously provided under this Section 4.3,
if
any, is materially correct and does not have any material omissions unless
the
Custodian has provided an update to such information.
Section
4.4. Report
on Assessment of Compliance and Attestation.
On or
before March 15th of each calendar year beginning in 2008, the Custodian
shall:
(a) deliver
to the Trustee, the Master Servicer and the Depositor a report regarding
the
Custodian’s assessment of compliance (an “Assessment of Compliance”) with the
Servicing Criteria during the preceding calendar year, as required under
Rules
13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. The
Assessment of Compliance, as set forth in Regulation AB, must contain (i)
a
statement by such officer of its responsibility for assessing compliance
with
the Servicing Criteria applicable to the Custodian, (ii) a statement by
such
officer that the Custodian used the Servicing Criteria attached as Exhibit
Five
hereto, and which will also be attached to the Assessment of Compliance,
to
assess compliance with the Servicing Criteria applicable to the Custodian,
(iii)
an assessment by such officer of the Custodian’s compliance with the applicable
Servicing Criteria for the period consisting of the preceding calendar
year,
including disclosure of any material instance of noncompliance with respect
thereto during such period, which assessment shall be based on the activities
the Custodian performs with respect to asset-based securities transactions
taken
as a whole involving the Custodian, that are backed by the same asset type
as
the Mortgage Loans, (iv) a statement that a registered public accounting
firm
has issued an attestation report on the Custodian’s Assessment of Compliance for
the period consisting of the preceding calendar year, and (v) a statement
as to
which of the Servicing Criteria, if any, are not applicable to the Custodian,
which statement shall be based on the activities the Custodian performs
with
respect to asset-backed securities transactions taken as a whole involving
the
Custodian, that are backed by the same asset type as the Mortgage Loans.
Such
report at a minimum shall address each of the Servicing Criteria specified
on
Exhibit Five hereto which are indicated as applicable to the Custodian;
and
(b) deliver
to the Trustee, the Master Servicer and the Depositor an Attestation Report
(an
“Attestation Report”) by a registered public accounting firm that attests to,
and reports on, the Assessment of Compliance made by the Custodian, as
required
by Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122(b) of Regulation
AB, which Attestation Report must be made in accordance with standards
for
attestation reports issued or adopted by the Public Company Accounting
Oversight
Board.
Notwithstanding
the foregoing, an Assessment of Compliance is not required to be delivered
by
the Custodian unless it is required as part of a Form 10-K with respect
to the
Trust Fund.
In
the
event the Custodian is terminated under, or resigns pursuant to, the terms
of
this Agreement, the Custodian shall provide an Assessment of Compliance
and
cause to be provided an Attestation Report pursuant to this Section 4.4
notwithstanding any such termination or resignation.
Section
4.5. Indemnification;
Remedies.
(a) The
Custodian shall indemnify the Depositor, each affiliate of the Depositor,
the
Master Servicer and each broker dealer acting as underwriter, placement
agent or
initial purchaser of the Certificates or each Person who controls any of
such
parties (within the meaning of Section 15 of the Securities Act and Section
20
of the Exchange Act); and the respective present and former directors,
officers,
employees and agents of each of the foregoing, and shall hold each of them
harmless from and against any losses, damages, penalties, fines, forfeitures,
legal fees and expenses and related costs, judgments, and any other costs,
fees
and expenses that any of them may sustain arising out of or based upon
any
failure by the Custodian to deliver any report on assessment of compliance
or
accountants’ attestation when and as required under this Article IV.
(b) In
the
case of any failure of performance described in clause (i) of Section 4.5(a),
the Custodian shall promptly reimburse the Depositor for all costs reasonably
incurred by the Depositor in order to obtain the information, report,
certification, accountants’ letter or other material not delivered as required
by the Custodian.
ARTICLE
V.
MISCELLANEOUS
PROVISIONS
Section
5.1. Notices. All
notices, requests, consents and demands and other communications required
under
this Agreement or pursuant to any other instrument or document delivered
hereunder shall be in writing and, unless otherwise specifically provided,
may
be delivered personally, by telegram or telex, or by registered or certified
mail, postage prepaid, return receipt requested, at the addresses specified
on
the signature page hereof (unless changed by the particular party whose
address
is stated herein by similar notice in writing), in which case the notice
will be
deemed delivered when received.
Section
5.2. Amendments. No
modification or amendment of or supplement to this Agreement shall be valid
or
effective unless the same is in writing and signed by all parties hereto.
The
Trustee shall give prompt notice to the Custodian of any amendment or supplement
to the Pooling and Servicing Agreement and furnish the Custodian with written
copies thereof.
Section
5.3. GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF
OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
Section
5.4. Recordation
of Agreement.
To the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any or all of the properties subject
to
the Mortgages are situated, and in any other appropriate public recording
office
or elsewhere, such recordation to be effected by the Depositor and at the
Trust’s expense, but only upon direction accompanied by an Opinion of Counsel
reasonably satisfactory to the Depositor to the effect that the failure
to
effect such recordation is likely to materially and adversely affect the
interests of the Certificateholders.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, 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
5.5. 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.
[Signature
Page Attached]
IN
WITNESS WHEREOF, this Agreement is executed as of the date first above
written.
|
Address:
000
Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Attention:
BSABS I Trust, Series 2007-AQ1
|
LASALLE
BANK NATIONAL ASSOCIATION, not individually but solely as
Trustee
By:_________________________________
Name:
Title:
|
|
Address:
0000
Xxxxx Xx., Xxxxx 000
Xxx
Xxxxx Xxxxxxx, XX 00000
|
LASALLE
BANK NATIONAL ASSOCIATION, as Custodian
By:_________________________________
Name:
Title:
|
|
Address:
000
Xxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
|
BEAR
XXXXXXX ASSET BACKED SECURITIES I LLC
By:_________________________________
Name:
Title:
|
|
Address:
0000
Xxxx Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxx 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
|
EMC
MORTGAGE CORPORATION
By:_________________________________
Name:
Title:
|
|
Address:
000
Xxxxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxx,
Xxxxx 00000
(Facsimile:
(000) 000-0000)
Attention:
Xxxx Xxxxxxxx
|
MASTER
FUNDING LLC
By:_________________________________
Name:
Title:
|
| STATE OF ILLINOIS | ) |
| ) ss: | |
| COUNTY OF XXXX | ) |
On
the
30th
day of
January, 2007 before me, a notary public in and for said State, personally
appeared _________________, known to me to be a(n) _______________ of LaSalle
Bank National Association, one of the parties that executed the within
agreement, and also known to me to be the person who executed the within
agreement on behalf of said party and acknowledged to me that such party
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
|
[SEAL]
| STATE OF ILLINOIS | ) |
| ) ss: | |
| COUNTY OF XXXX | ) |
On
the
30th
day of
January, 2007 before me, a notary public in and for said State, personally
appeared ____________________, known to me to be a(n) ____________________
of
LaSalle Bank National Association, one of the parties that executed the
within
instrument, and also known to me to be the person who executed it on behalf
of
said party, and acknowledged to me that such party 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]
| STATE OF NEW YORK | ) |
| ) ss: | |
| COUNTY OF NEW YORK | ) |
On
the
30th
day of
January, 2007 before me, a notary public in and for said State, personally
appeared Xxxxx Xxxxxxxxxxx, known to me to be a Vice President of Bear
Xxxxxxx
Asset Backed Securities I LLC, and also known to me to be the person who
executed the within instrument on behalf of said party, and acknowledged
to me
that such party 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
|
[SEAL]
| STATE OF TEXAS | ) |
| ) ss: | |
| COUNTY OF DALLAS | ) |
On
the
30th
day of
January, 2007 before me, a notary public in and for said State, personally
appeared ____________________, known to me to be a(n) ____________________
of
EMC Mortgage Corporation, one of the parties that executed the within
instrument, and also known to me to be the person who executed the within
instrument on behalf of said party, and acknowledged to me that such party
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]
| STATE OF TEXAS | ) |
| ) ss: | |
| COUNTY OF DALLAS | ) |
On
the
30th
day of
January, 2007 before me, a notary public in and for said State, personally
appeared _____________________, known to me to be a(n) ____________________
of
Master Funding LLC, one of the parties that executed the within instrument,
and
also known to me to be the person who executed the within instrument on
behalf
of said party, and acknowledged to me that such party 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]
SCHEDULE
A
(Provided
upon request)
EXHIBIT
ONE
FORM
OF
CUSTODIAN INITIAL CERTIFICATION
January
30, 2007
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxx 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
Attention:
Bear Xxxxxxx Asset Backed Securities I LLC, Series 2007-AQ1
| Re: |
Custodial
Agreement, dated as of January 30, 2007, by and
among
LaSalle Bank National Association, Bear Xxxxxxx
Asset
Backed Securities I LLC, EMC Mortgage
Corporation
and Master Funding LLC, relating to Bear
Xxxxxxx
Asset Backed Securities I Trust 2007-AQ1, Asset-
Backed
Certificates, Series 2007-AQ1
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(a) of the above-captioned Custodial Agreement,
the
undersigned, as Custodian, hereby certifies that it has received the following
documents with respect to each Mortgage Loan listed in the Mortgage Loan
Schedule, with any exceptions listed on Schedule A attached hereto: (i)
an
original note, including any riders thereto, endorsed without recourse
to the
order of LaSalle Bank National Association, as Trustee for certificateholders
of
___________________________ or to blank and showing an unbroken chain of
endorsements from the original payee thereof to the person endorsing it
to the
Trustee; (ii) an original mortgage and, if the related mortgage loan is
a MERS
Loan, registered with MERS, noting the presence of the mortgage identification
number and language indicating that such mortgage loan is a MERS Loan,
which
shall have been recorded (or, for Mortgage Loans other than the EMC Flow
Loans,
if the original is not available, a copy) with evidence of such recording
indicated thereon (or if clause (x) in the proviso below applies, shall
be in
recordable form); (iii) unless the mortgage loan is a MERS Loan, the assignment
(either an original or a copy, which may be in the form of a blanket assignment
if permitted in the jurisdiction in which the mortgage property is located)
to
the Trustee of the mortgage with respect to each mortgage loan in the name
of
___________________________, which shall have been recorded (of if clause
(x) in
the proviso below applies, shall be in recordable form); (iv) an original
or a
copy of all intervening assignments of the mortgage, if any, with evidence
of
recording thereon; (v) the original policy of title insurance or mortgagee’s
certificate of title insurance or commitment or binder for title insurance,
if
available, or a copy thereof, or, in the event that such original title
insurance policy is unavailable, a photocopy thereof, or in lieu thereof,
a
current lien search on the related mortgaged property; and (vi) originals
or
copies of all available assumption, modification or substitution agreements,
if
any; provided, however, that in lieu of the foregoing, the Sellers may
deliver
the following documents, under the circumstances set forth below: (x) if
any
mortgage (other than the mortgages related to the EMC Flow Loans), assignment
thereof to the Trustee or intervening assignments thereof have been delivered
or
are being delivered to recording offices for recording and have not been
returned in time to permit their delivery as specified above, the Depositor
may
deliver a true copy thereof with a certification by the related Seller
or the
title company issuing the commitment for title insurance, on the face of
such
copy, substantially as follows: “Certified to be a true and correct copy of the
original, which has been transmitted for recording”; and (y) in lieu of the
mortgage notes relating to the Mortgage Loans identified in the list attached
hereto, the Depositor may deliver a lost note affidavit and indemnity and
a copy
of the original note, if available.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
LASALLE
BANK NATIONAL ASSOCIATION
By:__________________________________
Name:________________________________
Title:_________________________________
SCHEDULE
A
(Please
see tab #52)
EXHIBIT
TWO
FORM
OF
CUSTODIAN INTERIM CERTIFICATION
[DATE]
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxx 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
Attention:
Bear Xxxxxxx Asset Backed Securities I LLC, Series 2007-AQ1
| Re: |
Custodial
Agreement, dated as of January 30, 2007, by and
among
LaSalle Bank National Association, Bear Xxxxxxx
Asset
Backed Securities I LLC, EMC Mortgage
Corporation
and Master Funding LLC, relating to Bear
Xxxxxxx
Asset Backed Securities I Trust 2007-AQ1, Asset-
Backed
Certificates, Series 2007-AQ1
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(b) of the above-captioned Custodial Agreement,
the
undersigned, as Custodian, hereby certifies that it has received and reviewed
the documents described in its initial certification dated January 30,
2007 and
has determined that: all documents have been executed and received and
that such
documents relate to the Mortgage Loans identified on the Mortgage Loan
Schedule,
with any exceptions listed on Schedule A attached hereto.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
LASALLE
BANK NATIONAL ASSOCIATION
By:__________________________________
Name:________________________________
Title:_________________________________
SCHEDULE
A
(Provided
upon request)
EXHIBIT
THREE
FORM
OF
CUSTODIAN FINAL CERTIFICATION
[DATE]
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
EMC
Mortgage Corporation
0000
Xxxx
Xxxxx Xxxxx
Xxxxxxxxxx,
Xxxxx 00000
(Facsimile:
(000) 000-0000)
Attention:
President or General Counsel
Attention:
Bear Xxxxxxx Asset Backed Securities I LLC, Series 2007-AQ1
| Re: |
Custodial
Agreement, dated as of January 30, 2007, by and
among
LaSalle Bank National Association, Bear Xxxxxxx
Asset
Backed Securities I LLC, EMC Mortgage
Corporation
and Master Funding LLC, relating to Bear
Xxxxxxx
Asset Backed Securities I Trust 2007-AQ1, Asset-
Backed
Certificates, Series 2007-AQ1
|
Ladies
and Gentlemen:
In
accordance with Section 2.3(c) of the above-captioned Custodial Agreement,
the
undersigned, as Custodian, hereby certifies that it has received and reviewed
the documents described in its initial certification dated January 30,
2007 and
has determined that: all documents have been executed and received and that
such
documents relate to the Mortgage Loans identified on the Mortgage Loan
Schedule,
with any exceptions listed on Schedule A attached hereto.
Capitalized
words and phrases used herein shall have the respective meanings assigned
to
them in the above-captioned Custodial Agreement.
LASALLE
BANK NATIONAL ASSOCIATION
By:__________________________________
Name:________________________________
Title:_________________________________
SCHEDULE
A
(Provided
upon request)
EXHIBIT
FOUR
FORM
OF
REQUEST FOR RELEASE OF DOCUMENTS AND RECEIPT
To: [Name/Address
of Owner]
Attention:
| Re: |
Custodial
Agreement, dated as of January 30, 2007, by and
among
LaSalle Bank National Association, Bear Xxxxxxx
Asset
Backed Securities I LLC, EMC Mortgage
Corporation
and Master Funding LLC, relating to Bear
Xxxxxxx
Asset Backed Securities I Trust 2007-AQ1, Asset-
Backed
Certificates, Series 2007-AQ1
|
In
connection with the Mortgage Files that you hold pursuant to the Custodial
Agreement, we request the release, and acknowledge receipt of the Mortgage
file/[specify document] for the Mortgage Loan described below, the reason
indicated.
Mortgagor’s
Name, Address and Zip Code:
Mortgage
Loan Number:
Reason
for Requesting Documents: (check one)
_____
1.
Mortgage Loan paid in full. ([The Master Servicer] [the Trustee] hereby
certifies that all amounts received in connection therewith have been credited
to
__________________________________________________________________________.)
_____
2.
Mortgage Loan in foreclosure.
_____
3.
Repurchase. (The [Master Servicer] [Trustee] hereby certifies that the
repurchase price has been credited to
_____________________________________________.)
_____
4.
Mortgage Loan liquidated by _______________________________________. ([The
Master Servicer] [The Trustee] hereby certifies that all proceeds of the
foreclosure, insurance, condemnation or other liquidation have been finally
received and credited to _____________________________________.
_____
5.
Other (explain):
EXHIBIT
FIVE
SERVICING
CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The
assessment of compliance to be delivered by the Custodian shall address,
at a
minimum, the criteria identified as below as “Applicable Servicing
Criteria”;
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
General
Servicing Considerations
|
||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements
|
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities
|
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the pool assets are maintained.
|
|
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on
the party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance
with the
terms of the transaction agreements.
|
|
|
Cash
Collection and Administration
|
||
|
1122(d)(2)(i)
|
Payments
on pool assets are deposited into the appropriate custodial bank
accounts
and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in
the
transaction agreements.
|
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances are
made,
reviewed and approved as specified in the transaction
agreements.
|
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are
separately
maintained (e.g., with respect to commingling of cash) as set
forth in the
transaction agreements.
|
|
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institutions” with respect
to a foreign financial institution means a foreign financial
institution
that meets the requirements of Rule 13k-1(b)(1) of the Securities
Exchange
Act.
|
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized
access.
|
|
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities
related
bank accounts, including custodial accounts and related bank
clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliations; and (D) contain explanations for reconciling
items, These
reconciling items are resolved within 90 calendar days of their
original
identification, or such other number of days specified in the
transaction
agreements.
|
|
|
Investor
Remittances and Reporting
|
||
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission,
are
maintained in accordance with the transaction agreements and
applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements, (B) provide information calculated in accordance
with the
terms specified in the transaction agreements; (C) are filed
with the
Commission as required by its rules and regulations; and (D)
agree with
investors; or the trustee’s records as to the total unpaid principal
balance and number of pool assets serviced by the
servicer.
|
|
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with
timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
|
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the
servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
|
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
|
|
|
Pool
Asset Administration
|
||
|
1122(d)(4)(i)
|
Collateral
or security on pool assets is maintained as required by the transaction
agreements or related asset pool documents.
|
√
|
|
1122(d)(4)(ii)
|
Pool
assets and related documents are safeguarded as required by the
transaction agreements.
|
√
|
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements
in the
transaction agreements
|
√2
|
|
1122(d)(4)(iv)
|
Payments
on pool assets, including any payoffs, made in accordance with
the related
pool asset documents are posted to the servicer’s obligor records
maintained no more than two business days after receipt, or such
other
number of days specified in the transaction agreements, and allocated
to
principal, interest or other items (e.g., escrow) in accordance
with the
related pool asset documents.
|
|
|
1122(d)(4)(v)
|
The
servicer’s records regarding the pool assets agree with the servicer’s
records with respect to an obligor’s unpaid principal
balance.
|
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor’s pool asset (e.g., loan
modifications or re-agings) are made, reviewed and approved by
authorized
personnel in accordance with the transaction agreements and related
pool
asset documents.
|
|
|
1122(d)(4)(vii)
|
Loss
mitigation of recovery actions (e.g., forbearance plans, modifications
and
deed in lieu of foreclosure, foreclosures and repossessions,
as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
documents.
|
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a pool
asset is delinquent in accordance with the transaction agreements.,
Such
records are maintained in at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent pool assets including, for
example,
phone calls, letters and payment rescheduling plans in cases
where
delinquency is deemed temporary (e.g., illness or
unemployment).
|
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for pool assets with variable
rates
are computed based on the related pool asset documents.
|
|
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts);
(A) such
funds are analyzed, in accordance with the obligor’s pool asset documents,
on at least an annual basis, or such other period specified in
the
transaction agreements; (B) interest on such funds is paid, or
credited,
to obligors in accordance with applicable pool asset documents
and state
laws; and (C) such funds are returned to the obligor within 3-
calendar
days of full repayment of the related pool asset, or such other
number of
days specified in the transaction agreements.
|
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax ore insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that
such support
has been received by the service at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
|
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of
days
specified in the transaction agreements.
|
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible funds are recognized and recorded
in
accordance with the transaction agreements.
|
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in item 1114(a)(1)
through (3) or item 1115 of Regulation AB, is maintained as set
forth in
the transaction agreements.
|
|
2
Only
with respect to the logistics of adding, removing or substituting loan
files.
EXHIBIT
SIX
ELECTRONIC
RELEASE REQUEST (Excel)
|
Collateral
Release Tasks
|
|
|
|
|
|
Required
Field Header
|
Description
|
|
|
|
|
Customer
|
Value
can be constant of '1018'
|
|
|
|
|
Poolnum
|
pool
number if available, can be left blank as well
|
|
|
|
|
Loaned
|
EMC
loan#, required field
|
|
|
|
|
loc_code
|
Codes
must be mutually agreed upon with custodian. Examples are PDPO=
loans
released for payoff, FORC = loans released for foreclosure, OLIQ=
loans
released for repurchase, NLIQ = loans released for
non-liquidation/correction.
|
|
|
|
|
rel_code
|
Codes
must be mutually agreed upon with custodian. Examples are
1
=
payoff, 2 = foreclosure, 4 = repurchase, 5 =
non-liquidation.
|
|
|
|
|
rel_doclist
|
Can
be left blank
|
|
|
|
|
notation
|
"Name
of Person File Being Released To @ Company Name" (i.e. Xxxxxx
Xxxxx@EMC)
|
|
|
|
|
reqstr
|
Can
be left blank
|
|
|
|
|
reqstr_sig
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Signatory
code assigned to requestor, TBD
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amend
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0
=
new release request, 1= amend an existing released record (ie.
FORC to
PDPO)
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EXHIBIT
K
FORM
OF
BACK-UP CERTIFICATION
RE:
The [ ] agreement dated as of [ ],
200[ ]
(the “Agreement”), among [IDENTIFY PARTIES]
I,
________________________________, the _______________________ of [NAME
OF
COMPANY], certify to [the Purchaser], [the Depositor], and the [Master
Servicer]
[Trustee], and their officers, with the knowledge and intent that they
will rely
upon this certification, that:
(1) I
have
reviewed the servicer compliance statement of the Company provided in accordance
with Item 1123 of Regulation AB (the “Compliance Statement”), the report on
assessment of the Company’s compliance with the servicing criteria set forth in
Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided in accordance
with Rules 13a-18 and 15d-18 under Securities Exchange Act of 1934, as
amended
(the “Exchange Act”) and Item 1122 of Regulation AB (the “Servicing
Assessment”), the registered public accounting firm’s attestation report
provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
Act and
Section 1122(b) of Regulation AB (the “Attestation
Report”), and all servicing reports, officer’s certificates and other
information relating to the servicing of the Mortgage Loans by the Company
during 200[ ] that were delivered by the Company to the [Depositor] [Master
Servicer] [Trustee] pursuant to the Agreement (collectively, the “Company
Servicing Information”);
(2) Based
on
my knowledge, the Company Servicing Information, taken as a whole, does
not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances
under
which such statements were made, not misleading with respect to the period
of
time covered by the Company Servicing Information;
(3) Based
on
my knowledge, all of the Company Servicing Information required to be provided
by the Company under the Agreement has been provided to the [Depositor]
[Master
Servicer] [Trustee];
(4) I
am
responsible for reviewing the activities performed by the Company as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed
in the
Compliance Statement, the Servicing Assessment or the Attestation Report,
the
Company has fulfilled its obligations under the Agreement in all material
respects; and
(5) The
Compliance Statement required to be delivered by the Company pursuant to
the
Agreement, and the Servicing Assessment and Attestation Report required
to be
provided by the Company and by any Subservicer or Subcontractor pursuant
to the
Agreement, have been provided to the [Depositor] [Master Servicer]. Any
material
instances of noncompliance described in such reports have been disclosed
to the
[Depositor] [Master Servicer]. Any material instance of noncompliance with
the
Servicing Criteria has been disclosed in such reports.
Date: _________________________
By:
Name:
________________________________
Title:
________________________________
EXHIBIT
L
FORM
OF
MORTGAGE LOAN PURCHASE AGREEMENT
MORTGAGE
LOAN PURCHASE AGREEMENT, dated as of January 30, 2007, as amended and
supplemented by any and all amendments hereto (collectively, “this
Agreement”),
by
and among EMC MORTGAGE CORPORATION, a Delaware corporation (“EMC”
or
a
“Mortgage
Loan Seller”),
MASTER FUNDING LLC, a Delaware limited liability company (a “Mortgage
Loan Seller”
or
“Master
Funding”,
and
together with EMC, the “Mortgage
Loan Sellers”)
and
BEAR XXXXXXX ASSET BACKED SECURITIES I LLC, a Delaware limited liability
company
(the “Purchaser”).
Upon
the
terms and subject to the conditions of this Agreement, each Mortgage Loan
Seller
agrees to sell, and the Purchaser agrees to purchase, certain conventional,
closed-end, subprime, fixed rate and adjustable rate, first lien mortgage
loans
secured by one- to four-family residences (collectively, the “Mortgage
Loans”)
as
described herein. The Purchaser intends to deposit the Mortgage Loans into
a
trust fund (the “Trust
Fund”)
and
create Bear Xxxxxxx Asset Backed Securities I Trust 2007-AQ1, Asset-Backed
Certificates, Series 2007-AQ1 (the “Certificates”),
under
a pooling and servicing agreement, to be dated as of January 1, 2007 (the
“Pooling
and Servicing Agreement”),
among
the Purchaser, as depositor, EMC, as seller and as master servicer (the
“Master
Servicer”),
and
LaSalle Bank National Association, as trustee (the “Trustee”).
The
Purchaser has filed with the Securities and Exchange Commission (the
“Commission”)
a
registration statement on Form S-3 (Number 333-131374) relating to its
Asset-Backed Certificates and the offering of certain series thereof (including
certain classes of the Certificates) from time to time in accordance with
Rule
415 under the Securities Act of 1933, as amended, and the rules and regulations
of the Commission promulgated thereunder (the “Securities
Act”).
Such
registration statement, when it became effective under the Securities Act,
and
the prospectus relating to the public offering of certain classes of the
Certificates by the Purchaser (the “Public
Offering”),
as
each may be amended or supplemented from time to time pursuant to the Securities
Act or otherwise, are referred to herein as the “Registration
Statement”
and
the
“Prospectus,”
respectively. The “Free
Writing Prospectus”
shall
mean the free writing prospectus, dated January 24, 2007, relating to certain
classes of the Certificates. The “Prospectus
Supplement”
shall
mean the final supplement, dated January 26, 2007, to the Prospectus, dated
December 18, 2006, relating to certain classes of the Certificates. With
respect
to the Public Offering of certain classes of the Certificates, Bear, Xxxxxxx
& Co. Inc. (“Bear
Xxxxxxx”)
and
the Purchaser have entered into a terms agreement, dated as of January
24, 2007,
to an underwriting agreement, dated April 13, 2006 (together, the “Underwriting
Agreement”)
between Bear Xxxxxxx and the Purchaser.
Now,
therefore, in consideration of the premises and the mutual agreements set
forth
herein, the parties hereto agree as follows:
SECTION
1. Definitions.
Certain
terms are defined herein. Capitalized terms used herein but not defined
herein
shall have the meanings specified in the Pooling and Servicing Agreement.
The
following other terms are defined as follows:
Acquisition
Price:
With
respect to EMC and the sale of the EMC Mortgage Loans, cash in an amount
equal
to $ *
(plus
$ *
in
accrued interest). With respect to Master Funding and the sale of the Master
Funding Mortgage Loans, cash in an amount equal to $ *
(plus
$ *
in
accrued interest).
Bear
Xxxxxxx:
Bear,
Xxxxxxx & Co. Inc.
Closing
Date:
January
30, 2007.
Custodial
Agreement:
An
agreement, dated as of January 30, 2007, among the Depositor, EMC, Master
Funding, the Master Servicer, the Trustee and LaSalle Bank National Association
as custodian (in such capacity, the “Custodian”).
Cut-off
Date:
January
1, 2007.
Cut-off
Date Balance:
Shall
mean $353,343,723.06.
Deleted
Mortgage Loan:
A
Mortgage Loan replaced or to be replaced by a Replacement Mortgage
Loan.
Due
Date:
As to
any Mortgage Loan, the date in each month on which the related Scheduled
Payment
is due, as set forth in the related Mortgage Note.
EMC:
EMC
Mortgage Corporation.
EMC
Flow Loans:
The
Mortgage Loans purchased by EMC pursuant to a flow loan purchase agreement.
EMC
Mortgage Loans:
The
Mortgage Loans identified as such on the Mortgage Loan Schedule for which
EMC is
the applicable Mortgage Loan Seller.
LaSalle:
LaSalle
Bank National Association, or its successors in interest.
Master
Funding:
Master
Funding LLC.
Master
Funding Mortgage Loan:
The
Mortgage Loans identified as such on the Mortgage Loan Schedule for which
Master
Funding is the applicable Mortgage Loan Seller.
MERS:
Mortgage Electronic Registration Systems, Inc., a corporation organized
and
existing under the laws of the State of Delaware, or any successor
thereto.
MERS®
System:
The
system of recording transfers of Mortgages electronically maintained by
MERS.
Moody’s:
Xxxxx’x
Investors Service, Inc., or its successors in interest.
Mortgage:
The
mortgage, deed of trust or other instrument creating a first lien on or
first
priority ownership interest in an estate in fee simple in real property
securing
a Mortgage Note.
Mortgage
File:
The
items referred to in Exhibit
1
pertaining to a particular Mortgage Loan and any additional documents required
to be added to such documents pursuant to this Agreement.
Mortgage
Rate:
The
annual rate of interest borne by a Mortgage Note as stated herein.
Mortgagor:
The
obligor(s) on a Mortgage Note.
Net
Mortgage Rate:
As to
each Mortgage Loan, and at any time, the per annum rate equal to the Mortgage
Rate less the sum of (i) the Servicing Fee Rate, (ii) the Trustee Fee Rate
and
(iii) the rate at which the LPMI Fee is calculated, if any.
Opinion
of Counsel:
A
written opinion of counsel, who may be counsel for the Mortgage Loan Sellers
or
the Purchaser, reasonably acceptable to the Trustee.
Person:
Any
legal person, including any individual, corporation, partnership, joint
venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
Purchase
Price:
With
respect to any Mortgage Loan required to be purchased by EMC (on its own
behalf
as a Mortgage Loan Seller and on behalf of Master Funding) pursuant to
the
applicable provisions of this Agreement, an amount equal to the sum of
(i) 100%
of the principal remaining unpaid on such Mortgage Loan as of the date
of
purchase (including if a foreclosure has already occurred, the principal
balance
of the related Mortgage Loan at the time the Mortgaged Property was
acquired), net of any Servicing Advances and Advances attributable to
principal and payable to the purchaser of the Mortgage Loan
if such purchaser is also the Master Servicer of such Mortgage Loan,
(ii) accrued and unpaid interest thereon at the applicable Mortgage Rate
through
and including the last day of the month of such purchase, net of any
portion of the Servicing Fee and any Servicing Advances and
Advances attributable to interest that is payable to the purchaser of the
Mortgage Loan if such purchaser is also the Master Servicer of such
Mortgage Loan, plus (iii) any costs and damages (if any) incurred by the
Trust in connection with any violation of such Mortgage Loan of any
anti-predatory lending laws.
Rating
Agency:
Moody’s.
Replacement
Mortgage Loan:
A
mortgage loan substituted for a Deleted Mortgage Loan which must meet on
the
date of such substitution the requirements stated herein and in the Pooling
and
Servicing Agreement; upon such substitution, such mortgage loan shall be
a
“Mortgage
Loan”
hereunder.
Securities
Act:
The
Securities Act of 1933, as amended.
Value:
The
value of the Mortgaged Property at the time of origination of the related
Mortgage Loan, such value being the lesser of (i) the value of such property
set
forth in an appraisal accepted by the applicable originator of the Mortgage
Loan
or (ii) the sales price of such property at the time of
origination.
SECTION
2. Purchase
and Sale of the Mortgage Loans and Related Rights.
(a) Upon
satisfaction of the conditions set forth in Section 11 hereof, each Mortgage
Loan Seller agrees to sell, and the Purchaser agrees to purchase Mortgage
Loans
sold by such Mortgage Loan Seller having an aggregate outstanding principal
balance as of the Cut-off Date equal to the Cut-off Date Balance, and each
Mortgage Loan Seller’s interest in the Swap Agreement.
(b) The
closing for the purchase and sale of the Mortgage Loans and the closing
for the
issuance of the Certificates will take place on the Closing Date at the
office
of the Purchaser’s counsel in New York, New York or such other place as the
parties shall agree.
(c) Upon
the
satisfaction of the conditions set forth in Section 11 hereof, on the Closing
Date, the Purchaser shall pay to each respective Mortgage Loan Seller the
related Acquisition Price for the Mortgage Loans sold by such Mortgage
Loan
Seller in immediately available funds by wire transfer to such account
or
accounts as shall be designated by such Mortgage Loan Seller.
SECTION
3. Mortgage
Loan Schedule.
EMC (on
its own behalf as a Mortgage Loan Seller and on behalf of Master Funding)
agrees
to provide to the Purchaser as of the date hereof a listing of the Mortgage
Loans (the “Mortgage
Loan Schedule”)
setting forth the information listed on Exhibit
2
to this
Agreement with respect to each of the Mortgage Loans being sold by the
respective Mortgage Loan Sellers. The Mortgage Loan Schedule shall be delivered
to the Purchaser on the Closing Date and shall be in form and substance
mutually
agreed to by EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) and the Purchaser.
SECTION
4. Mortgage
Loan Transfer.
(a) The
Purchaser will be entitled to all scheduled payments of principal and interest
on the Mortgage Loans due after the Cut-off Date (regardless of when actually
collected) and all payments thereof. Each Mortgage Loan Seller will be
entitled
to all scheduled payments of principal and interest on the Mortgage Loans
sold
by it to the Purchaser due on or before the Cut-off Date (including payments
collected after the Cut-off Date) and all payments thereof. Such principal
amounts and any interest thereon belonging to the related Mortgage Loan
Seller
as described above will not be included in the aggregate outstanding principal
balance of the Mortgage Loans as of the Cut-off Date as set forth on the
Mortgage Loan Schedule.
(b) Pursuant
to various conveyancing documents to be executed on the Closing Date and
pursuant to the Pooling and Servicing Agreement, the Purchaser will assign
on
the Closing Date all of its right, title and interest in and to the Mortgage
Loans to the Trustee for the benefit of the Certificateholders. In connection
with the transfer and assignment of the Mortgage Loans, each Mortgage Loan
Seller has delivered or will deliver or cause to be delivered to the Trustee,
or
the Custodian on behalf of the Trustee, by the Closing Date or such later
date
as is agreed to by the Purchaser and such Mortgage Loan Seller (each of
the
Closing Date and such later date is referred to as a “Mortgage
File Delivery Date”),
the
items of each Mortgage File, provided,
however,
that in
lieu of the foregoing, each Mortgage Loan Seller may deliver the following
documents, under the circumstances set forth below: (x) in lieu of the
original
Mortgage (other than the Mortgages related to the EMC Flow Loans), assignments
to the Trustee or intervening assignments thereof which have been delivered,
are
being delivered or will upon receipt of recording information relating
to the
Mortgage required to be included thereon, be delivered to recording offices
for
recording and have not been returned in time to permit their delivery as
specified above, the related Mortgage Loan Seller may deliver a true copy
thereof with a certification by such Mortgage Loan Seller or the Master
Servicer, on the face of such copy, substantially as follows: “Certified to be a
true and correct copy of the original, which has been transmitted for
recording;” (y) in lieu of the Mortgage (other than the Mortgages related to the
EMC Flow Loans), assignments to the Trustee or intervening assignments
thereof,
if the applicable jurisdiction retains the originals of such documents
or if the
originals are lost (in each case, as evidenced by a certification from
such
Mortgage Loan Seller or the Master Servicer to such effect), such Mortgage
Loan
Seller may deliver photocopies of such documents containing an original
certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; and (z) in lieu of the
Mortgage
Notes relating to the Mortgage Loans, each identified in the list delivered
by
the Purchaser to the Trustee on the Closing Date and attached hereto as
Exhibit
5
the
related Mortgage Loan Seller may deliver lost note affidavits and indemnities
of
such Mortgage Loan Seller; and provided further, however, that in the case
of
Mortgage Loans which have been prepaid in full after the Cut-off Date and
prior
to the Closing Date, such Mortgage Loan Seller, in lieu of delivering the
above
documents, may deliver to the Trustee a certification by such Mortgage
Loan
Seller or the Master Servicer to such effect. Each Mortgage Loan Seller
shall
deliver such original documents (including any original documents as to
which
certified copies had previously been delivered) or such certified copies
to the
Trustee, or the Custodian on behalf of the Trustee, promptly after they
are
received. EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) shall cause the Mortgage and intervening assignments, if
any,
and the assignment of the Mortgage to be recorded not later than 180 days
after
the Closing Date unless such assignment is not required to be recorded
under the
terms set forth in Section 6(a) hereof.
(c) In
connection with the assignment of any Mortgage Loan registered on the MERS®
System, EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of Master
Funding) further agrees that it will cause, at EMC’s own expense, within 30 days
after the Closing Date, the MERS® System to indicate that such Mortgage Loans
have been assigned by the related Mortgage Loan Seller to the Purchaser
and by
the Purchaser to the Trustee in accordance with this Agreement for the
benefit
of the Certificateholders by including (or deleting, in the case of Mortgage
Loans which are repurchased in accordance with this Agreement) in such
computer
files (a) the code in the field which identifies the specific Trustee and
(b)
the code in the field “Pool Field” which identifies the series of the
Certificates issued in connection with such Mortgage Loans. EMC (on its
own
behalf as a Mortgage Loan Seller and on behalf of Master Funding) further
agrees
that it will not, and will not permit the Master Servicer to, and the Master
Servicer agrees that it will not, alter the codes referenced in this paragraph
with respect to any Mortgage Loan during the term of the Pooling and Servicing
Agreement unless and until such Mortgage Loan is repurchased in accordance
with
the terms of the Pooling and Servicing Agreement.
(d) Each
Mortgage Loan Seller and the Purchaser acknowledge hereunder that all of
the
Mortgage Loans will ultimately be assigned to LaSalle Bank National Association,
as Trustee for the benefit of the Certificateholders, on the date
hereof.
SECTION
5. Examination
of Mortgage Files.
(a) On
or
before the Mortgage File Delivery Date, each Mortgage Loan Seller will
have made
the related Mortgage Files available to the Purchaser or its agent for
examination which may be at the offices of the Trustee or such Mortgage
Loan
Seller and/or such Mortgage Loan Seller’s custodian. The fact that the Purchaser
or its agent has conducted or has failed to conduct any partial or complete
examination of the related Mortgage Files shall not affect the Purchaser’s
rights to demand cure, repurchase, substitution or other relief as provided
in
this Agreement. In furtherance of the foregoing, each Mortgage Loan Seller
shall
make the related Mortgage Files available to the Purchaser or its agent
from
time to time so as to permit the Purchaser to confirm such Mortgage Loan
Seller’s compliance with the delivery and recordation requirements of this
Agreement and the Pooling and Servicing Agreement. In addition, upon request
of
the Purchaser, each Mortgage Loan Seller agrees to provide to the Purchaser,
Bear Xxxxxxx and to any investors or prospective investors in the Certificates
information regarding the Mortgage Loans and their servicing, to make the
related Mortgage Files available to the Purchaser, Bear Xxxxxxx and to
such
investors or prospective investors (which may be at the offices of the
related
Mortgage Loan Seller and/or such Mortgage Loan Seller’s custodian) and to make
available personnel knowledgeable about the related Mortgage Loans for
discussions with the Purchaser, Bear Xxxxxxx and such investors or prospective
investors, upon reasonable request during regular business hours, sufficient
to
permit the Purchaser, Bear Xxxxxxx and such investors or potential investors
to
conduct such due diligence as any such party reasonably believes is
appropriate.
(b) Pursuant
to the Pooling and Servicing Agreement, on the Closing Date the Trustee
(or the
Custodian as obligated under the Custodial Agreement), for the benefit
of the
Certificateholders, will review items of the Mortgage Files as set forth
on
Exhibit
1
and will
deliver to EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) an initial certification in the form attached as Exhibit
One to
the Custodial Agreement.
(c) Within
90
days of the Closing Date, the Trustee or the Custodian on its behalf shall,
in
accordance with the provisions of Section 2.02 of the Pooling and Servicing
Agreement, deliver to EMC (on its own behalf as a Mortgage Loan Seller
and on
behalf of Master Funding) and the Trustee an Interim Certification in the
form
attached as Exhibit Two to the Custodial Agreement to the effect that all
such
documents have been executed and received and that such documents relate
to the
Mortgage Loans identified on the Mortgage Loan Schedule, except for any
exceptions listed on Schedule A attached to such Interim Certification.
The
Custodian shall be under no duty or obligation to inspect, review or examine
said documents, instruments, certificates or other papers to determine
that the
same are genuine, enforceable, or appropriate for the represented purpose
or
that they have actually been recorded or that they are other than what
they
purport to be on their face.
(d) The
Trustee or the Custodian on its behalf will review the Mortgage Files within
180
days of the Closing Date and will deliver to EMC and the Master Servicer,
and if
reviewed by the Custodian, the Trustee, a final certification substantially
in
the form of Exhibit Three to the Custodial Agreement. If the Trustee or
the
Custodian on its behalf is unable to deliver a final certification with
respect
to the items listed in Exhibit
1
due to
any document that is missing, has not been executed, is unrelated, determined
on
the basis of the Mortgagor name, original principal balance and loan number,
to
the Mortgage Loans identified in the Mortgage Loan Schedule (a “Material
Defect”),
the
Trustee or the Custodian on its behalf shall notify EMC of such Material
Defect.
EMC (on its own behalf as a Mortgage Loan Seller and on behalf of Master
Funding) shall correct or cure any such Material Defect within 90 days
from the
date of notice from the Trustee, the Depositor or the Master Servicer of
the
Material Defect and if EMC (on its own behalf as a Mortgage Loan Seller
and on
behalf of Master Funding) does not correct or cure such Material Defect
within
such period and such defect materially and adversely affects the interests
of
the Certificateholders in the related Mortgage Loan, EMC (on its own behalf
as a
Mortgage Loan Seller and on behalf of Master Funding) will, in accordance
with
the terms of the Pooling and Servicing Agreement, within 90 days of the
date of
notice, provide the Trustee with a Replacement Mortgage Loan (if within
two
years of the Closing Date) or purchase the related Mortgage Loan at the
applicable Purchase Price; provided,
however,
that if
such defect relates solely to the inability of EMC (on its own behalf as
a
Mortgage Loan Seller and on behalf of Master Funding) to deliver the original
security instrument or intervening assignments thereof, or a certified
copy
because the originals of such documents, or a certified copy, have not
been
returned by the applicable jurisdiction, EMC shall not be required to purchase
such Mortgage Loan if EMC (on its own behalf as a Mortgage Loan Seller
and on
behalf of Master Funding) delivers such original documents or certified
copy
promptly upon receipt, but in no event later than 360 days after the Closing
Date. The foregoing repurchase obligation shall not apply in the event
that EMC
(on its own behalf as a Mortgage Loan Seller and on behalf of Master Funding)
cannot deliver such original or copy of any document submitted for recording
to
the appropriate recording office in the applicable jurisdiction because
such
document has not been returned by such office; provided that EMC (on its
own
behalf as a Mortgage Loan Seller and on behalf of Master Funding) shall
instead
deliver a recording receipt of such recording office or, if such receipt
is not
available, a certificate of EMC (on its own behalf as a Mortgage Loan Seller
and
on behalf of Master Funding) or a Servicing Officer confirming that such
documents have been accepted for recording, and delivery to the Trustee
shall be
effected by EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) within thirty days of its receipt of the original recorded
document.
(e) At
the
time of any substitution, EMC (on its own behalf as a Mortgage Loan Seller
and
on behalf of Master Funding) shall deliver or cause to be delivered the
Replacement Mortgage Loan, the related Mortgage File and any other documents
and
payments required to be delivered in connection with a substitution pursuant
to
the Pooling and Servicing Agreement. At the time of any purchase or
substitution, the Trustee shall (i) assign the selected Mortgage Loan to
EMC (on
its own behalf as a Mortgage Loan Seller and on behalf of Master Funding)
and
shall release or cause the Custodian to release the documents (including,
but
not limited to, the Mortgage, Mortgage Note and other contents of the Mortgage
File) in the possession of the Trustee or the Custodian, as applicable
relating
to the Deleted Mortgage Loan and (ii) execute and deliver such instruments
of
transfer or assignment, in each case without recourse, as shall be necessary
to
vest in EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of Master
Funding) title to such Deleted Mortgage Loan.
SECTION
6. Recordation
of Assignments of Mortgage.
(a) EMC
(on
its own behalf as a Mortgage Loan Seller and on behalf of Master Funding)
will,
promptly after the Closing Date, cause each Mortgage and each assignment
of
Mortgage from the Mortgage Loan Sellers to the Trustee, and all unrecorded
intervening assignments, if any, delivered on or prior to the Closing Date,
to
be recorded in all recording offices in the jurisdictions where the related
Mortgaged Properties are located; provided,
however,
EMC (on
its own behalf as a Mortgage Loan Seller or on behalf of Master Funding)
need
not cause to be recorded any assignment which relates to a Mortgage Loan
that is
a MOM Loan or for which the related Mortgaged Property is located in any
jurisdiction under the laws of which, as evidenced by an Opinion of Counsel
delivered by EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) to the Trustee and the Rating Agency, the recordation of
such
assignment is not necessary to protect the Trustee’s interest in the related
Mortgage Loan; provided,
however,
notwithstanding the delivery of any Opinion of Counsel, each assignment
of
Mortgage shall be submitted for recording by EMC (on its own behalf as
a
Mortgage Loan Seller and on behalf of Master Funding) in the manner described
above, at no expense to the Trust Fund or Trustee, upon the earliest to
occur of
(i) reasonable direction by the Holders of Certificates evidencing Percentage
Interests aggregating not less than 25% of the Trust, (ii) the occurrence
of an
Event of Default, (iii) the occurrence of a bankruptcy, insolvency or
foreclosure relating to EMC under the Pooling and Servicing Agreement,
(iv) the
occurrence of a servicing transfer or an assignment of the servicing as
described in Section 7.07 of the Pooling and Servicing Agreement or (iv)
with
respect to any one assignment of Mortgage, the occurrence of a bankruptcy,
insolvency or foreclosure relating to the Mortgagor under the related
Mortgage.
While
each such Mortgage or assignment is being recorded, if necessary, EMC (on
its
own behalf as a Mortgage Loan Seller and on behalf of Master Funding) shall
leave or cause to be left with the Trustee or the Custodian on its behalf
a
certified copy of such Mortgage or assignment. In the event that, within
180
days of the Closing Date, the Trustee has not been provided with an Opinion
of
Counsel as described above or received evidence of recording with respect
to
each Mortgage Loan delivered to the Purchaser pursuant to the terms hereof
or as
set forth above and the related Mortgage Loan is not a MOM Loan, the failure
to
provide evidence of recording or such Opinion of Counsel shall be considered
a
Material Defect, and the provisions of Section 5(c) and (d) shall apply.
All
customary recording fees and reasonable expenses relating to the recordation
of
the assignments of mortgage to the Trustee or the Opinion of Counsel, as
the
case may be, shall be borne by EMC.
(b) It
is the
express intent of the parties hereto that the conveyance of the Mortgage
Loans
by each Mortgage Loan Seller to the Purchaser, as contemplated by this
Agreement
be, and be treated as, a sale. It is, further, not the intention of the
parties
that such conveyance be deemed a pledge of the Mortgage Loans by such Mortgage
Loan Seller to the Purchaser to secure a debt or other obligation of that
Mortgage Loan Seller. However, in the event that, notwithstanding the intent
of
the parties, the Mortgage Loans are held by a court to continue to be property
of such Mortgage Loan Seller, then (a) this Agreement shall also be deemed
to be
a security agreement within the meaning of Articles 8 and 9 of the applicable
Uniform Commercial Code; (b) the transfer of the Mortgage Loans provided
for
herein shall be deemed to be a grant by such Mortgage Loan Seller to the
Purchaser of a security interest in all of such Mortgage Loan Seller’s right,
title and interest in and to the Mortgage Loans and all amounts payable
to the
holders of the Mortgage Loans in accordance with the terms thereof and
all
proceeds of the conversion, voluntary or involuntary, of the foregoing
into
cash, instruments, securities or other property, to the extent the Purchaser
would otherwise be entitled to own such Mortgage Loans and proceeds pursuant
to
Section 4 hereof, including all amounts, other than investment earnings,
from
time to time held or invested in any accounts created pursuant to the Pooling
and Servicing Agreement, whether in the form of cash, instruments, securities
or
other property; (c) the possession by the Purchaser or the Trustee (or
the
Custodian on its behalf) of Mortgage Notes and such other items of property
as
constitute instruments, money, negotiable documents or chattel paper shall
be
deemed to be “possession by the secured party” for purposes of perfecting the
security interest pursuant to Section 9-305 (or comparable provision) of
the
applicable Uniform Commercial Code; 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 Purchaser for the purpose of perfecting such security
interest under applicable law. Any assignment of the interest of the Purchaser
pursuant to any provision hereof or pursuant to the Pooling and Servicing
Agreement shall also be deemed to be an assignment of any security interest
created hereby. EMC (on its own behalf as a Mortgage Loan Seller and on
behalf
of Master Funding) and the Purchaser shall, to the extent consistent with
this
Agreement, take such actions as may be reasonably necessary to ensure that,
if
this Agreement were deemed to create a security interest in the Mortgage
Loans,
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 the Pooling and Servicing Agreement.
SECTION
7. Representations
and Warranties of EMC Concerning the Mortgage Loans.
EMC
hereby represents and warrants to the Purchaser as of the Closing Date
or such
other date as may be specified below with respect to each Mortgage
Loan:
(a) The
information set forth in the Mortgage Loan Schedule hereto is true and
correct
in all material respects.
(b) Immediately
prior to the transfer to the Purchaser, the related Mortgage Loan Seller
was the
sole owner of beneficial title and holder of each Mortgage and Mortgage
Note
relating to the Mortgage Loans and is conveying the same free and clear
of any
and all liens, claims, encumbrances, participation interests, equities,
pledges,
charges or security interests of any nature and such Mortgage Loan Seller
has
full right and authority to sell or assign the same pursuant to this
Agreement.
(c) Each
Mortgage Loan at the time it was made complied in all material respects
with all
applicable local, state and federal laws and regulations, including, without
limitation, usury, equal credit opportunity, disclosure and recording laws
and
all applicable predatory, abusive and fair lending laws; and each Mortgage
Loan
has been serviced in all material respects in accordance with all applicable
local, state and federal laws and regulations, including, without limitation,
usury, equal credit opportunity, disclosure and recording laws and all
applicable anti-predatory lending laws and the terms of the related Mortgage
Note, the Mortgage and other loan documents.
(d) There
is
no monetary default existing under any Mortgage or the related Mortgage
Note and
there is no material event which, with the passage of time or with notice
and
the expiration of any grace or cure period, would constitute a default,
breach
or event of acceleration; and neither the related Mortgage Loan Seller,
any of
its affiliates nor any servicer of any related Mortgage Loan has taken
any
action to waive any default, breach or event of acceleration; and no foreclosure
action is threatened or has been commenced with respect to the Mortgage
Loan.
(e) The
terms
of the Mortgage Note and the Mortgage have not been impaired, waived, altered
or
modified in any respect, except by written instruments, (i) if required
by law
in the jurisdiction where the Mortgaged Property is located, or (ii) to
protect
the interests of the Trustee on behalf of the Certificateholders.
(f) No
selection procedure reasonably believed by the related Mortgage Loan Seller
to
be adverse to the interests of the Certificateholders was utilized in selecting
the Mortgage Loans.
(g) Each
Mortgage is a valid and enforceable first lien on the property securing
the
related Mortgage Note and each Mortgaged Property is owned by the Mortgagor
in
fee simple (except with respect to common areas in the case of condominiums,
PUDs and de minimis
PUDs) or
by leasehold for a term longer than the term of the related Mortgage, subject
only to (i) the lien of current real property taxes and assessments, (ii)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record as of the date of recording of such Mortgage,
such
exceptions being acceptable to mortgage lending institutions generally
or
specifically reflected in the appraisal obtained in connection with the
origination of the related Mortgage Loan or referred to in the lender’s title
insurance policy delivered to the originator of the related Mortgage Loan
and
(iii) other matters to which like properties are commonly subject which
do not
materially interfere with the benefits of the security intended to be provided
by such Mortgage.
(h) There
is
no mechanics’ lien or claim for work, labor or material affecting the premises
subject to any Mortgage which is or may be a lien prior to, or equal with,
the
lien of such Mortgage except those which are insured against by the title
insurance policy referred to in clause (m) below.
(i) There
was
no delinquent tax or assessment lien against the property subject to any
Mortgage, except where such lien was being contested in good faith and
a stay
had been granted against levying on the property.
(j) There
is
no valid offset, defense or counterclaim to any Mortgage Note or Mortgage,
including the obligation of the Mortgagor to pay the unpaid principal and
interest on such Mortgage Note.
(k) The
physical property subject to any Mortgage is free of material damage and
is in
good repair and there is no proceeding pending or threatened for the total
or
partial condemnation of any Mortgaged Property.
(l) The
Mortgaged Property and all improvements thereon comply with all requirements
of
any applicable zoning and subdivision laws and ordinances.
(m) A
lender’s title insurance policy (on an ALTA or CLTA form) or binder, or other
assurance of title customary in the relevant jurisdiction therefor in a
form
acceptable to Xxxxxx Xxx or Xxxxxxx Mac, was issued on the date that each
Mortgage Loan was created by a title insurance company which, to the best
of the
related Mortgage Loan Seller’s knowledge, was qualified to do business in the
jurisdiction where the related Mortgaged Property is located, insuring
such
Mortgage Loan Seller and its successors and assigns that the Mortgage is
a first
priority lien on the related Mortgaged Property in the original principal
amount
of the Mortgage Loan. The related Mortgage Loan Seller is the sole insured
under
such lender’s title insurance policy, and such policy, binder or assurance is
valid and remains in full force and effect, and each such policy, binder
or
assurance shall contain all applicable endorsements including a negative
amortization endorsement, if applicable.
(n) At
the
time of origination, each Mortgaged Property was the subject of an appraisal
which conformed to the underwriting requirements of the originator of the
Mortgage Loan and, the appraisal is in a form acceptable to Xxxxxx Mae
or
Xxxxxxx Mac.
(o) The
improvements on each Mortgaged Property securing a Mortgage Loan are insured
(by
an insurer which is acceptable to the related Mortgage Loan Seller) against
loss
by fire and such hazards as are covered under a standard extended coverage
endorsement in the locale in which the Mortgaged Property is located, in
an
amount which is not less than the lesser of the maximum insurable value
of the
improvements securing such Mortgage Loan or the outstanding principal balance
of
the Mortgage Loan, but in no event in an amount less than an amount that
is
required to prevent the Mortgagor from being deemed to be a co-insurer
thereunder; if the improvement on the Mortgaged Property is a condominium
unit,
it is included under the coverage afforded by a blanket policy for the
condominium project; if upon origination of the related Mortgage Loan,
the
improvements on the Mortgaged Property were in an area identified as a
federally
designated flood area, a flood insurance policy is in effect in an amount
representing coverage not less than the least of (i) the outstanding principal
balance of the Mortgage Loan, (ii) the restorable cost of improvements
located
on such Mortgaged Property or (iii) the maximum coverage available under
federal
law; and each Mortgage obligates the Mortgagor thereunder to maintain the
insurance referred to above at the Mortgagor’s cost and expense.
(p) Each
Mortgage Loan constitutes a “qualified mortgage” under Section 860G(a)(3)(A) of
the Code and Treasury Regulation Section 1.860G-2(a)(1), (2), (4), (5),
(6), (7)
and (9) without reliance on the provisions of Treasury Regulation Section
1.860G-2(a)(3) or Treasury Regulation Section 1.860G-2(f)(2) or any other
provision that would allow a Mortgage Loan to be treated as a “qualified
mortgage” notwithstanding its failure to meet the requirements of Section
860G(a)(3)(A) of the Code and Treasury Regulation Section 1.860G-2(a)(1),
(2),
(4), (5), (6), (7) and (9).
(q) None
of
the Mortgage Loans are (a) loans subject to 12 CFR Part 226.31, 12 CFR
Part
226.32 or 12 CFR Part 226.34 of Regulation Z, the regulation implementing
TILA,
which implements the Home Ownership and Equity Protection Act of 1994,
as
amended or (b) “high cost home,” “covered” (excluding home loans defined as
“covered home loans” in the New Jersey Home
Ownership Security Act of 2002 that were originated between November 26,
2003
and July 7, 2004), “high risk home” or “predatory” loans under any applicable
state, federal or local law (or a similarly classified loan using different
terminology under a law imposing heightened regulatory scrutiny or additional
legal liability for residential mortgage loans having high interest rates,
points and/or fees).
(r) The
information set forth in Schedule A of the Prospectus Supplement with respect
to
the Mortgage Loans
is true
and correct in all material respects.
(s) No
Mortgage Loan (a) is a “high cost loan” or “covered loan” as applicable (as such
terms
are
defined in the then current Standard & Poor’s LEVELS® Glossary, which is now
Version 5.7, Appendix E, attached hereto as Exhibit 6) or (b) was originated
on
or after October 1, 2002 and before March 7, 2003, which is governed by
the
Georgia Fair Lending Act.
(t) Each
Mortgage Loan was originated in accordance with the underwriting guidelines
of
the related originator.
(u) Each
original Mortgage has been recorded or is in the process of being recorded
in
accordance with the requirements of Section 2.01 of the Pooling and Servicing
Agreement in the appropriate jurisdictions wherein such recordation is
required
to perfect the lien thereof for the benefit of the Trust Fund.
(v) The
related Mortgage File contains each of the documents and instruments listed
in
Section 2.01 of the Pooling and Servicing Agreement, subject to any exceptions,
substitutions and qualifications as are set forth in such Section.
(w) The
Mortgage Loans are currently being serviced in accordance with accepted
servicing practices.
(x) With
respect to each Mortgage Loan that has a prepayment penalty feature, each
such
prepayment penalty is enforceable and will be enforced by the related Mortgage
Loan Seller and each prepayment penalty
is
permitted pursuant to federal, state and local law. In addition, with respect
to
each Mortgage Loan (i) no Mortgage Loan will impose a prepayment penalty
for a
term in excess of five years from the date such Mortgage Loan was originated
and
(ii) such prepayment penalty is at least equal to the lesser of (A) the
maximum
amount permitted under applicable law and (B) six months interest at the
related
Mortgage Rate on the amount prepaid in excess of 20% of the original principal
balance of such Mortgage Loan.
(y) If
any of
the Mortgage Loans are secured by a leasehold interest, with respect to
each
leasehold interest: the use of leasehold estates for residential properties
is
an accepted practice in the area where the related Mortgaged Property is
located; residential property in such area consisting of leasehold estates
is
readily marketable; the lease is recorded and no party is in any way in
breach
of any provision of such lease; the leasehold is in full force and effect
and is
not subject to any prior lien or encumbrance by which the leasehold could
be
terminated or subject to any charge or penalty; and the remaining term
of the
lease does not terminate less than ten years after the maturity date of
such
Mortgage Loan.
(z)
each
Mortgage Loan was originated (a) by a savings and loan association, savings
bank, commercial bank, credit union, insurance company or similar institution
that is supervised and examined by a federal or state authority, (b) by
a
mortgagee approved by the Secretary of Housing and Urban Development pursuant
to
Sections 203 and 211 of the National Housing Act, as amended, or (c) by
a
mortgage broker or correspondent lender in a manner such that the related
Mortgage Loan would be regarded for purposes of Section 3(a)(41) of the
Securities Exchange Act of 1934, as amended, as having been originated
by an
entity described in clauses (a) or (b) above.
It
is
understood and agreed that the representations and warranties set forth
in this
Section 7 will inure to the benefit of the Purchaser, its successors and
assigns, notwithstanding any restrictive or qualified endorsement on any
Mortgage Note or assignment of Mortgage or the examination of any Mortgage
File.
Upon any substitution for a Mortgage Loan, the representations and warranties
set forth above shall be deemed to be made by the related Mortgage Loan
Seller
as to any Replacement Mortgage Loan as of the date of substitution.
Upon
discovery or receipt of notice by EMC, the Purchaser or the Trustee of
a breach
of any representation or warranty of EMC set forth in this Section 7 which
materially and adversely affects the value of the interests of the Purchaser,
the Certificateholders or the Trustee in any of the Mortgage Loans delivered
to
the Purchaser pursuant to this Agreement, the party discovering or receiving
notice of such breach shall give prompt written notice to the others. In
the
case of any such breach of a representation or warranty set forth in this
Section 7, within 90 days from the date of discovery by EMC, or the date
EMC is
notified by the party discovering or receiving notice of such breach (whichever
occurs earlier), EMC will (i) cure such breach in all material respects,
(ii)
purchase the affected Mortgage Loan at the applicable Purchase Price or
(iii) if
within two years of the Closing Date, substitute a qualifying Replacement
Mortgage Loan in exchange for such Mortgage Loan; provided that, (A) in
the case
of a breach of the representation and warranty concerning the Mortgage
Loan
Schedule contained in clause (a) of this Section 7, if such breach is material
and relates to any field on the Mortgage Loan Schedule which identifies
any
Prepayment Charge or (B) in the case of a breach of the representation
contained
in clause (x) of this Section 7, then, in each case, in lieu of purchasing
such
Mortgage Loan from the Trust Fund at the Purchase Price, EMC shall pay
the
amount of the Prepayment Charge (net of any amount previously collected
by or
paid to the Trust Fund in respect of such Prepayment Charge) from its own
funds
and without reimbursement therefor, and EMC shall have no obligation to
repurchase or substitute for such Mortgage Loan. The obligations of EMC
to cure,
purchase or substitute a qualifying Replacement Mortgage Loan shall constitute
the Purchaser’s, the Trustee’s and the Certificateholder’s sole and exclusive
remedy under this Agreement or otherwise respecting a breach of representations
or warranties hereunder with respect to the Mortgage Loans, except for
the
obligation of EMC to indemnify the Purchaser for such breach as set forth
in and
limited by Section 14 hereof.
Any
cause
of action against EMC or relating to or arising out of a breach by EMC
of any
representations and warranties made in this Section 7 shall accrue as to
any
Mortgage Loan upon (i) discovery of such breach by EMC or notice thereof
by the
party discovering such breach and (ii) failure by EMC to cure such breach,
purchase such Mortgage Loan or substitute a qualifying Replacement Mortgage
Loan
pursuant to the terms hereof.
SECTION
8. Representations
and Warranties Concerning EMC.
As of
the date hereof and as of the Closing Date, EMC represents and warrants
to the
Purchaser and Master Funding as to itself in the capacity indicated as
follows:
(a) EMC
(i)
is a corporation duly organized, validly existing and in good standing
under the
laws of the State of Delaware and (ii) is qualified and in good standing
to do
business in each jurisdiction where such qualification is necessary, except
where the failure so to qualify would not reasonably be expected to have
a
material adverse effect on EMC’s business as presently conducted or on EMC’s
ability to enter into this Agreement and to consummate the transactions
contemplated hereby;
(b) EMC
has
full power to own its property, to carry on its business as presently conducted
and to enter into and perform its obligations under this Agreement;
(c) The
execution and delivery by EMC of this Agreement has been duly authorized
by all
necessary action on the part of EMC; and neither the execution and delivery
of
this Agreement, nor the consummation of the transactions herein contemplated,
nor compliance with the provisions hereof or thereof, will conflict with
or
result in a breach of, or constitute a default under, any of the provisions
of
any law, governmental rule, regulation, judgment, decree or order binding
on EMC
or its properties or the charter or by-laws of EMC, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on EMC’s ability to enter into this Agreement and to consummate
the transactions contemplated hereby;
(d) The
execution, delivery and performance by EMC of this Agreement and the
consummation of the transactions contemplated hereby do not require the
consent
or approval of, the giving of notice to, the registration with, or the
taking of
any other action in respect of, any state, federal or other governmental
authority or agency, except those consents, approvals, notices, registrations
or
other actions as have already been obtained, given or made and, in connection
with the recordation of the Mortgages, powers of attorney or assignments
of
Mortgages not yet completed;
(e) This
Agreement has been duly executed and delivered by EMC and, assuming due
authorization, execution and delivery by the Purchaser or the parties thereto,
constitutes a valid and binding obligation of EMC enforceable against it
in
accordance with its terms (subject to applicable bankruptcy and insolvency
laws
and other similar laws affecting the enforcement of the rights of creditors
generally);
(f) There
are
no actions, suits or proceedings pending or, to the knowledge of EMC, threatened
against EMC, before or by any court, administrative agency, arbitrator
or
governmental body (i) with respect to any of the transactions contemplated
by
this Agreement or (ii) with respect to any other matter which in the judgment
of
EMC could reasonably be expected to be determined adversely to EMC and
if
determined adversely to EMC materially and adversely affect EMC’s ability to
perform its obligations under this Agreement; and EMC not in default with
respect to any order of any court, administrative agency, arbitrator or
governmental body so as to materially and adversely affect the transactions
contemplated by this Agreement; and
(g) The
Mortgage Loan Sellers’ Information (as defined in Section 14(a) hereof) does not
include any untrue statement of a material fact or omit to state a material
fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading.
SECTION
9. Representations
and Warranties Concerning the Purchaser.
As of
the date hereof and as of the Closing Date, the Purchaser represents and
warrants to the Mortgage Loan Sellers as follows:
(a) The
Purchaser (i) is a limited liability company duly organized, validly existing
and in good standing under the laws of the State of Delaware and (ii) is
qualified and in good standing to do business in each jurisdiction where
such
qualification is necessary, except where the failure so to qualify would
not
reasonably be expected to have a material adverse effect on the Purchaser’s
business as presently conducted or on the Purchaser’s ability to enter into this
Agreement and to consummate the transactions contemplated hereby;
(b) The
Purchaser has full power to own its property, to carry on its business
as
presently conducted and to enter into and perform its obligations under
this
Agreement;
(c) The
execution and delivery by the Purchaser of this Agreement has been duly
authorized by all necessary action on the part of the Purchaser; and neither
the
execution and delivery of this Agreement, nor the consummation of the
transactions herein contemplated, nor compliance with the provisions hereof,
will conflict with or result in a breach of, or constitute a default under,
any
of the provisions of any law, governmental rule, regulation, judgment,
decree or
order binding on the Purchaser or its properties or the certificate of
formation
or limited liability company agreement of the Purchaser, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on the Purchaser’s ability to enter into this Agreement and to
consummate the transactions contemplated hereby or thereby;
(d) The
execution, delivery and performance by the Purchaser of this Agreement
and the
consummation of the transactions contemplated hereby or thereby do not
require
the consent or approval of, the giving of notice to, the registration with,
or
the taking of any other action in respect of, any state, federal or other
governmental authority or agency, except those consents, approvals, notices,
registrations or other actions as have already been obtained, given or
made;
(e) This
Agreement has been duly executed and delivered by the Purchaser and, assuming
due authorization, execution and delivery by the Mortgage Loan Sellers,
constitutes a valid and binding obligation of the Purchaser enforceable
against
it in accordance with its terms (subject to applicable bankruptcy and insolvency
laws and other similar laws affecting the enforcement of the rights of
creditors
generally);
(f) There
are
no actions, suits or proceedings pending or, to the knowledge of the Purchaser,
threatened against the Purchaser, before or by any court, administrative
agency,
arbitrator or governmental body (i) with respect to any of the transactions
contemplated by this Agreement or (ii) with respect to any other matter
which in
the judgment of the Purchaser could reasonably be expected to be determined
adversely to the Purchaser and if determined adversely to the Purchaser
materially and adversely affect the Purchaser’s ability to perform its
obligations under this Agreement; and the Purchaser is not in default with
respect to any order of any court, administrative agency, arbitrator or
governmental body so as to materially and adversely affect the transactions
contemplated by this Agreement; and
(g) The
Purchaser’s Information (as defined in Section 14(b) hereof) does not include
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made, in light of the circumstances
under which they were made, not misleading.
SECTION
10. Representations
and Warranties Concerning Master Funding.
As of
the date hereof and as of the Closing Date, Master Funding represents and
warrants to EMC and the Purchaser as follows:
(a) Master
Funding (i) is a limited liability company duly organized, validly existing
and
in good standing under the laws of the State of Delaware and (ii) is qualified
and in good standing to do business in each jurisdiction where such
qualification is necessary, except where the failure so to qualify would
not
reasonably be expected to have a material adverse effect on Master Funding’s
business as presently conducted or on Master Funding’s ability to enter into
this Agreement and to consummate the transactions contemplated
hereby;
(b) Master
Funding has full power to own its property, to carry on its business as
presently conducted and to enter into and perform its obligations under
this
Agreement;
(c) The
execution and delivery by Master Funding of this Agreement has been duly
authorized by all necessary action on the part of Master Funding; and neither
the execution and delivery of this Agreement, nor the consummation of the
transactions herein contemplated, nor compliance with the provisions hereof
or
thereof, will conflict with or result in a breach of, or constitute a default
under, any of the provisions of any law, governmental rule, regulation,
judgment, decree or order binding on Master Funding or its properties or
the
written consent of the sole member or limited liability company agreement
of
Master Funding, except those conflicts, breaches or defaults which would
not
reasonably be expected to have a material adverse effect on Master Funding’s
ability to enter into this Agreement and to consummate the transactions
contemplated hereby;
(d) The
execution, delivery and performance by Master Funding of this Agreement
and the
consummation of the transactions contemplated hereby do not require the
consent
or approval of, the giving of notice to, the registration with, or the
taking of
any other action in respect of, any state, federal or other governmental
authority or agency, except those consents, approvals, notices, registrations
or
other actions as have already been obtained, given or made and, in connection
with the recordation of the Mortgages, powers of attorney or assignments
of
Mortgages not yet completed;
(e) This
Agreement has been duly executed and delivered by Master Funding and, assuming
due authorization, execution and delivery by the Purchaser or the parties
thereto, constitutes a valid and binding obligation of Master Funding
enforceable against it in accordance with its terms (subject to applicable
bankruptcy and insolvency laws and other similar laws affecting the enforcement
of the rights of creditors generally); and
(f) There
are
no actions, suits or proceedings pending or, to the knowledge of Master
Funding,
threatened against Master Funding, before or by any court, administrative
agency, arbitrator or governmental body (i) with respect to any of the
transactions contemplated by this Agreement or (ii) with respect to any
other
matter which in the judgment of Master Funding could reasonably be expected
to
be determined adversely to Master Funding and if determined adversely to
Master
Funding materially and adversely affect Master Funding’s ability to perform its
obligations under this Agreement; and Master Funding is not in default
with
respect to any order of any court, administrative agency, arbitrator or
governmental body so as to materially and adversely affect the transactions
contemplated by this Agreement.
SECTION
11. Conditions
to Closing.
(a) The
obligations of the Purchaser under this Agreement will be subject to the
satisfaction, on or prior to the Closing Date, of the following
conditions:
(1) Each
of
the obligations of each Mortgage Loan Seller required to be performed at
or
prior to the Closing Date pursuant to the terms of this Agreement shall
have
been duly performed and complied with in all material respects; all of
the
representations and warranties of each Mortgage Loan Seller under this
Agreement
shall be true and correct as of the date or dates specified in all material
respects; and no event shall have occurred which, with notice or the passage
of
time, would constitute a default under this Agreement or the Pooling and
Servicing Agreement; and the Purchaser shall have received certificates
to that
effect signed by authorized officers of each of the Mortgage Loan
Sellers.
(2) The
Purchaser shall have received all of the following closing documents, in
such
forms as are agreed upon and reasonably acceptable to the Purchaser, duly
executed by all signatories other than the Purchaser as required pursuant
to the
respective terms thereof:
(i) The
Pooling and Servicing Agreement, in form and substance reasonably satisfactory
to the Trustee and the Purchaser, and all documents required thereby duly
executed by all signatories;
(ii) A
certificate of an officer of EMC dated as of the Closing Date, in a form
reasonably acceptable to the Purchaser, and attached thereto the resolutions
of
EMC authorizing the transactions contemplated by this Agreement, together
with
copies of the articles of incorporation, by-laws and certificate of good
standing of EMC;
(iii) A
certificate of an officer of Master Funding dated as of the Closing Date,
in a
form reasonably acceptable to the Purchaser, and attached thereto the
resolutions of Master Funding authorizing the transactions contemplated
by this
Agreement, together with copies of the written consent of the sole member,
limited liability company agreement and certificate of good standing of
Master
Funding;
(iv) One
or
more opinions of counsel from the Mortgage Loan Sellers’ counsel otherwise in
form and substance reasonably satisfactory to the Purchaser, the Trustee
and
each Rating Agency;
(v) A
letter
from the Rating Agency giving each Class of Certificates set forth on Schedule
A
hereto the rating set forth therein; and
(vi) Such
other documents, certificates (including additional representations and
warranties) and opinions as may be reasonably necessary to secure the intended
ratings from each Rating Agency for the Certificates.
(3) The
Certificates to be sold to Bear Xxxxxxx pursuant to the Underwriting Agreement
and the Purchase Agreement shall have been issued and sold to Bear
Xxxxxxx.
(4) Each
Mortgage Loan Seller shall have furnished to the Purchaser such other
certificates of its officers or others and such other documents and opinions
of
counsel to evidence fulfillment of the conditions set forth in this Agreement
and the transactions contemplated hereby as the Purchaser and their respective
counsel may reasonably request.
(b) The
obligations of each Mortgage Loan Seller under this Agreement shall be
subject
to the satisfaction, on or prior to the Closing Date, of the following
conditions:
(1) The
obligations of the Purchaser required to be performed by it on or prior
to the
Closing Date pursuant to the terms of this Agreement shall have been duly
performed and complied with in all material respects, and all of the
representations and warranties of the Purchaser under this Agreement shall
be
true and correct in all material respects as of the date hereof and as
of the
Closing Date, and no event shall have occurred which would constitute a
breach
by it of the terms of this Agreement or the Pooling and Servicing Agreement,
and
each Mortgage Loan Seller shall have received a certificate to that effect
signed by an authorized officer of the Purchaser.
(2) Each
Mortgage Loan Seller shall have received copies of all of the following
closing
documents, in such forms as are agreed upon and reasonably acceptable to
each
Mortgage Loan Seller, duly executed by all signatories other than the related
Mortgage Loan Seller as required pursuant to the respective terms
thereof:
(i) The
Pooling and Servicing Agreement, in form and substance reasonably satisfactory
to EMC and the Trustee, and all documents required thereby duly executed
by all
signatories;
(ii) A
certificate of an officer of the Purchaser dated as of the Closing Date,
in a
form reasonably acceptable to each Mortgage Loan Seller, and attached thereto
the written consent of the member of the Purchaser authorizing the transactions
contemplated by this Agreement, the Pooling and Servicing Agreement, together
with copies of the Purchaser’s certificate of formation, limited liability
company agreement and evidence as to the good standing of the Purchaser
dated as
of a recent date;
(iii) One
or
more opinions of counsel from the Purchaser’s counsel in form and substance
reasonably satisfactory to each Mortgage Loan Seller, the Trustee and the
Rating
Agency; and
(iv) Such
other documents, certificates (including additional representations and
warranties) and opinions as may be reasonably necessary to secure the intended
rating from each Rating Agency for the Certificates.
SECTION
12. Fees
and Expenses.
Subject
to Section 17 hereof, EMC (on its own behalf as a Mortgage Loan Seller
and on
behalf of Master Funding) shall pay on the Closing Date or such later date
as
may be agreed to by the Purchaser (i) the fees and expenses of the Mortgage
Loan
Sellers’ attorneys and the reasonable fees and expenses of the Purchaser’s
attorneys, (ii) the fees and expenses of Deloitte & Touche llp,
(iii)
the fee for the use of Purchaser’s Registration Statement based on the aggregate
original principal amount of the Certificates and the filing fee of the
Commission as in effect on the date on which the Registration Statement
was
declared effective, (iv) the fees and expenses including counsel’s fees and
expenses in connection with any “blue sky” and legal investment matters, (v) the
fees and expenses of the Trustee which shall include without limitation
the fees
and expenses of the Trustee (and the fees and disbursements of its counsel)
with
respect to (A) legal and document review of this Agreement, the Pooling
and
Servicing Agreement, the Certificates and related agreements, (B) attendance
at
the Closing and (C) review of the Mortgage Loans to be performed by the
Trustee
or the Custodian on its behalf, (vi) the expenses for printing or otherwise
reproducing the Certificates, the Prospectus, the Prospectus Supplement
and the
Free Writing Prospectus, (vii) the fees and expenses of the Rating Agency
(both
initial and ongoing), (viii) the fees and expenses relating to the preparation
and recordation of mortgage assignments (including intervening assignments,
if
any and if available, to evidence a complete chain of title from the originator
to the Trustee) from each Mortgage Loan Seller to the Trustee or the expenses
relating to the Opinion of Counsel referred to in Section 6(a) hereof,
as the
case may be and (ix) Mortgage File due diligence expenses and other
out-of-pocket expenses incurred by the Purchaser in connection with the
purchase
of the Mortgage Loans and by Bear Xxxxxxx in connection with the sale of
the
Certificates. EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) additionally agrees to pay directly to any third party
on a
timely basis the fees provided for above which are charged by such third
party
and which are billed periodically.
SECTION
13. Accountants’
Letters.
(a) Deloitte
& Touche LLP
will
review the characteristics of a sample of the Mortgage Loans described
in the
Mortgage Loan Schedule and will compare those characteristics to the description
of the Mortgage Loans contained in the Free Writing Prospectus under the
captions “Summary—The Mortgage Loans” and “The Mortgage Pool” and in Schedule A
thereto. Deloitte & Touche LLP
will
review the characteristics of a sample of the Mortgage Loans described
in the
Mortgage Loan Schedule and will compare those characteristics to the description
of the Mortgage Loans contained in the Prospectus Supplement under the
captions
“Summary—The Mortgage Loans” and “The Mortgage Pool” and in Schedule A thereto.
EMC (on its own behalf as a Mortgage Loan Seller and on behalf of Master
Funding) will cooperate with the Purchaser in making available all information
and taking all steps reasonably necessary to permit such accountants to
complete
the review and to deliver the letters required of them under the Underwriting
Agreement. Deloitte & Touche LLP
will
also confirm certain calculations as set forth under the caption “Yield,
Prepayment and Maturity Considerations” in the Free Writing Prospectus and in
the Prospectus Supplement.
(b) To
the
extent statistical information with respect to EMC’s servicing portfolio is
included in the Free Writing Prospectus and in the Prospectus Supplement
under
the caption “Servicing of the Mortgage Loans—The Master Servicer,” a letter from
the certified public accountant for EMC will be delivered to the Purchaser
dated
the date of the Prospectus Supplement, in the form previously agreed to
by EMC
and the Purchaser, with respect to such statistical information.
SECTION
14. Indemnification.
(a) EMC
(on
its own behalf as a Mortgage Loan Seller and on behalf of Master Funding)
shall
indemnify and hold harmless the Purchaser and its directors, officers and
controlling persons (as defined in Section 15 of the Securities Act) from
and
against any loss, claim, damage or liability or action in respect thereof,
to
which they or any of them may become subject, under the Securities Act
or
otherwise, insofar as such loss, claim, damage, liability or action arises
out
of, or is based upon any untrue statement of a material fact contained
in the
Mortgage
Loan Sellers’ Information
as
identified in Exhibit
3,
the
omission to state in the Free Writing Prospectus, the Prospectus Supplement
or
Prospectus (or any amendment thereof or supplement thereto approved by
EMC (on
its own behalf as a Mortgage Loan Seller and on behalf of Master Funding)
and in
which additional Mortgage Loan Sellers’ Information is identified), in reliance
upon and in conformity with Mortgage Loan Sellers’ Information a material fact
required to be stated therein or necessary to make the statements therein
in
light of the circumstances in which they were made, not misleading, and
EMC (on
its own behalf as a Mortgage Loan Seller and on behalf of Master Funding)
shall
reimburse the Purchaser and each other indemnified party for any legal
and other
expenses reasonably incurred by them in connection with investigating or
defending or preparing to defend against any such loss, claim, damage,
liability
or action.
The
foregoing indemnity agreement is in addition to any liability which EMC
or
Master Funding otherwise may have to the Purchaser or any other such indemnified
party.
(b) The
Purchaser shall indemnify and hold harmless each Mortgage Loan Seller and
its
respective directors, officers and controlling persons (as defined in Section
15
of the Securities Act) from and against any loss, claim, damage or liability
or
action in respect thereof, to which they or any of them may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon any untrue statement
of a
material fact contained in the Purchaser’s
Information
as
identified in Exhibit
4,
the
omission to state in the Free Writing Prospectus, the Prospectus Supplement
or
Prospectus (or any amendment thereof or supplement thereto approved by
the
Purchaser and in which additional Purchaser’s Information is identified), in
reliance upon and in conformity with the Purchaser’s Information, a material
fact required to be stated therein or necessary to make the statements
therein
in light of the circumstances in which they were made, not misleading,
and the
Purchaser shall reimburse each Mortgage Loan Seller, and each other indemnified
party for any legal and other expenses reasonably incurred by them in connection
with investigating or defending or preparing to defend any such loss, claim,
damage, liability or action. The foregoing indemnity agreement is in addition
to
any liability which the Purchaser otherwise may have to the Mortgage Loan
Sellers, or any other such indemnified party.
(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 shall,
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 14 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 it
may elect by written notice delivered to the indemnified party promptly
(but, in
any event, within 30 days) after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
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 is a conflict of interest between itself or themselves and the
indemnifying party in the conduct of the defense of any claim or that the
interests of the indemnified party or parties are not substantially co-extensive
with those of the indemnifying party (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 (provided,
however,
that
the indemnifying party shall be liable only for the fees and expenses of
one
counsel in addition to one local counsel in the jurisdiction involved.
Anything
in this subsection to the contrary notwithstanding, an indemnifying party
shall
not be liable for any settlement or any claim or action effected without
its
written consent; provided,
however,
that
such consent was not unreasonably withheld.
(d) If
the
indemnification provided for in paragraphs (a) and (b) of this Section
14 shall
for any reason be unavailable to an indemnified party in respect of any
loss,
claim, damage or liability, or any action in respect thereof, referred
to in
Section 14, then the indemnifying party shall in lieu of indemnifying the
indemnified party contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in
respect
thereof, in such proportion as shall be appropriate to reflect the relative
benefits received by the Mortgage Loan Sellers on the one hand and the
Purchaser
on the other from the purchase and sale of the Mortgage Loans, the offering
of
the Certificates and the other transactions contemplated hereunder. No
person
found liable for a fraudulent misrepresentation shall be entitled to
contribution from any person who is not also found liable for such fraudulent
misrepresentation.
(e) The
parties hereto agree that reliance by an indemnified party on any publicly
available information or any information or directions furnished by an
indemnifying party shall not constitute negligence, bad faith or willful
misconduct by such indemnified party.
SECTION
15. Notices.
All
demands, notices and communications hereunder shall be in writing but may
be
delivered by facsimile transmission subsequently confirmed in writing.
Notices
to EMC shall be directed to EMC Mortgage Corporation, 0000 Xxxx Xxxxx Xxxxx,
Xxxxxxxxxx, Xxxxx 00000, (Facsimile: (469-759-4714)) Attention: President
or
General Counsel; notices to Master Funding shall be directed to Master
Funding
LLC, 0000 Xxxx Xxxxx Xxxxx, Xxxxxxxxxx, Xxxxx 00000 (Facsimile: (972-444-2880))
Attention: Xxxx Xxxxxxxxx; and notices to the Purchaser shall be directed
to
Bear Xxxxxxx Asset Backed Securities I LLC, 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
Xxx
Xxxx 00000, (Telecopy: (212-272-7206)), Attention: Chief Counsel; or to
any
other address as may hereafter be furnished by one party to the other party
by
like notice. Any such demand, notice or communication hereunder shall
be deemed to have been received on the date received at the premises of
the
addressee (as evidenced, in the case of registered or certified mail, by
the
date noted on the return receipt) provided that it is received on a business
day
during normal business hours and, if received after normal business hours,
then
it shall be deemed to be received on the next business day.
SECTION
16. Transfer
of Mortgage Loans.
The
Purchaser retains the right to assign the Mortgage Loans and any or all
of its
interest under this Agreement to the Trustee without the consent of the
Mortgage
Loan Sellers, and, upon such assignment, the Trustee shall succeed to the
applicable rights and obligations of the Purchaser hereunder; provided,
however,
the Purchaser shall remain entitled to the benefits set forth in Sections
12, 14
and 18 hereto and as provided in Section 2(a). Notwithstanding the foregoing,
the sole and exclusive right and remedy of the Trustee with respect to
a breach
of representation or warranty of the Mortgage Loan Sellers shall be the
cure,
purchase or substitution obligations of EMC contained in Sections 5 and
7
hereof.
SECTION
17. Termination.
This
Agreement may be terminated (a) by the mutual consent of the parties hereto
prior to the Closing Date, (b) by the Purchaser, if the conditions to the
Purchaser’s obligation to close set forth under Section 11(a) hereof are not
fulfilled as and when required to be fulfilled or (c) by any Mortgage Loan
Seller, if the conditions to the Mortgage Loan Sellers’ obligation to close set
forth under Section 11(b) hereof are not fulfilled as and when required
to be
fulfilled. In the event of termination pursuant to clause (b), EMC (on
its own
behalf as a Mortgage Loan Seller and on behalf of Master Funding) shall
pay, and
in the event of termination pursuant to clause (c), the Purchaser shall
pay, all
reasonable out-of-pocket expenses incurred by the other in connection with
the
transactions contemplated by this Agreement. In the event of a termination
pursuant to clause (a), each party shall be responsible for its own
expenses.
SECTION
18. Representations,
Warranties and Agreements to Survive Delivery.
All
representations, warranties and agreements contained in this Agreement,
or
contained in certificates of officers of the Mortgage Loan Sellers submitted
pursuant hereto, shall remain operative and in full force and effect and
shall
survive delivery of the Mortgage Loans to the Purchaser (and by the Purchaser
to
the Trustee). Subsequent to the delivery of the Mortgage Loans to the Purchaser,
each of EMC’s representations and warranties contained herein with respect to
the Mortgage Loans shall be deemed to relate to the Mortgage Loans actually
delivered to the Purchaser and included in the Mortgage Loan Schedule and
any
Replacement Mortgage Loan.
SECTION
19. Severability.
If any
provision of this Agreement shall be prohibited or invalid under applicable
law,
this Agreement shall be ineffective only to such extent, without invalidating
the remainder of this Agreement.
SECTION
20. Counterparts.
This
Agreement may be executed in counterparts, each of which will be an original,
but which together shall constitute one and the same agreement.
SECTION
21. Amendment.
This
Agreement cannot be amended or modified in any manner without the prior
written
consent of each party.
SECTION
22. GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF
OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
SECTION
23. Further
Assurances.
Each of
the parties agrees to execute and deliver such instruments and take such
actions
as another party may, from time to time, reasonably request in order to
effectuate the purpose and to carry out the terms of this Agreement including
any amendments hereto which may be required by either Rating
Agency.
SECTION
24. Successors
and Assigns.
This
Agreement shall bind and inure to the benefit of and be enforceable by
each of
the Mortgage Loan Sellers and the Purchaser and their permitted successors
and
assigns and, to the extent specified in Section 14 hereof, Bear Xxxxxxx,
and
their directors, officers and controlling persons (within the meaning of
federal
securities laws). The Mortgage Loan Sellers acknowledge and agree that
the
Purchaser may assign its rights under this Agreement (including, without
limitation, with respect to EMC’s representations and warranties respecting the
Mortgage Loans) to the Trustee. Any person into which any Mortgage Loan
Seller
may be merged or consolidated (or any person resulting from any merger
or
consolidation involving such Mortgage Loan Seller), any person resulting
from a
change in form of such Mortgage Loan Seller or any person succeeding to
the
business of such Mortgage Loan Seller, shall be considered the “successor” of
such Mortgage Loan Seller, hereunder and shall be considered a party hereto
without the execution or filing of any paper or any further act or consent
on
the part of any party hereto. Except as provided in the two preceding sentences,
this Agreement cannot be assigned, pledged or hypothecated by either party
hereto without the written consent of the other parties to this Agreement
and
any such assignment or purported assignment shall be deemed null and
void.
SECTION
25. The
Mortgage Loan Sellers.
EMC
will keep in full force and effect its existence, all rights and franchises
as a
corporation under the laws of the State 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 necessary to perform its obligations
under this Agreement.
Master
Funding will keep in full force and effect its existence, all rights and
franchises as a limited liability company under the laws of the State of
its
formation and will obtain and preserve its qualification to do business
as a
foreign limited liability company in each jurisdiction in which such
qualification is necessary to perform its obligations under this
Agreement.
SECTION
26. Entire
Agreement.
This
Agreement contains the entire agreement and understanding between the parties
with respect to the subject matter hereof, and supersedes all prior and
contemporaneous agreements, understandings, inducements and conditions,
express
or implied, oral or written, of any nature whatsoever with respect to the
subject matter hereof.
SECTION
27. No
Partnership.
Nothing
herein contained shall be deemed or construed to create a partnership or
joint
venture between the parties hereto.
* Please
contact Bear Xxxxxxx for pricing information.
IN
WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto
by their respective duly authorized officers as of the date first above
written.
| EMC MORTGAGE CORPORATION | ||
| |
|
|
| By: | ||
| Name: |
|
|
| Title: | ||
| BEAR XXXXXXX ASSET BACKED SECURITIES I LLC | ||
| |
|
|
| By: | ||
| Name: |
|
|
| Title: | ||
| MASTER FUNDING LLC | ||
| |
|
|
| By: | ||
| Name: |
|
|
| Title: | ||
EXHIBIT
1
CONTENTS
OF MORTGAGE FILE
With
respect to each Mortgage Loan, the Mortgage File shall include each of
the
following items, which shall be available for inspection by the Purchaser
or its
designee, and which shall be delivered to the Purchaser or its designee
pursuant
to the terms of this Agreement.
(i) The
original Mortgage Note, including any riders thereto, endorsed without
recourse
to the order of blank or to “LaSalle Bank National Association, as Trustee for
certificateholders of Bear Xxxxxxx Asset Backed Securities I LLC, Asset-Backed
Certificates, Series 2007-AQ1,” and showing to the extent available to the
related Mortgage Loan Seller an unbroken chain of endorsements from the
original
payee thereof to the Person endorsing it to the Trustee;
(ii) The
original Mortgage and, if the related Mortgage Loan is a MOM Loan, noting
the
presence of the MIN and language indicating that such Mortgage Loan is
a MOM
Loan, which shall have been recorded (or, for Mortgage Loans other than
the EMC
Flow Loans, if the original is not available, a copy), with evidence of
such
recording indicated thereon (or if clause (x) in the proviso below applies,
shall be in recordable form);
(iii) Unless
the Mortgage Loan is either a MOM Loan or has been assigned in the name
of MERS,
the assignment (either an original or a copy, which may be in the form
of a
blanket assignment if permitted in the jurisdiction in which the Mortgaged
Property is located) to the Trustee of the Mortgage with respect to each
Mortgage Loan in the name of “LaSalle Bank National Association, as Trustee for
certificateholders of Bear Xxxxxxx Asset Backed Securities I LLC, Asset-Backed
Certificates, Series 2007-AQ1,” which shall have been recorded (or if clause (x)
in the proviso below applies, shall be in recordable form);
(iv) An
original or a copy of all intervening assignments of the Mortgage, if any,
to
the extent available to the related Mortgage Loan Seller, with evidence
of
recording thereon;
(v) The
original policy of title insurance or mortgagee’s certificate of title insurance
or commitment or binder for title insurance, if available, or a copy thereof,
or, in the event that such original title insurance policy is unavailable,
a
photocopy thereof, or in lieu thereof, a current lien search on the related
Mortgaged Property; and
(vi) Originals
or copies of all available assumption, modification or substitution agreements,
if any;
provided,
however, that in lieu of the foregoing, the related Mortgage Loan Seller
may
deliver the following documents, under the circumstances set forth below:
(x) if
any Mortgage (other than the Mortgages related to the EMC Flow Loans),
assignment thereof to the Trustee or intervening assignments thereof have
been
delivered or are being delivered to recording offices for recording and
have not
been returned in time to permit their delivery as specified above, the
related
Mortgage Loan Seller may deliver a true copy thereof with a certification
by the
related Mortgage Loan Seller or the Master Servicer, on the face of such
copy,
substantially as follows: “Certified to be a true and correct copy of the
original, which has been transmitted for recording”; (y) in lieu of the
Mortgage, assignments to the Trustee or intervening assignments thereof,
if the
applicable jurisdiction retains the originals of such documents or if the
originals are lost (in each case, as evidenced by a certification from
the
related Mortgage Loan Seller or the Master Servicer to such effect), the
related
Mortgage Loan Seller may deliver photocopies of such documents containing
an
original certification by the judicial or other governmental authority
of the
jurisdiction where such documents were recorded; and (z) in lieu of the
Mortgage
Notes relating to the Mortgage Loans identified in the list set forth in
Exhibit
I to the Pooling and Servicing Agreement, the related Mortgage Loan Seller
may
deliver a lost note affidavit and indemnities of the related Mortgage Loan
Seller; and provided, further, however, that in the case of Mortgage Loans
which
have been prepaid in full after the Cut-Off Date and prior to the Closing
Date,
the related Mortgage Loan Seller, in lieu of delivering the above documents,
may
deliver to the Trustee a certification by the related Mortgage Loan Seller
or
the Master Servicer to such effect. In the case of the documents referred
to in
clause (x) above, the related Mortgage Loan Seller shall deliver such documents
to the Trustee or its Custodian promptly after they are received. EMC (on
its
own behalf as a Mortgage Loan Seller and on behalf of Master Funding) shall
cause, at its expense, the Mortgage and intervening assignments, if any,
and to
the extent required in accordance with the foregoing, the assignment of
the
Mortgage to the Trustee to be submitted for recording promptly after the
Closing
Date; provided that EMC (on its own behalf as a Mortgage Loan Seller and
on
behalf of Master Funding) need not cause to be recorded any assignment
(a) in
any jurisdiction under the laws of which, as evidenced by an Opinion of
Counsel
addressed to the Trustee delivered by EMC (on its own behalf as a Mortgage
Loan
Seller and on behalf of Master Funding) to the Trustee, and the Rating
Agency,
the recordation of such assignment is not necessary to protect the Trustee’s
interest in the related Mortgage Loan or (b) if MERS is identified on the
Mortgage or on a properly recorded assignment of the Mortgage as mortgagee
of
record solely as nominee for EMC (on its own behalf as a Mortgage Loan
Seller
and on behalf of Master Funding) and its successors and assigns. In the
event
that EMC (on its own behalf as a Mortgage Loan Seller and on behalf of
Master
Funding), the Purchaser or the Master Servicer gives written notice to
the
Trustee that a court has recharacterized the sale of the Mortgage Loans
as a
financing, EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) shall submit or cause to be submitted for recording as
specified
above or, should EMC (on its own behalf as a Mortgage Loan Seller and on
behalf
of Master Funding) fail to perform such obligations, the Master Servicer
shall
cause each such previously unrecorded assignment to be submitted for recording
as specified above at the expense of the Trust. In the event a Mortgage
File is
released to EMC (on its own behalf as a Mortgage Loan Seller and on behalf
of
Master Funding) or the Master Servicer as a result of such Person having
completed a Request for Release, the Custodian shall, if not so completed,
complete the assignment of the related Mortgage in the manner specified
in
clause (iii) above.
EXHIBIT
2
MORTGAGE
LOAN SCHEDULE INFORMATION
The
Mortgage Loan Schedule shall set forth the following information with respect
to
each Mortgage Loan:
(a) the
city,
state and zip code of the Mortgaged Property;
(b) the
property type;
(c) the
Mortgage Rate;
(d) the
Servicing Fee Rate;
(e) the
Master Servicer’s Fee Rate;
(f) the
LPMI
Fee, if applicable;
(g) the
Trustee Fee Rate, if applicable;
(h) the
Net
Rate;
(i) the
maturity date;
(j) the
stated original term to maturity;
(k) the
stated remaining term to maturity;
(l) the
original Principal Balance;
(m) the
first
payment date;
(n) the
principal and interest payment in effect as of the Cut-off Date;
(o) the
unpaid Principal Balance as of the Cut-off Date;
(p) the
Loan-to-Value Ratio at origination;
(q) the
insurer of any Primary Mortgage Insurance Policy;
(r) the
MIN
with respect to each MOM Loan;
(s) the
Gross
Margin, if applicable;
(t) the
next
Adjustment Date, if applicable;
(u) the
Maximum Lifetime Mortgage Rate, if applicable;
(v) the
Minimum Lifetime Mortgage Rate, if applicable;
(w) the
Periodic Rate Cap, if applicable;
(x) the
Loan
Group, if applicable;
(y) a
code
indicating whether the Mortgage Loan is negatively amortizing;
(z) which
Mortgage Loans adjust after an initial fixed-rate period of one, two, three,
five, seven or ten years or any other period;
(aa) the
Prepayment Charge, if any;
(bb) lien
position (e.g., first lien or second lien);
(cc) a
code
indicating whether the Mortgage Loan is has a balloon payment;
(dd) a
code
indicating whether the Mortgage Loan is an interest-only loan;
(ee) the
interest-only term, if applicable;
(ff) the
Mortgage Loan Seller; and
(gg) the
original amortization term.
Such
schedule also shall set forth for all of the Mortgage Loans, the total
number of
Mortgage Loans, the total of each of the amounts described under (n) and
(o)
above, the weighted average by principal balance as of the Cut-off Date
of each
of the rates described under (c) through (h) above, and the weighted average
remaining term to maturity by unpaid principal balance as of the Cut-off
Date.
EXHIBIT
3
MORTGAGE
LOAN SELLERS’ INFORMATION
All
information in the Prospectus Supplement described under the following
captions:
“SUMMARY — The Mortgage Loans,” “THE MORTGAGE POOL”, “THE SPONSOR” and “SCHEDULE
A — Mortgage Loan Statistical Data.”
EXHIBIT
4
PURCHASER’S
INFORMATION
All
information in the Free Writing Prospectus, Prospectus Supplement and the
Prospectus, except the Mortgage Loan Sellers’ Information.
EXHIBIT
5
SCHEDULE
OF LOST NOTES
Available
Upon Request
EXHIBIT
6
REVISED
October 20, 0000
XXXXXXXX
X - Standard & Poor’s Predatory Lending Categories
Standard
& Poor’s has categorized loans governed by anti-predatory lending laws in
the Jurisdictions listed below into three categories based upon a combination
of
factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note
that
certain loans classified by the relevant statute as Covered are included
in
Standard & Poor’s High Cost Loan Category because they included thresholds
and tests that are typical of what is generally considered High Cost by
the
industry.
|
Standard
& Poor’s High Cost Loan Categorization
|
||
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-Predatory Lending Law
|
|
Arkansas
|
Arkansas
Home Loan Protection Act, Ark. Code Xxx. §§ 00-00-000 et seq.
Effective
July 16, 2003
|
High
Cost Home Loan
|
|
Cleveland
Heights, OH
|
Ordinance
No. 72-2003 (PSH), Mun. Code §§ 757.01 et seq.
Effective
June 2, 2003
|
Covered
Loan
|
|
Colorado
|
Consumer
Equity Protection, Colo. Stat. Xxx. §§ 5-3.5-101 et seq.
Effective
for covered loans offered or entered into on or after January
1, 2003.
Other provisions of the Act took effect on June 7, 2002
|
Covered
Loan
|
|
Connecticut
|
Connecticut
Abusive Home Loan Lending Practices Act, Conn. Gen. Stat. §§ 36a-746
et seq.
Effective
October 1, 2001
|
High
Cost Home Loan
|
|
District
of Columbia
|
Home
Loan Protection Act, D.C. Code §§ 26-1151.01 et seq.
Effective
for loans closed on or after January 28, 2003
|
Covered
Loan
|
|
Florida
|
Fair
Lending Act, Fla. Stat. Xxx. §§ 494.0078 et seq.
Effective
October 2, 2002
|
High
Cost Home Loan
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
|
High
Cost Home Loan
|
|
Georgia
as amended (Mar. 7, 2003 - current)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective
for loans closed on or after March 7, 2003
|
High
Cost Home Loan
|
|
HOEPA
Section 32
|
Home
Ownership and Equity Protection Act of 1994, 15 U.S.C. § 1639, 12 C.F.R.
§§ 226.32 and 226.34
Effective
October 1, 1995, amendments October 1, 2002
|
High
Cost Loan
|
|
Illinois
|
High
Risk Home Loan Act, Ill. Comp. Stat. tit. 815, §§ 137/5 et seq.
Effective
January 1, 2004 (prior to this date, regulations under Residential
Mortgage License Act effective from May 14, 2001)
|
High
Risk Home Loan
|
|
Indiana
|
Indiana
Home Loan Practices Act, Ind. Code Xxx. §§ 24-9-1-1 et seq.
Effective
January 1, 2005; amended by 2005 HB 1179, effective July 1, 2005.
|
High
Cost Home Loans
|
|
Kansas
|
Consumer
Credit Code, Kan. Stat. Xxx. §§ 16a-1-101 et seq.
Sections
16a-1-301 and 16a-3-207 became effective April 14, 1999; Section
16a-3-308a became effective July 1, 1999
|
High
Loan to Value Consumer Loan (id. § 16a-3-207) and;
|
|
High
APR Consumer Loan (id.
§16a-3-308a)
|
||
|
Kentucky
|
2003
KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. Rev. Stat. §§ 360.100
et seq.
Effective
June 24, 2003
|
High
Cost Home Loan
|
|
Maine
|
Truth
in Lending, Me. Rev. Stat. tit. 9-A, §§ 8-101 et seq.
Effective
September 29, 1995 and as amended from time to time
|
High
Rate High Fee Mortgage
|
|
Massachusetts
|
Part
40 and Part 32, 209 C.M.R. §§ 32.00 et seq.
and 209 C.M.R. §§ 40.01 et seq.
Effective
March 22, 2001 and amended from time to time
|
High
Cost Home Loan
|
|
Nevada
|
Assembly
Xxxx No. 284, Nev. Rev. Stat. §§ 598D.010 et seq.
Effective
October 1, 2003
|
Home
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et seq.
Effective
for loans closed on or after November 27, 2003
|
High
Cost Home Loan
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
High
Cost Home Loan
|
|
New
York
|
N.Y.
Banking Law Article 6-l
Effective
for applications made on or after April 1, 2003
|
High
Cost Home Loan
|
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines
of credit)
|
High
Cost Home Loan
|
|
Ohio
|
H.B.
386 (codified in various sections of the Ohio Code), Ohio Rev.
Code Xxx.
§§ 1349.25 et seq.
Effective
May 24, 2002
|
Covered
Loan
|
|
Oklahoma
|
Consumer
Credit Code (codified in various sections of Title 14A)
Effective
July 1, 2000; amended effective January 1, 2004
|
Subsection
10 Mortgage
|
|
Rhode
Island
|
Rhode
Island Home Loan Protection Act, R.I. Gen. Laws §§ 34-25.2-1 et seq.
Effective
December 31, 2006.
|
High
Cost Home Loan
|
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et seq.
Effective
for loans taken on or after January 1, 2004
|
High
Cost Home Loan
|
|
Tennessee
|
Tennessee
Home Loan Protection Act, Tenn. Code Xxx. §§ 00-00-000 et seq.
Effective
January 1, 2007.
|
High
Cost Home Loan
|
|
West
Virginia
|
West
Virginia Residential Mortgage Lender, Broker and Servicer Act,
W. Va. Code
Xxx. §§ 31-17-1 et seq.
Effective
June 5, 0000
|
Xxxx
Xxxxxxxx Mortgage Loan Act Loan
|
|
Standard
& Poor’s Covered Loan Categorization
|
||
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-Predatory Lending Law
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective
October 1, 2002 - March 6, 2003
|
Covered
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et seq.
Effective
November 27, 2003 - July 5, 2004
|
Covered
Home Loan
|
|
Standard
& Poor’s Home Loan Categorization
|
||
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending
Law/Effective
Date
|
Category
under
Applicable
Anti-Predatory Lending Law
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et seq.
Effective
October 1, 2002 - March 6, 2003
|
Home
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et seq.
Effective
for loans closed on or after November 27, 2003
|
Home
Loan
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
Home
Loan
|
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines
of
credit)
|
Consumer
Home Loan
|
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et seq.
Effective
for loans taken on or after January 1, 2004
|
Consumer
Home Loan
|
SCHEDULE
A
REQUIRED
RATINGS FOR EACH CLASS OF CERTIFICATES
|
Class
|
Xxxxx’x
|
|
X-0
|
Xxx
|
|
X-0
|
Xxx
|
|
X-0
|
Aaa
|
|
X-0
|
Xx0
|
|
X-0
|
Xx0
|
|
X-0
|
Xx0
|
|
M-4
|
A1
|
|
M-5
|
A2
|
|
M-6
|
A3
|
|
M-7
|
Baa1
|
|
M-8
|
Baa2
|
|
M-9
|
Baa3
|
None
of
the above ratings has been lowered, qualified or withdrawn since the dates
of
issuance of such ratings by the Rating Agency.
Private
Certificates
|
Class
|
Xxxxx’x
|
|
M-10
|
Ba1
|
|
CE
|
Not
Rated
|
|
P
|
Not
Rated
|
|
R-1
|
Not
Rated
|
|
R-2
|
Not
Rated
|
|
R-3
|
Not
Rated
|
|
RX
|
Not
Rated
|
EXHIBIT
M
SWAP
AGREEMENT
 |
SWAP
TRANSACTION CONFIRMATION
|
|
|
Date:
|
January
30, 2007
|
||
|
To:
|
LaSalle
Bank National Association, not individually, but solely as Supplemental
Interest Trust Trustee on behalf of the Supplemental Interest
Trust with
respect to the Bear Xxxxxxx Asset Backed Securities I Trust 2007-AQ1,
Asset-Backed Certificates, Series 2007-AQ1
|
||
|
Phone:
|
000-000-0000
|
||
|
Fax:
|
000-000-0000
|
||
|
Attention:
|
Global
Securities and Trust Services Group - Bear Xxxxxxx Asset Backed
Securities
I Trust 2007-AQ1
|
||
|
From:
|
Wachovia
Bank, N.A.
|
||
|
Ref.
No:
|
0000000
|
||
The
purpose of this long-form confirmation (“Confirmation”)
is to
confirm the terms and conditions of the current Transaction entered into
on the
Trade Date specified below (the “Transaction”)
between
Wachovia Bank, N.A. (“Party
A”) and
LaSalle Bank National Association, not individually, but solely as supplemental
interest trust trustee (the “Supplemental Interest Trust Trustee”) on behalf of
the supplemental interest trust with respect to the Bear Xxxxxxx Asset
Backed
Securities I Trust 2007-AQ1, Asset-Backed Certificates, Series 2007-AQ1
(the
“Supplemental Interest Trust”) (“Party
B”)
created
under the Pooling and Servicing Agreement, dated as of January 1, 2007,
among
EMC
Mortgage Corporation, as seller, EMC Mortgage Corporation, as master servicer,
Bear Xxxxxxx Asset Backed Securities I LLC, as depositor and LaSalle Bank
National Association, as trustee (the “Pooling and Servicing
Agreement”) (the
“Pooling
and Servicing Agreement”).
This
Confirmation evidences a complete and binding agreement between you and
us to
enter into the Transaction on the terms set forth below and replaces any
previous agreement between us with respect to the subject matter hereof.
This
Confirmation constitutes a “Confirmation”
and also
constitutes a “Schedule”
as
referred to in the ISDA Master Agreement, and Paragraph 13 of a Credit
Support
Annex to the Schedule.
| 1. |
This
Confirmation shall supplement, form a part of, and be subject
to an
agreement in the form of the ISDA Master Agreement (Multicurrency
- Cross
Border) as published and copyrighted in 1992 by the International
Swaps
and Derivatives Association, Inc. (the “ISDA
Master Agreement”),
as if Party A and Party B had executed an agreement in such form
on the
date hereof, with a Schedule as set forth in Item 3 of this Confirmation,
and an ISDA Credit Support Annex (Bilateral Form - ISDA Agreements
Subject
to New York Law Only version) as published and copyrighted in
1994 by the
International Swaps and Derivatives Association, Inc., with Paragraph
13
thereof as set forth in Annex A hereto (the “Credit
Support Annex”).
For the avoidance of doubt, the Transaction described herein
shall be the
sole Transaction governed by such ISDA Master Agreement. In the
event of
any inconsistency among any of the following documents, the relevant
document first listed shall govern: (i) this Confirmation, exclusive
of
the provisions set forth in Item 3 hereof and Annex A hereto;
(ii) the
provisions set forth in Item 3 hereof, which are incorporated
by reference
into the Schedule; (iii) the Credit Support Annex; (iv) the Definitions;
and (v) the ISDA Master Agreement.
|
Each
reference herein to a “Section” (unless specifically referencing the Pooling and
Servicing Agreement) or to a “Section” “of this Agreement” will be construed as
a reference to a Section of the ISDA Master Agreement; each herein reference
to
a “Part” will be construed as a reference to the provisions herein deemed
incorporated in a Schedule to the ISDA Master Agreement; each reference
herein
to a “Paragraph” will be construed as a reference to a Paragraph of the Credit
Support Annex.
|
2.
|
The
terms of the particular Transaction to which this Confirmation
relates are
as follows:
|
||
|
Type
of Transaction:
|
Interest
Rate Swap
|
||
|
Notional
Amount:
|
With
respect to any Calculation Period, the amount set forth for
such period on
Schedule I attached hereto.
|
||
|
Trade
Date:
|
January
24, 2007
|
||
|
Effective
Date:
|
January
30, 2007
|
||
|
Termination
Date:
|
January
25, 2012, subject to adjustment in accordance with the Business
Day
Convention; provided, however, that for the purpose of determining
the
final Fixed Rate Payer Period End Date, Termination Date shall
be subject
to No Adjustment.
|
||
|
Fixed
Amounts:
|
|||
|
Fixed
Rate Payer:
|
Party
B
|
||
|
Fixed
Rate Payer
|
|||
|
Period
End Dates:
|
The
25th calendar day of each month during the Term of this Transaction,
commencing February 25, 2007, and ending on the Termination
Date, with No
Adjustment.
|
||
|
Fixed
Rate Payer
|
|||
|
Payment
Dates:
|
Early
Payment shall be applicable. Each Fixed Rate Payer Payment
Date shall be
one Business Day prior to the related Fixed Rate Payer Period
End Date.
|
||
|
Fixed
Rate:
|
5.2115%
|
||
|
Fixed
Amount:
|
To
be determined in accordance with the following formula:
|
||
|
100*Fixed
Rate*Notional Amount*Fixed Rate Day Count Fraction
|
|||
|
Fixed
Rate Day
|
|||
|
Count
Fraction:
|
30/360
|
||
|
Floating
Amounts:
|
|||
|
Floating
Rate Payer:
|
Party
A
|
||
|
Floating
Rate Payer
|
|||
|
Period
End Dates:
|
The
25th calendar day of each month during the Term of this Transaction,
commencing February 25, 2007, and ending on the Termination
Date, subject
to adjustment in accordance with the Business Day
Convention.
|
||
|
Floating
Rate Payer
|
|||
|
Payment
Dates:
|
Early
Payment shall be applicable. Each Floating Rate Payer Payment
Date shall
be one Business Day prior to the related Floating Rate Payer
Period End
Date.
|
||
|
Floating
Rate Option:
|
USD-LIBOR-BBA
|
||
|
Floating
Amount:
|
To
be determined in accordance with the following formula:
|
||
|
100*Floating
Rate Option*Notional Amount*Floating Rate Day Count
Fraction
|
|||
|
Designated
Maturity:
|
One
month
|
||
|
Floating
Rate Day
|
|||
|
Count
Fraction:
|
Actual/360
|
||
|
Reset
Dates:
|
The
first day of each Calculation Period.
|
||
|
Compounding:
|
Inapplicable
|
||
|
Business
Days:
|
New
York and Illinois
|
||
|
Business
Day Convention:
|
Following
|
||
|
Calculation
Agent:
|
Party
A
|
||
|
3.
|
Provisions
Deemed Incorporated in a separate Schedule to the ISDA Master
Agreement
and which for purposes of the ISDA Master will not constitute
part of a
Confirmation:
|
|
Part
1.
|
Termination
Provisions.
|
For
the
purposes of this Agreement:-
(a)
“Specified
Entity”
will not
apply to Party A or Party B for any purpose.
|
(b)
|
“Specified
Transaction”
will have the meaning specified in Section
14.
|
|
(c)
|
Events
of Default.
|
The
statement below that an Event of Default will apply to a specific party
means
that upon the occurrence of such an Event of Default with respect to such
party,
the other party shall have the rights of a Non-defaulting Party under Section
6
of this Agreement; conversely, the statement below that such event will
not
apply to a specific party means that the other party shall not have such
rights.
| (i) |
The
“Failure
to Pay or Deliver”
provisions of Section 5(a)(i) will apply to Party A and will
apply to
Party B; provided, however, that Section 5(a)(i) is hereby amended
by
replacing the word “third” with the word “first”; provided, further, that
notwithstanding anything to the contrary in Section 5(a)(i),
any failure
by Party A to comply with or perform any obligation to be complied
with or
performed by Party A under the Credit Support Annex shall not
constitute
an Event of Default under Section 5(a)(i) unless (A) a Required
Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local
Business Days and (B) such failure is not remedied on or before
the third
Local Business Day after notice of such failure is given to Party
A.
|
| (ii) |
The
“Breach
of Agreement”
provisions of Section 5(a)(ii) will apply to Party A and will
not apply to
Party B; provided, however, that Section 5(a)(ii) is hereby amended
by
inserting the words “or under the Item 1115 Agreement or the Credit
Support Annex” immediately after “4(d)” and within the parenthetical
contained therein.
|
| (iii) |
The
“Credit
Support Default”
provisions of Section 5(a)(iii) will apply to Party A and will
not apply
to Party B except that Section 5(a)(iii)(1) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex; provided, however, that notwithstanding anything
to the
contrary in Section 5(a)(iii)(1), any failure by Party A to comply
with or
perform any obligation to be complied with or performed by Party
A under
the Credit Support Annex shall not constitute an Event of Default
under
Section 5(a)(iii) unless (A) a Required Ratings Downgrade Event
has
occurred and been continuing for 30 or more Local Business Days
and (B)
such failure is not remedied on or before the third Local Business
Day
after notice of such failure is given to Party
A.
|
| (iv) |
The
“Misrepresentation”
provisions of Section 5(a)(iv) will apply to Party A and will
not apply to
Party B; provided, however, that Section 5(a)(iv) is hereby amended
by
inserting the words “or under the 1115 Agreement” immediately after “and
(f)” and within the parenthetical contained therein.
|
| (v) |
The
“Default
under Specified Transaction”
provisions of Section 5(a)(v) will apply to Party A and will
not apply to
Party B.
|
| (vi) |
The
“Cross
Default”
provisions of Section 5(a)(vi) will apply to Party A and will
not apply to
Party B. For purposes of Section 5(a)(vi), solely with respect
to Party
A:
|
“Specified
Indebtedness” will have the meaning specified in Section 14, except that such
term shall not include obligations in respect of deposits received in the
ordinary course of Party A’s banking business.
“Threshold
Amount” means with respect to Party A an amount equal to three percent (3%) of
the Shareholders’ Equity of Party A or, if applicable, the Eligible Guarantor.
“Shareholders’
Equity” means with respect to an entity, at any time, (1) if Party A is a
national banking association, the Total Equity Capital of Party A (as shown
in
the most recently filed Consolidated Report of Condition and Income for
a Bank
with Domestic and Foreign Offices Only or other comparable filing (“Call
Report”) Schedule RC - Balance Sheet of such entity) or (2) for any other
entity, the sum (as shown in the most recent annual audited financial statements
of such entity) of (i) its capital stock (including preferred stock)
outstanding, taken at par value, (ii) its capital surplus and (iii) its
retained
earnings, minus (iv) treasury stock, each to be determined in accordance
with
generally accepted accounting principles.
| (vii) |
The
“Bankruptcy”
provisions of Section 5(a)(vii) will apply to Party A and will
apply to
Party B except that the provisions of Section 5(a)(vii)(2), (6)
(to the
extent that such provisions refer to any appointment contemplated
or
effected by the Pooling and Servicing Agreement or any appointment
to
which Party B has not become subject), (7) and (9) will not apply
to Party
B; provided that, with respect to Party B only, Section 5(a)(vii)(4)
is
hereby amended by adding after the words “against it” the words
“(excluding any proceeding or petition instituted or presented
by Party A
or its Affiliates)”, and Section 5(a)(vii)(8) is hereby amended by
deleting the words “to (7) inclusive” and inserting lieu thereof “, (3),
(4) as amended, (5), (6) as amended, or
(7)”.
|
| (viii) |
The
“Merger
Without Assumption”
provisions of Section 5(a)(viii) will apply to Party A and will
apply to
Party B.
|
(d)
Termination
Events.
The
statement below that a Termination Event will apply to a specific party
means
that upon the occurrence of such a Termination Event, if such specific
party is
the Affected Party with respect to a Tax Event, the Burdened Party with
respect
to a Tax Event Upon Merger (except as noted below) or the non-Affected
Party
with respect to a Credit Event Upon Merger, as the case may be, such specific
party shall have the right to designate an Early Termination Date in accordance
with Section 6 of this Agreement; conversely, the statement below that
such an
event will not apply to a specific party means that such party shall not
have
such right; provided, however, with respect to “Illegality” the statement that
such event will apply to a specific party means that upon the occurrence
of such
a Termination Event with respect to such party, either party shall have
the
right to designate an Early Termination Date in accordance with Section
6 of
this Agreement.
(i)
The
“Illegality”
provisions of Section 5(b)(i) will apply to Party A and will apply to Party
B.
|
(ii)
|
The
“Tax
Event”
provisions of Section 5(b)(ii) will apply to Party A except that,
for
purposes of the application of Section 5(b)(ii) to Party A, Section
5(b)(ii) is hereby amended by deleting the words “(x) any action taken by
a taxing authority, or brought in a court of competent jurisdiction,
on or
after the date on which a Transaction is entered into (regardless
of
whether such action is taken or brought with respect to a party
to this
Agreement) or (y)”, and the “Tax
Event”
provisions of Section 5(b)(ii) will apply to Party B.
|
|
(iii)
|
The
“Tax
Event Upon Merger”
provisions of Section 5(b)(iii) will apply to Party A and will
apply to
Party B, provided that Party A shall not be entitled to designate
an Early
Termination Date by reason of a Tax Event upon Merger in respect
of which
it is the Affected Party.
|
|
(iv)
|
The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to Party A and
will not
apply to Party B.
|
|
(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to Party A and will
not apply to
Party B.
|
(f)
Payments
on Early Termination.
For the
purpose of Section 6(e) of this Agreement:
| (i) |
Market
Quotation will apply, provided, however, that, in the event of
a
Derivative Provider Trigger Event, the following provisions will
apply:
|
|
(A)
|
The
definition of Market Quotation in Section 14 shall be deleted
in its
entirety and replaced with the
following:
|
“Market
Quotation” means,
with respect to one or more Terminated Transactions, a Firm Offer which
is (1)
made by a Reference Market-maker that is an Eligible Replacement, (2) for
an
amount that would be paid to Party B (expressed as a negative number) or
by
Party B (expressed as a positive number) in consideration of an agreement
between Party B and such Reference Market-maker to enter into a Replacement
Transaction, and (3) made on the basis that Unpaid Amounts in respect of
the
Terminated Transaction or group of Transactions are to be excluded but,
without
limitation, any payment or delivery that would, but for the relevant Early
Termination Date, have been required (assuming satisfaction of each applicable
condition precedent) after that Early Termination Date is to be included.
|
(B)
|
The
definition of Settlement Amount shall be deleted in its entirety
and
replaced with the following:
|
“Settlement
Amount”
means,
with respect to any Early Termination Date, an amount (as determined by
Party B)
equal to:
|
(a)
|
If
a Market Quotation for the relevant Terminated Transaction or
group of
Terminated Transactions is accepted by Party B so as to become
legally
binding on or before the day falling ten Local Business Days
after the day
on which the Early Termination Date is designated, or such later
day as
Party B may specify in writing to Party A, but in either case
no later
than one Local Business Day prior to the Early Termination Date
(such day,
the “Latest Settlement Amount Determination Day”), the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
|
|
(b)
|
If,
on the Latest Settlement Amount Determination Day, no Market
Quotation for
the relevant Terminated Transaction or group of Terminated Transactions
has been accepted by Party B so as to become legally binding
and one or
more Market Quotations from Approved Replacements have been made
and
remain capable of becoming legally binding upon acceptance, the
Settlement
Amount shall equal the Termination Currency Equivalent of the
amount
(whether positive or negative) of the lowest of such Market Quotations
(for the avoidance of doubt, the lowest of such Market Quotations
shall be
the lowest Market Quotation of such Market Quotations expressed
as a
positive number or, if any of such Market Quotations is expressed
as a
negative number, the Market Quotation expressed as a negative
number with
the largest absolute value); or
|
|
(c)
|
If,
on the Latest Settlement Amount Determination Day, no Market
Quotation for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotation from an Approved Replacement remains capable of becoming
legally
binding upon acceptance, the Settlement Amount shall equal Party
B’s Loss
(whether positive or negative and without reference to any Unpaid
Amounts)
for the relevant Terminated Transaction or group of Terminated
Transactions.
|
|
(C)
|
If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
|
|
(D)
|
If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
shall be
deleted in its entirety and replaced with the
following:
|
“(3)
Second
Method and Market Quotation.
If the
Second Method and Market Quotation apply, (I) Party B shall pay to Party
A an
amount equal to the absolute value of the Settlement Amount in respect
of the
Terminated Transactions, (II) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (III) Party
A
shall pay to Party B the Termination Currency Equivalent of the Unpaid
Amounts
owing to Party B; provided, however, that (x) the amounts payable under
the
immediately preceding clauses (II) and (III) shall be subject to netting
in
accordance with Section 2(c) of this Agreement and (y) notwithstanding
any other
provision of this Agreement, any amount payable by Party A under the immediately
preceding clause (III) shall not be netted-off against any amount payable
by
Party B under the immediately preceding clause (I).”
|
(E)
|
At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations (which for the avoidance
of doubt may
be obtained by Party A and/or Party B) from Approved Replacements
remain
capable of becoming legally binding upon acceptance, Party B
shall be
entitled to accept only the lowest of such Market Quotations
(for the
avoidance of doubt, the lowest of such Market Quotations shall
be the
lowest Market Quotation of such Market Quotations expressed as
a positive
number or, if any of such Market Quotations is expressed as a
negative
number, the Market Quotation expressed as a negative number with
the
largest absolute value).
|
| (ii) |
The
Second Method will apply.
|
(g)
“Termination
Currency”
means
USD.
(h)
Additional
Termination Events.
Additional Termination Events will apply as provided in Part 5(c).
Part
2. Tax
Matters.
(a)
Tax
Representations.
|
(i)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement:
|
(A)
Party
A
makes the following representation(s):
None.
(B)
Party
B
makes the following representation(s):
None.
(ii)
Payee
Representations.
For the
purpose of Section 3(f) of this Agreement:
(A)
Party
A
makes the following representation(s):
None.
(B)
Party
B
makes the following representation(s):
None.
|
(b)
|
Tax
Provisions.
|
|
(i)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, in each case such that Party
B shall not
be required to pay any additional amounts referred to
therein.
|
|
(ii)
|
Indemnifiable
Tax.
The definition of “Indemnifiable Tax” in Section 14 is deleted in its
entirety and replaced with the
following:
|
“Indemnifiable
Tax”
means,
in relation to payments by Party A, any Tax and, in relation to payments
by
Party B, no Tax.
Part
3. Agreement
to Deliver Documents.
(a) For
the
purpose of Section 4(a)(i), tax forms, documents, or certificates to be
delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
|
Party
A
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
(or successor thereto), together with appropriate attachments,
that
eliminates U.S. federal withholding and backup withholding Tax
on payments
to Party A under this Agreement.
|
(A)
at closing, (B) promptly upon reasonable demand by the other
party and (C)
promptly upon learning that any such form previously provided
by the party
has become obsolete or incorrect.
|
|
Party
B
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form W-9
(or successor thereto), together with appropriate attachments,
that
eliminates U.S. federal withholding and backup withholding Tax
on payments
to Party B under this Agreement, and such other tax forms relating
to the
beneficial owner of payments to Party B under this Agreement
from time to
time as appropriate that eliminates U.S. federal withholding
and backup
withholding Tax on payments to Party B under this
Agreement.
|
(A)
On or before the first payment date hereunder, (B) promptly upon
reasonable demand by the other party and (C) promptly upon learning
that
any such form previously provided by the party has become obsolete
or
incorrect.
|
(b) For
the
purpose of Section 4(a)(ii), other documents to be delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by Section 3(d) Representation
|
|
Party
A and
Party
B
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for
it to execute
and deliver the Agreement, this Confirmation, and any Credit
Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under the Agreement, this Confirmation and any Credit Support
Document, as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
Party
A and
Party
B
|
A
certificate of an authorized officer of the party, as to the
incumbency
and authority of the respective officers of the party signing
the
Agreement, this Confirmation, and any relevant Credit Support
Document, as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
Party
A
|
Quarterly
Consolidated Report of Condition and Income for a Bank with Domestic
and
Foreign Offices Only (“Call Report”) of Party A or any report in
replacement thereof
|
Promptly
upon becoming publicly available to be posted on Party A’s internet site
(currently xxxx://xxxxxxxx.xxx)
|
Yes
|
|
Party
A and
Party
B
|
An
opinion of counsel to such party with respect to the due authorization,
execution and enforceability of this Agreement, acceptable to
the other
party.
|
Upon
the execution and delivery of this Agreement
|
No
|
Part
4. Miscellaneous.
|
(a)
|
Address
for Notices:
For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Party A:
Address:
000
Xxxxx
Xxxxxxx, XX-0
Xxxxxxxxx,
XX 00000-0000
Attention:
Xxxxx
X.
Xxxxx
Senior
Vice President, Risk Management
Facsimile:
(000)
000-0000
Phone:
(000)
000-0000
(For
all
purposes)
Address
for notices or communications to Party B:
Address:
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
Attention:
Global
Securities and Trust Services Group
BSABS
07-AQ1
Facsimile:
(000)
000-0000
Phone:
(000)
000-0000
(For
all
purposes)
(b)
Process
Agent.
For the
purpose of Section 13(c):
Party
A
appoints as its Process Agent: Not applicable.
Party
B
appoints as its Process Agent: Not applicable.
|
(c)
|
Offices.
The provisions of Section 10(a) will apply to this
Agreement.
|
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is not a Multibranch Party.
|
Party
B is not a Multibranch Party.
|
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A.
|
(f)
Credit
Support Document.
|
Party
A:
|
The
Credit Support Annex, and any guarantee in support of Party A’s
obligations under this Agreement.
|
Party
B: The
Credit Support Annex, solely in respect of Party B’s obligations under Paragraph
3(b) of the Credit Support Annex.
|
(g)
|
Credit
Support Provider.
|
Party
A: The
guarantor under any guarantee in support of Party A’s obligations under this
Agreement.
Party
B: None.
|
(h)
|
Governing
Law.
The parties to this Agreement hereby agree that the law of the
State of
New York shall govern their rights and duties in whole, without
regard to
the conflict of law provisions thereof other than New York General
Obligations Law Sections 5-1401 and 5-1402.
|
|
(i)
|
Netting
of Payments.
The parties agree that subparagraph (ii) of Section 2(c) will
apply to
each Transaction hereunder.
|
|
(j)
|
Affiliate.“Affiliate”
shall have the meaning assigned thereto in Section 14; provided,
however,
that Party B shall be deemed to have no Affiliates for purposes
of this
Agreement, including for purposes of Section
6(b)(ii).
|
Part
5. Others
Provisions.
|
(a)
|
Definitions.
Unless
otherwise specified in a Confirmation, this Agreement and each
Transaction
under this Agreement are subject to the 2000 ISDA Definitions
as published
and copyrighted in 2000 by the International Swaps and Derivatives
Association, Inc. (the “Definitions”),
and will be governed in all relevant respects by the provisions
set forth
in the Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions
are
hereby incorporated by reference in and shall be deemed a part
of this
Agreement, except that (i) references in the Definitions to a
“Swap
Transaction” shall be deemed references to a “Transaction” for purposes of
this Agreement, and (ii) references to a “Transaction” in this Agreement
shall be deemed references to a “Swap Transaction” for purposes of the
Definitions. Each term capitalized but not defined in this Agreement
shall
have the meaning assigned thereto in the Pooling and Servicing
Agreement.
|
(b)
Amendments
to ISDA Master Agreement.
|
(i)
|
Single
Agreement.
Section 1(c) is hereby amended by the adding the words “including, for the
avoidance of doubt, the Credit Support Annex” after the words “Master
Agreement”.
|
|
(ii)
|
[Reserved.]
|
|
(iii)
|
Change
of Account.
Section 2(b) is hereby amended by the addition of the following
after the
word “delivery” in the first line
thereof:
|
“to
another account in the same legal and tax jurisdiction as the original
account”.
|
(iv)
|
Representations.
Section 3 is hereby amended by adding at the end thereof the
following
subsection (g):
|
|
“(g)
|
Relationship
Between Parties.
|
|
(1)
|
Nonreliance.
(i) It is not relying on any statement or representation of the
other
party regarding the Transaction (whether written or oral), other
than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and
upon any
advice from such advisors as it has deemed necessary and not
upon any view
expressed by the other party.
|
|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate (internally
or
through independent professional advice) the Transaction and
has made its
own decision to enter into the Transaction and (ii) It understands
the
terms, conditions and risks of the Transaction and is willing
and able to
accept those terms and conditions and to assume those risks,
financially
and otherwise.
|
|
(3)
|
Purpose.
It is entering into the Transaction for the purposes of managing
its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of business.
|
|
(4)
|
Status
of Parties. The other party is not acting as an agent, fiduciary
or
advisor for it in respect of the Transaction.
|
|
(5)
|
Eligible
Contract Participant. It is an “eligible swap participant” as such term is
defined in, Section 35.1(b)(2) of the regulations (17 C.F.R.
35)
promulgated under, and an “eligible contract participant” as defined in
Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
|
(v)
|
Transfer
to Avoid Termination Event.
Section 6(b)(ii) is hereby amended by (i) deleting the words
“or if a Tax
Event Upon Merger occurs and the Burdened Party is the Affected
Party,”
and (ii) by deleting the words “to transfer” and inserting the words “to
effect a Permitted Transfer” in lieu
thereof.
|
|
(vi)
|
Jurisdiction.
Section
13(b) is hereby amended by: (i) deleting in the second line of
subparagraph (i) thereof the word "non-", (ii) deleting “; and” from the
end of subparagraph 1 and inserting “.” in lieu thereof, and (iii)
deleting the final paragraph
thereof.
|
|
(vii)
|
Local
Business Day.
The definition of Local Business Day in Section 14 is hereby
amended by
the addition of the words “or any Credit Support Document” after “Section
2(a)(i)” and the addition of the words “or Credit Support Document” after
“Confirmation”.
|
|
(c)
|
Additional
Termination Events.
The following Additional Termination Events will
apply:
|
| (i) |
First
Rating Trigger Collateral.
If
(A) it is not the case that a Xxxxx’x Second Trigger Ratings Event has
occurred and been continuing for 30 or more Local Business Days
and (B)
Party A has failed to comply with or perform any obligation to
be complied
with or performed by Party A in accordance with the Credit Support
Annex,
then an Additional Termination Event shall have occurred with
respect to
Party A and Party A shall be the sole Affected Party with respect
to such
Additional Termination Event.
|
| (ii) |
Second
Rating Trigger Replacement.
If
(A) a Required Ratings Downgrade Event has occurred and been
continuing
for 30 or more Local Business Days and (B) (i) at least one Eligible
Replacement has made a Firm Offer to be the transferee of all
of Party A’s
rights and obligations under this Agreement (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible
Replacement
upon acceptance by the offeree) and/or (ii) an Eligible Guarantor
has made
a Firm Offer to provide an Eligible Guarantee (and such Firm
Offer remains
an offer that will become legally binding upon such Eligible
Guarantor
immediately upon acceptance by the offeree), then an Additional
Termination Event shall have occurred with respect to Party A
and Party A
shall be the sole Affected Party with respect to such Additional
Termination Event.
|
|
(iii)
|
Amendment
of Pooling and Servicing Agreement.
If, without the prior written consent of Party A where such consent
is
required under the Pooling and Servicing Agreement (such consent
not to be
unreasonably withheld), an amendment is made to the Pooling and
Servicing
Agreement which amendment could reasonably be expected to have
a material
adverse effect on the interests of Party A (excluding, for the
avoidance
of doubt, any amendment to the Pooling and Servicing Agreement
that is
entered into solely for the purpose of appointing a successor
servicer,
master servicer, securities administrator, trustee or other service
provider) under this Agreement, an Additional Termination Event
shall have
occurred with respect to Party B and Party B shall be the sole
Affected
Party with respect to such Additional Termination Event.
|
|
(iv)
|
[Reserved.]
|
|
(v)
|
Optional
Termination of Securitization.
An
Additional Termination Event shall occur upon the notice to
Certificateholders of a Optional Termination becoming unrescindable
in
accordance with Article X of the Pooling and Servicing Agreement
(such
notice, the “Optional
Termination Notice”).
With respect to such Additional Termination Event: (A) Party
B shall be
the sole Affected Party; (B) notwithstanding anything to the
contrary in
Section 6(b)(iv) or Section 6(c)(i), the final Distribution Date
specified
in the Optional Termination Notice is hereby designated as the
Early
Termination Date for this Additional Termination Event in respect
of all
Affected Transactions; (C) Section 2(a)(iii)(2) shall not be
applicable to
any Affected Transaction in
connection with the Early Termination Date resulting from this
Additional
Termination Event; notwithstanding anything to the contrary in
Section
6(c)(ii), payments and deliveries under Section 2(a)(i) or Section
2(e) in
respect of the Terminated Transactions resulting from this Additional
Termination Event will be required to be made through and including
the
Early Termination Date designated
as a result of this Additional Termination Event; provided, for
the
avoidance of doubt, that any such payments or deliveries that
are made on
or prior to such Early Termination Date will not be treated as
Unpaid
Amounts in determining the amount payable in respect of such
Early
Termination Date; (D) notwithstanding anything to the contrary
in Section
6(d)(i), (I) if, no later than 4:00 pm New York City time on
the day that
is four Business Days prior to the final Distribution Date specified
in
the Optional Termination Notice, the Trustee requests from Party
A in
writing (which request shall reference this Part 5(c)(v) and
shall be
immediately followed with a telephone call by Trustee with an
officer at
Party A responsible for obtaining such estimate confirming receipt
by
Party A of such request and further referencing this Part 5(c)(v))
(collectively, “Written Notice”) the amount of the Estimated Swap
Termination Payment, Party A shall provide to the Trustee in
writing
(which may be done in electronic format) the amount of the Estimated
Swap
Termination Payment no later than 2:00 pm New York City time
on the
following Business Day and (II) if the Trustee provides Written
Notice to
Party A no later than two Business Days prior to the final Distribution
Date specified in the Optional Termination Notice that all requirements
of
the Optional Termination have been met, then Party A shall, no
later than
one Business Day prior to the final Distribution Date specified
in the
Optional Termination Notice, make the calculations contemplated
by Section
6(e) of the ISDA Master Agreement (as amended herein) and provide
to the
Trustee in writing (which may be done in electronic format) the
amount
payable by either Party B or Party A in respect of the related
Early
Termination Date in
connection with this Additional Termination Event; provided,
however, that
the amount payable by Party B, if any, in respect of the related
Early
Termination Date shall be the lesser of (x) the amount calculated
to be
due from Party B pursuant to Section 6(e) and (y) the Estimated
Swap
Termination Payment; and (E) notwithstanding anything to the
contrary in
this Agreement, any amount due from Party B to Party A in respect
of this
Additional Termination Event will be payable on the final Distribution
Date specified in the Optional Termination Notice and any amount
due from
Party A to Party B in respect of this Additional Termination
Event will be
payable one Business Day prior to the final Distribution Date
specified in
the Optional Termination Notice.
|
The
Trustee shall be an express third party beneficiary of this Agreement as
if a
party hereto to the extent of the Trustee’s rights specified herein.
|
(d)
|
Required
Ratings Downgrade Event.
In
the event that no Relevant Entity has credit ratings at least
equal to the
Required Ratings Threshold, then Party A shall, as soon as reasonably
practicable and so long as a Required Ratings Downgrade Event
is in
effect, at its own expense, using commercially reasonable efforts,
procure
either (A) a Permitted Transfer or (B) an Eligible Guarantee.
|
|
(e)
|
Item
1115 Agreement.
Party A and Party B hereby agree that the terms of the Item 1115
Agreement, dated as of December 20, 2006 (the “Item
1115 Agreement”),
among
EMC Mortgage Corporation, Bear Xxxxxxx Asset Backed Securities
I LLC and
Structured Asset Mortgage Investments II Inc. and Wachovia Bank,
National
Association, shall be incorporated by reference into this Agreement
and
Party B shall be an express third party beneficiary of the Item
1115
Agreement. A copy of the Item 1115 Agreement is annexed hereto
at Annex B.
|
|
(f)
|
Transfers.
|
(i)
Section
7
is hereby amended to read in its entirety as follows:
“Except
with respect to any Permitted Transfer pursuant to Section 6(b)(ii), Part
5(d),
the Item 1115 Agreement or the succeeding sentence, neither Party A nor
Party B
is permitted to assign, novate or transfer (whether by way of security
or
otherwise) as a whole or in part any of its rights, obligations or interests
under the Agreement or any Transaction unless the prior written consent
of the
other party is obtained. At any time at which no Relevant Entity has credit
ratings at least equal to the Approved Ratings Threshold, Party A may make
a
Permitted Transfer.”
|
(ii)
|
If
an Approved Replacement has made a Firm Offer (which remains
an offer that
will become legally binding upon acceptance by Party B) to be
the
transferee pursuant to a Permitted Transfer, Party B shall, at
Party A’s
written request and at Party A’s expense, take any reasonable steps
required to be taken by Party B to effect such transfer.
|
|
(g)
|
Non-Recourse.
Party A acknowledges and agree that, notwithstanding any provision
in this
Agreement to the contrary, the obligations of Party B hereunder
are
limited recourse obligations of Party B, payable solely from
the
Supplemental Interest Trust and the Swap Account and the proceeds
thereof,
in accordance with the priority of payments and other terms of
the Pooling
and Servicing Agreement and that Party A will not have any recourse
to any
of the directors, officers, employees, shareholders or affiliates
of the
Party B with respect to any claims, losses, damages, liabilities,
indemnities or other obligations in connection with any transactions
contemplated hereby. In the event that the Supplemental Interest
Trust and
the Swap Account and the proceeds thereof, should be insufficient
to
satisfy all claims outstanding and following the realization
of the
account held by the Supplemental Interest Trust and the proceeds
thereof,
any claims against or obligations of Party B under the ISDA Master
Agreement or any other confirmation thereunder still outstanding
shall be
extinguished and thereafter not revive. The Supplemental Interest
Trust
Trustee shall not have liability for any failure or delay in
making a
payment hereunder to Party A due to any failure or delay in receiving
amounts in the account held by the Supplemental Interest Trust
from the
Trust created pursuant to the Pooling and Servicing Agreement.
This
provision will survive the termination of this
Agreement.
|
|
(h)
|
Timing
of Payments
by Party B upon Early Termination.
Notwithstanding anything to the contrary in Section 6(d)(ii),
to the
extent that all or a portion (in either case, the “Unfunded Amount”) of
any amount that is calculated as being due in respect of any
Early
Termination Date under Section 6(e) from Party B to Party A will
be paid
by Party B from amounts other than any upfront payment paid to
Party B by
an Eligible Replacement that has entered a Replacement Transaction
with
Party B, then such Unfunded Amount shall be due on the next subsequent
Distribution Date following the date on which the payment would
have been
payable as determined in accordance with Section 6(d)(ii), and
on any
subsequent Distribution Dates until paid in full (or if such
Early
Termination Date is the final Distribution Date, on such final
Distribution Date); provided, however, that if the date on which
the
payment would have been payable as determined in accordance with
Section
6(d)(ii) is a Distribution Date, such payment will be payable
on such
Distribution Date.
|
|
(i)
|
Rating
Agency Notifications. Notwithstanding
any other provision of this Agreement, no Early Termination Date
shall be
effectively designated hereunder by Party B and no transfer of
any rights
or obligations under this Agreement shall be made by either party
unless
each Swap Rating Agency has been given prior written notice of
such
designation or
transfer.
|
|
(j)
|
No
Set-off.
Except as expressly provided for in Section 2(c), Section 6 or
Part
1(f)(i)(D) hereof, and notwithstanding any other provision of
this
Agreement or any other existing or future agreement, each party
irrevocably waives any and all rights it may have to set off,
net, recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between it and the other party hereunder against
any
obligation between it and the other party under any other agreements.
Section 6(e) shall be amended by deleting the following sentence:
“The
amount, if any, payable in respect of an Early Termination Date
and
determined pursuant to this Section will be subject to any
Set-off.”.
|
|
(k)
|
Amendment.
Notwithstanding any provision to the contrary in this Agreement,
no
amendment of either this Agreement or any Transaction under this
Agreement
shall be permitted by either party unless each of the Swap Rating
Agencies
has been provided prior written notice of the
same.
|
|
(l)
|
Notice
of Certain Events or Circumstances.
Each Party agrees, upon learning of the occurrence or existence
of any
event or condition that constitutes (or that with the giving
of notice or
passage of time or both would constitute) an Event of Default
or
Termination Event with respect to such party, promptly to give
the other
Party and to each Swap Rating Agency notice of such event or
condition;
provided that failure to provide notice of such event or condition
pursuant to this Part 5(l) shall not constitute an Event of Default
or a
Termination Event.
|
(m) Proceedings.
No
Relevant Entity shall institute against, or cause any other person to institute
against, or join any other person in instituting against Party B, the
Supplemental Interest Trust Trustee, or the trust formed pursuant to the
Pooling
and Servicing Agreement, in any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other proceedings under any federal
or
state bankruptcy or similar law for a period of one year (or, if longer,
the
applicable preference period) and one day following payment in full of
the
Certificates and any Notes. This provision will survive the termination
of this
Agreement.
|
(n)
|
Supplemental
Interest Trust Trustee Liability Limitations.
It
is expressly understood and agreed by the parties hereto that
(a) this
Agreement is executed by LaSalle Bank National Association (“LaSalle”) not
in its individual capacity, but solely as Supplemental Interest
Trust
Trustee under the Pooling and Servicing Agreement in the exercise
of the
powers and authority conferred and invested in it thereunder;
(b) LaSalle
has been directed pursuant to the Pooling and Servicing Agreement
to enter
into this Agreement and to perform its obligations hereunder;
(c) each of
the representations, undertakings and agreements herein made
on behalf of
the Supplemental Interest Trust is made and intended not as personal
representations of the Supplemental Interest Trust Trustee but
is made and
intended for the purpose of binding only the Supplemental Interest
Trust;
and (d) under no circumstances shall LaSalle
in its individual capacity be personally liable for any payments
hereunder
or for the breach or failure of any obligation, representation,
warranty
or covenant made or undertaken under this
Agreement.
|
|
(o)
|
Severability.
If
any term, provision, covenant, or condition of this Agreement,
or the
application thereof to any party or circumstance, shall be held
to be
invalid or unenforceable (in whole or in part) in any respect,
the
remaining terms, provisions, covenants, and conditions hereof
shall
continue in full force and effect as if this Agreement had been
executed
with the invalid or unenforceable portion eliminated, so long
as this
Agreement as so modified continues to express, without material
change,
the original intentions of the parties as to the subject matter
of this
Agreement and the deletion of such portion of this Agreement
will not
substantially impair the respective benefits or expectations
of the
parties; provided, however, that this severability provision
shall not be
applicable if any provision of Section 2, 5, 6, or 13 (or any
definition
or provision in Section 14 to the extent it relates to, or is
used in or
in connection with any such Section) shall be so held to be invalid
or
unenforceable.
|
The
parties shall endeavor to engage in good faith negotiations to replace
any
invalid or unenforceable term, provision, covenant or condition with a
valid or
enforceable term, provision, covenant or condition, the economic effect
of which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
|
(p)
|
Agent
for Party B. Party
A acknowledges that Party B has appointed the Supplemental Interest
Trust
Trustee and the Swap Administrator as its agent under the Pooling
and
Servicing Agreement and the Swap Administration Agreement to
carry out
certain functions on behalf of Party B, and that the Supplemental
Interest
Trust Trustee and the Swap Administrator shall be entitled to
give notices
and to perform and satisfy the obligations of Party B hereunder
on behalf
of Party B.
|
|
(q)
|
Escrow
Payments.
If
(whether by reason of the time difference between the cities
in which
payments are to be made or otherwise) it is not possible for
simultaneous
payments to be made on any date on which both parties are required
to make
payments hereunder, either Party may at its option and in its
sole
discretion notify the other Party that payments on that date
are to be
made in escrow. In this case deposit of the payment due earlier
on that
date shall be made by 2:00 pm (local time at the place for the
earlier
payment) on that date with an escrow agent selected by the notifying
party, accompanied by irrevocable payment instructions (i) to
release the
deposited payment to the intended recipient upon receipt by the
escrow
agent of the required deposit of any corresponding payment payable
by the
other party on the same date accompanied by irrevocable payment
instructions to the same effect or (ii) if the required deposit
of the
corresponding payment is not made on that same date, to return
the payment
deposited to the party that paid it into escrow. The party that
elects to
have payments made in escrow shall pay all costs of the escrow
arrangements.
|
|
(r)
|
Consent
to Recording.
Each party hereto consents to the monitoring or recording, at
any time and
from time to time, by the other party of any and all communications
between officers and employees of the parties and their Affiliates,
waives
any further notice of such monitoring or recording, and agrees
to notify
its officers and employees of such monitoring or recording.
|
|
(s)
|
Waiver
of Jury Trial.
Each party waives any right it may have to a trial by jury in
respect of
any in respect of any suit, action or proceeding relating to
this
Agreement or any Credit Support Document.
|
|
(t)
|
Form
of ISDA Master Agreement. Party
A and Party B hereby agree that the text of the body of the ISDA
Master
Agreement is intended to be the printed form of the ISDA Master
Agreement
(Multicurrency - Crossborder) as published and copyrighted in
1992 by the
International Swaps and Derivatives Association,
Inc.
|
|
(u)
|
Payment
Instructions.
Party A hereby agrees that, unless notified in writing by Party
B or the
Swap Administrator of other payment instructions, any and all
amounts
payable by Party A to Party B under this Agreement shall be paid
to the
account specified in Item 4 of this Confirmation, below. Party
A shall be
entitled to rely on any written notice or communication from
Party B or
the Swap Administrator to that effect which is delivered to Party
A in
accordance with Section 12.
|
|
(v)
|
Additional
representations.
|
|
(i)
|
Representations
of Party A.
Party A represents to Party B on the date on which Party A enters
into
each Transaction that: Party A is a bank subject to the requirements
of 12
U.S.C. § 1823(e), its execution, delivery and performance of this
Agreement (including the Credit Support Annex and each Confirmation)
have
been approved by its board of directors or its loan committee,
such
approval is reflected in the minutes of said board of directors
or loan
committee, and this Agreement (including the Credit Support Annex
and each
Confirmation) will be maintained as one of its official records
continuously from the time of its execution (or in the case of
any
Confirmation, continuously until such time as the relevant Transaction
matures and the obligations therefor are satisfied in
full).
|
|
(ii)
|
Capacity.
Party A represents to Party B on the date on which Party A enters
into
this Agreement that it is entering into the Agreement and the
Transaction
as principal and not as agent of any person. The Supplemental
Interest
Trust Trustee on behalf of the Supplemental Interest Trust represents
to
Party A on the date on which the Supplemental Interest Trust
Trustee
executes this Agreement that the Supplemental Interest Trust
Trustee is
executing the Agreement in its capacity as Supplemental Interest
Trust
Trustee on behalf of the Supplemental Interest Trust.
|
|
(w)
|
Bankruptcy
Code. Subject
to Part 5(m), without limiting the applicability if any, of any
other
provision of the U.S. Bankruptcy Code as amended (the “Bankruptcy Code”)
(including without limitation Sections 362, 546, 556, and 560
thereof and
the applicable definitions in Section 101 thereof), the parties
acknowledge and agree that all Transactions entered into hereunder
will
constitute “forward contracts” or “swap agreements” as defined in Section
101 of the Bankruptcy Code or “commodity contracts” as defined in Section
761 of the Bankruptcy Code, that the rights of the parties under
Section 6
of this Agreement will constitute contractual rights to liquidate
Transactions, that any margin or collateral provided under any
margin,
collateral, security, pledge, or similar agreement related hereto
will
constitute a “margin payment” as defined in Section 101 of the Bankruptcy
Code, and that the
parties are entities entitled to the rights under, and protections
afforded by, Sections 362, 546, 556, and 560 of the Bankruptcy
Code.
|
|
(x)
|
[Reserved.]
|
|
(y)
|
[Reserved.]
|
(z)
Additional
Definitions.
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Approved
Ratings Threshold”
means
the Xxxxx’x First Trigger Ratings Threshold.
“Approved
Replacement”
means,
with respect to a Market Quotation, an entity making such Market Quotation,
which entity would satisfy conditions (a), (b), (c) and (d) of the definition
of
Permitted Transfer (as determined by Party B in its sole discretion, acting
in a
commercially reasonable manner) if such entity were a Transferee, as defined
in
the definition of Permitted Transfer.
“Derivative
Provider Trigger Event” means
(i)
an Event of Default with respect to which Party A is a Defaulting Party,
(ii) a
Termination Event with respect to which Party A is the sole Affected Party
or
(iii) an Additional Termination Event with respect to which Party A is
the sole
Affected Party.
“Eligible
Guarantee” means
an
unconditional and irrevocable guarantee of all present and future obligations
(for the avoidance of doubt, not limited to payment obligations) of Party
A or
an Eligible Replacement to Party B under this Agreement that is provided
by an
Eligible Guarantor as principal debtor rather than surety and that is directly
enforceable by Party B, and either (A) a law firm has given a legal opinion
confirming that none of the guarantor’s payments to Party B under such guarantee
will be subject to Tax collected by withholding or (B) such guarantee provides
that, in the event that any of such guarantor’s payments to Party B are subject
to Tax collected by withholding, such guarantor is required to pay such
additional amount as is necessary to ensure that the net amount actually
received by Party B (free and clear of any Tax collected by withholding)
will
equal the full amount Party B would have received had no such withholding
been
required.
“Eligible
Guarantor”
means
an
entity that has credit ratings from Xxxxx’x at least equal to the Xxxxx’x Second
Trigger Ratings Threshold, provided, for the avoidance of doubt, that an
Eligible Guarantee of an Eligible Guarantor with credit ratings below the
Approved Ratings Threshold will not cause a Collateral Event (as defined
in the
Credit Support Annex) not to occur or continue.
“Eligible
Replacement” means
an
entity (A) (i) has credit ratings from Xxxxx’x at least equal to the Xxxxx’x
Second Trigger Ratings Threshold, or (ii) the present and future obligations
(for the avoidance of doubt, not limited to payment obligations) of which
entity
to Party B under this Agreement are guaranteed pursuant to an Eligible
Guarantee
and (B) that has executed an Item 1115 Agreement or other Regulation AB
provisions reasonably acceptable to Depositor.
“Estimated
Swap Termination Payment”
means,
with respect to an Early Termination Date, an amount determined by Party
A in
good faith and in a commercially reasonable manner as the maximum payment
that
Party A believes could be owed by Party B to Party A in respect of such
Early
Termination Date pursuant to Section 6(e) of the ISDA Master Agreement,
taking
into account then current market conditions.
“Firm
Offer”
means
(A) with respect to an Eligible Replacement, a quotation from such Eligible
Replacement (i) in an amount equal to the actual amount payable by or to
Party B
in consideration of an agreement between Party B and such Eligible Replacement
to replace Party A as the counterparty to this Agreement by way of novation
or,
if such novation is not possible, an agreement between Party B and such
Eligible
Replacement to enter into a Replacement Transaction (assuming that all
Transactions hereunder become Terminated Transactions), and (ii) that
constitutes an offer by such Eligible Replacement to replace Party A as
the
counterparty to this Agreement or enter a Replacement Transaction that
will
become legally binding upon such Eligible Replacement upon acceptance by
Party
B, and (B) with respect to an Eligible Guarantor, an offer by such Eligible
Guarantor to provide an Eligible Guarantee that will become legally binding
upon
such Eligible Guarantor upon acceptance by the offeree.
“Moody’s” means
Xxxxx’x Investors Service, Inc., or any successor thereto.
“Moody’s
First Trigger Ratings Event” means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s First Trigger Ratings Threshold at any time at which Xxxxx’x is rating
the Certificates or the Notes.
“Xxxxx’x
First Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Moody’s, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Moody’s of “A2” and a
short-term unsecured and unsubordinated debt rating from Moody’s of “Prime-1”,
or (ii) if such entity does not have a short-term unsecured and unsubordinated
debt rating or counterparty rating from Moody’s, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Moody’s of
“A1”.
“Moody’s
Second Trigger Ratings Event” means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s Second Trigger Ratings Threshold at any time at which Xxxxx’x is rating
the Certificates or the Notes.
“Xxxxx’x
Second Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Moody’s, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Moody’s of “A3” and a
short-term unsecured and unsubordinated debt rating from Moody’s of “Prime-2”,
or (ii) if such entity does not have a short-term unsecured and unsubordinated
debt rating from Moody’s, a long-term unsecured and unsubordinated debt rating
or counterparty rating from Moody’s of “A3”.
“Permitted
Transfer” means
a
transfer by novation by Party A pursuant to Section 6(b)(ii), Part 5(d),
the
Item 1115 Agreement or the second sentence of Section 7 (as amended herein),
to
a transferee (the “Transferee”)
of all,
but not less than all, of the rights, liabilities, duties and obligations
that
Party A would, but for the occurrence of such transfer, have had under
this
Agreement and all relevant Transactions after the date of such transfer
(collectively, the “Transferred
Interest”),
and,
with respect to which transfer each of the following conditions is satisfied:
(a) the Transferee is an Eligible Replacement; (b) Party A and the Transferee
are both “dealers in notional principal contracts” within the meaning of
Treasury regulations section 1.1001-4; (c) as of the date of such transfer
the
Transferee would not be required to withhold or deduct on account of Tax
from
any payments under this Agreement or would be required to gross up for
such Tax
under Section 2(d)(i)(4); (d) an Event of Default or Termination Event
would not
occur as a result of such transfer; (e) pursuant to a written instrument
(the
“Transfer Agreement”), the Transferee acquires and assumes the Transferred
Interests; (f) Party B shall have determined, in its sole discretion, acting
in
a commercially reasonable manner, that such Transfer Agreement is effective
to
transfer to the Transferee the Transferred Interests; (g) Party A will
be
responsible for any costs or expenses incurred in connection with such
transfer
(including any replacement cost of entering into a replacement transaction);
(h)
either (A) Moody’s has been given prior written notice of such transfer or (B)
each Swap Rating Agency has been given prior written notice of such transfer
and
such transfer is in connection with the assignment and assumption of the
Transferred Interests without modification of the terms of this Agreement, other
than party names, dates relevant to the effective date of such transfer,
tax
representations (provided that the representations in Part 2(a)(i) are
not
modified) and any other representations regarding the status of the substitute
counterparty of the type included in Part 5(b)(iv) or Part 5(v), notice
information and account details; and (i) such transfer otherwise complies
with
the terms of the Pooling and Servicing Agreement.
“Relevant
Entity”
means
Party A and, to the extent applicable, a guarantor under an Eligible
Guarantee.
“Replacement
Transaction” means,
with respect to any Terminated Transaction or group of Terminated Transactions,
a transaction or group of transactions that (i) would have the effect of
preserving for Party B the economic equivalent of any payment or delivery
(whether the underlying obligation was absolute or contingent and assuming
the
satisfaction of each applicable condition precedent) by the parties under
Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated
Transactions that would, but for the occurrence of the relevant Early
Termination Date, have been required after that Date, and (ii) has terms
which
are substantially the same as this Agreement, including, without limitation,
rating triggers, Regulation AB compliance, and credit support documentation,
save for the exclusion of provisions relating to Transactions that are
not
Terminated Transaction, as determined by Party B in its sole discretion,
acting
in a commercially reasonable manner.
“Required
Ratings Downgrade Event” means
that no Relevant Entity has credit ratings at least equal to the Required
Ratings Threshold.
“Required
Ratings Threshold”
means
the
Moody’s Second Trigger Ratings Threshold.
“Swap
Rating Agencies” means,
with respect to any date of determination, Moody’s, to the extent that Xxxxx’x
is then providing a rating for any of the Bear Xxxxxxx Asset Backed Securities
I
Trust 2007-AQ1, Asset-Backed Certificates, Series 2007-AQ1 (the “Certificates”)
or any notes backed by the Certificates (the “Notes”).
[Remainder
of this page intentionally left blank.]
4. Account
Details and Settlement Information:
Payments
to Party A:
Wachovia
Bank, N.A.
CIB
Group, ABA 000000000
Ref:
Derivative Desk (Trade No: 0000000)
Account
#: 04659360006116
Payments
to Party
B: LaSalle
Bank
ABA
#000000000
LaSalle
CHGO/CTR/BNF:/LASALLE TRUST
Ref
Trust
A/C# 724454.2
This
Agreement may be executed in several counterparts, each of which shall
be deemed
an original but all of which together shall constitute one and the same
instrument.
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
Very
truly yours,
Wachovia
Bank, N.A.
By: _______________________________
Name:
Title:
Party
B,
acting through its duly authorized signatory, hereby agrees to, accepts
and
confirms the terms of the foregoing as of the date hereof.
LaSalle
Bank National Association, not individually, but solely as Supplemental
Interest
Trust Trustee on behalf of the Supplemental Interest Trust with respect
to the
Bear Xxxxxxx Asset Backed Securities I Trust 2007-AQ1, Asset-Backed
Certificates, Series 2007-AQ1
By: _______________________________
Name:
Title:
SCHEDULE
I
(all
such
dates subject to No Adjustment with respect to Fixed Rate Payer Period
End Dates
and adjustment in accordance with the Following Business Day Convention
with
respect to Floating Rate Payer Period End Dates)
|
From
and including
|
To
but excluding
|
Notional
Amount (USD)
|
|
Effective
Date
|
2/25/2007
|
3,533,437.2306
|
|
2/25/2007
|
3/25/2007
|
3,485,608.0200
|
|
3/25/2007
|
4/25/2007
|
3,428,409.4371
|
|
4/25/2007
|
5/25/2007
|
3,361,961.6881
|
|
5/25/2007
|
6/25/2007
|
3,286,460.9355
|
|
6/25/2007
|
7/25/2007
|
3,202,181.0399
|
|
7/25/2007
|
8/25/2007
|
3,109,488.7075
|
|
8/25/2007
|
9/25/2007
|
3,008,840.1759
|
|
9/25/2007
|
10/25/2007
|
2,900,839.8931
|
|
10/25/2007
|
11/25/2007
|
2,789,841.0164
|
|
11/25/2007
|
12/25/2007
|
2,683,233.2314
|
|
12/25/2007
|
1/25/2008
|
2,580,871.7358
|
|
1/25/2008
|
2/25/2008
|
2,482,580.7723
|
|
2/25/2008
|
3/25/2008
|
2,388,192.0994
|
|
3/25/2008
|
4/25/2008
|
2,297,544.6646
|
|
4/25/2008
|
5/25/2008
|
2,210,484.2864
|
|
5/25/2008
|
6/25/2008
|
2,126,863.3547
|
|
6/25/2008
|
7/25/2008
|
2,046,540.5425
|
|
7/25/2008
|
8/25/2008
|
1,969,380.5311
|
|
8/25/2008
|
9/25/2008
|
1,895,253.7479
|
|
9/25/2008
|
10/25/2008
|
1,824,036.1151
|
|
10/25/2008
|
11/25/2008
|
1,755,643.8879
|
|
11/25/2008
|
12/25/2008
|
1,689,941.9101
|
|
12/25/2008
|
1/25/2009
|
1,626,804.1175
|
|
1/25/2009
|
2/25/2009
|
1,566,126.3003
|
|
2/25/2009
|
3/25/2009
|
1,507,808.6389
|
|
3/25/2009
|
4/25/2009
|
1,451,755.5133
|
|
4/25/2009
|
5/25/2009
|
1,397,885.2341
|
|
5/25/2009
|
6/25/2009
|
1,346,100.5480
|
|
6/25/2009
|
7/25/2009
|
1,296,316.3249
|
|
7/25/2009
|
8/25/2009
|
1,248,452.1729
|
|
8/25/2009
|
9/25/2009
|
1,202,430.9688
|
|
9/25/2009
|
10/25/2009
|
1,158,178.5530
|
|
10/25/2009
|
11/25/2009
|
1,115,644.9007
|
|
11/25/2009
|
12/25/2009
|
1,074,746.6345
|
|
12/25/2009
|
1/25/2010
|
1,035,411.5797
|
|
1/25/2010
|
2/25/2010
|
997,577.4279
|
|
2/25/2010
|
3/25/2010
|
961,184.4709
|
|
3/25/2010
|
4/25/2010
|
926,175.3854
|
|
4/25/2010
|
5/25/2010
|
892,499.3931
|
|
5/25/2010
|
6/25/2010
|
860,099.7468
|
|
6/25/2010
|
7/25/2010
|
828,925.7662
|
|
7/25/2010
|
8/25/2010
|
798,929.0823
|
|
8/25/2010
|
9/25/2010
|
770,063.3473
|
|
9/25/2010
|
10/25/2010
|
742,284.0282
|
|
10/25/2010
|
11/25/2010
|
715,548.5047
|
|
11/25/2010
|
12/25/2010
|
689,815.8659
|
|
12/25/2010
|
1/25/2011
|
665,046.8102
|
|
1/25/2011
|
2/25/2011
|
91,483.9765
|
|
2/25/2011
|
3/25/2011
|
88,615.1542
|
|
3/25/2011
|
4/25/2011
|
85,835.8689
|
|
4/25/2011
|
5/25/2011
|
83,143.3361
|
|
5/25/2011
|
6/25/2011
|
80,534.8576
|
|
6/25/2011
|
7/25/2011
|
78,007.8189
|
|
7/25/2011
|
8/25/2011
|
75,559.6867
|
|
8/25/2011
|
9/25/2011
|
73,186.6639
|
|
9/25/2011
|
10/25/2011
|
70,887.7893
|
|
10/25/2011
|
11/25/2011
|
68,658.9854
|
|
11/25/2011
|
12/25/2011
|
66,498.4309
|
|
12/25/2011
|
Termination
Date
|
64,404.1156
|
Annex
A
Paragraph
13 of the Credit Support Annex
Annex
B
Item
1115 Agreement
ANNEX
A
ISDA®
CREDIT
SUPPORT ANNEX
to
the
Schedule to the
ISDA
Master Agreement
dated
as
of January 30, 2007 between
Wachovia
Bank, N.A. (hereinafter referred to as “Party A” or “Pledgor”)
and
LaSalle
Bank National Association, not individually, but solely as Supplemental
Interest
Trust Trustee on behalf of the Supplemental Interest Trust with respect
to the
Bear Xxxxxxx Asset Backed Securities I Trust 2007-AQ1, Asset-Backed
Certificates, Series 2007-AQ1 (hereinafter referred to as “Party B” or “Secured
Party”).
For
the
avoidance of doubt, and notwithstanding anything to the contrary that may
be
contained in the Agreement, this Credit Support Annex shall relate solely
to the
Transaction documented in the Confirmation dated January 30, 2007, between
Party
A and Party B, Reference Number 1721614.
Paragraph
13. Elections and Variables.
|
(a)
|
Security
Interest for “Obligations”. The term “Obligations” as used in this Annex
includes the following additional
obligations:
|
With
respect to Party A: not applicable.
With
respect to Party B: not applicable.
|
(b)
|
Credit
Support Obligations.
|
|
(i)
|
Delivery
Amount, Return Amount and Credit Support
Amount.
|
|
(A)
|
“Delivery
Amount” has the meaning specified in Paragraph 3(a) as amended (I) by
deleting the words “upon a demand made by the Secured Party on or promptly
following a Valuation Date” and inserting in lieu thereof the words “not
later than the close of business on each Valuation Date” and (II) by
deleting in its entirety the sentence beginning “Unless otherwise
specified in Paragraph 13” and ending “(ii) the Value as of that Valuation
Date of all Posted Credit Support held by the Secured Party.” and
inserting in lieu thereof the
following:
|
The
“Delivery Amount” applicable to the Pledgor for any Valuation Date will equal
the greatest of
|
(1)
|
the
amount by which (a) the Moody’s First Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Xxxxx’x First Trigger Value as of such
Valuation Date of all Posted Credit Support held by the Secured
Party,
and
|
|
(2)
|
the
amount by which (a) the Xxxxx’x Second Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Xxxxx’x Second Trigger Value as of
such Valuation Date of all Posted Credit Support held by the
Secured
Party.
|
|
(B)
|
“Return
Amount” has the meaning specified in Paragraph 3(b) as amended by deleting
in its entirety the sentence beginning “Unless otherwise specified in
Paragraph 13” and ending “(ii) the Credit Support Amount.” and inserting
in lieu thereof the following:
|
The
“Return Amount” applicable to the Secured Party for any Valuation Date will
equal the least of
|
(1)
|
the
amount by which (a) the Moody’s First Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x First Trigger Credit Support Amount for such Valuation Date,
and
|
|
(2)
|
the
amount by which (a) the Xxxxx’x Second Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x Second Trigger Credit Support Amount for such Valuation
Date.
|
|
(C)
|
“Credit
Support Amount” shall not apply. For purposes of calculating any Delivery
Amount or Return Amount for any Valuation Date, reference shall
be made to
the Xxxxx’x First Trigger Credit Support Amount, or the Xxxxx’x Second
Trigger Credit Support Amount, in each case for such Valuation
Date, as
provided in Paragraphs 13(b)(i)(A) and 13(b)(i)(B),
above.
|
|
(ii)
|
Eligible
Collateral.
|
On
any
date, the following items will qualify as “Eligible Collateral” (for the
avoidance of doubt, all Eligible Collateral to be denominated in
USD):
|
ISDA
Collateral
Asset
Definition
(ICAD)
Code
|
Remaining
Maturity in Years
|
Moody’s
First
Trigger
Valuation
Percentage
|
Moody’s
Second
Trigger
Valuation
Percentage
|
|
(A)
US-CASH
|
N/A
|
100%
|
100%
|
|
(B) US-TBILL
US-TNOTE
US-TBOND
|
|||
|
1
or less
|
100%
|
100%
|
|
|
More
than 1 but not more than 2
|
100%
|
99%
|
|
|
More
than 2 but not more than 3
|
100%
|
98%
|
|
|
More
than 3 but not more than 5
|
100%
|
97%
|
|
|
More
than 5 but not more than 7
|
100%
|
95%
|
|
|
More
than 7 but not more than 10
|
100%
|
94%
|
|
|
More
than 10 but not more than 20
|
100%
|
89%
|
|
|
More
than 20
|
100%
|
87%
|
|
|
(C)
US-GNMA
US-FNMA
US-FHLMC
|
|||
|
1
or less
|
100%
|
99%
|
|
|
More
than 1 but not more than 2
|
100%
|
98%
|
|
|
More
than 2 but not more than 3
|
100%
|
97%
|
|
|
More
than 3 but not more than 5
|
100%
|
96%
|
|
|
More
than 5 but not more than 7
|
100%
|
94%
|
|
|
More
than 7 but not more than 10
|
100%
|
93%
|
|
|
More
than 10 but not more than 20
|
100%
|
88%
|
|
|
More
than 20
|
100%
|
86%
|
(i)
The
ISDA
Collateral Asset Definition (ICAD) Codes used in this Paragraph 13(b)(ii)
are
taken from the Collateral Asset Definitions (First Edition - June 2003)
as
published and copyrighted in 2003 by the International Swaps and Derivatives
Association, Inc.
(iii)
Other
Eligible Support.
The
following items will qualify as “Other Eligible Support” for the party
specified:
Not
applicable.
|
(iv)
|
Threshold.
|
|
(A)
|
“Independent
Amount” means zero with respect to Party A and Party
B.
|
|
(B)
|
“Threshold”
means, with respect to Party A and any Valuation Date, zero if
(i) a
Collateral Event has occurred and been continuing and either
(x) such
Collateral Event has been continuing for at least 30 days or
(y) no
Relevant Entity has had credit ratings at least equal to the
Approved
Ratings Threshold since this Annex was
executed,
|
“Threshold”
means,
with respect to Party B and any Valuation Date, infinity.
|
(C)
|
“Minimum
Transfer Amount” means USD 100,000 with respect to Party A and Party B
(or, with respect to Party B, if the aggregate Value of Posted
Collateral
is less than $100,000, the aggregate Value of Posted
Collateral);
|
|
(D)
|
Rounding:
The Delivery Amount will be rounded up to the nearest integral
multiple of
USD 10,000. The Return Amount will be rounded down to the nearest
integral
multiple of USD 1,000.
|
|
(c)
|
Valuation
and Timing.
|
|
(i)
|
“Valuation
Agent” means Party A in all circumstances.
|
|
(ii)
|
“Valuation
Date” means the first Local Business Day in each week on which any
of the
Xxxxx’x First Trigger Credit Support Amount or the Moody’s Second Trigger
Credit Support Amount is greater than
zero.
|
|
(iii)
|
“Valuation
Time” means the close of business in the city of the Valuation Agent
on
the Local Business Day immediately preceding the Valuation Date
or date of
calculation, as applicable; provided that the calculations of
Value and
Exposure will be made as of approximately the same time on the
same date.
The Valuation Agent will notify each party (or the other party,
if the
Valuation Agent is a party) of its calculations not later than
the
Notification Time on the applicable Valuation Date (or in the
case of
Paragraph 6(d), the Local Business Day following the day on which
such
relevant calculations are
performed).
|
|
(iv)
|
“Notification
Time” means 11:00 a.m., New York time, on a Local Business
Day.
|
|
(d)
|
Conditions
Precedent and Secured Party’s Rights and Remedies. The following
Termination Events will be a “Specified Condition” for the party specified
(that party being the Affected Party if the Termination Event
occurs with
respect to that party): With respect to Party A and Party B:
None.
|
|
(e)
|
Substitution.
|
|
(i)
|
“Substitution
Date” has the meaning specified in Paragraph
4(d)(ii).
|
|
(ii)
|
Consent.
If specified here as applicable, then the Pledgor must obtain
the Secured
Party’s consent for any substitution pursuant to Paragraph 4(d):
Inapplicable.
|
|
(f)
|
Dispute
Resolution.
|
|
(i)
|
“Resolution
Time” means 1:00 p.m. New York time on the Local Business Day following
the date on which the notice of the dispute is given under Paragraph
5.
|
|
(ii)
|
Value.
Notwithstanding anything to the contrary in Paragraph 12, for
the purpose
of Paragraphs 5(i)(C) and 5(ii), the Moody’s First Trigger Value and
Moody’s Second Trigger Value, on any date, of Eligible Collateral other
than Cash will be calculated as
follows:
|
For
Eligible Collateral in the form of securities listed in Paragraph 13(b)(ii):
the
sum of (A) the product of (1)(x) the bid price at the Valuation Time for
such
securities on the principal national securities exchange on which such
securities are listed, or (y) if such securities are not listed on a national
securities exchange, the bid price for such securities quoted at the Valuation
Time by any principal market maker for such securities selected by the
Valuation
Agent, or (z) if no such bid price is listed or quoted for such date, the
bid
price listed or quoted (as the case may be) at the Valuation Time for the
day
next preceding such date on which such prices were available and (2) the
applicable Valuation Percentage for such Eligible Collateral, and (B) the
accrued interest on such securities (except to the extent Transferred to
the
Pledgor pursuant to Paragraph 6(d)(ii) or included in the applicable price
referred to in the immediately preceding clause (A)) as of such
date.
|
(iii)
|
Alternative.
The provisions of Paragraph 5 will
apply.
|
|
(g)
|
Holding
and Using Posted Collateral.
|
|
(i)
|
Eligibility
to Hold Posted Collateral; Custodians. A Custodian will be entitled
to
hold Posted Collateral on behalf of Party B pursuant to Paragraph
6(b),
provided that:
|
|
(A)
|
Posted
Collateral may be held only in the following jurisdiction: United
States.
|
|
(B)
|
The
Custodian for Party B is either (1) the entity then serving as
Swap
Administrator or (2) any entity other than the entity then serving
as Swap
Administrator if such other entity (or, to the extent applicable,
its
parent company or credit support provider) shall then have a
short-term
unsecured and unsubordinated debt rating from S&P of at least
“A-1”.
|
Initially,
the Custodian for Party B is: The Swap Administrator.
|
(ii)
|
Use
of Posted Collateral. The provisions of Paragraph 6(c) will not
apply to
Party B.
|
|
(h)
|
Distributions
and Interest Amount.
|
|
(i)
|
Interest
Rate. The “Interest Rate” will be the actual interest rate earned on
Posted Collateral in the form of Cash that is held by Party B
or its
Custodian. Posted Collateral in the form of Cash shall be invested
in such
overnight (or redeemable within two Local Business Days of demand)
Permitted Investments rated at least Prime-1 by Moody’s or Aaa by Moody’s
as directed by Party A (unless (x) an Event of Default or an
Additional
Termination Event has occurred with respect to which Party A
is the
defaulting or sole Affected Party or (y) an Early Termination
Date has
been designated, in which case such investment shall be held
uninvested).
In
the absence of instructions from Party A, Posted Collateral in
the form of
Cash will be invested in investments as specified in part (viii)
of the
definition of Permitted Investments in the Pooling and Servicing
Agreement, provided that such Permitted Investments are rated
at least
Prime-1 by Moody’s or Aaa by Moody’s. Gains
and losses incurred in respect of any investment of Posted Collateral
shall be for the account of Party
A.
|
|
(ii)
|
Transfer
of Interest Amount. The Transfer of the Interest Amount will
be made on
the second Local Business Day following the end of each calendar
month and
on any other Local Business Day on which Posted Collateral in
the form of
Cash is Transferred to the Pledgor pursuant to Paragraph 3(b);
provided,
however, that the obligation of Party B to Transfer any Interest
Amount to
Party A shall be limited to the extent that Party B has earned
and
received such funds.
|
|
(iii)
|
Alternative
to Interest Amount. The provisions of Paragraph 6(d)(ii) will
apply.
|
|
(i)
|
Additional
Representation(s). There are no additional representations by
either
party.
|
|
(j)
|
Other
Eligible Support and Other Posted
Support.
|
|
(i)
|
“Value”
with respect to Other Eligible Support and Other Posted Support
means: not
applicable.
|
|
(ii)
|
“Transfer”
with respect to Other Eligible Support and Other Posted Support
means: not
applicable.
|
|
(k)
|
Demands
and Notices.All demands, specifications and notices under this
Annex will
be made pursuant to the Notices Section of this Agreement, except
that any
demand, specification or notice shall be given to or made at
the following
addresses, or at such other address as the relevant party may
from time to
time designate by giving notice (in accordance with the terms
of this
paragraph) to the other party:
|
If
to
Party A, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B’s Custodian:
LaSalle
Bank National Association
000
Xxxxx
XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
XX 00000
Attn:
Global Securities and Trust Services Group - BSABS 2007 AQ1
Facsimile:
(000) 000-0000
Phone:
(000) 000-0000
|
(l)
|
Address
for Transfers. Each Transfer hereunder shall be made to the address
specified below or to an address specified in writing from time
to time by
the party to which such Transfer will be
made.
|
Party
A
account details for holding collateral:
Wachovia
Bank, N.A.
ABA:
000000000
ACCT:
04659360000127
Attn:
Derivative Collateral Mgmt
Party
B’s
Custodian account details for holding collateral:
LaSalle
Bank National Association
ABA:
000000000
LaSalle
CHGO/CTR/BNF:/LASALLE TRUST
Ref:
Trust A/C#: 724454.3
|
(m)
|
Other
Provisions.
|
|
(i)
|
Collateral
Account. The Custodian, on Party B’s behalf, shall open and maintain an
Eligible Account segregated from the Swap Account and any other
moneys of
the Trustee held pursuant to the Pooling and Servicing Agreement,
which
account shall be an Eligible Account, in which all Posted Collateral
shall
be held.
|
|
(ii)
|
Agreement
as to Single Secured Party and Single Pledgor. Party A and Party
B hereby
agree that, notwithstanding anything to the contrary in this
Annex, (a)
the term “Secured Party” as used in this Annex means only Party B, (b) the
term “Pledgor” as used in this Annex means only Party A, (c) only Party A
makes the pledge and grant in Paragraph 2, the acknowledgement
in the
final sentence of Paragraph 8(a) and the representations in Paragraph
9.
|
|
(iii)
|
Calculation
of Value. Paragraph 4(c) is hereby amended by deleting the word
“Value”
and inserting in lieu thereof “Moody’s First Trigger Value, Moody’s Second
Trigger Value”. Paragraph 4(d)(ii) is hereby amended by (A) deleting the
words “a Value” and inserting in lieu thereof “Moody’s First Trigger
Value, and Moody’s Second Trigger Value” and (B) deleting the words “the
Value” and inserting in lieu thereof “Moody’s First Trigger Value, and
Moody’s Second Trigger Value”. Paragraph 5 (flush language) is hereby
amended by deleting the word “Value” and inserting in lieu thereof
“Moody’s First Trigger Value, or Moody’s Second Trigger Value”. Paragraph
5(i) (flush language) is hereby amended by deleting the word
“Value” and
inserting in lieu thereof “Moody’s First Trigger Value, and Moody’s Second
Trigger Value”. Paragraph 5(i)(C) is hereby amended by deleting the word
“the Value, if” and inserting in lieu thereof “any one or more of the
Moody’s First Trigger Value, or Moody’s Second Trigger Value, as may be”.
Paragraph 5(ii) is hereby amended by (1) deleting the first instance
of
the words “the Value” and inserting in lieu thereof “any one or more of
the Moody’s First Trigger Value, or Moody’s Second Trigger Value” and (2)
deleting the second instance of the words “the Value” and inserting in
lieu thereof “such disputed Moody’s First Trigger Value, or Moody’s Second
Trigger Value”. Each of Paragraph 8(b)(iv)(B) and Paragraph 11(a) is
hereby amended by deleting the word “Value” and inserting in lieu thereof
“least of the Moody’s First Trigger Value, and Moody’s Second Trigger
Value”.
|
|
(iv)
|
Form
of Annex. Party A and Party B hereby agree that the text of Paragraphs
1
through 12, inclusive, of this Annex is intended to be the printed
form of
ISDA Credit Support Annex (Bilateral Form - ISDA Agreements Subject
to New
York Law Only version) as published and copyrighted in 1994 by
the
International Swaps and Derivatives Association,
Inc.
|
|
(v)
|
Events
of Default. Paragraph 7 will not apply to cause any Event of
Default to
exist with respect to Party B except that Paragraph 7(i) will
apply to
Party B solely in respect of Party B’s obligations under Paragraph 3(b) of
the Credit Support Annex. Notwithstanding anything to the contrary
in
Paragraph 7, any failure by Party A to comply with or perform
any
obligation to be complied with or performed by Party A under
the Credit
Support Annex shall only be an Event of Default if (A) a Required
Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local
Business Days and (B) such failure is not remedied on or before
the third
Local Business Day after notice of such failure is given to Party
A.
|
|
(vi)
|
Expenses.
Notwithstanding anything to the contrary in Paragraph 10, the
Pledgor will
be responsible for, and will reimburse the Secured Party for,
all transfer
and other taxes and other costs involved in any Transfer of Eligible
Collateral.
|
|
(vii)
|
Withholding.
Paragraph 6(d)(ii) is hereby amended by inserting immediately
after “the
Interest Amount” in the fourth line thereof the words “less any applicable
withholding taxes.”
|
(viii)
Additional
Definitions. As used in this Annex:
“Collateral
Event” means
that no Relevant Entity has credit ratings at least equal to the Approved
Ratings Threshold.
“DV01”
means,
with respect to a Transaction and any date of determination, the estimated
change in the Secured Party’s Transaction Exposure with respect to such
Transaction that would result from a one basis point change in the relevant
swap
curve on such date, as determined by the Valuation Agent in good faith
and in a
commercially reasonable manner. The Valuation Agent shall, upon request
of Party
B, provide to Party B a statement showing in reasonable detail such
calculation.
“Exposure”
has the
meaning specified in Paragraph 12, except that after the word “Agreement” the
words “(assuming, for this purpose only, that Part 1(f) of the Schedule is
deleted)” shall be inserted.
“Local
Business Day”
means,
for purposes of this Annex: any day on which (A) commercial banks are open
for
business (including dealings in foreign exchange
and
foreign currency deposits) in New York and the location of Party A, Party
B and
any Custodian, and (B) in relation to a Transfer of Eligible Collateral,
any day
on which the clearance system agreed between the parties for the delivery
of
Eligible Collateral is open for acceptance and execution of settlement
instructions (or in the case of a Transfer of Cash or other Eligible Collateral
for which delivery is contemplated by other means a day on which commercial
banks are open for business (including dealings in foreign exchange and
foreign
deposits) in New York and the location of Party A, Party B and any
Custodian.
“Moody’s
First Trigger Credit Support Amount” means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (I) a Moody’s First Trigger Ratings Event has
occurred and has been continuing and either (x) such Moody’s First Trigger
Ratings Event has been continuing for at least 30 Local Business
Days or
(y) no Relevant Entity has had credit ratings from Moody’s at least equal
to the Moody’s First Trigger Ratings Threshold since this Annex was
executed and (II) it is not the case that a Moody’s Second Trigger Ratings
Event has occurred and been continuing for at least 30 Local
Business
Days, an amount equal to the greater of (a) zero and (b) the
sum of (i)
the Secured Party’s Exposure for such Valuation Date and (ii) the sum, for
each Transaction to which this Annex relates, of the least of
(x) the
product of the Moody’s First Trigger DV01 Multiplier and DV01 for such
Transaction and such Valuation Date, (y) the product of Moody’s First
Trigger Notional Amount Multiplier, (ii) 100 and (iii) the Notional
Amount
for such Transaction for the Calculation Period for such Transaction
(each
as defined in the related Confirmation) which includes such Valuation
Date, and (z) the product of the applicable Moody’s First Trigger Factor
set forth in Table 1, (ii) 100 and (iii) the Notional Amount
for such
Transaction for the Calculation Period for such Transaction (each
as
defined in the related Confirmation) which includes such Valuation
Date;
or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
the
Threshold for Party A such Valuation Date.
“Xxxxx’x
First Trigger DV01 Multiplier”
means
25.
“Xxxxx’x
First Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x First Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Xxxxx’x
First Trigger Notional Amount Multiplier”
means
4%.
“Xxxxx’x
Second Trigger Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which it is the case that a Xxxxx’x Second Trigger
Ratings Event has occurred and been continuing for at least 30
Local
Business Days, an amount equal to the greatest of (a) zero, (b)
the
aggregate amount of the next payment due to be paid by Party
A under each
Transaction to which this Annex relates, and (c) the sum of (x)
the
Secured Party’s Exposure for such Valuation Date and (y) the sum, for each
Transaction to which this Annex relates,
of
|
(1)
if
such
Transaction is not a Transaction-Specific Hedge,
the
least
of (i) the product of the Xxxxx’x Second Trigger DV01 Multiplier and DV01 for
such Transaction and such Valuation Date, (ii) the product of (1) the Xxxxx’x
Second Trigger Notional Amount Multiplier, (2) 100 and (3) the Notional
Amount
for such Transaction for the Calculation Period for such Transaction (each
as
defined in the related Confirmation) which includes such Valuation Date,
and
(iii) the
product of (i) the applicable Xxxxx’x Second Trigger Factor set forth in Table
2, (ii) 100 and (iii) the Notional Amount for such Transaction for the
Calculation Period for such Transaction (each as defined in the related
Confirmation) which includes such Valuation Date; or
(2)
if
such
Transaction is a Transaction-Specific Hedge,
the
least
of (i) the product of the Xxxxx’x Second Trigger Transaction-Specific Hedge DV01
Multiplier and DV01 for such Transaction and such Valuation Date, (ii)
the
product of (1) the Xxxxx’x Second Trigger Transaction-Specific Hedge Notional
Amount Multiplier, (2) 100 and (3) the Notional Amount for such Transaction
for
the Calculation Period for such Transaction (each as defined in the related
Confirmation) which includes such Valuation Date, and (iii) the product
of (i)
the applicable Xxxxx’x Second Trigger Factor set forth in Table 3, (ii) 100 and
(iii) the Notional Amount for such Transaction for the Calculation Period
for
such Transaction (each as defined in the related Confirmation) which includes
such Valuation Date; or
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II) the
Threshold for Party A for such Valuation Date.
“Xxxxx’x
Second Trigger DV01 Multiplier”
means
60.
“Xxxxx’x
Second Trigger Notional Amount Multiplier”
means
9%.
“Xxxxx’x
Second Trigger Transaction-Specific Hedge DV01
Multiplier”
means
75.
“Xxxxx’x
Second Trigger Transaction-Specific Hedge Notional Amount
Multiplier”
means
11%.
“Xxxxx’x
Second Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x Second Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Remaining
Weighted Average Maturity” means,
with respect to a Transaction, the expected weighted average maturity for
such
Transaction as determined by the Valuation Agent.
“Transaction
Exposure”
means,
for any Transaction, Exposure determined as if such Transaction were the
only
Transaction between the Secured Party and the Pledgor.
“Transaction-Specific
Hedge” means
any
Transaction that is (i) an interest rate swap in respect of which (x) the
notional amount of the interest rate swap is “balance guaranteed” or (y) the
notional amount of the interest rate swap for any Calculation Period (as
defined
in the related Confirmation) otherwise is not a specific dollar amount
that is
fixed at the inception of the Transaction, (ii) an interest rate cap, (iii)
an
interest rate floor or (iv) an interest rate swaption.
“Valuation
Percentage”
shall
mean, for purposes of determining the Xxxxx’x First Trigger Value, or Xxxxx’x
Second Trigger Value with respect to any Eligible Collateral or Posted
Collateral, the applicable Xxxxx’x First Trigger Valuation Percentage, or
Xxxxx’x Second Trigger Valuation Percentage for such Eligible Collateral or
Posted Collateral, respectively, in each case as set forth in Paragraph
13(b)(ii).
“Value”
shall
mean, in respect of any date, the related Xxxxx’x First Trigger Value, and the
related Xxxxx’x Second Trigger Value.
[Remainder
of this page intentionally left blank]
Table
1
|
Xxxxx’x
First Trigger Factor
|
||
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
|
|
1
or less
|
0.25%
|
|
|
More
than 1 but not more than 2
|
0.50%
|
|
|
More
than 2 but not more than 3
|
0.70%
|
|
|
More
than 3 but not more than 4
|
1.00%
|
|
|
More
than 4 but not more than 5
|
1.20%
|
|
|
More
than 5 but not more than 6
|
1.40%
|
|
|
More
than 6 but not more than 7
|
1.60%
|
|
|
More
than 7 but not more than 8
|
1.80%
|
|
|
More
than 8 but not more than 9
|
2.00%
|
|
|
More
than 9 but not more than 10
|
2.20%
|
|
|
More
than 10 but not more than 11
|
2.30%
|
|
|
More
than 11 but not more than 12
|
2.50%
|
|
|
More
than 12 but not more than 13
|
2.70%
|
|
|
More
than 13 but not more than 14
|
2.80%
|
|
|
More
than 14 but not more than 15
|
3.00%
|
|
|
More
than 15 but not more than 16
|
3.20%
|
|
|
More
than 16 but not more than 17
|
3.30%
|
|
|
More
than 17 but not more than 18
|
3.50%
|
|
|
More
than 18 but not more than 19
|
3.60%
|
|
|
More
than 19 but not more than 20
|
3.70%
|
|
|
More
than 20 but not more than 21
|
3.90%
|
|
|
More
than 21 but not more than 22
|
4.00%
|
|
|
More
than 22 but not more than 23
|
4.00%
|
|
|
More
than 23 but not more than 24
|
4.00%
|
|
|
More
than 24 but not more than 25
|
4.00%
|
|
|
More
than 25 but not more than 26
|
4.00%
|
|
|
More
than 26 but not more than 27
|
4.00%
|
|
|
More
than 27 but not more than 28
|
4.00%
|
|
|
More
than 28 but not more than 29
|
4.00%
|
|
|
More
than 29
|
4.00%
|
|
Table
2
|
Xxxxx’x
Second Trigger Factor for Interest Rate Swaps with Fixed Notional
Amounts
|
||
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
|
|
1
or less
|
0.60%
|
|
|
More
than 1 but not more than 2
|
1.20%
|
|
|
More
than 2 but not more than 3
|
1.70%
|
|
|
More
than 3 but not more than 4
|
2.30%
|
|
|
More
than 4 but not more than 5
|
2.80%
|
|
|
More
than 5 but not more than 6
|
3.30%
|
|
|
More
than 6 but not more than 7
|
3.80%
|
|
|
More
than 7 but not more than 8
|
4.30%
|
|
|
More
than 8 but not more than 9
|
4.80%
|
|
|
More
than 9 but not more than 10
|
5.30%
|
|
|
More
than 10 but not more than 11
|
5.60%
|
|
|
More
than 11 but not more than 12
|
6.00%
|
|
|
More
than 12 but not more than 13
|
6.40%
|
|
|
More
than 13 but not more than 14
|
6.80%
|
|
|
More
than 14 but not more than 15
|
7.20%
|
|
|
More
than 15 but not more than 16
|
7.60%
|
|
|
More
than 16 but not more than 17
|
7.90%
|
|
|
More
than 17 but not more than 18
|
8.30%
|
|
|
More
than 18 but not more than 19
|
8.60%
|
|
|
More
than 19 but not more than 20
|
9.00%
|
|
|
More
than 20 but not more than 21
|
9.00%
|
|
|
More
than 21 but not more than 22
|
9.00%
|
|
|
More
than 22 but not more than 23
|
9.00%
|
|
|
More
than 23 but not more than 24
|
9.00%
|
|
|
More
than 24 but not more than 25
|
9.00%
|
|
|
More
than 25 but not more than 26
|
9.00%
|
|
|
More
than 26 but not more than 27
|
9.00%
|
|
|
More
than 27 but not more than 28
|
9.00%
|
|
|
More
than 28 but not more than 29
|
9.00%
|
|
|
More
than 29
|
9.00%
|
|
Table
3
|
Xxxxx’x
Second Trigger Factor for Transaction-Specific
Xxxxxx
|
||
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
|
|
1
or less
|
0.75%
|
|
|
More
than 1 but not more than 2
|
1.50%
|
|
|
More
than 2 but not more than 3
|
2.20%
|
|
|
More
than 3 but not more than 4
|
2.90%
|
|
|
More
than 4 but not more than 5
|
3.60%
|
|
|
More
than 5 but not more than 6
|
4.20%
|
|
|
More
than 6 but not more than 7
|
4.80%
|
|
|
More
than 7 but not more than 8
|
5.40%
|
|
|
More
than 8 but not more than 9
|
6.00%
|
|
|
More
than 9 but not more than 10
|
6.60%
|
|
|
More
than 10 but not more than 11
|
7.00%
|
|
|
More
than 11 but not more than 12
|
7.50%
|
|
|
More
than 12 but not more than 13
|
8.00%
|
|
|
More
than 13 but not more than 14
|
8.50%
|
|
|
More
than 14 but not more than 15
|
9.00%
|
|
|
More
than 15 but not more than 16
|
9.50%
|
|
|
More
than 16 but not more than 17
|
9.90%
|
|
|
More
than 17 but not more than 18
|
10.40%
|
|
|
More
than 18 but not more than 19
|
10.80%
|
|
|
More
than 19 but not more than 20
|
11.00%
|
|
|
More
than 20 but not more than 21
|
11.00%
|
|
|
More
than 21 but not more than 22
|
11.00%
|
|
|
More
than 22 but not more than 23
|
11.00%
|
|
|
More
than 23 but not more than 24
|
11.00%
|
|
|
More
than 24 but not more than 25
|
11.00%
|
|
|
More
than 25 but not more than 26
|
11.00%
|
|
|
More
than 26 but not more than 27
|
11.00%
|
|
|
More
than 27 but not more than 28
|
11.00%
|
|
|
More
than 28 but not more than 29
|
11.00%
|
|
|
More
than 29
|
11.00%
|
|
IN
WITNESS WHEREOF, the parties have executed this Annex by their duly authorized
representatives as of the date of the Agreement.
|
Wachovia
Bank, N.A.
|
LaSalle
Bank National Association, not individually, but solely as Supplemental
Interest Trust Trustee on behalf of the Supplemental Interest
Trust with
respect to the Bear Xxxxxxx Asset Backed Securities I Trust 2007-AQ1,
Asset-Backed Certificates, Series 2007-AQ1
|
|
By: _____________________________
Name
Title:
Date:
|
By: _____________________________
Name
Title:
Date:
|
EXHIBIT
N
[Reserved]
EXHIBIT
O
[Reserved]
EXHIBIT
P
SERVICING
CRITERIA TO BE ADDRESSED
IN
ASSESSMENT OF COMPLIANCE
Definitions
Master
Servicer - aggregator of pool assets
Custodian
- safe keeper of pool assets
Trustee
-
fiduciary of the transaction, waterfall calculator, paying agent
Where
there are multiple checks for criteria the attesting party will identify
in
their management assertion that they are attesting only to the portion
of the
distribution chain they are responsible for in the related transaction
agreements.
Key: X
- obligation
|
Reg
AB Reference
|
Servicing
Criteria
|
Master
Servicer
|
Trustee
|
Custodian
|
|
General
Servicing Considerations
|
||||
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
X
|
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
|
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the Pool Assets are maintained.
|
|
|
|
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on
the party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance
with the
terms of the transaction agreements.
|
X
|
|
|
|
|
Cash
Collection and Administration
|
|
|
|
|
1122(d)(2)(i)
|
Payments
on pool assets are deposited into the appropriate custodial bank
accounts
and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in
the
transaction agreements.
|
X
|
X
|
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
X
|
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are
made,
reviewed and approved as specified in the transaction agreements.
|
X
|
X
|
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of over collateralization, are
separately
maintained (e.g., with respect to commingling of cash) as set
forth in the
transaction agreements.
|
X
|
X
|
|
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities
Exchange Act.
|
X
|
X
|
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized access.
|
X
|
|
|
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities
related
bank accounts, including custodial accounts and related bank
clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling
items. These
reconciling items are resolved within 90 calendar days of their
original
identification, or such other number of days specified in the
transaction
agreements.
|
X
|
X
|
|
|
|
Investor
Remittances and Reporting
|
|
|
|
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission,
are
maintained in accordance with the transaction agreements and
applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance
with the
terms specified in the transaction agreements; (C) are filed
with the
Commission as required by its rules and regulations; and (D)
agree with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of Pool Assets serviced by the Servicer.
|
X
|
X
|
|
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with
timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
X
|
|
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the
Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
X
|
|
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank statements.
|
X
|
X
|
|
|
|
Pool
Asset Administration
|
|
|
|
|
1122(d)(4)(i)
|
Collateral
or security on pool assets is maintained as required by the transaction
agreements or related pool asset documents.
|
|
|
X
|
|
1122(d)(4)(ii)
|
Pool
assets and related documents are safeguarded as required by the
transaction agreements
|
|
|
X
|
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements
in the
transaction agreements.
|
X
|
X
|
X*
|
|
1122(d)(4)(iv)
|
Payments
on pool assets, including any payoffs, made in accordance with
the related
pool asset documents are posted to the Servicer’s obligor records
maintained no more than two business days after receipt, or such
other
number of days specified in the transaction agreements, and allocated
to
principal, interest or other items (e.g., escrow) in accordance
with the
related pool asset documents.
|
X
|
|
|
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the pool assets agree with the Servicer’s
records with respect to an obligor’s unpaid principal balance.
|
X
|
|
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor's pool assets
(e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
|
|
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions,
as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
|
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a pool
asset is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent pool assets including, for
example,
phone calls, letters and payment rescheduling plans in cases
where
delinquency is deemed temporary (e.g., illness or unemployment).
|
X
|
|
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for pool assets with variable
rates
are computed based on the related pool asset documents.
|
X
|
|
|
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s pool asset documents,
on at least an annual basis, or such other period specified in
the
transaction agreements; (B) interest on such funds is paid, or
credited,
to obligors in accordance with applicable pool asset documents
and state
laws; and (C) such funds are returned to the obligor within 30
calendar
days of full repayment of the related pool assets, or such other
number of
days specified in the transaction agreements.
|
X
|
|
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that
such support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
|
|
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the Servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
|
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of
days
specified in the transaction agreements.
|
X
|
|
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
|
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set
forth in
the transaction agreements.
|
|
X
|
|
*
Only
with respect to the logistics of adding, removing and substituting
loan
files.
EXHIBIT
Q
FORM
10-D, FORM 8-K AND FORM 10-K
REPORTING
RESPONSIBILITY
As
to
each item described below, the entity indicated as the Responsible Party
shall
be primarily responsible for reporting the information to the party identified
as responsible for preparing the Securities Exchange Act Reports pursuant
to
Section 3.16 of the Pooling and Servicing Agreement. The
trustee in this transaction is responsible for all of the securities
administrator functions.
Under
Item 1 of Form 10-D: a) items marked “monthly statements to certificateholders”
are required to be included in the periodic Distribution Date statement
under
Section 5.06 of the Pooling and Servicing Agreement, provided by the Trustee
based on information received from the party providing such information;
and b)
items marked “Form 10-D report” are required to be in the Form 10-D report but
not the monthly statements to certificateholders, provided by the party
indicated. Information under all other Items of Form 10-D is to be included
in
the Form 10-D report. All such information and any other Items of Form
8-K and
Form 10-K set forth in this exhibit shall be sent to the Trustee and the
Depositor.
|
Form
|
Item
|
Description
|
Master
Servicer
|
Trustee
|
Custodian
|
Depositor
|
Sponsor
|
|
|
10-D
|
Must
be filed within 15 days of the distribution date for the asset-backed
securities.
|
|
|
|||||
|
|
1
|
Distribution
and Pool Performance Information
|
|
|
|
|
|
|
|
Item
1121(a) - Distribution and Pool Performance
Information
|
|
|
|
|
|
|||
|
(1)
Any applicable record dates, accrual dates, determination dates
for
calculating distributions and actual distribution dates for the
distribution period.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(2)
Cash flows received and the sources thereof for distributions,
fees and
expenses.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(3)
Calculated amounts and distribution of the flow of funds for
the period
itemized by type and priority of payment, including:
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(i)
Fees or expenses accrued and paid, with an identification of
the general
purpose of such fees and the party receiving such fees or
expenses.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(ii)
Payments accrued or paid with respect to enhancement or other
support
identified in Item 1114 of Regulation AB (such as insurance premiums
or
other enhancement maintenance fees), with an identification of
the general
purpose of such payments and the party receiving such
payments.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(iii)
Principal, interest and other distributions accrued and paid
on the
asset-backed securities by type and by class or series and any
principal
or interest shortfalls or carryovers.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(iv)
The amount of excess cash flow or excess spread and the disposition
of
excess cash flow.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(4)
Beginning and ending principal balances of the asset-backed
securities.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(5)
Interest rates applicable to the pool assets and the asset-backed
securities, as applicable. Consider providing interest rate information
for pool assets in appropriate distributional groups or incremental
ranges.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(6)
Beginning and ending balances of transaction accounts, such as
reserve
accounts, and material account activity during the period.
|
|
X
(monthly
statements to certificateholders) (only with respect to the reserve
accounts)
|
|
|
|
|||
|
(7)
Any amounts drawn on any credit enhancement or other support
identified in
Item 1114 of Regulation AB, as applicable, and the amount of
coverage
remaining under any such enhancement, if known and
applicable.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(8)
Number and amount of pool assets at the beginning and ending
of each
period, and updated pool composition information, such as weighted
average
coupon, weighted average remaining term, pool factors and prepayment
amounts.
|
|
X
(monthly
statements to certificateholders)
|
|
Updated
pool composition information fields to be as specified by Depositor
from
time to time
|
|
|||
|
(9)
Delinquency and loss information for the period.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
In
addition, describe any material changes to the information specified
in
Item 1100(b)(5) of Regulation AB regarding the pool assets.
(methodology)
|
X
|
|
|
|
|
|||
|
(10)
Information on the amount, terms and general purpose of any advances
made
or reimbursed during the period, including the general use of
funds
advanced and the general source of funds for
reimbursements.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(11)
Any material modifications, extensions or waivers to pool asset
terms,
fees, penalties or payments during the distribution period or
that have
cumulatively become material over time.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(12)
Material breaches of pool asset representations or warranties
or
transaction covenants.
|
X
|
X
(if
agreed upon by the parties)
|
|
X
|
|
|||
|
(13)
Information on ratio, coverage or other tests used for determining
any
early amortization, liquidation or other performance trigger
and whether
the trigger was met.
|
|
X
(monthly
statements to certificateholders)
|
|
|
|
|||
|
(14)
Information regarding any new issuance of asset-backed securities
backed
by the same asset pool,
|
|
|
|
X
|
|
|||
|
information
regarding any pool asset changes (other than in connection with
a pool
asset converting into cash in accordance with its terms), such
as
additions or removals in connection with a prefunding or revolving
period
and pool asset substitutions and repurchases (and purchase rates,
if
applicable), and cash flows available for future purchases, such
as the
balances of any prefunding or revolving accounts, if
applicable.
|
X
|
X
|
|
X
|
|
|||
|
Disclose
any material changes in the solicitation, credit-granting, underwriting,
origination, acquisition or pool selection criteria or procedures,
as
applicable, used to originate, acquire or select the new pool
assets.
|
|
|
|
X
|
X
|
|||
|
Item
1121(b) - Pre-Funding or Revolving Period Information
Updated
pool information as required under Item 1121(b).
|
|
|
|
X
|
|
|||
|
2
|
Legal
Proceedings
|
|
|
|
|
|
||
|
Item
1117 - Legal proceedings pending against the following entities,
or their
respective property, that is material to Certificateholders,
including
proceedings known to be contemplated by governmental
authorities:
|
|
|
|
|
|
|||
|
Sponsor
(Seller)
|
|
|
|
|
X
|
|||
|
Depositor
|
|
|
|
X
|
|
|||
|
Trustee
|
|
X
|
|
|
|
|||
|
Issuing
entity
|
|
|
|
X
|
|
|||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
|
|
|
|
|||
|
Originator
of 20% or more of pool assets as of the Cut-off Date
|
|
|
|
X
|
|
|||
|
Custodian
|
|
|
X
|
|
|
|||
|
|
3
|
Sales
of Securities and Use of Proceeds
|
|
|
|
|
|
|
|
Information
from Item 2(a) of Part II of Form 10-Q:
With
respect to any sale of securities by the sponsor, depositor or
issuing
entity, that are backed by the same asset pool or are otherwise
issued by
the issuing entity, whether or not registered, provide the sales
and use
of proceeds information in Item 701 of Regulation S-K. Pricing
information
can be omitted if securities were not registered.
|
|
|
|
X
|
|
|||
|
4
|
Defaults
Upon Senior Securities
|
|
|
|
|
|
||
|
Information
from Item 3 of Part II of Form 10-Q:
Report
the occurrence of any Event of Default (after expiration of any
grace
period and provision of any required notice)
|
|
X
|
|
|
|
|||
|
5
|
Submission
of Matters to a Vote of Certificateholders
|
|
|
|
|
|
||
|
Information
from Item 4 of Part II of Form 10-Q
|
|
X
|
|
|
|
|||
|
6
|
Significant
Obligors of Pool Assets
|
|
|
|
|
|
||
|
Item
1112(b) - Significant
Obligor Financial Information*
|
|
|
|
X
|
|
|||
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Item.
|
|
|
|
|
|
|||
|
7
|
Significant
Enhancement Provider Information
|
|
|
|
|
|
||
|
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information*
|
|
|
|
|
|
|||
|
Determining
applicable disclosure threshold
|
|
X
|
|
|
|
|||
|
Requesting
required financial information or effecting incorporation by
reference
|
|
X
|
|
|
|
|||
|
Item
1115(b) - Derivative Counterparty Financial
Information*
|
|
|
|
|
|
|||
|
Determining
current maximum probable exposure
|
|
|
|
X
|
|
|||
|
Determining
current significance percentage
|
|
X
|
|
|
|
|||
|
Requesting
required financial information or effecting incorporation by
reference
|
|
X
|
|
|
|
|||
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
|
|
|
|
|||
|
8
|
Other
Information
|
|
|
|
|
|
||
|
|
|
Disclose
any information required to be reported on Form 8-K during the
period
covered by the Form 10-D but not reported
|
The
Responsible Party for the applicable Form 8-K item as indicated
below.
|
|||||
|
|
9
|
Exhibits
|
|
|
|
|
|
|
|
Distribution
report
|
|
X
|
|
|
|
|||
|
Exhibits
required by Item 601 of Regulation S-K, such as material
agreements
|
|
|
|
X
|
|
|||
|
8-K
|
Must
be filed within four business days of an event reportable on
Form
8-K.
|
|
|
|||||
|
|
1.01
|
Entry
into a Material Definitive Agreement
|
|
|
|
|
|
|
|
Disclosure
is required regarding entry into or amendment of any definitive
agreement
that is material to the securitization, even if depositor is
not a party.
Examples:
servicing agreement, custodial agreement.
Note:
disclosure not required as to definitive agreements that are
fully
disclosed in the prospectus
|
X
|
X
|
|
X
|
X
|
|||
|
1.02
|
Termination
of a Material Definitive Agreement
|
X
|
X
|
|
X
|
X
|
||
|
Disclosure
is required regarding termination of any definitive agreement
that is
material to the securitization (other than expiration in accordance
with
its terms), even if depositor is not a party.
Examples:
servicing agreement, custodial agreement.
|
X
|
X
|
X
|
X
|
X
|
|||
|
1.03
|
Bankruptcy
or Receivership
|
|
|
|
|
|
||
|
Disclosure
is required regarding the bankruptcy or receivership, if known
to the
Master Servicer, with respect to any of the following:
Sponsor
(Seller), Depositor, Master Servicer, affiliated Servicer, other
Servicer
servicing 20% or more of pool assets at time of report, other
material
servicers, Trustee, significant obligor, credit enhancer (10%
or more),
derivatives counterparty, Custodian
|
X
|
X
|
X
|
X
|
X
|
|||
|
2.04
|
Triggering
Events that Accelerate or Increase a Direct Financial Obligation
or an
Obligation under an Off-Balance Sheet Arrangement [in
this transaction there is no off-balance sheet
arrangement]
|
|
|
|
|
|
||
|
Includes
an early amortization, performance trigger or other event, including
event
of default, that would materially alter the payment priority/distribution
of cash flows/amortization schedule.
Disclosure
will be made of events other than waterfall triggers which are
disclosed
in the monthly statements to certificateholders [in this transaction
there
will be no events other than waterfall triggers]
|
|
X
|
|
|
|
|||
|
3.03
|
Material
Modification to Rights of Certificateholders
|
|
|
|
|
|
||
|
Disclosure
is required of any material modification to documents defining
the rights
of Certificateholders, including the Pooling and Servicing
Agreement
|
|
X
|
|
|
|
|||
|
5.03
|
Amendments
to Articles of Incorporation or Bylaws; Change in Fiscal
Year
|
|
|
|
|
|
||
|
Disclosure
is required of any amendment “to the governing documents of the issuing
entity”
|
|
|
|
X
|
|
|||
|
5.06
|
Change
in Shell Company Status
|
|
|
|
|
|
||
|
[Not
applicable to ABS issuers]
|
|
|
|
X
|
|
|||
|
6.01
|
ABS
Informational and Computational Material
|
|
|
|
|
|
||
|
[Not
included in reports to be filed under Section 3.16]
|
|
|
|
X
|
|
|||
|
6.02
|
Change
of Servicer or Trustee
|
|
|
|
|
|
||
|
Requires
disclosure of any removal, replacement, substitution or addition
of any
master servicer, affiliated servicer, other servicer servicing
10% or more
of pool assets at time of report, other material servicers or
trustee.
|
X
|
X
|
|
X
|
|
|||
|
Reg
AB disclosure about any new master servicer is also
required.
|
X
|
|
|
|
|
|||
|
Reg
AB disclosure about any new trustee is also required.
|
|
X
|
|
|
|
|||
|
6.03
|
Change
in Credit Enhancement or Other External Support
|
|
|
|
|
|
||
|
Covers
termination of any enhancement in manner other than by its terms,
the
addition of an enhancement, or a material change in the enhancement
provided. Applies to external credit enhancements as well as
derivatives.
|
|
X
|
|
X
|
|
|||
|
Reg
AB disclosure about any new enhancement provider is also
required.
|
|
X
|
|
X
|
|
|||
|
6.04
|
Failure
to Make a Required Distribution
|
|
X
|
|
|
|
||
|
6.05
|
Securities
Act Updating Disclosure
|
|
|
|
|
|
||
|
If
any material pool characteristic differs by 5% or more at the
time of
issuance of the securities from the description in the final
prospectus,
provide updated Reg AB disclosure about the actual asset
pool.
|
|
|
|
X
|
|
|||
|
If
there are any new servicers or originators required to be disclosed
under
Regulation AB as a result of the foregoing, provide the information
called
for in Items 1108 and 1110 respectively.
|
|
|
|
X
|
|
|||
|
7.01
|
Regulation
FD Disclosure
|
X
|
X
|
X
|
X
|
|
||
|
8.01
|
Other
Events
|
|
|
|
|
|
||
|
Any
event, with respect to which information is not otherwise called
for in
Form 8-K, that the registrant deems of importance to
certificateholders.
|
|
|
|
X
|
|
|||
|
|
9.01
|
Financial
Statements and Exhibits
|
The
Responsible Party applicable to reportable event.
|
|||||
|
10-K
|
|
Must
be filed within 90 days of the fiscal year end for the
registrant.
|
|
|
||||
|
|
9B
|
Other
Information
|
|
|
|
|
|
|
|
|
|
Disclose
any information required to be reported on Form 8-K during the
fourth
quarter covered by the Form 10-K but not reported
|
The
Responsible Party for the applicable Form 8-K as indicated
above.
|
|||||
|
|
15
|
Exhibits
and Financial Statement Schedules
|
|
|
|
|
|
|
|
Item
1112(b) - Significant
Obligor Financial Information
|
|
|
|
X
|
|
|||
|
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information
|
|
|
|
|
|
|||
|
Determining
applicable disclosure threshold
|
|
X
|
|
|
|
|||
|
Requesting
required financial information or effecting incorporation by
reference
|
|
X
|
|
|
|
|||
|
Item
1115(b) - Derivative Counterparty Financial
Information
|
|
|
|
|
|
|||
|
Determining
current maximum probable exposure
|
|
|
|
X
|
|
|||
|
|
|
Determining
current significance percentage
|
|
X
|
|
|
|
|
|
Requesting
required financial information or effecting incorporation by
reference
|
|
X
|
|
|
|
|||
|
Item
1117 - Legal proceedings pending against the following entities,
or their
respective property, that is material to Certificateholders,
including
proceedings known to be contemplated by governmental
authorities:
|
|
|
|
|
|
|||
|
Sponsor
(Seller)
|
|
|
|
|
X
|
|||
|
Depositor
|
|
|
|
X
|
|
|||
|
Trustee
|
|
X
|
|
|
|
|||
|
Issuing
entity
|
|
|
|
X
|
|
|||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
|
|
|
|
|||
|
Originator
of 20% or more of pool assets as of the Cut-off Date
|
|
|
|
X
|
|
|||
|
Custodian
|
|
|
X
|
|
|
|||
|
Item
1119 - Affiliations and relationships between the following entities,
or
their respective affiliates, that are material to
Certificateholders:
|
|
|
|
|
|
|||
|
Sponsor
(Seller)
|
|
|
|
|
X
|
|||
|
Depositor
|
|
|
|
X
|
|
|||
|
Trustee
|
|
X
|
|
|
|
|||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
|
|
|
|
|||
|
Originator
|
|
|
|
X
|
|
|||
|
Custodian
|
|
|
X
|
|
|
|||
|
Credit
Enhancer/Support Provider
|
|
|
|
X
|
|
|||
|
Significant
Obligor
|
|
|
|
X
|
|
|||
|
Item
1122 - Assessment of Compliance with Servicing
Criteria
|
X
|
X
|
X
|
|
|
|||
|
Item
1123 - Servicer Compliance Statement
|
X
|
X
|
|
|
||||
EXHIBIT
R
ADDITIONAL
DISCLOSURE NOTIFICATION
Bear
Xxxxxxx Asset Backed Securities I LLC
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000
E-mail:
xxxxxxxxxxxxxxxxxx@xxxx.xxx
LaSalle
Bank National Association as Trustee
000
X.
XxXxxxx Xx., Xxxxx 0000
Xxxxxxx,
Xxxxxxxx 00000
Fax:
(000) 000-0000
E-mail:
xxxxx@xxxxxxx.xxx
Attn:
Global Securities and Trust Services Group - BEAR XXXXXXX ASSET BACKED
SECURITIES I TRUST 2007-AQ1-SEC REPORT PROCESSING
RE:
**Additional Form [ ] Disclosure**Required
Ladies
and Gentlemen:
In
accordance with Section 3.16(a)(iv) of the Pooling and Servicing Agreement,
dated as of January 1, 2007, among Bear Xxxxxxx Asset Backed Securities
I LLC,
as depositor, EMC Mortgage Corporation, as seller and as master servicer,
and
LaSalle Bank National Association, as trustee. The Undersigned, as [Name
of
Party], hereby notifies you that certain events have come to our attention
that
[will][may] need to be disclosed on Form [ ].
Description
of Additional Form [ ] Disclosure:
List
of
Any Attachments hereto to be included in the Additional Form [ ]
Disclosure:
Any
inquiries related to this notification should be directed to [ ], phone
number:
[ ]; email address: [ ].
[NAME
OF
PARTY]
as
[role]
By:
____________________________________
Name:
Title:
