CHASE MANHATTAN ACCEPTANCE CORPORATION,
DEPOSITOR,
CHASE MANHATTAN MORTGAGE CORPORATION,
SERVICER
and
[TRUSTEE]
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of [DATE]
$----------------
Multi-Class Mortgage Pass-Through Certificates
Series [ ]
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS...............................................................................................
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND..................................................................
Section 2.01. Conveyance of Mortgage Loans.......................................................
Section 2.02. Acceptance by Trustee..............................................................
Section 2.03. Trust Fund; Authentication of Certificates.........................................
Section 2.04. REMIC Election.....................................................................
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND
THE SERVICER; REPURCHASE OF MORTGAGE LOANS................................................................
Section 3.01. Representations and Warranties of the Depositor with respect to the
Mortgage Loans.....................................................................
Section 3.02. Representations and Warranties of the Servicer.....................................
Section 3.03. Option to Substitute...............................................................
ARTICLE IV
THE CERTIFICATES..........................................................................................
Section 4.01. The Certificates...................................................................
Section 4.02. Registration of Transfer and Exchange of Certificates..............................
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates..................................
Section 4.04. Persons Deemed Owners..............................................................
Section 4.05. Appointment of Paying Agent; Certificate Account...................................
Section 4.06. Authenticating Agents..............................................................
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS............................................................
Section 5.01. Servicer to Service Mortgage Loans.................................................
Section 5.02. Sub-Servicing Agreements Between Servicer and Sub-Servicers;
Enforcement of Sub-Servicer's Obligations..........................................
Section 5.03. Successor Sub-Servicers............................................................
Section 5.04. Liability of the Servicer..........................................................
Section 5.05. No Contractual Relationship Between Sub-Servicer and Trustee or
Certificateholders.................................................................
Section 5.06. Termination of Sub-Servicing Agreement.............................................
Section 5.07. Collection of Mortgage Loan Payments...............................................
Section 5.08. Establishment of Collection Account; Deposit in Collection Account.................
i
Section 5.09. Permitted Withdrawals from the Collection Account...................................
Section 5.10. Establishment of Escrow Account; Deposits in Escrow Account.........................
Section 5.11. Permitted Withdrawals from Escrow Account...........................................
Section 5.12. Payment of Taxes, Insurance and Other Charges.......................................
Section 5.13. Transfer of Accounts................................................................
Section 5.14. [Reserved]..........................................................................
Section 5.15. Maintenance of the Primary Insurance Policies.......................................
Section 5.16. Maintenance of Standard Hazard Policies.............................................
Section 5.17. [Reserved]..........................................................................
Section 5.18. [Reserved]..........................................................................
Section 5.19. Fidelity Bond and Errors and Omissions Insurance....................................
Section 5.20. Collections under Insurance Policies; Enforcement of Due-On-Sale
Clauses; Assumption Agreements......................................................
Section 5.21. Income and Realization from Defaulted Mortgage Loans................................
Section 5.22. Trustee to Cooperate; Release of Mortgage Files.....................................
Section 5.23. Servicing and Other Compensation....................................................
Section 5.24. 1934 Act Reports....................................................................
Section 5.25. Annual Statement as to Compliance...................................................
Section 5.26. Annual Independent Public Accountants' Servicing Report.............................
Section 5.27. Access to Certain Documentation; Rights of the Depositor in Respect of
the Servicer........................................................................
Section 5.28. REMIC-Related Covenants.............................................................
ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS....................................................................
Section 6.01. Distributions.......................................................................
Section 6.02. Statements to the Certificateholders................................................
Section 6.03. Advances by the Servicer............................................................
Section 6.04. Allocation of Realized Losses.......................................................
Section 6.05. Compensating Interest; Allocation of Certain Interest Shortfalls....................
Section 6.06. Subordination.......................................................................
Section 6.07. Determination of LIBOR..............................................................
ARTICLE VII
REPORTS TO BE PREPARED BY THE SERVICER................................................................
Section 7.01. Servicer Shall Provide Information as Reasonably Required...........................
Section 7.02. Federal Information Returns and Reports to Certificateholders.......................
ARTICLE VIII
THE DEPOSITOR AND THE SERVICER........................................................................
Section 8.01. Indemnification; Third Party Claims.................................................
Section 8.02. Merger or Consolidation of the Depositor or the Servicer............................
ii
Section 8.03. Limitation on Liability of the Depositor, the Servicer, the Trustee and
Others.............................................................................
Section 8.04. Depositor and Servicer Not to Resign...............................................
Section 8.05. Successor to the Servicer..........................................................
Section 8.06. Maintenance of Ratings.............................................................
ARTICLE IX
DEFAULT..................................................................................................
Section 9.01. Events of Default..................................................................
Section 9.02. Waiver of Defaults.................................................................
Section 9.03. Trustee to Act; Appointment of Successor...........................................
Section 9.04. Notification to Certificateholders and the Rating Agencies.........................
ARTICLE X
CONCERNING THE TRUSTEE...................................................................................
Section 10.01. Duties of Trustee..................................................................
Section 10.02. Certain Matters Affecting the Trustee..............................................
Section 10.03. Trustee Not Liable for Certificates or Mortgage Loans..............................
Section 10.04. Trustee May Own Certificates.......................................................
Section 10.05. Fees and Expenses..................................................................
Section 10.06. Eligibility Requirements for Trustee...............................................
Section 10.07. Resignation and Removal of the Trustee.............................................
Section 10.08. Successor Trustee..................................................................
Section 10.09. Merger or Consolidation of Trustee.................................................
Section 10.10. Appointment of Co-Trustee or Separate Trustee......................................
Section 10.11. Appointment of Office or Agency....................................................
ARTICLE XI
TERMINATION..............................................................................................
Section 11.01. Termination........................................................................
ARTICLE XII
MISCELLANEOUS PROVISIONS.................................................................................
Section 12.01. Severability of Provisions.........................................................
Section 12.02. Limitation on Rights of Certificateholders.........................................
Section 12.03. Amendment..........................................................................
Section 12.04. Counterparts.......................................................................
Section 12.05. Duration of Agreement..............................................................
Section 12.06. Governing Law......................................................................
Section 12.07. Notices............................................................................
iii
EXHIBIT A MORTGAGE LOAN SCHEDULE
EXHIBIT B CONTENTS OF MORTGAGE FILE
EXHIBIT C FORMS OF CLASS A CERTIFICATES
EXHIBIT D FORM OF CLASS M CERTIFICATE
EXHIBIT E FORMS OF CLASS B CERTIFICATES
EXHIBIT F FORM OF CLASS A-R CERTIFICATE
EXHIBIT G FORM OF TRUSTEE CERTIFICATION
EXHIBIT H FORM OF INVESTMENT LETTER
EXHIBIT I FORM OF RULE 144A INVESTMENT LETTER
EXHIBIT J FORM OF SPECIAL SERVICING AGREEMENT
EXHIBIT K FORM OF CLASS A-R TRANSFER LETTER
EXHIBIT L REQUEST FOR RELEASE
iv
This Pooling and Servicing Agreement, dated as of [DATE], is executed
among Chase Manhattan Acceptance Corporation, as depositor (together with its
permitted successors and assigns, the "Depositor"), Chase Manhattan Mortgage
Corporation, as servicer (together with its permitted successors and assigns,
the "Servicer") and [TRUSTEE], as trustee (together with its permitted
successors and assigns, the "Trustee").
In consideration of the premises and the mutual agreements hereinafter
set forth, the Depositor, the Servicer and the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless the
context otherwise requires, shall have the following meanings:
ACCEPTED SERVICING PRACTICES: With respect to any Mortgage Loan, those
mortgage servicing practices (including collection procedures) of prudent
mortgage banking institutions which service mortgage loans of the same type as
such Mortgage Loan in the jurisdiction where the related Mortgaged Property is
located, and which are in accordance with FNMA servicing practices and
procedures, for MBS pool mortgages, as defined in the FNMA Guides including
future updates.
ADJUSTED LOCK-OUT PERCENTAGE: Equals (i) for any Distribution Date
prior to the Distribution Date in [MONTH/YEAR], 0% and (ii) for any Distribution
Date on or after the Distribution Date in [MONTH/YEAR], the Lock-out Percentage.
ADVANCE: The aggregate of the advances made by the Servicer with
respect to a particular Distribution Date pursuant to Section 6.03.
AGGREGATE CLASS A INTEREST ACCRUAL AMOUNT: On any Distribution Date, an
amount equal to the sum of the Class A-1 Interest Accrual Amount, the Class A-2
Interest Accrual Amount, the Class A-3 Interest Accrual Amount, the Class A-4
Interest Accrual Amount, the Class A-5 Interest Accrual Amount, the Class A-6
Interest Accrual Amount, the Class A-7 Interest Accrual Amount, the Class A-R
Interest Accrual Amount and the Class A-X Interest Accrual Amount.
AGGREGATE CLASS A INTEREST SHORTFALL: On any Distribution Date, an
amount equal to the sum of the Class A-1 Shortfall, the Class A-2 Shortfall, the
Class A-3 Shortfall, the Class A-4 Shortfall, the Class A-5 Shortfall, the Class
A-6 Shortfall, the Class A-7 Shortfall, the Class A-R Shortfall and the Class
A-X Shortfall.
1
AGREEMENT: This Pooling and Servicing Agreement and all amendments
hereof and supplements hereto.
APPRAISED VALUE: The value set forth in an appraisal made in connection
with the origination of the related Mortgage Loan as the value of the Mortgaged
Property.
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the laws
of the jurisdiction where the related Mortgaged Property is located to reflect
of record the sale and assignment of the Mortgage Loan to the Trustee, which
assignment, notice of transfer or equivalent instrument may, if permitted by
law, be in the form of one or more blanket assignments covering Mortgages
secured by Mortgaged Properties located in the same county.
AUTHENTICATING AGENT: The meaning specified in Section 4.06.
AVAILABLE DISTRIBUTION AMOUNT: On any Distribution Date, an amount
equal to the amount on deposit in the Certificate Account as of the close of
business on the related Determination Date except:
(a) amounts received on particular Mortgage Loans as late payments or
other recoveries of principal or interest (including Liquidation Proceeds,
Insurance Proceeds and condemnation awards) and respecting which the Servicer
previously made an unreimbursed Advance of such amounts;
(b) reimbursement for Nonrecoverable Advances and other amounts
permitted to be withdrawn by the Servicer pursuant to Section 5.09 from, or not
required to be deposited in, the Collection Account;
(c) amounts representing the Servicing Fee with respect to such
Distribution Date;
(d) amounts representing all or part of a Monthly Payment due (i) after
the related Due Period or (ii) on or prior to the Cut-off Date;
(e) all Repurchase Proceeds, Principal Prepayments, Liquidation
Proceeds, Insurance Proceeds and condemnation awards with respect to Mortgage
Loans received after the related Principal Prepayment Period, and all related
payments of interest representing interest for any period of time after the last
day of the related Due Period for such Mortgage Loans; and
(f) all income from Eligible Investments held in the Collection Account
for the account of the Servicer.
2
BANKRUPTCY AMOUNT: As of any date of determination, $_________ minus
all Bankruptcy Losses on the Mortgage Loans, if any, previously allocated to the
Certificates in accordance with Section 6.04.
BANKRUPTCY LOSS: With respect to any Mortgage Loan, a Realized Loss
resulting from a Deficient Valuation or Debt Service Reduction.
BOOK-ENTRY CERTIFICATES: The Class A Certificates (other than the Class
A-R and Class A-X Certificates), referred to collectively.
BUSINESS DAY: Any day other than (a) a Saturday or Sunday, (b) a legal
holiday in the State of New York or (c) a day on which banking institutions in
the State of New York are authorized or obligated by law or executive order to
be closed.
CARRY-OVER SUBORDINATED PRINCIPAL AMOUNT: As of any Distribution Date,
with respect to any Class of Subordinated Certificates, an amount, if any, equal
to the amount of principal distributable to such Class on any prior Distribution
Date that has not been so distributed.
CASH LIQUIDATION: Recovery of all cash proceeds by the Servicer with
respect to the liquidation of any Mortgage Loan, including Insurance Proceeds
and other payments or recoveries (whether made at one time or over a period of
time) which the Servicer deems to be finally recoverable, in connection with the
sale, assignment or satisfaction of such Mortgage Loan, trustee's sale,
foreclosure sale or otherwise, but only if title to the related Mortgaged
Property was not acquired by foreclosure or deed in lieu of foreclosure by the
Servicer pursuant to Section 5.21.
CERTIFICATE: Any Class A, Class M or Class B Certificate.
CERTIFICATE ACCOUNT: The account created and maintained pursuant to
Section 4.05.
CERTIFICATEHOLDER or HOLDER: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purposes of
giving any consent, waiver, request or demand pursuant to this Agreement, any
Certificate registered in the name of the Depositor, the Servicer, any
Sub-Servicer, or any of their respective affiliates shall be disregarded and the
undivided Percentage Interest evidenced thereby shall not be taken into account
in determining whether the requisite amount of Percentage Interests necessary to
effect any such consent, waiver, request or demand has been obtained. The
Trustee shall be entitled to conclusively rely upon the certificate of the
Depositor or the Servicer as to the determination of which Certificates are
registered in the name of such affiliates.
3
CERTIFICATE OWNER: Any Person who is the beneficial owner of a Book-
Entry Certificate registered in the name of the Depository or its nominee.
CERTIFICATE RATE: The per annum rate of interest borne by each Class of
Certificates (other than the Class A-P Certificates), which rate shall equal
___% with respect to the Class X-0, Xxxxx X-0, Class A-3, Class A-4, Class A-7,
Class A-R, Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates. In the case of the Class A-5 Certificates, the Certificate Rate
shall equal _____% with respect to the [DATE] Distribution Date, and with
respect to any Distribution Date thereafter, the Certificate Rate with respect
to the Class A-5 Certificates shall equal the lesser of (i) ____% plus LIBOR and
(ii) _____%. In the case of the Class A-6 Certificates, the Certificate Rate
shall equal _______% with respect to the [DATE] Distribution Date, and with
respect to any Distribution Date thereafter, the Certificate Rate with respect
to the Class A-6 Certificates shall equal____% minus the product of (i) 3.000
and (ii) LIBOR, but not less than _____%. In the case of the Class A-X
Certificates, the Certificate Rate shall equal, with respect to any Distribution
Date, the weighted average, expressed as a percentage, of the Stripped Interest
Rate on each Mortgage Loan having a Stripped Interest Rate exceeding zero as of
the Due Date in the month immediately preceding the month in which such
Distribution Date occurs, weighted on the basis of the respective Principal
Balances of the Mortgage Loans, which Principal Balances shall be the Principal
Balances of the Mortgage Loans at the close of business on the immediately
preceding Distribution Date after giving effect to distributions thereon
allocable to principal (or, in the case of the Certificate Rate for the initial
Distribution Date, at the close of business on the Cut-off Date). With respect
to any Distribution Date, (i) interest will accrue on each Class of Certificates
(other than the Class A-5 and Class A-6 Certificates) from the first day of the
calendar month preceding the month in which such Distribution Date occurs
through the last day of the month preceding the month in which such Distribution
Date occurs and (ii) interest will accrue on the Class A-5 and Class A-6
Certificates from the 25th day of the month preceding the month in which such
Distribution Date occurs through the 24th day of the month in which such
Distribution Date occurs (except that with respect to the [DATE] Distribution
Date, interest will accrue on the Class A-5 and Class A-6 Certificates from
[DATE] through [DATE]). Interest with respect to each Class of Certificates
(other than the Class A-P Certificates) at the Certificate Rate shall be
calculated based on a year of 360 days comprised of twelve 30-day months.
CERTIFICATE REGISTER: The register maintained pursuant to Section 4.02.
CHASE: The Chase Manhattan Bank, a New York State banking corporation,
or its successor in interest.
CLASS: Pertaining to the Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7, Class A-P, Class A-R, Class A-X, Class M, Class
B-1, Class B-2, Class B-3, Class B-4 or Class B-5 Certificates, as the case may
be.
4
CLASS A, CLASS M OR CLASS B: Pertaining to Class A Certificates, Class
M Certificates or Class B Certificates, as the case may be.
CLASS A-P AMOUNT: With respect to any Distribution Date, the applicable
PO Percentage of (i) all principal received on or in respect of each Discount
Mortgage Loan (exclusive of any amounts in respect of any Monthly Payment)
during the related Principal Prepayment Period and (ii) all principal received
as part of a Monthly Payment on or in respect of a Discount Mortgage Loan during
the related Due Period.
CLASS A CERTIFICATES: The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5, Class A-6, Class A-7, Class A-P, Class A-R and Class A-X
Certificates, referred to collectively.
CLASS A-1 CERTIFICATE: Any one of the Class A-1 Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-2 CERTIFICATE: Any one of the Class A-2 Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-3 CERTIFICATE: Any one of the Class A-3 Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-4 CERTIFICATE: Any one of the Class A-4 Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-5 CERTIFICATE: Any one of the Class A-5 Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-6 CERTIFICATE: Any one of the Class A-6 Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-7 CERTIFICATE: Any one of the Class A-7 Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
5
CLASS A-P CERTIFICATE: Any one of the Class A-P Certificates, executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-R CERTIFICATE: The Class A-R Certificate executed by the
Trustee and authenticated by the Trustee, which represents the Residual
Interest, substantially in the form of the Class A-R Certificate set forth in
Exhibit F hereto.
CLASS A-X CERTIFICATE: Any one of the Class A-X Certificates executed
by the Trustee and authenticated by the Trustee, senior in right of payment to
the Class M and Class B Certificates, substantially in the form of the Class A
Certificate set forth in Exhibit C hereto.
CLASS A-P DISTRIBUTION AMOUNT: With respect to any Distribution Date,
the amounts distributed to the Class A-P Certificates pursuant to Sections
6.01(b)(ii) and 6.01(b)(iii).
CLASS A-1 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-1 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-1 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-1 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS A-2 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-2 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-2 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-2 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS A-3 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-3 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-3 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-3 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS A-4 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-4 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-4 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-4 Certificates on such Distribution
Date pursuant to Section 6.05(c).
6
CLASS A-5 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-5 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-5 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-5 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS A-6 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-6 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-6 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-6 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS A-7 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-7 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-7 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-7 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS A-R INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class A-R Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class A-R Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class A-R Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS A-X INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Class A-X Notional
Balance minus (i) any Compensating Interest Shortfall allocated to the Class A-X
Certificates on such Distribution Date pursuant to Section 6.05(b) and (ii) any
Realized Loss Interest Shortfall allocated to the Class A-X Certificates on such
Distribution Date pursuant to Section 6.05(c).
CLASS A-X NOTIONAL BALANCE: With respect to any Distribution Date, an
amount equal to the aggregate Scheduled Principal Balance of the Non-Discount
Mortgage Loans.
CLASS A PERCENTAGE: As of any Distribution Date, the percentage
obtained by dividing the Class A Principal Balance by the Mortgage Pool
Principal Balance, but not more than 100%.
7
CLASS A PRINCIPAL BALANCE: As of any Distribution Date, (a) the Class A
Principal Balance for the immediately preceding Distribution Date less (b)
amounts distributed to the Class A Certificateholders on such preceding
Distribution Date allocable to principal (including the principal portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized Losses
allocated to the Class A Certificates pursuant to Section 6.04); provided that
the Class A Principal Balance on the first Distribution Date shall be the
Original Class A Principal Balance.
CLASS A-1 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-1 Interest Accrual Amount over the
amount actually distributed to the Class A-1 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(A).
CLASS A-2 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-2 Interest Accrual Amount over the
amount actually distributed to the Class A-2 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(B).
CLASS A-3 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-3 Interest Accrual Amount over the
amount actually distributed to the Class A-3 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(C).
CLASS A-4 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-4 Interest Accrual Amount over the
amount actually distributed to the Class A-4 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(D).
CLASS A-5 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-5 Interest Accrual Amount over the
amount actually distributed to the Class A-5 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(E).
CLASS A-6 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-6 Interest Accrual Amount over the
amount actually distributed to the Class A-6 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(F).
CLASS A-7 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-7 Interest Accrual Amount over the
amount actually distributed to the Class A-7 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(G).
8
CLASS A-R SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-R Interest Accrual Amount over the
amount actually distributed to the Class A-R Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(H).
CLASS A-X SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class A-X Interest Accrual Amount over the
amount actually distributed to the Class A-X Certificates on such Distribution
Date pursuant to Section 6.01(b)(i)(I).
CLASS A-P SHORTFALL AMOUNT: With respect to any Distribution Date prior
to and including the Credit Support Depletion Date, to the extent of amounts
available to pay the Subordinated Optimal Principal Amount (without regard to
clause (b)(2) of the definition of such term), an amount equal to the sum of (i)
the applicable PO Percentage of any Realized Loss (other than an Excess Loss)
with respect to a Discount Mortgage Loan and (ii) the sum of amounts, if any, by
which the amounts specified in clause (i) with respect to each prior
Distribution Date exceeded the amount actually distributed in respect thereof on
such prior Distribution Date and not subsequently distributed to the Class A-P
Certificateholders.
CLASS B CERTIFICATES: The Class B-1, Class B-2, Class B-3, Class B-4
and Class B-5 Certificates, referred to collectively.
CLASS B-1 CERTIFICATE: Any one of the Class B-1 Certificates executed
by the Trustee and authenticated by the Trustee, subordinated in right of
payment to the Class A and Class M Certificates, substantially in the form of
the Class B Certificate set forth in Exhibit E hereto.
CLASS B-2 CERTIFICATE: Any one of the Class B-2 Certificates executed
by the Trustee and authenticated by the Trustee, subordinated in right of
payment to the Class A, Class M and Class B-1 Certificates, substantially in the
form of the Class B Certificate set forth in Exhibit E hereto.
CLASS B-3 CERTIFICATE: Any one of the Class B-3 Certificates executed
by the Trustee and authenticated by the Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1 and Class B-2 Certificates,
substantially in the form of the Class B Certificate set forth in Exhibit E
hereto.
CLASS B-4 CERTIFICATE: Any one of the Class B-4 Certificates executed
by the Trustee and authenticated by the Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1, Class B-2 and Class B-3
Certificates, substantially in the form of the Class B Certificate set forth in
Exhibit E hereto.
9
CLASS B-5 CERTIFICATE: Any one of the Class B-5 Certificates executed
by the Trustee and authenticated by the Trustee, subordinated in right of
payment to the Class A, Class M, Class B-1, Class B-2, Class B-3 and Class B-4
Certificates, substantially in the form of the Class B Certificate set forth in
Exhibit E hereto.
CLASS B-1 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class B-1 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class B-1 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class B-1 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS B-2 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class B-2 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class B-2 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class B-2 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS B-3 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class B-3 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class B-3 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class B-3 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS B-4 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class B-4 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class B-4 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class B-4 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS B-5 INTEREST ACCRUAL AMOUNT: With respect to any Distribution
Date, one month's interest at the Certificate Rate on the Outstanding
Certificate Principal Balance of the Class B-5 Certificates minus (i) any
Compensating Interest Shortfall allocated to the Class B-5 Certificates on such
Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall allocated to the Class B-5 Certificates on such Distribution
Date pursuant to Section 6.05(c).
CLASS B-1 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class B-1 Interest Accrual Amount over the
amount actually
10
distributed to the Class B-1 Certificates on such Distribution Date pursuant to
Section 6.01(d)(i)(1) (A) and (B).
CLASS B-2 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class B-2 Interest Accrual Amount over the
amount actually distributed to the Class B-2 Certificates on such Distribution
Date pursuant to Section 6.01(d)(i)(2) (A) and (B).
CLASS B-3 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class B-3 Interest Accrual Amount over the
amount actually distributed to the Class B-3 Certificates on such Distribution
Date pursuant to Section 6.01(d)(i)(3) (A) and (B).
CLASS B-4 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class B-4 Interest Accrual Amount over the
amount actually distributed to the Class B-4 Certificates on such Distribution
Date pursuant to Section 6.01(d)(i)(4) (A) and (B).
CLASS B-5 SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class B-5 Interest Accrual Amount over the
amount actually distributed to the Class B-5 Certificates on such Distribution
Date pursuant to Section 6.01(d)(i)(5) (A) and (B).
CLASS B PERCENTAGE: As of any Distribution Date, the difference between
100% and the sum of (i) the Class A Percentage and (ii) the Class M Percentage
for such Distribution Date.
CLASS B PRINCIPAL BALANCE: As of any Distribution Date, the excess of
the Mortgage Pool Principal Balance (together with the principal portion of any
Monthly Payment due but not paid with respect to which an Advance has not been
made) over the sum of (i) the Class A Principal Balance and (ii) the Class M
Principal Balance.
CLASS M CERTIFICATE: Any one of the Class M Certificates executed by
the Trustee and authenticated by the Trustee, subordinated in right of payment
to the Class A Certificates, substantially in the form of the Class M
Certificate set forth in Exhibit D hereto.
CLASS M INTEREST ACCRUAL AMOUNT: With respect to any Distribution Date,
one month's interest at the Certificate Rate on the Outstanding Certificate
Principal Balance of the Class M Certificates minus (i) any Compensating
Interest Shortfall allocated to the Class M Certificates on such Distribution
Date pursuant to Section 6.05(b) and (ii) any Realized Loss Interest Shortfall
allocated to the Class M Certificates on such Distribution Date pursuant to
Section 6.05(c).
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CLASS M PERCENTAGE: As of any Distribution Date, the percentage
obtained by dividing the Class M Principal Balance by the Mortgage Pool
Principal Balance, but not more than 100%; provided, however, that on any
Distribution Date on which the Class B Percentage equals 0%, the Class M
Percentage shall equal 100% minus the Class A Percentage.
CLASS M PRINCIPAL BALANCE: As of any Distribution Date, (a) the Class M
Principal Balance for the immediately preceding Distribution Date less (b)
amounts distributed to the Class M Certificateholders on such preceding
Distribution Date allocable to principal (including the principal portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized Losses
allocated to the Class M Certificates pursuant to Section 6.04); provided that
the Class M Principal Balance on the first Distribution Date shall be the
Original Class M Principal Balance, and provided further that if the aggregate
Outstanding Certificate Principal Balance of the Class B Certificates has been
reduced to zero, as of any Distribution Date, the Class M Principal Balance will
equal the excess of the Mortgage Pool Principal Balance (together with the
portion of any Monthly Payment due but not paid with respect to which an Advance
has not been made) over the Class A Principal Balance.
CLASS M SHORTFALL: With respect to any Distribution Date, the amount
equal to the excess, if any, of the Class M Interest Accrual Amount over the
amount actually distributed to the Class M Certificateholders on such
Distribution Date pursuant to Section 6.01(c)(i) (A) and (B).
CLOSING DATE: [DATE].
CMMC: Chase Manhattan Mortgage Corporation, a New Jersey corporation,
or its successor in interest.
CODE: The Internal Revenue Code of 1986, as amended from time to time,
and any successor statutes thereto, and applicable U.S. Department of Treasury
temporary or final regulations promulgated thereunder.
COLLECTION ACCOUNT: The account created and maintained pursuant to
Section 5.08.
COMPENSATING INTEREST: The meaning specified in Section 6.05(a).
COMPENSATING INTEREST SHORTFALL: The meaning specified in Section
6.05(b).
CORPORATE TRUST OFFICE: The principal office of the Trustee at which at
any particular time its corporate trust business shall be administered, which
office at the date of execution of this instrument is located at [ADDRESS]
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CREDIT SUPPORT: With respect to each Class of Subordinated Certificates
(other than the Class B-5 Certificates), the level of credit support supporting
such Class, expressed as a percentage of the aggregate Outstanding Certificate
Principal Balance of all Classes of Certificates (other than the Class A-P
Certificates). With respect to each Distribution Date, Credit Support for each
such Class will equal in each case the percentage, rounded to two decimal
places, obtained by dividing the aggregate Outstanding Certificate Principal
Balances immediately prior to such Distribution Date of all Classes of
Subordinated Certificates having higher numerical class designations than such
Class (for this purpose, each Class of Class M Certificates shall be deemed to
have a lower numerical class designation than each Class of Class B
Certificates) by the aggregate Outstanding Certificate Principal Balance of all
Classes of Certificates (other than the Class A-P Certificates) immediately
prior to such Distribution Date.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on which the
aggregate outstanding principal balance of the Subordinated Certificates has
been or will be reduced to zero.
CUT-OFF DATE: [DATE].
DCR: Duff & Xxxxxx Credit Rating Co. or its successor in interest.
DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a reduction
in the scheduled Monthly Payment for such Mortgage Loan by a court of competent
jurisdiction in a proceeding under the Bankruptcy Code, other than such a
reduction resulting from a Deficient Valuation.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation of
the related Mortgaged Property by a court of competent jurisdiction in an amount
less than the then outstanding principal balance of the Mortgage Loan, which
valuation results from a proceeding initiated under the Bankruptcy Code.
DEFINITIVE CERTIFICATES: The Certificates referred to in Section
4.01(c).
DEPOSITOR: Chase Manhattan Acceptance Corporation, a Delaware
corporation, or its successor in interest or any successor under this Agreement
appointed as herein provided.
DEPOSITORY: The Depository Trust Company, the nominee of which is Cede
& Co.
DEPOSITORY AGREEMENT: The agreement referred to in Section 4.01(b).
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DEPOSITORY PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
DETERMINATION DATE: The sixteenth day of the month in which the related
Distribution Date occurs (or, if such sixteenth day is not a Business Day, the
preceding Business Day).
DISCOUNT MORTGAGE LOAN: Any Mortgage Loan having a Net Mortgage Rate
less than the Remittance Rate.
DISQUALIFIED ORGANIZATION: An organization referred to in section
860E(e)(5) of the Code.
DISTRIBUTION DATE: The 25th day of any month, or if such 25th day is
not a Business Day, the first Business Day immediately following, beginning with
[DATE].
DUE DATE: The first day of each month, being the day of the month on
which each Monthly Payment is due on a Mortgage Loan, exclusive of any days of
grace.
DUE PERIOD: With respect to any Distribution Date, the period from the
second day of the month preceding the month in which such Distribution Date
occurs through the first day of the month in which such Distribution Date
occurs.
ELIGIBLE ACCOUNT: An account that is (i) maintained with a depository
institution the long-term unsecured debt obligations of which are rated by each
Rating Agency in one of its two highest rating categories, or (ii) maintained
with the corporate trust department of a national bank which has a rating of at
least BBB- or A-2 by S&P, or (iii) an account or accounts the deposits in which
are fully insured by the FDIC, or (iv) an account or accounts in a depository
institution in which such accounts are insured by the FDIC (to the limit
established by the FDIC), the uninsured deposits in which accounts are otherwise
secured such that, as evidenced by an Opinion of Counsel delivered to and
acceptable to the Trustee and each Rating Agency, the Certificateholders have a
claim with respect to the funds in such account and a perfected first security
interest against any collateral (which shall be limited to Eligible Investments)
securing such funds that is superior to claims of any other depositors or
creditors of the depository institution with which such account is maintained,
or (v) otherwise acceptable to each Rating Agency without reduction or
withdrawal of the rating of any Class of Certificates, as evidenced by a letter
from each Rating Agency.
ELIGIBLE INVESTMENTS: One or more of the following:
(i) obligations of, or guaranteed as to principal and interest by, the
United States or obligations of any agency or instrumentality thereof when such
obligations are
14
backed by the full faith and credit of the United States; provided that any such
obligation held as a "cash flow investment" within the meaning of section
860G(a)(6) of the Code shall not have a remaining maturity of more than 45 days;
(ii) repurchase agreements on obligations specified in clause (i)
maturing not more than two months from the date of acquisition
thereof, provided that the long-term unsecured obligations of the
party agreeing to repurchase such obligations are at the time rated by
each Rating Agency in one of its two highest rating categories and the
short-term debt obligations of the party agreeing to repurchase are
rated A-1 by S&P and D-1 by DCR if rated by DCR;
(iii) federal funds, certificates of deposit, time deposits and
bankers' acceptances (which shall each have an original maturity of
not more than 60 days and, in the case of bankers' acceptances, shall
in no event have an original maturity of more than 365 days) of any
United States depository institution or trust company incorporated
under the laws of the United States or any state, provided that the
long-term unsecured debt obligations of such depository institution or
trust company at the date of acquisition thereof have been rated by
each Rating Agency in one of its two highest rating categories and the
short-term obligations of such depository institution or trust company
are rated X- 0 by S&P and D-1 by DCR if rated by DCR;
(iv) commercial paper (having original maturities of not more
than 365 days) of any corporation incorporated under the laws of the
United States or any state thereof which on the date of acquisition
has been rated by each Rating Agency in its highest short-term
unsecured commercial paper rating category; provided that such
commercial paper shall have a remaining maturity of not more than 45
days;
(v) units of taxable money market funds (including those for
which the Trustee or the Servicer or any affiliate thereof receives
compensation with respect to such investment) which funds have been
rated by each Rating Agency in its highest rating category or which
have been designated in writing by each Rating Agency as Eligible
Investments with respect to this definition;
(vi) other obligations or securities that are "permitted
investments" within the meaning of Section 860G(a)(5) of the Code and
acceptable to each Rating Agency rating the Certificates as an
Eligible Investment hereunder and will not result in a reduction or
withdrawal in the then current rating of any Class of Certificates, as
evidenced by a letter to such effect from each Rating Agency.
provided that no such instrument shall be an Eligible Investment if such
instrument evidences either (a) a right to receive only interest payments with
respect to the obligations underlying such instrument, or (b) both principal and
interest payments derived from obligations underlying such instrument where the
interest and principal payments with respect to such instrument provide a
15
yield to maturity of greater than 120% of the yield to maturity at par of such
underlying obligations.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ESCROW ACCOUNT: The account or accounts created and maintained pursuant
to Section 5.10.
ESCROW PAYMENTS: The amounts constituting applicable ground rents,
taxes, assessments, water rates, Standard Hazard Policy premiums and other
payments required to be escrowed by the Mortgagor with the mortgagee pursuant to
a Mortgage Loan.
EVENT OF DEFAULT: Any of the events specified in Section 9.01.
EXCEPTION REPORT: The report of the Trustee referred to in Section
2.02.
EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion thereof, which
exceeds the then applicable Bankruptcy Amount.
EXCESS FRAUD LOSS: Any Fraud Loss, or portion thereof, which exceeds
the then applicable Fraud Loss Amount.
EXCESS LOSSES: Excess Bankruptcy Losses, Excess Fraud Losses and Excess
Special Hazard Losses, referred to collectively.
EXCESS PROCEEDS: All amounts (net of the related Servicing Advances)
received on any Mortgage Loan (whether as regular principal payments, Principal
Prepayments, Repurchase Proceeds, Liquidation Proceeds, Insurance Proceeds,
condemnation awards, or with respect to a disposition of a Mortgaged Property
which has been acquired by foreclosure or deed in lieu of foreclosure or
otherwise) in excess of the Principal Balance at the Cut-off Date of such
Mortgage Loan and accrued interest thereon at its Mortgage Rate to the Due Date
immediately succeeding the date of prepayment, repurchase or liquidation, as the
case may be.
EXCESS SPECIAL HAZARD LOSS: Any Special Hazard Loss, or portion
thereof, that exceeds the then applicable Special Hazard Amount.
FDIC: The Federal Deposit Insurance Corporation or any successor
organization.
FHLMC: The Federal Home Loan Mortgage Corporation or any successor
organization.
FIDELITY BOND: A fidelity bond and errors and omissions insurance to be
maintained by the Servicer pursuant to Section 5.19.
16
FNMA: The Federal National Mortgage Association, or any successor
organization.
FNMA GUIDES: The FNMA Sellers' Guide and the FNMA Servicers' Guide, and
all amendments or additions thereto.
FRAUD LOSS: Any Realized Loss or portion thereof sustained by reason of
a default arising from fraud, dishonesty or misrepresentation in connection with
the related Mortgage Loan, including by reason of the denial of coverage under
any related Primary Insurance Policy.
FRAUD LOSS AMOUNT: As of any date of determination after the Cut-off
Date, an amount equal to: (X) prior to the first anniversary of the Cut-off
Date,____% (initially, $___________) of the aggregate outstanding principal
balance of all of the Mortgage Loans as of the Cut-off Date minus the aggregate
amount of Fraud Loss on the Mortgage Loans allocated to the Certificates in
accordance with Section 6.04 since the Cut-off Date up to such date of
determination and (Y) from the first to the fifth anniversary of the Cut-off
Date, (1) ______% of the aggregate outstanding principal balance of all of the
Mortgage Loans as of the most recent anniversary of the Cut-off Date minus (2)
the Fraud Losses allocated to the Certificates in accordance with Section 6.04
since the most recent anniversary of the Cut-off Date up to such date of
determination. On and after the fifth anniversary of the Cut-off Date, the Fraud
Loss Amount shall be zero.
INDIRECT PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Depository Participant.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to any
insurance policy covering a Mortgage Loan, net of costs of collecting such
proceeds and net of amounts released to the Mortgagor or applied to the
restoration of the Mortgaged Property.
INSURED EXPENSES: Expenses covered by any insurance policy.
INTEREST ACCRUAL PERIOD: With respect to any Distribution Date and the
Class A-5 and Class A-6 Certificates, the period from the 25th day of the month
preceding the month in which such Distribution Date occurs through the 24th day
of the month in which such Distribution Date occurs.
LATE COLLECTIONS: With respect to any Mortgage Loan, all amounts
received during any Due Period, whether as late payments of Monthly Payments or
as Liquidation Proceeds, condemnation proceeds, Insurance Proceeds, or with
respect to a disposition of a Mortgaged Property which has been acquired by
foreclosure or deed in lieu of
17
foreclosure or otherwise, which represent late payments or collections of
Monthly Payments due but delinquent for a previous Due Period and not previously
recovered.
LIBOR: With respect to any Distribution Date and the Certificate Rates
on the Class A-5 and Class A-6 Certificates, LIBOR as determined in accordance
with Section 6.07.
LIBOR BUSINESS DAY: Any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the city of London, England are
required or authorized by law to be closed.
LIQUIDATED MORTGAGE LOAN: Any Mortgage Loan (a) as to which the
Servicer has determined that all amounts which it expects to recover from or on
account of such Mortgage Loan or property acquired in respect thereof have been
recovered, (b) as to which a Cash Liquidation has taken place or (c) with
respect to which the Mortgaged Property has been acquired by foreclosure or deed
in lieu of foreclosure and a disposition (the term disposition shall include,
for purposes of a repurchase pursuant to Section 11.01, any repurchase of a
Mortgaged Property pursuant to such Section) of such Mortgaged Property has
occurred.
LIQUIDATION EXPENSES: Expenses which are incurred by the Servicer or
any Sub-Servicer in connection with the liquidation of any defaulted Mortgage
Loan or property acquired in respect thereof including, without limitation,
legal fees and expenses, any unreimbursed amount expended by the Servicer
pursuant to Sections 5.16 and 5.21 respecting the related Mortgage Loan and any
related and unreimbursed expenditures for real estate property taxes or for
property restoration or preservation.
LIQUIDATION PRINCIPAL: With respect to any Distribution Date, the
principal portion of Net Liquidation Proceeds received with respect to each
Mortgage Loan which became a Liquidated Mortgage Loan (but not in excess of the
Principal Balance thereof) during the calendar month preceding the month of such
Distribution Date, exclusive of the portion thereof attributable to the Class
A-P Amount.
LIQUIDATION PROCEEDS: Cash (including Insurance Proceeds) received by
the Servicer in connection with the liquidation of any Mortgage Loan or
Mortgaged Property acquired in respect thereof, whether through the sale or
assignment of such Mortgage Loan (other than pursuant to Section 5.21),
trustee's sale, foreclosure sale or otherwise, or the sale of the Mortgaged
Property if the Mortgaged Property is acquired in satisfaction of the Mortgage
Loan other than amounts required to be paid to the Mortgagor pursuant to law or
the terms of the applicable Mortgage Note.
LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage, the
numerator of which is the outstanding principal amount of the related Mortgage
Loan at the time of origination (or, (i) for purposes of Section 5.15, at the
time of determination and (ii) for purposes of a Mortgage Loan with respect to
which a conversion from adjustable rate to fixed
18
rate has occurred, at the time of initial origination) and the denominator of
which is the appraised value of the related Mortgaged Property at the time of
origination or, in the case of a Mortgage Loan financing the acquisition of the
Mortgaged Property, the sales price of the Mortgaged Property, if such sales
price is less than such appraised value.
LOCK-OUT LIQUIDATION AMOUNT: With respect to any Distribution Date, the
aggregate, for each Mortgage Loan which became a Liquidated Mortgage Loan during
the calendar month preceding the month of such Distribution Date, of the lesser
of (i) the Lock-out Percentage of the PO Percentage of such Mortgage Loan and
(ii) the Lock-out Percentage on any Distribution Date occurring prior to the
fifth anniversary of the first Distribution Date, and the Lock-out Prepayment
Percentage on any Distribution Date thereafter, in each case, of the Net
Liquidation Proceeds with respect to such Mortgage Loan.
LOCK-OUT PERCENTAGE: With respect to any Distribution Date, the
outstanding principal balance of the Class A-7 Certificates divided by the
aggregate outstanding principal balance of the Certificates (other than the
Class A-P Certificates), in each case immediately prior to the Distribution
Date.
LOCK-OUT PREPAYMENT PERCENTAGE: The product of (a) the Lock-out
Percentage and (b) the Step Down Percentage.
LOCK-OUT PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the sum of (i) the Adjusted Lock-out Percentage of the
principal portion of Monthly Payments, whether or not received, which were due
on the related Due Date on outstanding Mortgage Loans as of such Due Date, (ii)
the Lock-out Prepayment Percentage of the applicable Non-PO Percentage of the
principal portion of Principal Prepayments, Insurance Proceeds, condemnation
awards and other cash proceeds from sources other than Mortgagors, and
Repurchase Proceeds, in each case received during the related Principal
Prepayment Period and (iii) the Lock-out Liquidation Amount.
MODIFIED MORTGAGE LOAN: Any Mortgage Loan which the Servicer has
modified pursuant to Section 5.01.
MONTHLY PAYMENT: The minimum required monthly payment of principal and
interest due on a Mortgage Loan as specified in the Mortgage Note for any Due
Date (before any adjustment to such scheduled amount by reason of any bankruptcy
or similar proceeding or any moratorium or similar waiver or grace period).
Monthly Payments shall be deemed due on an Outstanding Mortgage Loan until such
time as it becomes a Liquidated Mortgage Loan.
MORTGAGE: The mortgage, deed of trust or other instrument creating a
first lien or a first priority ownership interest in an estate in fee simple in
real property securing a Mortgage Note.
19
MORTGAGE FILE: As to each Mortgage Loan, the items referred to in
Exhibit B annexed hereto.
MORTGAGE LOAN: An individual mortgage loan and all rights with respect
thereto, evidenced by a Mortgage and a Mortgage Note, sold and assigned by the
Depositor to the Trustee and which is subject to this Agreement and included in
the Trust Fund. The Mortgage Loans originally sold and subject to this Agreement
are identified on the Mortgage Loan Schedule.
MORTGAGE LOAN SCHEDULE: The schedule of Mortgage Loans attached hereto
as Exhibit A as it may be amended in accordance with Section 3.03, setting forth
the following information as to each Mortgage Loan: (i) the Mortgage Loan
identifying number; (ii) the street address of the Mortgaged Property including
the zip code; (iii) an indication of whether the Mortgaged Property is
owner-occupied; (iv) the property type of the Mortgaged Property; (v) the
original number of months to stated maturity; (vi) the number of months
remaining to stated maturity from the Cut-off Date; (vii) the original
Loan-to-Value Ratio; (viii) the original principal balance of the Mortgage Loan;
(ix) the unpaid principal balance of the Mortgage Loan as of the close of
business on the Cut-off Date; (x) the Mortgage Rate; (xi) the amount of the
current Monthly Payment; and (xii) the PO Percentage with respect to such
Mortgage Loan.
MORTGAGE NOTE: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage.
MORTGAGE POOL: The pool of Mortgage Loans held in the Trust Fund.
MORTGAGE POOL PRINCIPAL BALANCE: As of any date of determination, the
aggregate of the Principal Balances of each Outstanding Mortgage Loan on such
date of determination less the principal portion of any Monthly Payment due but
not paid with respect to which an Advance has not been made.
MORTGAGED PROPERTY: The property securing a Mortgage Note.
MORTGAGE RATE: With respect to each Mortgage Loan, the per annum rate
of interest borne by the Mortgage Loan, as specified in the Mortgage Note.
MORTGAGOR: The obligor on a Mortgage Note.
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of Liquidation Expenses.
NET MORTGAGE RATE: With respect to each Mortgage Loan, a per annum rate
of interest for the applicable period equal to the Mortgage Rate less the
Servicing Fee.
20
NON-DISCOUNT MORTGAGE LOANS: The Mortgage Loans having Net Mortgage
Rates in excess of the Remittance Rate.
NON-PO ALLOCATED AMOUNT: At the time of any determination, the amount
derived by (i) multiplying the Principal Balance of each Mortgage Loan on such
date of determination by the Non-PO Percentage with respect to such Mortgage
Loan and (ii) summing the results.
NON-PO CLASS A CERTIFICATES: The Class A-1, Class A-2, Class A-3, Class
A-4, Class A-5, Class A-6, Class A-7, Class A-R and Class A-X Certificates,
referred to collectively.
NON-PO CLASS A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution Date, the lesser of (a) the Non-PO Class A Principal Balance and
(b) the sum of:
(i) the Non-PO Class A Percentage of the applicable Non-PO
Percentage of the principal portion of all Monthly Payments, whether or
not received, which were due during the related Due Period on Mortgage
Loans which were outstanding during such Due Period;
(ii) the Non-PO Class A Prepayment Percentage of the
applicable Non-PO Percentage of all Principal Prepayments made on any
Mortgage Loan during the related Principal Prepayment Period;
(iii) with respect to each Mortgage Loan not described in (iv)
below, the Non-PO Class A Percentage of the applicable Non-PO
Percentage of the principal portion of all Insurance Proceeds,
condemnation awards and any other cash proceeds from a source other
than the applicable Mortgagor, to the extent required to be deposited
in the Collection Account pursuant to Section 5.08(iv) and (v), which
were received during the related Principal Prepayment Period, net of
related unreimbursed Servicing Advances and net of any portion thereof
which, as to any such Mortgage Loan, constitutes Late Collections that
have been the subject of an Advance on any prior Distribution Date;
(iv) with respect to each Mortgage Loan which has become a
Liquidated Mortgage Loan during the related Principal Prepayment
Period, the lesser of (A) the Non-PO Class A Percentage of applicable
Non-PO Percentage of an amount equal to the Principal Balance of such
Liquidated Mortgage Loan as of the Due Date immediately preceding the
date on which it became a Liquidated Mortgage Loan and (B) the Non-PO
Class A Prepayment Percentage of the applicable Non-PO Percentage of
the Net Liquidation Proceeds with respect to such liquidated Mortgage
Loan (net of any unreimbursed Advances);
21
(v) with respect to each Mortgage Loan repurchased during the
related Principal Prepayment Period pursuant to Section 2.02, 3.01,
5.21 or 11.01, an amount equal to the Non-PO Class A Prepayment
Percentage of the applicable Non-PO Percentage of the principal portion
of the Purchase Price (net of amounts with respect to which a
distribution of principal has previously been made to the Non-PO Class
A Certificateholders); and
(vi) on or after the Credit Support Depletion Date, the excess
of the Non-PO Class A Principal Balance (calculated after giving effect
to reductions thereof on such Distribution Date with respect to the
amounts described in (i) - (v) above) over the Non-PO Allocated
Amount, if any, as of the preceding Distribution Date.
NON-PO CLASS A PERCENTAGE: As of any Distribution Date, the fraction,
expressed as a percentage (which shall never exceed 100%), the numerator of
which is the Non-PO Class A Principal Balance and the denominator of which is
the Non-PO Allocated Amount as of the immediately preceding Due Date.
NON-PO CLASS A PREPAYMENT PERCENTAGE: As of any Distribution Date up to
and including the Step-down Date, 100%; as of any Distribution Date during the
first year thereafter, the Non-PO Class A Percentage plus 70% of the
Subordinated Percentage for such Distribution Date; as of any Distribution Date
during the second year thereafter, the Non- PO Class A Percentage plus 60% of
the Subordinated Percentage for such Distribution Date; as of any Distribution
Date during the third year thereafter, the Non-PO Class A Percentage plus 40% of
the Subordinated Percentage for such Distribution Date; as of any Distribution
Date during the fourth year thereafter, the Non-PO Class A Percentage plus 20%
of the Subordinated Percentage for such Distribution Date; and as of any
Distribution Date after the fourth year thereafter, the Non-PO Class A
Percentage; provided that if the Non-PO Class A Percentage as of any such
Distribution Date is greater than the Non-PO Class A Percentage on the first
Distribution Date, the Non-PO Class A Prepayment Percentage shall be 100%; and
provided further that whenever the Non-PO Class A Percentage equals 0%, the
Non-PO Class A Prepayment Percentage shall equal 0%.
NON-PO CLASS A PRINCIPAL BALANCE: As of any Distribution Date, (a) the
Non-PO Class A Principal Balance for the immediately preceding Distribution Date
less (b) amounts distributed (or deemed distributed) to the Non-PO Class A
Certificateholders on such preceding Distribution Date allocable to principal
(including the principal portion of Advances of the Servicer made pursuant to
Section 6.03 and Realized Losses allocated to the Non-PO Class A Certificates
pursuant to Section 6.04); provided that the Non-PO Class A Principal Balance on
the first Distribution Date shall be the Original Non-PO Class A Principal
Balance.
NON-PO CLASS A PRINCIPAL PAYMENT RULES: [Describe payment methodology]
22
NON-PO PERCENTAGE: With respect to each Mortgage Loan, the fraction,
expressed as a percentage (but not greater than 100%), the numerator of which
equals the applicable Net Mortgage Rate and the denominator of which equals the
Remittance Rate.
NONRECOVERABLE ADVANCE: Any Advance previously made or proposed to be
made in respect of a Mortgage Loan by the Servicer pursuant to Section 6.03
which, in the good faith judgment of the Servicer, will not or, in the case of a
proposed Advance, would not, ultimately be recoverable by the Servicer from Late
Collections or otherwise. The determination by the Servicer that it has made, or
would be making, a Nonrecoverable Advance shall be evidenced by a certificate of
a Servicing Officer of the Servicer delivered to the Trustee, any co-trustee and
the Depositor and detailing the reasons for such determination.
OFFICERS' CERTIFICATE: A certificate signed by two of the Chairman of
the Board, the Vice Chairman of the Board, the President or a Vice President,
the Treasurer or the Secretary or one of the Assistant Treasurers or Assistant
Secretaries or any other duly authorized officer of the Depositor or the
Servicer, and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be counsel
for the Depositor or the Servicer and who is reasonably acceptable to the
Trustee.
ORIGINAL CERTIFICATE PRINCIPAL BALANCE: With respect to any Class of
Certificates, the amount specified for such Class in Section 4.01(d).
ORIGINAL CLASS A PRINCIPAL BALANCE: $_____________
ORIGINAL CLASS M PRINCIPAL BALANCE: $_____________
ORIGINAL CLASS B PRINCIPAL BALANCE: $_____________
ORIGINAL NON-PO CLASS A PRINCIPAL BALANCE $_____________
ORIGINAL CREDIT SUPPORT: With respect to any Class of Subordinated
Certificates (other than the Class B-5 Certificates), the level of Credit
Support indicated below:
Class M: %
Class B-1: %
Class B-2: %
Class B-3: %
Class B-4: %
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE: With respect to any Class
(other than the Class A-X Certificates) of Certificates and any Distribution
Date, the
23
Original Certificate Principal Balance of such Class minus the sum of (i) any
distributions of principal made on such Class prior to such Distribution Date
and (ii) any Realized Losses allocated to such Class prior to such Distribution
Date; provided, however, that (I) with respect to the Class of Class B
Certificates then outstanding having the highest numerical class designation,
the Outstanding Certificate Principal Balance of such Class shall equal the
excess of the Mortgage Pool Principal Balance (together with the principal
portion of any Monthly Payment due but not paid with respect to which an Advance
has not been made) over the sum of the Outstanding Certificate Principal
Balances of all Classes of Certificates (other than the Class of Class B
Certificates then outstanding having the highest numerical class designation);
and (II) during such time as the Outstanding Certificate Principal Balance of
the Class B-1 Certificates equals zero, with respect to the Class M
Certificates, the Outstanding Certificate Principal Balance of such Class shall
equal the excess of the Mortgage Pool Principal Balance (together with the
principal portion of any Monthly Payment due but not paid with respect to which
an Advance has not been made) over the Class A Principal Balance.
OUTSTANDING MORTGAGE LOAN: As to any Distribution Date, a Mortgage Loan
which was not paid in full during the related or any previous Principal
Prepayment Period, which did not become a Liquidated Mortgage Loan during the
related or any previous Principal Prepayment Period and which was not
repurchased under Section 2.02, 3.01, 5.21 or 11.01 during the related or any
previous Principal Prepayment Period.
PASS-THRU ENTITY: A "Pass-Thru Entity" as defined in Section 860E(e)(6)
of the Code.
PAYING AGENT: The Person appointed by the Trustee as Paying Agent
pursuant to Section 4.05.
PERCENTAGE INTEREST: As to any Certificate (other than a Class A-X
Certificate), the percentage interest evidenced thereby in distributions
required to be made hereunder, such percentage interest being equal, with
respect to any Class, to the percentage obtained by dividing the denomination of
such Certificate by the aggregate of the denominations of all the Certificates
of such Class and with respect to all Certificates, the percentage obtained by
dividing the denomination of such Certificate by the aggregate of the
denominations of all the Certificates. With respect to any Class A-X
Certificate, the percentage interest specified on the face of such Certificate.
PERSON: Any individual, corporation, partnership, limited liability
company, limited liability partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government or any agency or
political subdivision thereof.
PO PERCENTAGE: The PO Percentage with respect to each Mortgage Loan as
identified on the Mortgage Loan Schedule, such percentage being equal to the
fraction, expressed as a percentage (but not less than 0%), the numerator of
which equals the excess of the
24
Remittance Rate over the applicable Net Mortgage Rate and the denominator of
which equals the Remittance Rate.
PRIMARY INSURANCE POLICY: Each primary policy of mortgage guaranty
insurance or any replacement policy therefor referred to in Section 5.15 hereof.
PRINCIPAL BALANCE: At the time of any determination, the principal
balance of a Mortgage Loan remaining to be paid at the close of business on the
Cut-off Date (after deduction of all principal payments due on or before the
Cut-off Date whether or not paid) (or, in the case of a substitute Mortgage Loan
included in the Trust Fund pursuant to Section 3.04, the close of business as of
the date of substitution) reduced by all amounts previously distributed to
Certificateholders that are allocable to payments of principal on such Mortgage
Loan (including the principal portion of Advances of the Servicer made pursuant
to Section 6.03).
PRINCIPAL PREPAYMENT: Any payment or other recovery of principal on a
Mortgage Loan (other than Late Collections) which is received other than as part
of a Monthly Payment; provided, however, that the term Principal Prepayment does
not include Insurance Proceeds, Liquidation Proceeds, condemnation awards or
other cash proceeds from a source other than the applicable Mortgagor.
PRINCIPAL PREPAYMENT PERIOD: With respect to any Distribution Date, the
period beginning on the first day of the month preceding the month in which such
Distribution Date occurs and ending on the last day of such month.
PURCHASE PRICE: With respect to any Mortgage Loan required to be
purchased on any date pursuant to Section 2.02, 3.01, 5.01, 5.21 or 11.01, an
amount equal to the sum of (a) 100% of the Principal Balance thereof, (b) unpaid
accrued interest at the Mortgage Rate thereon from the Due Date on which
interest was last paid by the Mortgagor or Advanced by the Servicer to the Due
Date next following the date of repurchase and (c) the aggregate of any
unreimbursed Advances.
QUALIFIED INSURER: An insurance company duly qualified as such under
the laws of the states in which the Mortgaged Properties are located, duly
authorized and licensed in such states to transact the applicable insurance
business and to write the insurance provided, approved as an insurer by FNMA and
FHLMC and whose claims-paying ability is rated in the two highest rating
categories by S&P, Xxxxx'x and Fitch with respect to primary mortgage insurance
and in the two highest rating categories for general policyholder rating and
financial performance index rating by Best's with respect to hazard and flood
insurance.
RATE ADJUSTMENT DATE: The LIBOR Business Day prior to the first day of
each Interest Accrual Period after the initial Interest Accrual Period.
25
RATING AGENCY: Any nationally recognized statistical rating
organization, or its successor, that rated one or more Classes of Certificates
at the request of the Depositor at the time of the initial issuance of the
Certificates. If such organization or a successor is no longer in existence,
"Rating Agency" shall be such nationally recognized statistical rating
organization, or other comparable Person, designated by the Depositor, notice of
which designation shall be given to the Trustee and the Servicer. References
herein to the two highest long-term debt rating categories of a Rating Agency
shall mean AA or better.
REALIZED LOSS: With respect to (i) a Liquidated Mortgage Loan, the
amount, if any, by which the unpaid Principal Balance and accrued interest
thereon at a rate equal to the Net Mortgage Rate exceeds the amount actually
recovered by the Servicer with respect thereto (net of reimbursement of Advances
and Servicing Advances) at the time such Mortgage Loan became a Liquidated
Mortgage Loan or (ii) with respect to a Mortgage Loan which is not a Liquidated
Mortgage Loan, any amount of principal that the Mortgagor is no longer legally
required to pay (except for the extinguishment of debt that results from the
exercise of remedies due to default by the Mortgagor).
REALIZED LOSS INTEREST SHORTFALL: The meaning specified in Section
6.05(c).
RECORD DATE: The close of business of the last Business Day of the
month preceding the month of the related Distribution Date.
REFERENCE BANK RATE: As of 11:00 A.M. London time, on the day that is
one LIBOR Business Day prior to the immediately preceding Distribution Date, the
rate at which deposits are offered by the reference banks (which shall be three
major banks engaged in transactions in the London interbank market, selected by
the Servicer) to prime banks in the London interbank market for a period of one
month in amounts approximately equal to the aggregate Outstanding Certificate
Principal Balance of the Class A-5 and Class A-6 Certificates in accordance with
the following procedures. The Servicer will request the principal London office
of each of the reference banks to provide a quotation of its rate. If at least
two such quotations are provided, the rate will be the arithmetic mean of the
quotations. If on such date fewer than two quotations are provided as requested,
the rate will be the arithmetic mean of the rates quoted by one or more major
banks in New York City, selected by the Servicer as of 11:00 A.M., New York City
time, on such date for loans in U.S. Dollars to leading European banks for a
period of one month in amounts approximately equal to the aggregate Outstanding
Certificate Principal Balance of the Class A-5 and Class-6 Certificates. In the
event no such quotations can be obtained, the rate will be LIBOR for the prior
Distribution Date, or in the case of the first Rate Adjustment Date, _________%.
RELEVANT MORTGAGE LOAN: The meaning specified in Section 5.01.
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REMIC: A "real estate mortgage investment conduit," as such term is
defined in Section 860D of the Code. References herein to "the REMIC" shall mean
the REMIC created hereunder.
REMIC PROVISIONS: Provisions of the federal income tax law relating to
REMICs which appear at Sections 860A through 860G of Part IV of Subchapter M of
Chapter 1 of Subtitle A of the Code, and related provisions, and U.S. Department
of the Treasury temporary, proposed or final regulations and rulings promulgated
thereunder, as the foregoing are in effect (or with respect to proposed
regulations, are proposed to be in effect) from time to time.
REMITTANCE RATE: ___% per annum.
REPURCHASE PROCEEDS: All proceeds of any Mortgage Loan or property
acquired in respect thereof repurchased pursuant to Section 2.02, 3.01, 5.01,
5.21 or 11.01.
RESIDUAL INTEREST: The interest in the Trust Fund represented by
amounts, if any, remaining in the Collection Account following termination of
the Trust Fund after payments to the Class A Certificateholders (other than the
Class A-R Certificateholders), the Class M Certificateholders and the Class B
Certificateholders.
RESPONSIBLE OFFICER: When used with respect to the Trustee, any Senior
Vice President, any Vice President, any Assistant Vice President, any Senior
Trust Officer, any Trust Officer or any other officer of the Trustee in its
Corporate Trust Office customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer in its Corporate Trust Office to whom such
matter is referred because of such officer's knowledge of and familiarity with
the particular subject.
S&P: Standard & Poor's Ratings Services, a division of The XxXxxx-Xxxx
Companies, Inc. or its successor in interest.
SALE AGREEMENT: The Mortgage Loan Sale Agreement dated as of [DATE]
between the Depositor and CMMC.
SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan as of
any Distribution Date, the unpaid principal balance of such Mortgage Loan as
specified in the amortization schedule at the time relating thereto (before any
adjustment to such schedule by reason of bankruptcy or similar proceeding or any
moratorium or similar waiver or grace period) as of the Due Date in the month
preceding the month of such Distribution Date, or as the Cut-off Date, with
respect to the first Distribution Date, after giving effect to any previously
applied prepayments, the payment of principal due on such first day of the month
and any reduction of
27
the principal balance of such Mortgage Loan by a bankruptcy court, irrespective
of any delinquency in payment by the related Mortgagor.
SELLER: [CMMC].
SERVICER: [CMMC] or any successor under this Agreement as herein
provided.
SERVICING ADVANCES: All customary, reasonable and necessary "out of
pocket" costs and expenses incurred in the performance by the Servicer of its
servicing obligations and which are "unanticipated expenses" of the REMIC, as
defined in the REMIC Provisions, including, but not limited to, the cost of (i)
the preservation, restoration and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the Mortgaged Property if the Mortgaged Property
is acquired in satisfaction of the Mortgage, (iv) taxes and assessments on the
Mortgaged Properties subject to the Mortgage Loans and (v) compliance with the
obligations under Section 5.21.
SERVICING FEE: The amount of the monthly fee paid for the servicing of
the Mortgage Loans, equal to, as of any Distribution Date, the total of, with
respect to each Mortgage Loan, one-twelfth of ______% per annum of the Principal
Balance thereof as of the Determination Date in the preceding month, subject to
adjustment as provided in Section 6.05. The Servicing Fee shall be payable only
at the time of and with respect to those Mortgage Loans for which payment is in
fact made of the entire amount of the Monthly Payments that shall have come due
and only at the time such Monthly Payment shall be made. The right to receive
the Servicing Fee is limited to, and the Servicing Fee is payable solely from,
the interest portion of such Monthly Payments (or the interest portion of any
Principal Prepayment in full) collected by the Servicer, or as otherwise
provided under Section 5.09 or 5.23.
SERVICING OFFICER: Any officer of the Servicer or any Sub-servicer
involved in, or responsible for, the administration and servicing of the
Mortgage Loans whose name appears on a written certificate listing servicing
officers furnished to the Trustee by the Servicer on or prior to the Closing
Date, and signed on behalf of the Servicer or any Sub-servicer by its President,
any Vice President or its Treasurer, as such certificate may from time to time
be amended.
SINGLE CERTIFICATE: A Certificate of any Class that evidences the
smallest permissible original denomination for such Class of Certificates as
specified in Section 4.01(d).
SPECIAL HAZARD AMOUNT: Initially, $__________. As of the first
anniversary of the Cut-off Date, the Special Hazard Amount shall be reduced, but
not increased, to the lesser of (i) the initial Special Hazard Amount less the
sum of all amounts allocated to the Subordinated Certificates in respect of
Special Hazard Losses on the Mortgage Loans during
28
such year or (ii) the Adjustment Amount for such anniversary. As of each
subsequent anniversary of the Cut-off Date, the Special Hazard Amount on the
immediately preceding anniversary of the Cut-off Date less the sum of all
amounts allocated to the Subordinated Certificates in respect of Special Hazard
Losses on the Mortgage Loans during such year and (ii) the Adjustment Amount for
such anniversary. The "Adjustment Amount" with respect to each anniversary of
the Cut-off Date will be equal to the greatest of (i) ___% multiplied by the
aggregate outstanding principal balance of the Mortgage Loans, (ii) the
aggregate outstanding principal balance of the Mortgage Loans secured by
Mortgaged Properties located in the California postal zip code area in which the
highest percentage of Mortgage Loans by Principal Balance are located and (iii)
twice the outstanding principal balance of the Mortgage Loan having the largest
outstanding principal balance.
SPECIAL HAZARD LOSS: Any Realized Loss or portion thereof resulting
from direct physical loss or damage to the Mortgaged Property, which is not
insured against under the Standard Hazard Policy required to be maintained
hereunder.
STANDARD HAZARD POLICY: Each standard hazard insurance policy or
replacement therefor referred to in Section 5.16.
STARTUP DAY: The meaning specified in Section 2.04(a).
STEP-DOWN DATE: The earliest of the Distribution Date in [MONTH/YEAR]
or any succeeding Distribution Date on which the following conditions are
satisfied as of the last day of the month preceding such Distribution Date:
(a) the aggregate outstanding Principal Balance of Outstanding
Mortgage Loans 60 days or more delinquent (including loans in
foreclosure and with respect to owned real estate) does not exceed 50%
of the aggregate Outstanding Certificate Balance of the Subordinated
Certificates as of such date; and
(b) Realized Losses through the last day of the month preceding
such Distribution Date (including Nonrecoverable Advances) do not
exceed the following thresholds:
(i) if such Distribution Date occurs between and
including [MONTH/YEAR] and [MONTH/YEAR], 30% of the
Subordinated Percentage of the Mortgage Pool Principal Balance
as of the Cut-off Date;
(ii) if such Distribution Date occurs between and
including [MONTH/YEAR] and [MONTH/YEAR], 35% of the
Subordinated Percentage of the Mortgage Pool Principal Balance
as of the Cut-off Date;
29
(iii) if such Distribution Date occurs between and
including [MONTH/YEAR] and [MONTH/YEAR], 40% of the
Subordinated Percentage of the Mortgage Pool Principal Balance
as of the Cut-off Date;
(iv) if such Distribution Date occurs between and
including [MONTH/YEAR] and [MONTH/YEAR], 45% of the
Subordinated Percentage of the Mortgage Pool Principal Balance
as of the Cut-off Date; and
(v) if such Distribution Date occurs after
[MONTH/YEAR], 50% of the Subordinated Percentage of the
Mortgage Pool Principal Balance as of the Cut-off Date.
STEP DOWN PERCENTAGE: With respect to any Distribution Date, the
percentage indicated below:
DISTRIBUTION DATE OCCURRING IN STEP DOWN PERCENTAGE
MONTH/DATE through MONTH DATE........................ %
STRIPPED INTEREST RATE: For each Mortgage Loan, the excess, if any, of
the Net Mortgage Rate for such Mortgage Loan over the Remittance Rate.
SUBORDINATED CERTIFICATES: The Class M and Class B Certificates,
referred to collectively.
SUBORDINATED OPTIMAL PRINCIPAL AMOUNT: With respect to any Distribution
Date, the lesser of (a) the aggregate Outstanding Certificate Principal Balance
of the Subordinated Certificates (before giving effect to any distributions of
principal on such Distribution Date) and (b)(1) the sum of: (i) the Subordinated
Percentage of the applicable Non- PO Percentage of the principal portion of all
Monthly Payments, whether or not received, which were due during the related Due
Period on Mortgage Loans which were outstanding during such Due Period; (ii) the
Subordinated Prepayment Percentage of the applicable Non-PO Percentage of all
Principal Prepayments made on any Mortgage Loan during the related Principal
Prepayment Period; (iii) with respect to each Mortgage Loan not described in
(iv) below, the Subordinated Percentage of the applicable Non-PO Percentage of
the principal portion of all Insurance Proceeds, condemnation awards and any
other cash proceeds from a source other than the applicable Mortgagor, to the
extent required to be deposited in the Collection Account pursuant to Section
5.08(iv) and (v), which were received during the related Principal
30
Prepayment Period, net of related unreimbursed Servicing Advances and net of any
portion thereof which, as to any such Mortgage Loan, constitutes Late
Collections that have been the subject of an Advance on any prior Distribution
Date; (iv) with respect to each Mortgage Loan which has become a Liquidated
Mortgage Loan during the related Principal Prepayment Period, an amount equal to
the portion (if any) of the Net Liquidation Proceeds with respect to such
liquidated Mortgage Loan (net of any unreimbursed Advances) that was not
included in the Class A-P Amount or the Non-PO Class A Optimal Principal Amount
with respect to such Distribution Date; and (v) with respect to each Mortgage
Loan repurchased during the related Principal Prepayment Period pursuant to
Section 2.02, 3.01, 5.21 or 11.01, an amount equal to the Subordinated
Prepayment Percentage of the applicable Non-PO Percentage of the principal
portion of the Purchase Price (net of amounts with respect to which a
distribution of principal has previously been made to the Subordinated
Certificateholders) minus (2) the Class A-P Shortfall Amount with respect to
such Distribution Date.
SUBORDINATED PERCENTAGE: As of any Distribution Date, the difference
between 100% and the Non-PO Class A Percentage.
SUBORDINATED PREPAYMENT PERCENTAGE: As of any Distribution Date, the
difference between 100% and the Non-PO Class A Prepayment Percentage.
SUB-SERVICER: Any Person with whom the Servicer enters into a
Sub-Servicing Agreement.
SUB-SERVICING AGREEMENT: Any agreement between the Servicer and any
Sub-Servicer, relating to servicing or administration of certain Mortgage Loans
as provided in Section 5.02, in such form as has been approved by the Servicer
and the Depositor.
SUBSTITUTE EXCESS INTEREST: As defined in Section 3.04.
TELERATE SCREEN PAGE 3750: The display designated as page 3750 on the
Dow Xxxxx Telerate Service or such other page as may replace page 3750 on that
service for the purpose of displaying London interbank offered rates of major
banks.
TRUST: The Trust created pursuant to this Agreement.
TRUST FUND: The corpus of the Trust consisting of (i) the Mortgage
Loans, (ii) such assets as shall from time to time be identified as deposited in
the Collection Account and the Certificate Account, (iii) property which secured
a Mortgage Loan and which has been acquired by foreclosure or deed in lieu of
foreclosure, (iv) Standard Hazard Policies and any other insurance policies, and
the proceeds thereof and (v) any proceeds of any of the foregoing.
TRUSTEE: [TRUSTEE], a ___________ and its successors and any
corporation resulting from or surviving any consolidation or merger to which it
or its successors may be a
31
party, and any successor trustee at the time serving as successor trustee
hereunder, appointed as herein provided.
U.S. PERSON: A "United States Person" as defined in Section 7701(a)(30)
of the Code.
[End of Article I]
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND
Section 2.01. Conveyance of Mortgage Loans. The Depositor, concurrently
with the execution and delivery hereof, does hereby sell, transfer, assign, set
over and convey to the Trustee without recourse all the right, title and
interest of the Depositor in and to the Mortgage Loans, including all interest
and principal received on or with respect to the Mortgage Loans on or after the
Cut-off Date (other than Monthly Payments due on the Mortgage Loans on or before
the Cut-off Date).
In connection with such assignment, the Depositor does hereby deliver
to, and deposit with, the Trustee the following documents or instruments with
respect to each Mortgage Loan so assigned:
(A) (I) Original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II) original
Consolidation, Extension and Modification Agreement (or a lost note
affidavit (including a copy of the original Consolidation, Extension
and Modification Agreement), in either case endorsed, "Pay to the order
of [TRUSTEE], as trustee, without recourse."
(B) The original Mortgage (including all riders thereto) with
evidence of recording thereon, or a copy thereof certified by the
public recording office in which such mortgage has been recorded or, if
the original Mortgage has not been returned from the applicable public
recording office, a true certified copy, certified by the Seller, of
the original Mortgage together with a certificate of the Seller
certifying that the original Mortgage has been delivered for recording
in the appropriate public recording office of the jurisdiction in which
the Mortgaged Property is located.
(C) The original Assignment of Mortgage to "[TRUSTEE], as
trustee," which assignment shall be in form and substance acceptable
for recording, or a copy certified by the Seller as a true and correct
copy of the original Assignment which has been sent for recordation.
Subject to the foregoing, such assignments may, if permitted by law, be
by blanket assignments for Mortgage Loans covering Mortgaged Properties
situated within
32
the same county. If the Assignment of Mortgage is in blanket form, a
copy of the Assignment of Mortgage shall be included in the related
individual Mortgage File.
(D) The original policy of title insurance, including riders
and endorsements thereto, or if the policy has not yet been issued, a
written commitment or interim binder or preliminary report of title
issued by the title insurance or escrow company.
(E) Originals of all recorded intervening Assignments of
Mortgage, or copies thereof, certified by the public recording office
in which such Assignments or Mortgage have been recorded showing a
complete chain of title from the originator to the Depositor, with
evidence of recording, thereon, or a copy thereof certified by the
public recording office in which such Assignment of Mortgage has been
recorded or, if the original Assignment of Mortgage has not been
returned from the applicable public recording office, a true certified
copy, certified by the Seller of the original Assignment of Mortgage
together with a certificate of the Seller certifying that the original
Assignment of Mortgage has been delivered for recording in the
appropriate public recording office of the jurisdiction in which the
Mortgaged Property is located.
(F) Originals, or copies thereof certified by the public
recording office in which such documents have been recorded, of each
assumption, extension, modification, written assurance or substitution
agreements, if applicable, or if the original of such document has not
been returned from the applicable public recording office, a true
certified copy, certified by the Seller, of such original document
together with certificate of Seller certifying the original of such
document has been delivered for recording in the appropriate recording
office of the jurisdiction in which the Mortgaged Property is located.
(G) If the Mortgaged Note or Mortgage or any other material
document or instrument relating to the Mortgaged Loan has been signed
by a person on behalf of the Mortgagor, the original power of attorney
or other instrument that authorized and empowered such person to sign
bearing evidence that such instrument has been recorded, if so required
in the appropriate jurisdiction where the Mortgaged Property is located
(or, in lieu thereof, a duplicate or conformed copy of such instrument,
together with a certificate of receipt from the recording office,
certifying that such copy represents a true and complete copy of the
original and that such original has been or is currently submitted to
be recorded in the appropriate governmental recording office of the
jurisdiction where the Mortgaged Property is located), or if the
original power of attorney or other such instrument has been delivered
for recording in the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located.
If in connection with any Mortgage Loan the Depositor cannot deliver
the Mortgage, Assignments of Mortgage or assumption, consolidation or
modification, as the case may be, with evidence of recording thereon
concurrently with the execution and delivery of this
33
Agreement solely because of a delay caused by the public recording office where
such Mortgage, Assignments of Mortgage or assumption, consolidation or
modification, as the case may be, has been delivered for recordation, the
Depositor shall deliver or cause to be delivered to the Trustee written notice
stating that such Mortgage, Assignments of Mortgage or assumption, consolidation
or modification, as the case may be, has been delivered to the appropriate
public recording office for recordation. Thereafter, the Depositor shall deliver
or cause to be delivered to the Trustee such Mortgage, Assignments of Mortgage
or assumption, consolidation or modification, as the case may be, with evidence
of recording indicated thereon upon receipt thereof from the public recording
office.
The Servicer shall cause to be recorded in the appropriate public
recording office for real property records each Assignment of Mortgage referred
to in this Section 2.01 as soon as practicable. While each Assignment of
Mortgage to be recorded is being recorded, the Servicer shall deliver to the
Trustee a photocopy of such document. If any such Assignment of Mortgage is
returned unrecorded to the Servicer because of any defect therein, the Servicer
shall cause such defect to be cured and such document to be recorded in
accordance with this paragraph. The Depositor shall deliver or cause to be
delivered each original recorded Assignment of Mortgage and intermediate
assignment to the Trustee within 270 days of the Closing Date or shall deliver
to the Trustee on or before such date an Officer's Certificate stating that such
document has been delivered to the appropriate public recording office for
recordation, but has not been returned solely because of a delay caused by such
recording office. In any event, the Depositor shall use all reasonable efforts
to cause each such document with evidence of recording thereon to be delivered
to the Trustee within 300 days of the Closing Date.
The ownership of each Mortgage Note, the Mortgage and the contents of
the related Mortgage File is vested in the Trustee. Neither the Depositor nor
the Servicer shall take any action inconsistent with such ownership and shall
not claim any ownership interest therein. The Depositor and the Servicer shall
respond to any third party inquiries with respect to ownership of the Mortgage
Loans by stating that such ownership is held by the Trustee on behalf of the
Certificateholders. Mortgage documents relating to the Mortgage Loans not
delivered to the Trustee are and shall be held in trust by the Servicer or any
Sub-Servicer, for the benefit of the Trustee as the owner thereof, and the
Servicer's or such Sub-Servicer's possession of the contents of each Mortgage
File so retained is for the sole purpose of servicing the related Mortgage Loan,
and such retention and possession by the Servicer or such Sub-Servicer is in a
custodial capacity only. The Depositor agrees to take no action inconsistent
with the Trustee's ownership of the Mortgage Loans, to promptly indicate to all
inquiring parties that the Mortgage Loans have been sold and to claim no
ownership interest in the Mortgage Loans. Each Mortgage File and the mortgage
documents relating to the Mortgage Loans contain proprietary business
information of the Servicer and its customers. The Trustee and the Depositor
agree that they will not use such information for business purposes without the
express written consent of the Servicer and that all such information shall be
kept strictly confidential.
34
It is the intention of this Agreement that the conveyance of the
Depositor's right, title and interest in and to the Trust Fund pursuant to this
Agreement shall constitute a purchase and sale and not a loan. If a conveyance
of Mortgage Loans from the Seller to the Depositor is characterized as a pledge
and not a sale, then the Depositor shall be deemed to have transferred to the
Trustee all of the Depositor's right, title and interest in, to and under the
obligations of the Seller deemed to be secured by said pledge; and it is the
intention of this Agreement that the Depositor shall also be deemed to have
granted to the Trustee a first priority security interest in all of the
Depositor's right, title, and interest in, to and under the obligations of the
Seller to the Depositor deemed to be secured by said pledge and that the Trustee
shall be deemed to be an independent custodian for purposes of perfection of the
security interest granted to the Depositor. If the conveyance of the Mortgage
Loans from the Depositor to the Trustee is characterized as a pledge, it is the
intention of this Agreement that this Agreement shall constitute a security
agreement under applicable law, and that the Depositor shall be deemed to have
granted to the Trustee a first priority security interest in all of the
Depositor's right, title and interest in, to and under the Mortgage Loans, all
payments of principal of or interest on such Mortgage Loans, all other rights
relating to and payments made in respect of the Trust Fund, and all proceeds of
any thereof. If the trust created by this Agreement terminates prior to the
satisfaction of the claims of any Person in any Certificates, the security
interest created hereby shall continue in full force and effect and the Trustee
shall be deemed to be the collateral agent for the benefit of such Person.
In addition to the conveyance made in the first paragraph of this
Section 2.01, the Depositor does hereby convey, assign and set over to the
Trustee all of its right, title and interest in that portion of the Trust Fund
described in items (ii), (iii), (iv) and (v) of the definition thereof and
further assigns to the Trustee for the benefit of the Certificateholders those
representations and warranties of the Seller contained in the Sale Agreement and
described in Section 3.01 hereof and the benefit of the repurchase obligations
of the Seller described in Sections 2.02 and 3.01 hereof and the obligations of
the Seller contained in the Sale Agreement to take, at the request of the
Depositor or the Trustee, all action on its part which is reasonably necessary
to ensure the enforceability of a Mortgage Loan.
Section 2.02. Acceptance by Trustee. Except as set forth in the
Exception Report delivered contemporaneously herewith (the "Exception Report"),
the Trustee acknowledges receipt of the Mortgage Note for each Mortgage Loan and
delivery of a Mortgage File (but does not acknowledge receipt of all documents
required to be included in such Mortgage File) with respect to each Mortgage
Loan and declares that it holds and will hold such documents and any other
documents constituting a part of the Mortgage Files delivered to it in trust for
the use and benefit of all present and future Certificateholders. The Depositor
will cause the Seller to repurchase any Mortgage Loans to which an exception was
taken in the Exception Report unless such exception is cured to the satisfaction
of the Trustee within 45 Business Days of the Closing Date.
The Trustee agrees, for the benefit of Certificateholders, to review
each Mortgage File delivered to it within 270 days after the Closing Date to
ascertain that all documents
35
required by Section 2.01 have been executed and received, and that such
documents relate to the Mortgage Loans identified in Exhibit A that have been
conveyed to it. If the Trustee finds any document or documents constituting a
part of a Mortgage File to be missing or defective (that is, mutilated, damaged,
defaced or unexecuted) in any material respect, the Trustee shall promptly (and
in any event within no more than five Business Days) after such finding so
notify the Servicer, the Seller and the Depositor. In addition, the Trustee
shall also notify the Servicer, the Seller and the Depositor, if (a) in
examining the Mortgage Files, the documentation shows on its face (i) any
adverse claim, lien or encumbrance, (ii) that any Mortgage Note was overdue or
had been dishonored, (iii) any evidence on the face of any Mortgage Note or
Mortgage of any security interest or other right or interest therein, or (iv)
any defense against or claim to the Mortgage Note by any party or (b) the
original Mortgage with evidence of recording thereon with respect to a Mortgage
Loan is not received within 270 days of the Closing Date. The Trustee shall
request that the Seller correct or cure such omission, defect or other
irregularity, or substitute a Mortgage Loan pursuant to the provisions of
Section 3.03, within 60 days from the date the Seller was notified of such
omission or defect and, if the Seller does not correct or cure such omission or
defect within such period, that the Seller purchase such Mortgage Loan from the
Trustee within 90 days from the date the Trustee notified the Seller of such
omission, defect or other irregularity at the Purchase Price of such Mortgage
Loan. The Purchase Price for any Mortgage Loan purchased pursuant to this
Section 2.02 shall be paid to the Servicer and deposited by the Servicer in the
Collection Account promptly upon receipt, and, upon receipt by the Trustee of
written notification of such deposit signed by a Servicing Officer, the Trustee
shall promptly release to the Seller the related Mortgage File and the Trustee
shall execute and deliver such instruments of transfer or assignment, without
recourse, as shall be necessary to vest in the Seller or its designee, as the
case may be, any Mortgage Loan released pursuant hereto, and the Trustee shall
have no further responsibility with regard to such Mortgage Loan. It is
understood and agreed that the obligation of the Seller to purchase, cure or
substitute any Mortgage Loan as to which a material defect in or omission of a
constituent document exists shall constitute the sole remedy respecting such
defect or omission available to the Trustee on behalf of Certificateholders. The
Trustee shall be under no duty or obligation to inspect, review and examine such
documents, instruments, certificates or other papers to determine that they are
genuine, enforceable or appropriate to the represented purpose, or that they
have actually been recorded, or that they are other than what they purport to be
on their face. The Trustee shall keep confidential the name of each Mortgagor
and shall not solicit any such Mortgagor for the purpose of refinancing the
related Mortgage Loan.
Within 280 days of the Closing Date, the Trustee shall deliver to the
Depositor and the Servicer the Trustee's Certification, substantially in the
form of Exhibit G attached hereto, setting forth the status of the Mortgage
Files as of such date.
Section 2.03. Trust Fund; Authentication of Certificates. The Trustee
acknowledges and accepts the assignment to it of the Trust Fund created pursuant
to this Agreement in trust for the use and benefit of all present and future
Certificateholders. The Trustee acknowledges the assignment to it for the
benefit of the Trust Fund of the Mortgage
36
Loans and has caused to be authenticated and delivered to or upon the order of
the Depositor, in exchange for the Mortgage Loans, Certificates duly
authenticated by the Trustee or, if an Authenticating Agent has been appointed
pursuant to Section 4.06, the Authenticating Agent in authorized denominations
evidencing ownership of the entire Trust Fund.
Section 2.04. REMIC Election.
(a) The Depositor hereby instructs and authorizes the Trustee to make
an appropriate election to treat the Trust Fund as a REMIC. This Agreement shall
be construed so as to carry out the intention of the parties that the Trust Fund
be treated as a REMIC at all times prior to the date on which the Trust Fund is
terminated. The Closing Date is hereby designated as the "startup day" of the
REMIC within the meaning of Section 860G(a)(9) of the Code. The "regular
interests" (within the meaning of Section 860G(a)(1) of the Code) in the REMIC
shall consist of the Class A Certificates (exclusive of the Class A-R
Certificates), the Class M Certificates and the Class B Certificates, and the
"residual interest" (within the meaning of Section 860G(a)(2) of the Code) in
the REMIC shall consist of the Residual Interest, and all such interests shall
be designated as such on the Startup Day.
(b) The principal amount of the regular interests in the REMIC is equal
to the sum of the Original Class A Principal Balance, the Original Class M
Principal Balance and the Original Class B Principal Balance.
(c) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of the
Treasury regulations, the "latest possible maturity date" by which the
Outstanding Certificate Principal Balance of each Class of Certificates
representing a regular interest in the REMIC would be reduced to zero is [DATE],
which is the Distribution Date immediately following the latest scheduled
maturity of any Mortgage Loan.
(d) The "tax matters person" with respect to the Trust Fund for
purposes of the REMIC provisions shall be the beneficial owner of the Class A-R
Certificate; provided, however, that the Holder of a Class A-R Certificate, by
its acceptance thereof, irrevocably appoints the Servicer as its agent and
attorney-in-fact to act as "tax matters person" with respect to the Trust Fund
for purposes of the REMIC provisions.
(e) It is intended that the Trust Fund shall constitute, and that the
affairs of the Trust Fund shall be conducted so as to qualify the Trust Fund as,
a "real estate mortgage investment conduit" as defined in and in accordance with
the REMIC Provisions. In furtherance of such intention, the Servicer covenants
and agrees that it shall act as agent (and the Servicer is hereby appointed to
act as agent) on behalf of the Trust Fund and the respective Holders of the
Class A-R Certificates and that in such capacity it shall:
(i) prepare and file, or cause to be prepared and filed, in a
timely manner, a U.S. Real Estate Mortgage Investment Conduit Income
Tax Return (Form
37
1066) 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 the Trust Fund, using the calendar year as the taxable year and the
accrual method of accounting, 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 shall 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;
(ii) within thirty days of the Closing Date, shall furnish or
cause to be furnished to the Internal Revenue Service, on Form 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 (and the
Servicer shall act as the representative of the Trust Fund for this
purpose), together with such additional information as may be required
by such Form, and shall update such information at the time or times
in the manner required by the Code;
(iii) make or cause to be made an election, on behalf of the
Trust Fund, to be treated as a REMIC, and make the appropriate
designations, if applicable, in accordance with this Section 2.04 on
the federal tax return of the Trust Fund for its first taxable year
(and, if necessary, under applicable state law);
(iv) 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 or reports,
or furnish or cause to be furnished by telephone, mail, publication or
other appropriate method such information, 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;
(v) provide information necessary for the computation of tax
imposed on the transfer of the Class A-R Certificate to a Disqualified
Organization, or an agent (including a broker, nominee or other
middleman) of a Disqualified Organization, or a pass-through entity in
which a Disqualified Organization 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);
(vi) ensure that federal, state or local income tax or
information returns shall be signed by the Trustee or such other
person as may be required to sign such returns by the Code or state or
local laws, regulations or rules; and
(vii) maintain such records relating to the Trust Fund, as may be
required by the Code and, as may be necessary to prepare the foregoing
returns, schedules, statements or information.
[End of Article II]
38
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND
THE SERVICER; REPURCHASE OF MORTGAGE LOANS
Section 3.01. Representations and Warranties of the Depositor with
respect to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee for the
benefit of the Certificateholders that on the Closing Date it has entered into
the Sale Agreement with CMMC as Seller, that the Seller has made the following
representations and warranties with respect to each Mortgage Loan in such Sale
Agreement as of the Closing Date, which representations and warranties run to
and are for the benefit of the Depositor and the Trustee for the benefit of the
Certificateholders, and as to which the Depositor has assigned to the Trustee
for the benefit of the Certificateholders, pursuant to Section 2.01 hereof, the
right to cause the Seller to repurchase a Mortgage Loan as to which there has
occurred an uncured breach of representations and warranties in accordance with
the provisions of the Sale Agreement.
(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct in all material respects;
(b) The Mortgage creates a first lien or a first priority ownership
interest in an estate in fee simple in real property securing the related
Mortgage Note;
(c) All payments due prior to the Cut-off Date for such Mortgage Loan
have been made as of the Closing Date, the Mortgage Loan is not delinquent in
payment more than 30 days and has not been dishonored; to the best of the
Seller's knowledge, there are no material defaults under the terms of the
Mortgage Loan; the Seller has not advanced funds, or induced, solicited or
knowingly received any advance of funds from a party other than the owner of the
Mortgaged Property subject to the Mortgage, directly or indirectly, for the
payment of any amount required by the Mortgage Loan; there has been no more than
one delinquency in excess of 30 days during the preceding twelve-month period;
(d) To the best of the Seller's knowledge, all taxes, governmental
assessments, insurance premiums, water, sewer and municipal charges, leasehold
payments or ground rents which previously became due and owing have been paid,
or escrow funds have been established in an amount sufficient to pay for every
such escrowed item which remains unpaid and which has been assessed but is not
yet due and payable;
(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. No Mortgagor has been released, in whole or in part, from the terms
thereof except in connection
39
with an assumption agreement and which assumption agreement is part of the
Mortgage File and the terms of which are reflected in the Mortgage Loan
Schedule;
(f) The Mortgage Note and the Mortgage are not subject to any right of
rescission, set-off, counterclaim or defense, including, without limitation, the
defense of usury, nor will the operation of any of the terms of the Mortgage
Note or Mortgage, or the exercise of any right thereunder, render the Mortgage
Note or Mortgage unenforceable, in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury,
and no such right of rescission, set-off, counterclaim or defense has been
asserted with respect thereto, and the Mortgagor was not a debtor in any state
or federal bankruptcy or insolvency proceeding at the time the Mortgage Loan was
originated;
(g) All buildings or other customarily insured improvements upon the
Mortgaged Property are insured by an insurer acceptable under the FNMA Guides
against loss by fire, hazards of extended coverage and such other hazards as are
provided for in the FNMA Guides or by FHLMC. All such standard hazard policies
are in full force and effect and on the date of origination contained a standard
mortgagee clause naming the Seller and its successors in interest and assigns as
loss payee and such clause is still in effect and all premiums due thereon have
been paid. If required by the Flood Disaster Protection Act of 1973, as amended,
the Mortgage Loan is covered by a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
which policy conforms to FNMA and FHLMC requirements. The Mortgage obligates the
Mortgagor thereunder to maintain all such insurance at the Mortgagor's cost and
expense, and on the Mortgagor's failure to do so, authorizes the holder of the
Mortgage to maintain such insurance at the Mortgagor's cost and expense and to
seek reimbursement therefor from the Mortgagor;
(h) Any and all requirements of any federal, state or local law
including, without limitation, usury, truth-in-lending, real estate settlement
procedures, consumer credit protection, equal credit opportunity or disclosure
laws applicable to the Mortgage Loan have been complied with in all material
respects;
(i) The Mortgage has not been satisfied, canceled or subordinated, in
whole or in part, or rescinded, and the Mortgaged Property has not been released
from the lien of the Mortgage, in whole or in part nor has any instrument been
executed that would effect any such release, cancellation, subordination or
rescission;
(j) The Mortgage is a valid, subsisting, enforceable and perfected
first lien on the Mortgaged Property, including, all buildings on the Mortgaged
Property and all installations and mechanical, electrical, plumbing, heating and
air conditioning systems affixed to such buildings, and all additions,
alterations and replacements made at any time with respect to the foregoing
securing the Mortgage Note's original principal balance. The Mortgage and the
Mortgage Note do not contain any evidence of any security interest or other
interest or right thereto. Such lien is free and clear of all adverse claims,
liens and encumbrances having priority
40
over the first lien of the Mortgage subject only to (1) the lien of
non-delinquent current real property taxes and assessments not yet due and
payable, (2) covenants, conditions and restrictions, rights of way, easements
and other matters of the public record as of the date of recording which are
acceptable to mortgage lending institutions generally and either (A) which are
referred to or otherwise considered in the appraisal made for the originator of
the Mortgage Loan, or (B) which do not adversely affect the appraised value of
the Mortgaged Property as set forth in such appraisal, and (3) 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 the Mortgage or the
use, enjoyment, value or marketability of the related Mortgaged Property. Any
security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
subsisting, enforceable and perfected first lien and first priority security
interest on the property described therein, and the Depositor has the full right
to sell and assign the same to the Trustee for the benefit of the
Certificateholders;
(k) The Mortgage Note and the related Mortgage are original and genuine
and each is the legal, valid and binding obligation of the maker thereof,
enforceable in all respects in accordance with its terms subject to bankruptcy,
insolvency and other laws of general application affecting the rights of
creditors and the Depositor has taken all action necessary to transfer such
rights of enforceability to the Trustee for the benefit of the
Certificateholders. All parties to the Mortgage Note and the Mortgage had the
legal capacity to enter into the Mortgage Loan and to execute and deliver the
Mortgage Note and the Mortgage. The Mortgage Note and the Mortgage have been
duly and property executed by such parties. The proceeds of the Mortgage Loan
have been fully disbursed and there is no requirement for future advances
thereunder, and any and all requirements as to completion of any on-site or
off-site improvements and as to disbursements of any escrow funds therefor have
been complied with;
(1) The Depositor is the sole owner of record and holder of the
Mortgage Loan and the indebtedness evidenced by the Mortgage Note, except for
the Assignments of Mortgage which have been sent for recording, and upon
recordation the Depositor will be the owner of record of the Mortgage and the
indebtedness evidenced by the Mortgage Note, and upon the sale of the Mortgage
Loan to the Trust for the benefit of the Certificateholders, the Depositor will
retain the Mortgage File or any part thereof with respect thereto not delivered
to the Trust for the benefit of the Certificateholders or its designee in trust
only for the purpose of servicing and supervising the servicing of the Mortgage
Loan. Immediately prior to the transfer and assignment to the Trust for the
benefit of the Certificateholders, the Mortgage Loan, including the Mortgage
Note and the Mortgage, were not subject to an assignment or pledge, and the
Depositor had good and marketable title to and was the sole owner thereof and
had full right to transfer and sell the Mortgage Loan to the Trustee for the
benefit of the Certificateholders free and clear of any encumbrance, equity,
lien, pledge, charge, claim or security interest and has the full right and
authority subject to no interest or participation of, or agreement with, any
other party, to sell and assign the Mortgage Loan pursuant to this Agreement and
following the sale of the Mortgagee Loan, the Trustee for the benefit of the
Certificateholders will own such Mortgage
41
Loan free and clear of any encumbrance, equity, participation interest, lien,
pledge, charge, claim or security interest;
(m) The Mortgage Loan is covered by an ALTA lender's title insurance
policy or other generally acceptable form of policy or insurance acceptable to
FNMA or FHLMC, issued by a title insurer acceptable to FNMA or FHLMC and
qualified to do business in the jurisdiction where the Mortgaged Property is
located, insuring (subject to the exceptions contained in (j) (1), (2) and (3)
above) the Seller, its successors and assigns, as to the first priority lien of
the Mortgage in the original principal amount of the Mortgage Loan. Such
lender's title insurance policy insures ingress and egress by or upon the
Mortgaged Property or any interest therein. Where required by state law or
regulation, the Mortgagor has been given the opportunity to choose the carrier
of the required mortgage title insurance. The Seller, its successors and
assigns, are the sole insureds of such lender's title insurance policy, such
title insurance policy has been duly and validly endorsed to the Trustee for the
benefit of the Certificateholders or the assignment to the Trustee for the
benefit of the Certificateholders of the Seller's interest therein does not
require the consent of or notification to the insurer and such lender's title
insurance policy is in full force and effect and will be in full force and
effect upon the consummation of the transactions contemplated by this Agreement.
No claims have been made under such lender's title insurance policy, and no
prior holder of the related Mortgage, including the Seller, has done, by act or
omission, anything which would impair the coverage of such lender's title
insurance policy;
(n) There is no default, breach, violation or event of acceleration
existent, under the Mortgage or the related Mortgage Note and no event which,
with the passage of time or with notice and the expiration of any grace or cure
period, would constitute a default, breach, violation or event permitting
acceleration; and neither the Seller nor any prior mortgagee has waived any
default, breach, violation or event permitting acceleration;
(o) There are no mechanics', or similar liens or claims which have been
filed for work, labor or material (and no rights are outstanding that under law
could give rise to such liens) affecting the related Mortgaged Property which
are or may be liens prior to or equal to the lien of the related Mortgage;
(p) All improvements subject to the Mortgage which were considered in
determining the Appraised Value of the Mortgaged Property lie wholly within the
boundaries and building restriction lines of the Mortgaged Property (and wholly
within the project with respect to a condominium unit) and no improvements on
adjoining properties encroach upon the Mortgaged Property except those which are
insured against by the title insurance policy referred to in clause (m) above
and all improvements on the property comply with all applicable zoning and
subdivision laws and ordinances; the Mortgaged Property is lawfully occupied
under applicable law;
42
(q) The Mortgage Loan complies in all material respects with all the
terms, conditions and requirements of the Seller's underwriting standards in
effect at the time of origination of such Mortgage Loan. The Mortgage Notes and
Mortgages (exclusive of any riders) are on forms generally acceptable to FNMA or
FHLMC. Monthly Payments under the Mortgage Note are due and payable on the first
day of each month. The Mortgage contains the usual and enforceable provisions of
the originator at the time of origination for the acceleration of the payment of
the unpaid principal amount of the Mortgage Loan if the related Mortgaged
Property is sold without the prior consent of the mortgagee thereunder;
(r) To the best of the Seller's knowledge, the Mortgaged Property is
not subject to any material damage by waste, fire, earthquake, windstorm, flood
or other casualty. To the best of the Seller's knowledge, at origination of the
Mortgage Loan there was, and there currently is, no proceeding pending for the
total or partial condemnation of the Mortgaged Property;
(s) The related Mortgage contains customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate for the
realization against the Mortgaged Property of the benefits of the security
provided thereby, including, (l) in the case of a Mortgage designated as a deed
of trust, by trustee's sale, and (2) otherwise by judicial foreclosure. There is
no homestead or other exemption available to the Mortgagor which would interfere
with the right to sell the Mortgaged Property at a trustee's sale or the right
to foreclose the Mortgage;
(t) If the Mortgage constitutes a deed of trust, a trustee, authorized
and duly qualified if required under applicable law to act as such, has been
properly designated and currently so serves and is named in the Mortgage, and no
fees or expenses, except as may be required by local law, are or will become
payable by, the Purchaser to the trustee under the deed of trust, except in
connection with a trustee's sale or attempted sale after default by the
Mortgagor;
(u) The Mortgage File contains an appraisal of the related Mortgaged
Property signed prior to the final approval of the mortgage loan application by
an appraiser approved by the Seller who had no interest, direct or indirect, in
the Mortgaged Property or in any loan made on the security thereof, and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan. The appraisal is in a form acceptable to FNMA or FHLMC;
(v) All parties which have had any interest in the Mortgage, whether as
mortgagee, assignee, pledgee or otherwise, are (or, during the period in which
they held and disposed of such interest, were) (A) in substantial compliance
with any and all applicable licensing requirements of the laws of the state
wherein the Mortgaged Property is located, and (B) (1) organized under the laws
of such state, or (2) qualified to do business in such state, or (3) federal
savings and loan associations or national banks or a Federal Home Loan Bank or
savings bank having principal offices in such state, or (4) not doing business
in such state;
43
(w) The related Mortgage Note is not and has not been secured by any
collateral except the lien of the corresponding Mortgage and the security
interest of any applicable security interest of any applicable agreement or
chattel mortgage referred to above and such collateral does not serve as
security for any other obligation;
(x) The Mortgagor has received all disclosure materials required by
applicable law with respect to the making of such mortgage loans;
(y) The Mortgage Loan does not contain "graduated payment" features;
(z) The Mortgagor is not in bankruptcy and, to the best of the Seller's
knowledge, the Mortgagor is not insolvent;
(aa) The Mortgage Loans are fixed rate mortgage loans. The Mortgage
Loans have an original term to maturity of not more than thirty (30) years, with
interest payable in arrears on the first day of each month. Each Mortgage Note
is payable in equal monthly installments of principal and interest which is
sufficient to amortize the Mortgage Loan fully by the stated maturity date. No
Mortgage Loan contains terms or provisions which would result in negative
amortization;
(bb) Each Mortgage Note, each Mortgage, each Assignment of Mortgage and
any other documents required pursuant to this Agreement to be delivered to the
Trustee on behalf of the Certificateholders or its designee, or its assignee for
each Mortgage Loan, have been, on or before the Closing Date, delivered to the
Trustee on behalf of the Certificateholders or its designee, or its assignee;
(cc) All escrow payments have been collected in full compliance with
state and federal law and the provisions of the related Mortgage Note and
Mortgage. As to any Mortgage Loan that is the subject of an escrow, escrow of
funds is not prohibited by applicable law and has been established in an amount
sufficient to pay for every escrowed item that remains unpaid and has been
assessed but is not yet due and payable. No escrow deposits or other charges or
payments due under the Mortgage Note have been capitalized under any Mortgage or
the related Mortgage Note. Any interest required to be paid pursuant to state,
federal and local law has been properly paid and credited;
(dd) [Reserved];
(ee) In the event the Mortgage Loan has a Loan-to-Value Ratio greater
than 80%, the excess of the principal balance of the Mortgage Loan over 75% of
the Appraised Value, with respect to a refinanced Mortgage Loan, or the lesser
of the Appraised Value or the purchase price of the Mortgaged Property, with
respect to a purchase money Mortgage Loan, is and will be insured as to payment
defaults by a Primary Insurance Policy issued by a Qualified Insurer. All
provisions of such Primary Insurance Policy have been and are being complied
with such policy
44
is in full force and effect, and all premiums due thereunder have been paid. No
action, inaction, or event has occurred and no state of facts exists that has,
or will result in the exclusion from, denial of, or defense to coverage. Any
Mortgage Loan subject to a Primary Insurance Policy obligates the Mortgagor
thereunder to maintain the Primary Insurance Policy and to pay all premiums and
charges in connection therewith. The Mortgage Rate for the Mortgage Loan as set
forth on the Mortgage Loan Schedule is net of any such insurance premium;
(ff) The assignment of Mortgage is in recordable form and is acceptable
for recording under the laws of the jurisdiction in which the Mortgaged Property
is located;
(gg) As to Mortgage Loans that are not secured by an interest in a
leasehold estate, the Mortgaged Property is located in the state identified in
the Mortgage Loan Schedule and consists of a single parcel of real property with
a detached single family residence erected thereon, or a two-to four-family
dwelling, or an individual condominium unit in a condominium project, or an
individual unit in an attached planned unit development or a detached planned
unit development, provided, however, that no residence or dwelling is a single
parcel of real property with a mobile home thereon. As of the date of
origination, no portion of the Mortgaged Property was used for commercial
purposes, and since the date of origination, to the best of the Seller's
knowledge, no portion of the Mortgaged Property is used for commercial purposes;
(hh) If the Mortgaged Property is a condominium unit or a planned unit
development (other than a de minimis planned unit development) such condominium
or planned unit development project meets the Seller's eligibility requirements,
as set forth in the Seller's underwriting guidelines;
(ii) To the best of the Seller's knowledge, there is no pending action
or proceeding directly involving the Mortgaged Property in which compliance with
any environmental law, rule or regulation is an issue;
(jj) The Mortgagor has not notified the Seller, and the Depositor has
no knowledge of any relief requested or allowed to the Mortgagor under the
Soldiers' and Sailors' Civil Relief Act of 1940;
(kk) No Mortgage Loan was made in connection with the construction or
rehabilitation of a Mortgaged Property or facilitating the trade-in or exchange
of a Mortgaged Property;
(ll) No action has been taken or failed to be taken by Depositor, on or
prior to the Closing Date which has resulted or will result in an exclusion
from, denial of, or defense to coverage under any Primary Insurance Policy
(including, without limitation, any exclusions, denials or defenses which would
limit or reduce the availability of the timely payment of the full amount of the
loss otherwise due thereunder to the insured) whether arising out of actions,
45
representations, errors, omissions, negligence, or fraud of the Depositor, or
for any other reason under such coverage;
(mm) The Mortgage Loan was originated by a mortgagee approved by the
Secretary of Housing and Urban Development pursuant to Sections 203 and 211 of
the Act, a savings and loan association, a savings bank, a commercial bank,
credit union, insurance company or similar institution which is supervised and
examined by a federal or state authority;
(nn) Principal payments on the Mortgage Loan commenced no more than
sixty (60) days after funds were disbursed in connection with the Mortgage Loan.
The Mortgage Note is payable on the first day of each month in equal monthly
installments of principal and interest, with interest calculated and payable in
arrears, sufficient to amortize the Mortgage Loan fully by the stated maturity
date, over an original term of not more than thirty years from commencement of
amortization; and
(oo) The Mortgage Loan is a "qualified mortgage" within the meaning of
Section 860G(a)(3) of the Code (without regard to Treasury Regulations ss.
1.860G-2(f) or any similar rule that provides that a defective obligation is a
qualified mortgage for a temporary period);
Upon discovery by any of the Depositor, the Servicer or the Trustee of
a breach of any of the foregoing representations and warranties which materially
and adversely affects the value of a Mortgage Loan or the interest of the
Certificateholders (or which materially and adversely affects the interests of
the Certificateholders in the related Mortgage Loan in the case of a
representation and warranty relating to a particular Mortgage Loan), the party
discovering such breach shall give prompt written notice to the other parties
and to the Seller, which notice shall specify the date of discovery. Pursuant to
the Sale Agreement, the Seller shall within 90 days from the earlier of (i) the
date specified in the notice as the date of discovery of such breach or (ii) the
date the Seller otherwise discovers such breach, cure such breach, substitute a
Mortgage Loan pursuant to the provisions of Section 3.03 or, if the breach
relates to a particular Mortgage Loan, purchase such Mortgage Loan from the
Trustee at the Purchase Price. The Purchase Price for the purchased Mortgage
Loan shall be paid to the Servicer and shall be deposited by the Servicer in the
Collection Account promptly upon receipt, and, upon receipt by the Trustee of
written notification of such deposit signed by a Servicing Officer, the Trustee
shall promptly release to the Seller the related Mortgage File, and the Trustee
shall execute and deliver such instruments of transfer or assignment as may be
provided to it by the Servicer, without recourse, as shall be necessary to vest
in the Seller or its designee, as the case may be, any Mortgage Loan released
pursuant hereto, and the Trustee shall have no further responsibility with
regard to such Mortgage Loan. It is understood and agreed that the obligation of
the Seller to cure, substitute or purchase any Mortgage Loan as to which such a
breach has occurred shall constitute the sole remedy respecting such breach
available to Certificateholders or the Trustee on behalf of Certificateholders.
46
Section 3.02. Representations and Warranties of the Servicer. The
Servicer represents and warrants to, and covenants with, the Trustee for the
benefit of the Certificateholders that as of the Closing Date:
(a) The Servicer is a corporation duly chartered and validly existing
in good standing under the laws of the State of New Jersey, and the Servicer is
duly qualified or registered as a foreign corporation in good standing in each
jurisdiction in which the ownership or lease or its properties or the conduct of
its business requires such qualification;
(b) The execution and delivery of this Agreement by the Servicer and
its performance and compliance with the terms of this Agreement will not violate
the Servicer's corporate charter or by-laws or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default) under,
or result in the breach of, any material contract, agreement or other instrument
to which the Servicer is a party or which may be applicable to the Servicer or
any of its assets;
(c) This Agreement, assuming due authorization, execution and delivery
by the Trustee and the Depositor, constitutes a valid, legal and binding
obligation of the Servicer, enforceable against it in accordance with the terms
hereof subject to applicable bankruptcy, insolvency, reorganization, moratorium
and other laws affecting the enforcement of creditors' rights generally and to
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law;
(d) The Servicer is not in default with respect to any order or decree
of any court or any order, regulation or demand of any federal, state, municipal
or governmental agency, which default might have consequences that would
materially and adversely affect the condition (financial or other) or operations
of the Servicer or its properties or might have consequences that would affect
its performance hereunder; and
(e) No litigation is pending or, to the best of the Servicer's
knowledge, threatened against the Servicer which would prohibit its entering
into this Agreement or performing its obligations under this Agreement.
It is understood and agreed that the representations and warranties set
forth in this Section 3.02 shall survive the issuance and delivery of the
Certificates and shall be continuing as long as any Certificate shall be
outstanding or this Agreement has been terminated.
Section 3.03. Option to Substitute. If the Seller is required to
repurchase any Mortgage Loan pursuant to Section 2.02 or 3.01, the Seller may,
at its option, within two years from the Closing Date, remove such defective
Mortgage Loan from the terms of this Agreement and substitute another mortgage
loan for such defective Mortgage Loan, in lieu of repurchasing such defective
Mortgage Loan. Any substitute Mortgage Loan shall (a) have a Principal Balance
47
at the time of substitution not in excess of the Principal Balance of the
removed Mortgage Loan (the amount of any difference, plus one month's interest
thereon at the Mortgage Rate borne by the removed Mortgage Loan, being paid by
the Seller and deemed to be a Principal Prepayment to be deposited by the
Servicer in the Collection Account), (b) have a Mortgage Rate not less than, and
not more than one percentage point greater than, the Mortgage Rate of the
removed Mortgage Loan (provided, however, that if the Mortgage Rate on the
substitute Mortgage Loan exceeds the Mortgage Rate on the removed Mortgage Loan,
the amount of that excess interest (the "Substitute Excess Interest") shall be
payable to the Residual Interest), (c) have a remaining term to stated maturity
not later than, and not more than one year less than, the remaining term to
stated maturity of the removed Mortgage Loan, (d) be, in the reasonable
determination of the Servicer, of the same type, quality and character
(including location of the Mortgaged Property) as the removed Mortgage Loan as
if the breach had not occurred, (e) have a Loan-to-Value Ratio at origination no
greater than that of the removed Mortgage Loan and (f) be, in the reasonable
determination of the Servicer, in material compliance with the representations
and warranties contained in the Sale Agreement and described in Section 3.01, as
of the date of substitution.
The Servicer shall amend the Mortgage Loan Schedule to reflect the
withdrawal of the removed Mortgage Loan from this Agreement and the substitution
of such substitute Mortgage Loan therefor and shall send a copy of such amended
Mortgage Loan Schedule to the Trustee. The Sale Agreement provides that upon
such amendment the Seller shall be deemed to have made as to such substitute
Mortgage Loan the representations and warranties set forth in Section 3.01 as of
the date of such substitution, which shall be continuing as long as any
Certificate shall be outstanding or this Agreement has not been terminated, and
the remedies for breach of any such representation or warranty shall be as set
forth in Section 3.01. Upon such amendment, the Trustee shall review the
Mortgage File delivered to it relating to the substitute Mortgage Loan, within
the time and in the manner and with the remedies specified in Section 2.02,
except that for purposes of this Section 3.03 (other than the two-year period
specified in the first sentence of this Section), such time shall be measured
from the date of the applicable substitution. In the event of such a
substitution, accrued interest on the substitute Mortgage Loan for the month in
which the substitution occurs and any Principal Prepayments made thereon during
such month shall be the property of the Trust Fund, and accrued interest for
such month on the Mortgage Loan for which the substitution is made and any
Principal Prepayments made thereon during such month shall be the property of
the Seller. The principal payment on a substitute Mortgage Loan due on the Due
Date in the month of substitution shall be the property of the Seller, and the
principal payment on the Mortgage Loan for which the substitution is made due on
such date shall be the property of the Trust Fund.
[End of Article III]
48
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates. (a) The Class A, Class M and Class B
Certificates shall be substantially in the forms thereof included within
Exhibits C, D, E and F and shall, on original issue, be executed by the
Depositor and authenticated by the Trustee (or, if an Authenticating Agent has
been appointed pursuant to Section 4.06, the Authenticating Agent) upon receipt
by the Trustee of the documents specified in Section 2.01, delivered to or upon
the order of the Depositor.
(b) The Depository, the Depositor, the Paying Agent and the Trustee
have entered into a Depository Agreement dated as of [DATE] (the "Depository
Agreement"). Except as provided in paragraph (c) below, the Book-Entry
Certificates shall at all times remain registered in the name of the Depository
or its nominee and at all times: (i) registration of the Book-Entry Certificates
may not be transferred as provided in Section 4.02 except to a successor to the
Depository; (ii) ownership and transfers of registration of the Book-Entry
Certificates on the books of the Depository shall be governed by applicable
rules established by the Depository; (iii) the Depository may collect its usual
and customary fees, charges and expenses from its Depository Participants; (iv)
the Trustee shall deal with the Depository, Depository Participants and Indirect
Participants as representatives of the Certificate Owners of the Book-Entry
Certificates for purposes of exercising the rights of such Holders under this
Agreement, and requests and directions for and votes of such representatives
shall not be deemed to be inconsistent if they are made with respect to
different Certificate Owners; and (v) the Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository with respect
to its Depository Participants and furnished by the Depository Participants with
respect to Indirect Participants and persons shown on the books of such Indirect
Participants as direct or indirect Certificate Owners. The Depository Agreement
provides that the Depository shall maintain book-entry records with respect to
the Certificate Owners and with respect to ownership and transfers of such
Certificates.
All transfers by Certificate Owners of Book-Entry 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.
(c) If (i)(A) the Depositor advises the Depositor, the Paying Agent or
the Trustee in writing that the Depository is no longer willing or able to
properly discharge its responsibilities as Depository and (B) the Trustee, the
Paying Agent or the Depositor are unable after exercise of their reasonable best
efforts to locate a qualified successor or (ii) the Depositor at its option
advises the Trustee in writing that it elects to terminate the book-entry system
through the Depository, the Trustee or, if a Paying Agent has been appointed
under Section 4.05,
49
the Paying Agent, shall notify all Certificate Owners, through the Depository,
of the occurrence of any such event and of the availability of definitive, fully
registered Certificates (the "Definitive Certificates") to Certificate Owners
requesting the same. Upon surrender to the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, of the Book-Entry
Certificates by the Depository for registration and receipt by the Trustee or,
if a Paying Agent has been appointed under Section 4.05, the Paying Agent, of an
adequate supply of certificates from the Depositor, the Trustee or if the Paying
Agent is appointed under Section 4.05, the Paying Agent shall issue the
Definitive Certificates based on information received from the Depository.
Neither the Depositor, the Servicer, the Paying Agent nor the Trustee shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying on, such instructions.
(d) The Certificates shall be issuable in the minimum original dollar
denominations (and integral multiples of $1,000 in excess of such amount) and
aggregate original dollar denominations per Class as set forth in the following
table (except that one Certificate of each of [Class A-5, Class A-6, Class A-P
and Class M and each of the Class B] Certificates may be issued in a different
denomination).
Aggregate Original Certificate
Minimum Principal Balance of all
Original Certificates of the CUSIP
Class Denomination Indicated Class Number
----- ------------ ------------------------------ ------
A-1
X-0
X-0
X-0
X-0
X-0
X-0
A-P
A-R(1)
A-X(2) (2) (2)
M
B-1
B-2
B-3
B-4
B-5
---------------
(1) The Class A-R Certificate represents the Residual Interest.
50
(2) The Class A-X Certificates have no Principal Balance, but accrue interest
on the Class A-X Notional Balance (initially, $________________).
The Certificates shall be signed by manual or facsimile signature on
behalf of the Depositor by an officer of the Depositor. Certificates bearing the
manual or facsimile signatures of individuals who were at the time of signature
officers of the Depositor shall bind the Depositor, notwithstanding that such
individuals or any of them have ceased to be an officer prior to the
authentication and delivery of such Certificate or did not hold such offices at
the date of such Certificates. No Certificate shall be entitled to any benefit
under this Agreement, or be valid for any purpose, unless there appears on such
Certificate a manual authentication by an officer of the Depositor and such
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.
Section 4.02. Registration of Transfer and Exchange of Certificates.
(a) The Trustee or, if a Paying Agent has been appointed hereunder pursuant to
Section 4.05, the Paying Agent, shall cause to be kept a Certificate Register in
which, subject 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.
(b) Upon surrender for registration of transfer of any Certificate at
any office or agency of the Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, maintained for such purpose, the Depositor
shall execute and the Trustee or if an Authenticating Agent is appointed under
Section 4.06, the Authenticating Agent shall authenticate and deliver, in the
name of the designated transferee or transferees, a Certificate of a like Class
and aggregate Percentage Interest and dated the date of authentication by the
Authenticating Agent.
(c) No transfer of a Class A-X, Class B-3, Class B-4 or Class B-5
Certificate shall be made unless such transfer is made pursuant to an effective
registration statement or otherwise in accordance with the requirements under
the Securities Act of 1933, as amended. If such a transfer is to be made in
reliance upon an exemption from said Act, (i) the Depositor may require (except
with respect to the initial transfer of a Class B-3, Class B-4 or Class B-5
Certificate from Credit Suisse First Boston Corporation and except if the
transferee executes a certificate substantially in the form of Exhibit I hereto)
a written opinion of independent counsel acceptable to and in form and substance
satisfactory to the Depositor that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from said
Act and laws or is being made pursuant to said Act and laws, which opinion of
counsel shall not be an expense of the Trust Fund, the Trustee, the Depositor or
the Servicer, and (ii) the Depositor shall require the transferee to execute a
certification substantially in the form of Exhibit H or Exhibit I.
51
(d) No transfer of a Subordinated Certificate shall be made to any
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, nor a person acting on behalf of such plan or using the assets of such
plan. No transfer of a Subordinated Certificate shall be made unless the
Depositor shall have received either (i) a representation letter from the
transferee of such Certificate acceptable to and in form and substance
satisfactory to the Depositor, to the effect that (A) such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code, nor a person acting on behalf of any such plan or using the assets of such
plan, or, alternatively, in the case of an insurance company, the assets of any
separate accounts to effect such acquisition, or alternatively, (B) the source
of funds for the purchase of such Certificate is an "insurance company general
account" within the meaning of Prohibited Transaction Class Exemption 95-60
("PTCE 95-60"), 60 Fed. Reg. 35925 (July 12, 1995), and the conditions set forth
in Section I and III of PTCE 95-60 are satisfied with respect to the purchase
and holding of such Certificate, which representation letter shall not be an
expense of the Trustee, the Depositor or the Servicer, or (ii) in the case of a
Subordinated Certificate presented for registration in the name of an employee
benefit plan subject to ERISA or Section 4975 of the Code (or comparable
provisions of any subsequent enactments) or a trustee of any such plan or any
other Person who is using the assets of any such plan to effect such
acquisition, an Opinion of Counsel satisfactory to the Depositor to the effect
that the purchase or holding of such Subordinated Certificate will not result in
the assets of the Trust Fund being deemed to be "plan assets" pursuant to the
Department of Labor Plan Asset Regulations set forth in 29 C.F.R. ss.2510.3-101
and subject to the fiduciary responsibility provisions of ERISA or the
prohibited transaction provisions of the Code, will not constitute or result in
a prohibited transaction within the meaning of Section 406 or Section 407 of
ERISA or Section 4975 of the Code, and will not subject the Trustee, the
Depositor or the Servicer to any obligation in addition to those undertaken in
this Agreement, which opinion of counsel shall not be an expense of the Trustee,
the Depositor or the Servicer.
(e) At the option of a Certificateholder, a Certificate may be
exchanged for another Certificate or Certificates of authorized denominations of
a like Class, upon surrender of the Certificate to be exchanged at any office or
agency of the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, maintained for such purpose. Whenever the Certificate is
so surrendered for exchange, the Depositor shall execute and the Authenticating
Agent shall authenticate and deliver, the Certificate which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer or exchange shall (if so required by the
Authenticating Agent) be duly endorsed by, or be accompanied by a written
instrument of transfer in the form satisfactory to the Authenticating Agent duly
executed by, the Holder thereof or his attorney duly authorized in writing.
(f) No service charge shall be made to the Holder for any transfer or
exchange of a Certificate, but the Servicer may require payment by the
Certificateholders of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of such
Certificate.
52
(g) All Certificates surrendered for transfer or exchange shall be
destroyed by the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, in accordance with the Trustee's or, if a Paying Agent
has been appointed under Section 4.05, the Paying Agent's, standard procedures.
(h) [Reserved].
(i) A Disqualified Organization is prohibited from acquiring beneficial
ownership of a Class A-R Certificate. Notwithstanding anything to the contrary
contained herein, unless and until the Servicer shall have received an Opinion
of Counsel, satisfactory to it in form and substance, to the effect that the
absence of the conditions contained in this Section 4.02(i) would not result in
the imposition of federal tax upon the Trust Fund or cause the Trust Fund to
fail to qualify as a REMIC, no transfer, sale or other disposition of the Class
A-R Certificate (including for purposes of this section any beneficial interest
therein) may be made without the express written consent of the Servicer, which
consent is to be granted by the Servicer only upon compliance with the
requirements of this Section and a copy of which written consent shall be
supplied to the Servicer. As a condition to granting its consent to a transfer
of a Class A-R Certificate, the Servicer shall require the proposed transferee
of such Certificate (including, in the case of the initial issuance of the Class
A-R Certificate, the initial Holder thereof) to execute a letter and affidavit
substantially in the form attached hereto as Exhibit K.
As a condition to the granting of the consent referred to in this
Section 4.02(i), prior to the transfer, sale, pledge, hypothecation or other
disposition of the Class A-R Certificate or any interest therein, the Servicer
shall require that the proposed transferee deliver to it (1) its taxpayer
identification number and state, under penalties of perjury that such number is
the social security or employee identification number, as the case may be, of
the transferee or provide an affidavit under penalties of perjury stating that
as of the date of such transfer such transferee is not and has no intention of
becoming a Disqualified Organization, (2) an affidavit stating (i) that such
transferee is not acquiring such Class A-R Certificate as an agent, broker,
nominee, or middleman for a Disqualified Organization, (ii) if the Residual
Interest is a "non-economic residual interest" within the meaning of Treas. Reg.
ss.1.860E-1(c)(2), (X) that no purpose of the acquisition of the Class A-R
Certificate is to avoid or impede the assessment or collection of tax, (Y) that
such transferee has historically paid its debts as they came due and will
continue to pay its debts as they come due, and (Z) that such transferee
represents that it understands that, as the holder of the non-economic residual
interest, the transferee may incur tax liabilities in excess of any cash flows
generated by the interest and that the transferee intends to pay taxes
associated with holding the residual interest, and (iii) unless the Servicer
consents to the transfer of the Class A-R Certificate to a Person who is not a
U.S. Person and who has furnished a duly completed and effective Form 4224, that
it is a U.S. Person, and (3) the transferor deliver to the Servicer a written
certification that as of the date of such transfer it has no knowledge and no
reason to know that the affirmations described in clauses (1) and (2) were
false. The Servicer shall not grant the consent referred to in this Section
4.02(i) if it has actual knowledge that any statement made in the affidavit
issued pursuant to the preceding sentence is not true.
53
Notwithstanding any purported transfer, sale or other disposition of the Class
A-R Certificate to a Disqualified Organization, such transfer, sale or other
disposition shall be deemed to be of no legal force or effect whatsoever and
such Disqualified Organization shall not be deemed to be a Class A-R
Certificateholder for any purpose hereunder, including, but not limited to, the
receipt of distributions on such Class A-R Certificate. If any purported
transfer shall be in violation of the provisions of this Section 4.02(i) then
the prior holder of the Class A-R Certificate shall, upon discovery that the
transfer of such Class A-R Certificate was not in fact permitted by this Section
4.02(i), be restored to all rights as a Holder thereof retroactive to the date
of the purported transfer of such Class A-R Certificate. The Trustee and the
Servicer shall be under no liability to any Person for any registration or
transfer of a Class A-R Certificate that is not permitted by this Section
4.02(i) or for making payments due on such Class A-R Certificate to the
purported Holder thereof or taking any other action with respect to such
purported Holder under the provisions of this Agreement so long as the transfer
was not registered under the written certification of the Servicer as described
in this Section 4.02(i). The prior Holder shall be entitled to recover from any
purported Holder of a Class A-R Certificate that was in fact not a permitted
purported transferee under this Section 4.02(i) at the time it became a
purported Holder all payments made to such purported Holder on such Class A-R
Certificate; provided that the Servicer shall not be responsible for such
recovery. Each Class A-R Certificateholder, by the acceptance of the Class A-R
Certificate, shall be deemed for all purposes to have consented to the
provisions of this Section 4.02(i) and to any amendment to this Agreement deemed
necessary by counsel of the Trustee or the Servicer to ensure that the Class A-R
Certificate is not transferred to a Disqualified Organization and that any
transfer of such Class A-R Certificate will not cause the imposition of a tax
upon the Trust Fund or cause the Trust Fund to fail to qualify as a REMIC. The
restrictions on transfer of the Class A-R Certificate will cease to apply and be
void upon receipt by the Servicer of an Opinion of Counsel to the effect that
such restrictions on transfer are no longer necessary to avoid the risk of
material federal taxation to the Trust Fund or prevent the Trust Fund from
qualifying as a REMIC.
(j) The Servicer shall make available upon written request to each
Holder and each proposed transferee of a Class A-X, Class B-3, Class B-4 or
Class B-5 Certificate such information as may be required to permit the proposed
transfer to be effected pursuant to Rule 144A under the Securities Act of 1933.
Section 4.03. Mutilated, Destroyed, Lost or Stolen Certificates. If (a)
any mutilated Certificate is surrendered to the Trustee or, if a Paying Agent
has been appointed under Section 4.05, the Paying Agent, or the Trustee or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (b) there is delivered to the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, such security or indemnity
as may be required by it to save it harmless, then, in the absence of notice to
the Trustee or, if a Paying Agent has been appointed under Section 4.05, the
Paying Agent, that such Certificate has been acquired by a bona fide purchaser,
the Trustee or, if a Paying Agent has been appointed under Section 4.05, the
Paying Agent, shall authenticate and deliver, in exchange for or in lieu of any
such mutilated,
54
destroyed, lost or stolen Certificate, a new Certificate of like tenor and
Class. Upon the issuance of any new Certificate under this Section, the Trustee
or, if a Paying Agent has been appointed under Section 4.05, the Paying Agent,
may require of the Certificateholder 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 connected therewith. Any replacement Certificate of any Class
issued pursuant to this Section shall constitute complete and indefeasible
evidence of ownership of the Percentage Interest in the distributions to which
the Certificateholders of such Class are entitled, as if originally issued,
whether or not the mutilated, destroyed, lost or stolen Certificate shall be
found at any time, and such mutilated, destroyed, lost or stolen Certificate
shall be of no force or effect under this Agreement, to the extent permitted by
law.
Section 4.04. Persons Deemed Owners. Prior to due presentation of a
Certificate of any Class for registration of transfer, the Depositor, the
Servicer, the Paying Agent and the Trustee may treat the person in whose name
any Certificate is registered on the Record Date as the owner of such
Certificate and the Percentage Interest in the distributions to which the
Certificateholders of such Class are entitled on the relevant date as the Holder
of such Certificate and the Percentage Interest represented by such Certificate
for the purpose of receiving remittances pursuant to Section 6.01 and for all
other purposes whatsoever, and neither the Depositor, the Servicer nor the
Trustee shall be affected by notice to the contrary.
Section 4.05. Appointment of Paying Agent; Certificate Account. The
Trustee may appoint a Paying Agent hereunder, which Paying Agent shall not be
Depositor, the Seller, or an affiliate of the Depositor or the Seller unless
such Paying Agent is the Corporate Trust Department of Chase. In the event of
any such appointment, on the Business Day prior to each Distribution Date, the
Servicer shall deposit or cause to be deposited with the Paying Agent from funds
on deposit in the Collection Account a sum up to the Available Distribution
Amount, such sum to be held in trust for the benefit of Certificateholders in a
segregated account (the "Certificate Account") which shall be an Eligible
Account in the name of "[TRUSTEE], as Trustee, in trust for and for the benefit
of the Certificateholders of Multi-Class Mortgage Pass- Through Certificates,
Chase Manhattan Acceptance Corporation, Series [ ] - Certificate Account". The
Servicer shall cause the Paying Agent to perform each of the obligations of the
Paying Agent set forth herein and shall be liable to the Trustee and the
Certificateholders for failure of the Paying Agent to perform such obligations.
If the Paying Agent is a party other than the Trustee, the Trustee shall have no
liability in connection with the performance or failure of performance of the
Paying Agent. The Trustee designates the Corporate Trust Department of Chase as
the initial Paying Agent. Only the Trustee may remove the Paying Agent, and may
do so at will.
If, on any Distribution Date, the Paying Agent fails to distribute to
Certificateholders the amounts then on deposit in the Certificate Account for
the purposes specified herein, the Trustee shall be obligated promptly upon its
knowledge thereof to distribute such amounts to Certificateholders in the manner
and in such amounts based upon information provided by the Servicer; provided
that in no event shall the Trustee be obligated for purposes of
55
this paragraph to distribute to Certificateholders any amounts other than those
on deposit in the Certificate Account or expend any funds not reimbursable
pursuant to Section 10.05 hereof, except as otherwise provided herein.
Notwithstanding anything in this Agreement to the contrary, the Trustee shall be
liable to the Servicer and the Certificateholders only for its negligence in
connection with the withdrawal of funds from the Certificate Account by the
Trustee and the distribution of such funds by the Trustee to Certificateholders
pursuant to this paragraph.
The Servicer shall cause each Paying Agent other than the Trustee to
execute and deliver to the Servicer and the Trustee on the Closing Date or, if
subsequently appointed, on the date of appointment, a written instrument
executed by an officer of the Paying Agent in which such Paying Agent shall
agree with the Servicer and the Trustee that such Paying Agent will hold all
sums held by it for the payment to Certificateholders in trust for the benefit
of the Certificateholders entitled thereto until such sums shall be paid to such
Certificateholders.
Section 4.06. Authenticating Agents. (a) The Trustee may appoint one or
more Authenticating Agents (each, an "Authenticating Agent") which shall be
authorized to act on behalf of the Trustee in authenticating the Certificates.
Wherever reference is made in this Agreement to the authentication of
Certificates by the Trustee or the Trustee's certificate of authentication, such
reference shall be deemed to include authentication on behalf of the Trustee by
an Authenticating Agent and a certificate of authentication executed on behalf
of the Trustee by an Authenticating Agent. Each Authenticating Agent must be an
entity organized and doing business under the laws of the United States of
America or of any state, having a combined capital and surplus of at least
$15,000,000, authorized under such laws to do a trust business and subject to
supervision or examination by federal or state authorities. If the
Authenticating Agent is a party other than the Trustee, the Trustee shall have
no liability in connection with the performance or failure of performance of the
Authenticating Agent. [The Trustee hereby appoints Chase as the initial
Authenticating Agent.]
(b) Any Person into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which any Authenticating Agent shall be a
party, or any Person succeeding to the corporate agency business of any
Authenticating Agent, shall continue to be the Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at least
30 days' advance written notice of resignation to the Trustee and the Depositor.
The Trustee may at any time terminate the agency of any Authenticating Agent by
giving written notice of termination to such Authenticating Agent and the
Depositor. Upon receiving a notice of resignation or upon such a termination, or
in case at any time any Authenticating Agent shall cease to be eligible in
accordance within the provisions of this Section 4.06, the Trustee may appoint a
successor Authenticating Agent, shall give written notice of such appointment to
the Depositor and shall
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mail notice of such appointment to all Holders of Certificates. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers, duties and responsibilities of its
predecessor hereunder, with like effect as if originally named as Authenticating
Agent. No successor Authenticating Agent shall be appointed unless eligible
under the provisions of this Section 4.06. No Authenticating Agent shall have
responsibility or liability for any action taken by it as such at the direction
of the Trustee. Any Authenticating Agent shall be entitled to reasonable
compensation for its services and any such compensation shall be payable solely
by the Trustee, without any right of reimbursement from the Depositor, the
Servicer or the Trust Fund.
[End of Article IV]
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ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01. Servicer to Service Mortgage Loans. The Servicer shall
service and administer the Mortgage Loans and shall have full power and
authority, acting alone or through Sub-Servicers as provided in Section 5.02, to
do any and all things which it may deem necessary or desirable in connection
with such servicing and administration, all in accordance with Accepted
Servicing Practices. Without limiting the generality of the foregoing, the
Servicer in its own name or in the name of a Sub-Servicer shall, pursuant to a
power of attorney granted hereby by the Trustee for such purposes, when the
Servicer or the Sub-Servicer, as the case may be, believes it appropriate in its
best judgment, to execute and deliver, on behalf of the Certificateholders and
the Trustee 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; provided, however, that subject to the provisions of
this paragraph, the Servicer may allow a modification with respect to a Mortgage
Loan if the Servicer would take such action in the ordinary course of its
business if it were the owner of the Mortgage Loan. The Servicer may agree to a
modification of any Mortgage Loan (the "Relevant Mortgage Loan") upon the
request of the related Mortgagor, provided that (i) the modification is in lieu
of a refinancing and the Mortgage Rate on the Relevant Mortgage Loan, as
modified, is approximately a prevailing market rate of newly- originated
mortgage loans having similar terms, (ii) the aggregate of the adjusted bases of
all Modified Mortgage Loans (including the Relevant Mortgage Loans) plus the
aggregate adjusted bases of any assets that are not qualified mortgages or
permitted investments under Section 860G(a) of the Code that are assets of the
Trust Fund established hereunder at all times on any day is less than one
percent of the aggregate of the adjusted bases of all assets of the Trust Fund
(including such Modified Mortgage Loans) on such day, and (iii) the Servicer
purchases the Relevant Mortgage Loan from the Trust Fund as described below.
Effective immediately after such modification, and, in any event, on the same
Business Day on which the modification occurs, all right, title and interest of
the Trustee in and to the Modified Mortgage Loan shall automatically be deemed
transferred and assigned to the Servicer and all benefits and burdens of
ownership thereof, including without limitation the right to accrued interest
thereon from and including the date of modification and the risk of default
thereon, shall pass to the Servicer. To confirm such transfer and assignment,
the Servicer, as servicer hereunder, as soon as practicable shall execute an
instrument of assignment of the Modified Mortgage Loan without recourse in
customary form to the Servicer in its individual capacity. The Servicer shall
deposit the Purchase Price for any Modified Mortgage Loan in the Collection
Account pursuant to Section 5.08. Upon receipt by the Trustee of written
notification of any such deposit signed by a Servicing Officer, the Trustee
shall release to the Servicer the related Mortgage File and shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, as shall be necessary more fully to vest in the Servicer any Modified
Mortgage Loan previously transferred and assigned pursuant thereto.
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The Servicer shall furnish to the Trustee for execution and redelivery
to the Servicer or, at the request of the Servicer, a Sub-Servicer, such
documents necessary or appropriate to enable the Servicer to service and
administer the Mortgage Loans and the Trustee shall not be responsible for the
Servicer's application thereof. The Servicer agrees to remain eligible as either
a FNMA or FHLMC seller/servicer, or both, for so long as it is Servicer.
All Servicing Advances made by the Servicer in effecting the timely
payment of taxes, insurance and assessments on the properties subject to the
Mortgage Loans shall not, for the purpose of calculating monthly distributions
to Certificateholders, be added to the amount owing under the related Mortgage
Loans, notwithstanding that the terms of such Mortgage Loan so permit, and such
Servicing Advances shall be recoverable by the Servicer to the extent permitted
by Sections 5.09 and 5.23.
Section 5.02. Sub-Servicing Agreements Between Servicer and
Sub-Servicers; Enforcement of Sub-Servicer's Obligations. (a) The Servicer may
enter into Sub-Servicing Agreements with Sub-Servicers for the servicing and
administration of all or part of the Mortgage Loans. References in this
Agreement to actions taken or to be taken by the Servicer in servicing the
Mortgage Loans include actions taken or to be taken by a Sub-Servicer on behalf
of the Servicer. Each Sub-Servicing Agreement will be upon such terms and
conditions as are not inconsistent with this Agreement and as the Servicer and
the Sub-Servicer have agreed. The Servicer shall notify the Trustee in writing
promptly upon the appointment of any Sub-Servicer. For purposes of this
Agreement, the receipt by the Sub-Servicer of any amount with respect to a
Mortgage Loan (other than amounts representing servicing compensation or
reimbursement for an advance) shall be treated as the receipt by the Servicer of
such amount. The Sub-Servicer shall deposit all such funds in an Eligible
Account.
(b) As part of its servicing activities hereunder, the Servicer, for
the benefit of the Trustee and the Certificateholders, shall enforce the
obligations of each Sub-Servicer under the related Sub-Servicing Agreement. Such
enforcement, including, without limitation, the legal prosecution of claims,
termination of Sub-Servicing Agreements as appropriate, and the pursuit of other
remedies, shall be in such form and carried out to such an extent and at such
time as the Servicer, in its good faith business judgment, would require were it
the owner of the related Mortgage Loans. The Servicer shall pay the costs of
such enforcement at its own expense but shall be reimbursed therefor only (i)
from a general recovery resulting from such enforcement only to the extent, if
any, that such recovery exceeds all amounts due in respect of the related
Mortgage Loans or (ii) from a specific recovery of costs, expenses or attorneys'
fees against the party against whom such enforcement is directed.
Section 5.03. Successor Sub-Servicers. The Servicer shall be entitled
to terminate any Sub-Servicing Agreement that may exist in accordance with the
terms and conditions of such Sub-Servicing Agreement and without any limitation
by virtue of this Agreement.
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Section 5.04. Liability of the Servicer. Notwithstanding any
Sub-Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Servicer and a Sub-Servicer or reference
to actions taken through a Sub-Servicer or otherwise, the Servicer shall remain
obligated and liable to the Trustee and Certificateholders for the servicing and
administering of the Mortgage Loans in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of such
Sub-Servicing Agreements or arrangements or by virtue of indemnification from
the Sub-Servicer and to the same extent and under the same terms and conditions
as if the Servicer alone were servicing and administering the Mortgage Loans.
The Servicer shall be entitled to enter into any agreement with a Sub-Servicer
for indemnification of the Servicer and nothing contained in this Agreement
shall be deemed to limit or modify such indemnification.
Section 5.05. No Contractual Relationship Between Sub-Servicer and
Trustee or Certificateholders. Any Sub-Servicing Agreement that may be entered
into and any other transactions or services relating to the Mortgage Loans
involving a Sub-Servicer in its capacity as such and not as an originator shall
be deemed to be between the Sub-Servicer and the Servicer alone, and the Trustee
and Certificateholders shall not be deemed parties thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to the
Sub-Servicer.
Section 5.06. Termination of Sub-Servicing Agreement. If the Servicer
shall for any reason no longer be the Servicer hereunder (including by reason of
any Event of Default), the Servicer shall thereupon terminate each Sub-Servicing
Agreement that may have been entered into, and the Trustee, its designee or the
successor servicer and the Trustee shall not be deemed to have assumed any of
the Servicer's interest therein or to have replaced the Servicer as a party to
any such Sub-Servicing Agreement.
Section 5.07. Collection of Mortgage Loan Payments. Continuously from
the date hereof until the principal and interest on all Mortgage Loans are paid
in full, the Servicer will proceed diligently to collect all payments due under
each of the Mortgage Loans when the same shall become due and payable and shall,
to the extent such procedures shall be consistent with this Agreement, follow
such collection procedures as it follows with respect to conventional mortgage
loans held in its own portfolio. Any such arrangements shall not diminish or
otherwise affect the Servicer's obligation to make Advances pursuant to Section
6.03.
Section 5.08. Establishment of Collection Account; Deposit in
Collection Account. With respect to all of the Mortgage Loans, the Servicer
shall segregate and hold all funds collected and received pursuant to a Mortgage
Loan separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Collection Accounts for the benefit of the
Certificateholders (collectively, the "Collection Account") which are Eligible
Accounts, in the form of a trust account, in the name of "[TRUSTEE], as Trustee,
in trust for and for the benefit of the Certificateholders of Multi-Class
Mortgage Pass-Through Certificates, Chase Manhattan Acceptance Corporation,
Series [ ] - Collection Account." Such Collection Account shall be established
with a commercial bank, a savings bank or a savings and loan
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association. The Servicer may invest, or cause the institution maintaining the
Collection Account to invest, moneys in the Collection Account in Eligible
Investments, which shall mature not later than the Business Day next preceding
the Distribution Date next following the date of such investment and shall not
be sold or disposed of prior to its maturity. All income and gain realized from
any such investment shall be for the benefit of the Servicer as additional
compensation and shall be subject to its withdrawal or order from time to time.
The amount of any losses incurred in respect of any such investments (to the
extent not offset by income from other such investments) shall be deposited in
the Collection Account by the Servicer out of its own funds immediately as
realized; provided, however, that if the Trustee becomes Servicer, the Trustee
shall not be required to deposit the amount of any loss incurred prior to it
becoming Servicer.
The Servicer shall deposit or cause to be deposited in the Collection
Account on a daily basis (and not later than the second Business Day following
receipt), and retain therein:
(i) All payments which were received after the Cut-off Date on
account of principal of the Mortgage Loans (other than the principal
portion of Monthly Payments due on or before the Cut-off Date), and
all Principal Prepayments collected on or after the Cut-off Date;
(ii) All payments which were received after the Cut-off Date on
account of interest on the Mortgage Loans (net of the Servicing
Fee)(other than the interest portion of Monthly Payments due on or
before the Cut-off Date);
(iii) Net Liquidation Proceeds;
(iv) All Insurance Proceeds received by the Servicer under any
title, hazard or other insurance policy, including amounts required to
be deposited pursuant to Sections 5.16 and 5.20, other than proceeds
to be held in the Escrow Account or applied to the restoration or
repair of the Mortgaged Property or released to the Mortgagor in
accordance with the Servicer's normal servicing procedures or
otherwise applied or held as required by applicable law;
(v) All awards or settlements in respect of condemnation
proceedings affecting any Mortgaged Property which are not released to
the Mortgagor in accordance with the Servicer's normal servicing
procedures;
(vi) All Repurchase Proceeds;
(vii) All Advances made by the Servicer pursuant to Section 6.03;
(viii) All amounts representing revenues under the insurance
provided pursuant to Section 5.19 to the extent of any losses borne by
any Certificateholder;
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(ix) All revenues from any Mortgaged Property acquired by the
Servicer by foreclosure or deed in lieu of foreclosure net of any
Servicing Advances with respect to such Mortgaged Property; and
(x) Any other amounts required to be deposited therein pursuant
to this Agreement.
The Servicer shall maintain accounting records on a loan-by-loan basis
with respect to the Collection Account. The Servicer shall give notice to the
Trustee and the Depositor and each Rating Agency of any change in the location
of the Collection Account, prior to the use thereof. Notwithstanding anything to
the contrary herein, no Monthly Payment or any portion thereof shall be
permitted to remain in the Collection Account for more than 12 months. Any
Monthly Payment or any portion thereof that has remained in the Collection
Account for 12 months shall be deemed a Principal Prepayment and distributed to
Certificateholders pursuant to the provisions of this Agreement on the
Distribution Date immediately following the end of such 12 month period.
Section 5.09. Permitted Withdrawals from the Collection Account. The
Servicer may, from time to time, withdraw funds from the Collection Account for
the following purposes:
(i) to reimburse itself for Advances made pursuant to Section
6.03 (including amounts to reimburse the related Sub-Servicer for
advances made pursuant to the applicable Sub-Servicing Agreement), the
Servicer's and the Sub-Servicer's right to receive reimbursement
pursuant to this subclause (i) being limited to amounts received on
particular Mortgage Loans which represent Late Collections (net of the
Servicing Fees) with respect to those particular Mortgage Loans;
(ii) to pay itself the Servicing Fee;
(iii) to reimburse itself for unreimbursed Servicing Advances, or
to pay the related Sub-Servicer any unreimbursed Servicing Advances,
the Servicer's right to receive reimbursement or make payments to the
Sub-Servicer pursuant to this subclause (iii) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds, Insurance
Proceeds, and condemnation awards;
(iv) to reimburse itself (or the related Sub-Servicer) or the
Depositor for expenses incurred by and recoverable by or reimbursable
to it pursuant to Section 5.01 or 5.16;
(v) to reimburse itself (or the related Sub-Servicer) for any
Nonrecoverable Advances;
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(vi) to pay to itself (or the related Sub-Servicer) income earned
on the investment of funds deposited in the Collection Account;
(vii) to make deposits into the Certificate Account in the
amounts and in the manner provided for herein;
(viii) to make payments to itself or others pursuant to any
provision of this Agreement, and to clear and terminate the Collection
Account upon the termination of this Agreement; and
(ix) to withdraw amounts deposited in error.
Section 5.10. Establishment of Escrow Account; Deposits in Escrow
Account. With respect to those Mortgage Loans on which the Servicer or any
Sub-Servicer collects Escrow Payments, if any, the Servicer shall, and shall
cause the Sub-Servicer to, segregate and hold all funds collected and received
pursuant to each such Mortgage Loan which constitute Escrow Payments separate
and apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts, in the form of trust accounts. Such Escrow
Accounts shall be established with a commercial bank, a mutual savings bank or a
savings and loan association the deposits of which are insured by the FDIC in a
manner which shall provide maximum available insurance thereunder, and which may
be drawn on by the Servicer. The Servicer shall give notice to the Trustee of
the location of any Escrow Account, and of any change thereof, prior to the use
thereof. Nothing in this paragraph shall be deemed to require the Servicer to
collect Escrow Payments in the absence of a provision in the related Mortgage
requiring such collection.
The Servicer shall deposit, or cause to be deposited, in any Escrow
Account or Accounts on a daily basis, and retain therein, (i) all Escrow
Payments collected on account of any Mortgage Loans, for the purpose of
effecting timely payment of any such items as required under the terms of this
Agreement and (ii) all amounts representing proceeds of any hazard insurance
policy which are to be applied to the restoration or repair of any Mortgaged
Property. The Servicer shall make withdrawals therefrom only to effect such
payments as are required under this Agreement, and for such other purposes as
are set forth in Section 5.11. The Servicer shall be entitled to retain any
interest paid on funds deposited in the Escrow Account by the depository
institution other than interest on escrowed funds required by law to be paid to
the related Mortgagor and, to the extent required by law, the Servicer shall pay
interest on escrowed funds to the related Mortgagor notwithstanding that the
Escrow Account is non-interest-bearing or that interest paid thereon is
insufficient for such purposes.
Section 5.11. Permitted Withdrawals from Escrow Account. Withdrawals
from any Escrow Account or Accounts may be made by the Servicer only (i) to
effect timely payments of ground rents, taxes, assessments, water rates,
Standard Hazard Policy premiums, or other items constituting Escrow Payments for
the related Mortgage, (ii) to reimburse the Servicer for
63
any Servicing Advance made by the Servicer, with respect to a related Mortgage
Loan but only from amounts received on the related Mortgage Loan which represent
late payments or collections of Escrow Payments thereunder, (iii) to refund to
any Mortgagor any funds found to be in excess of the amounts required under the
terms of the related Mortgage Loan or under applicable law, (iv) for application
to restoration or repair of the property subject to the related Mortgage, (v) to
pay to the Servicer, or to the Mortgagor to the extent required by law, any
interest paid on the funds deposited in the Escrow Account, (vi) to clear and
terminate the Escrow Account on the termination of this Agreement or (vii) to
withdraw amounts deposited in error.
Section 5.12. Payment of Taxes, Insurance and Other Charges. With
respect to each Mortgage Loan, the Servicer shall maintain, or cause to be
maintained, accurate records reflecting any delinquencies or nonpayments with
regard to taxes, assessments and Standard Hazard Policy premiums. The Servicer
assumes full responsibility for ensuring the payment of all such bills and shall
effect payments of all such bills irrespective of each Mortgagor's faithful
performance in the payment of same or the making of the Escrow Payments and
shall make advances from its own funds to effect such payments.
Section 5.13. Transfer of Accounts. The Servicer may transfer the
Collection Account or Escrow Account to an Eligible Account maintained with a
different depository institution from time to time.
Section 5.14. [Reserved].
Section 5.15. Maintenance of the Primary Insurance Policies. The
Servicer shall not take, or permit any Sub-Servicer to take, any action which
would result in non-coverage under any applicable Primary Insurance Policy of
any loss which, but for the actions of the Servicer or Sub-Servicer, would have
been covered thereunder. Except as otherwise required by applicable law, to the
extent coverage is available and until the Loan-to-Value Ratio of the related
Mortgage Loan is reduced to 80%, the Servicer shall keep or cause to be kept in
full force and effect each such Primary Insurance Policy in an amount equal to
the amount by which the unpaid principal balance of the related Mortgage Loan
exceeds 75% of the value (as described in the definition of Loan-to-Value Ratio)
of the related Mortgaged Property. The Servicer shall not cancel or refuse to
renew any such Primary Insurance Policy or consent to any Sub-Servicer canceling
or refusing to renew any such Primary Insurance Policy applicable to a Mortgage
Loan subserviced by it, that is in effect at the date of the initial issuance of
the Certificates and is required to be kept in force hereunder unless the
replacement Primary Insurance Policy for such canceled or non-renewed policy is
maintained with an insurer whose claims-paying ability is rated at least as high
as the original insurer or is acceptable to each Rating Agency as confirmed in
writing by each such Rating Agency, unless otherwise required by law.
Section 5.16. Maintenance of Standard Hazard Policies. (a) The Servicer
shall cause to be maintained for each Mortgage Loan a Standard Hazard Policy
with extended
64
coverage as is prudent in the area where the Mortgaged Property is located in an
amount which is equal to the greater of (i) the lesser of (A) 100% of the
maximum insurable value of the improvements securing such Mortgage Loan or (B)
the principal balance owing on such Mortgage Loan, or (ii) such amount required
to prevent the Mortgagor or mortgagee from becoming a co-insurer. If the
Mortgaged Property is in an area identified at the time of origination in the
Federal Register by the Federal Emergency Management Agency as having special
flood hazards (and such flood insurance has been made available) the Servicer
will cause to be maintained a flood insurance policy meeting the requirements of
the current guidelines of the Federal Insurance Administration with a generally
acceptable insurance carrier, in an amount representing coverage not less than
the least of (i) the outstanding Principal Balance of the Mortgage Loan, (ii)
the full insurable value or (iii) the maximum amount of insurance which is
available under the Flood Disaster Protection Act of 1973. The Servicer shall
also maintain on property acquired upon foreclosure, or by deed in lieu of
foreclosure, of any Mortgage Loan, fire and hazard insurance with extended
coverage in an amount which is not less than the lesser of (i) the outstanding
principal balance of the Mortgage Loan or (ii) the maximum insurable value of
the improvements which are a part of such property, liability insurance, and, to
the extent available, flood insurance in an amount as provided above. Any
amounts collected by the Servicer under any such policies (other than amounts to
be applied to the restoration or repair of the property subject to the related
Mortgage or property acquired in liquidation of the Mortgage Loan, or released
to the Mortgagor in accordance with the Servicer's normal servicing procedures)
shall be deposited, subject to applicable law, in the Collection Account. It is
understood and agreed that no earthquake or other additional insurance need be
required by the Servicer of any Mortgagor or maintained on property acquired in
respect of a Mortgage Loan, other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. All such Standard Hazard Policies and other policies shall
be endorsed with standard mortgagee clauses with loss payable to the Servicer or
its designee. Any such Standard Hazard Policies or other policies may be in the
form of blanket policies; provided, however, that in the event of any claim
arising in connection with a hazard loss the Servicer shall be obligated, in the
case of blanket insurance policies, to deposit in the Collection Account any
amount not payable under such blanket policy because of a deductible clause in
such policy and not otherwise payable under an individual policy. The Servicer
shall not interfere with the Mortgagor's freedom of choice in selecting either
his insurance carrier or agent; provided, however, that the Servicer shall not
accept any such insurance policies from insurance companies unless such
companies are acceptable insurers in the discretion of the Servicer.
(b) Any cost incurred by the Servicer in maintaining any of the
foregoing insurance shall not, for the purpose of calculating monthly
distributions to Certificateholders, be added to the amount owing under the
Mortgage Loan, notwithstanding that the terms of the Mortgage Loan so permit.
Such costs (other than the costs of maintaining a blanket hazard insurance
policy not attributable to a specific Mortgaged Property) shall be recoverable
by the Servicer from the Mortgagor or out of Insurance Proceeds or Liquidation
Proceeds or to the extent permitted by Section 5.09.
65
Section 5.17. [Reserved].
Section 5.18. [Reserved]
Section 5.19. Fidelity Bond and Errors and Omissions Insurance. The
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 on behalf of the
Servicer in any capacity with regard to the Mortgage Loans to handle funds,
money, documents and papers relating to the Mortgage Loans. Any such fidelity
bond and errors and omissions insurance shall protect and insure the Servicer
against losses, including forgery, theft, embezzlement, fraud, errors and
omissions and negligent acts of such persons and shall be maintained at a level
acceptable to FNMA. No provision of this Section 5.19 requiring such fidelity
bond and errors and omissions insurance shall diminish or relieve the Servicer
from its duties and obligations as set forth in this Agreement. Upon request of
the Trustee, the Servicer shall cause to be delivered to the Trustee a
certification evidencing coverage under such fidelity bond and insurance policy.
Promptly upon receipt of any notice from the surety or the insurer that such
fidelity bond or insurance policy has been terminated or modified in a
materially adverse manner, the Servicer shall notify the Trustee and each Rating
Agency of any such termination or modification.
Section 5.20. Collections under Insurance Policies; Enforcement of
Due-On-Sale Clauses; Assumption Agreements. (a) In connection with its
activities as administrator and servicer of the Mortgage Loans, the Servicer
agrees to present, on behalf of itself, the Trustee and the Certificateholders,
claims to the insurer under any Standard Hazard Policies and, in this regard, to
take such reasonable action as shall be necessary to permit recovery under any
insurance policies. Pursuant to Section 5.08, the Servicer shall deposit
Insurance Proceeds in the Collection Account.
(b) When any Mortgaged Property is conveyed by the Mortgagor, the
Servicer shall enforce any due-on-sale clause contained in any Mortgage Note or
Mortgage, to the extent permitted by such Mortgage Note or Mortgage, applicable
law and governmental regulations. Subject to the foregoing, the Servicer is
authorized to take or enter into an assumption or substitution agreement from or
with the Person to whom such property has been or is about to be conveyed. In
connection with such assumption or substitution, the Servicer shall apply such
underwriting standards and follow such practices and procedures as shall be
normal and usual and as it applies to mortgage loans owned solely by it.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any conveyance by the
Mortgagor of the Mortgaged Property or any assumption of a Mortgage Loan by
operation of law which the Servicer in good faith determines it may be
restricted by law from preventing, for any reason whatsoever.
66
(c) Subject to the Servicer's duty to enforce any due-on-sale clause to
the effect set forth in Section 5.20(b), in any case in which a Mortgaged
Property is to be 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, the Servicer shall so notify the Trustee by
forwarding to the Trustee the original copy of such assumption or substitution
agreement, which copy shall be added by the Trustee 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.
In connection with any such assumption, modification agreement or substitution
agreement, the interest rate of the related Mortgage Note shall not be changed,
the principal amount of the Mortgage Note shall not be increased or decreased
and the maturity of the Mortgage Note shall not be extended, nor shall it be
shortened by more than one year. Any fee collected by the Servicer for entering
into an assumption or substitution of liability agreement with respect to such
Mortgage Loan shall be retained by the Servicer as additional servicing
compensation.
Section 5.21. Income and Realization from Defaulted Mortgage Loans. The
Servicer, on behalf of the Trustee, shall foreclose upon or otherwise comparably
convert the ownership of Mortgaged 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 pursuant to
Section 5.07, shall manage, conserve, protect and operate such Mortgaged
Properties for the purposes of their prompt disposition and sale, and shall
dispose of such Mortgaged Properties on such terms and conditions as it deems in
the best interests of the Certificateholders. The Servicer shall sell such
property prior to the close of the third calendar year beginning after the year
in which such foreclosure or conversion occurs or such longer period as would
not prevent such Mortgaged Property from constituting "foreclosure property"
within the meaning of Section 860G(a)(8) of the Code. In connection with such
activities, the Servicer shall follow such practices and procedures as it shall
deem necessary or advisable, as shall be normal and usual in its general
mortgage servicing activities, including its management of foreclosed properties
for a temporary period as contemplated herein. The foregoing is subject to the
provisions of Section 5.28 of this Agreement and to the proviso that the
Servicer shall not be required to expend its own funds in connection with any
management, foreclosure or towards the restoration of any property unless it
shall determine that such management, restoration or foreclosure will increase
the Liquidation Proceeds of the Mortgage Loan to Certificateholders after
reimbursement to itself for such expenses (respecting which it shall have
priority for purposes of withdrawals from the Collection Account pursuant to
Section 5.09). The Servicer shall be permitted to earn income with respect to
any Mortgaged Properties, provided such income does not constitute "net income
from foreclosure property" within the meaning of Section 860G(c) of the Code.
The income earned from the management of such Mortgaged Properties, net of
reimbursement to the Servicer for expenses (including any taxes) incurred in
connection with such management, shall be applied to the payment of principal of
and interest on the related defaulted Mortgage Loans (with interest accruing and
principal amortizing as though such Mortgage Loans were still current) and all
such income shall be deemed, for all purposes in this Agreement, to be payments
on account of principal and interest on the related Mortgage
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Notes and shall be deposited into the Collection Account. To the extent the
income received is in excess of the amount attributable to amortizing principal
and accrued interest at the Net Mortgage Rate on the related Mortgage Loan, such
excess shall be deposited in the Collection Account.
The Servicer shall take into account the existence of any hazardous
substances, hazardous wastes or solid wastes, as such terms are defined in the
Comprehensive Environmental Response Compensation and Liability Act, the
Resources Conservation and Recovery Act of 1976, or other federal, state or
local environmental legislation, on a Mortgaged Property in determining whether
to foreclose upon or otherwise comparably convert the ownership of such
property. To the extent that the Servicer has actual knowledge of any such
substance or waste, it shall consult with the Trustee regarding the appropriate
course of action. The Servicer shall not institute foreclosure actions with
respect to a property containing substance or waste as described above if it
reasonably believes that such action would not be consistent with its servicing
standards, and in no event shall the Servicer manage, operate or take any other
action with respect thereto which the Servicer in good faith believes will
result in "clean-up" or other liability under applicable law. The net income
from the rental or sale of a REO Property shall be deposited in the Collection
Account within two (2) Business Days after receipt thereof by the Servicer.
The Servicer may enter into a special servicing agreement with an
unaffiliated holder of 100% Percentage Interest of a Class B Certificate or a
holder of a class of securities representing interests in such Class B
Certificate and/or other subordinate mortgage pass-through certificates, such
agreement to be (i) substantially in the form of Exhibit J hereto or (ii)
subject to each Rating Agency's acknowledgment that the ratings of the
Certificates in effect immediately prior to the entering into of such agreement
would not be qualified, downgraded or withdrawn and the Certificates xxxx not be
placed on credit review status (except for possible upgrading) as a result of
such agreement. Any such agreement may contain provisions whereby such holder
may instruct the Servicer to commence or delay foreclosure proceedings with
respect to delinquent Mortgage Loans and will contain provisions for the deposit
of cash by the holder that would be available for distribution to
Certificateholders if Liquidation Proceeds are less than they otherwise may have
been had the Servicer acted in accordance with its normal procedures.
Section 5.22. Trustee to Cooperate; Release of Mortgage Files. (a) Upon
becoming aware of the payment in full of any Mortgage Loan, or upon the receipt
by the Servicer of a notification that payment in full will be made in a manner
customary for such purposes, the Servicer shall immediately notify the Trustee
(if the Trustee holds the related Mortgage File) by a certification (which
certification shall include a statement to the effect that all amounts received
or to be received in connection with such payment which are required to be
deposited in the Collection Account pursuant to Section 5.08 have been or will
be so deposited) of a Servicing Officer and shall request delivery to it of the
Mortgage File. Upon receipt of such certification and request, within five
Business Days the Trustee shall release the related Mortgage File to the
Servicer and execute and deliver to the Servicer the request for reconveyance,
deed of
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reconveyance or release or satisfaction of mortgage or such other instruments
releasing the lien of the Mortgage as have been provided by the Servicer to the
Trustee, together with the Mortgage Note with written evidence of cancellation
thereon, and the Trustee shall have no further responsibility with respect to
said Mortgage File. Upon any such payment in full, or the receipt of such
notification, the Servicer is authorized to procure from the Trustee under the
deed of trust which secured the Mortgage Note, if any, a deed of full
reconveyance covering the property encumbered by such deed of trust, which
assignment of deed of trust, except as otherwise provided by any applicable law,
shall be recorded by the Servicer in the appropriate land records in the
jurisdiction in which the assignment of deed of trust is recorded, or, as the
case may be, to procure from the Trustee an instrument of satisfaction or, if
the Mortgagor so requests, an assignment without recourse, which deed of
reconveyance, instrument of satisfaction or assignment shall be delivered by the
Servicer to the Person or Persons entitled thereto. No expenses incurred in
connection with any instrument of satisfaction or deed of reconveyance shall be
chargeable to the Collection Account or to the Trustee.
(b) From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, the Servicer shall deliver to the Trustee a
certificate of a Servicing Officer requesting that possession of the Mortgage
File be released to the Servicer and certifying as to the reason for such
release and that such release will not invalidate any insurance coverage
provided in respect of the Mortgage Loan under any of the insurance policies
required by this Agreement. With such certificate, the Servicer shall require
that the Trustee release the Mortgage File, and, within five Business Days, the
Trustee shall deliver the Mortgage File or any document therein to the Servicer.
The Servicer shall cause each Mortgage File so released to be returned to the
Trustee when the need therefor by the Servicer no longer exists, unless (i) the
Mortgage Loan has been liquidated and the Net Liquidation Proceeds relating to
the Mortgage Loan have been deposited in the Collection Account or (ii) the
Mortgage File 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 either
judicially or non-judicially, and the Servicer has delivered to the Trustee a
certificate of a Servicing Officer in the form of Exhibit L hereto certifying as
to the name and address of the Person to which such Mortgage File was delivered
and the purpose or purposes of such delivery.
(c) Upon written request of the Servicer, the Trustee shall execute and
deliver to the Servicer any court pleadings, requests for trustee's sale or
other documents prepared by and delivered by the Servicer to the Trustee
necessary to the foreclosure or trustee's sale in respect of a Mortgaged
Property or to any legal action brought to obtain judgment against any Mortgagor
on the Mortgage Note or Mortgage or to obtain a deficiency judgment, or to
enforce any other remedies or rights provided by the Mortgage Note or Mortgage
or otherwise available at law or in equity. Together with such documents or
pleadings, the Servicer shall deliver to the Trustee a certificate of a
Servicing Officer requesting that such pleadings or documents be executed by the
Trustee and certifying as to the reason such documents or pleadings are required
and that the execution and delivery thereof by the Trustee will not invalidate
any insurance coverage under
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the insurance policies required under this Agreement or invalidate or otherwise
affect the lien of the Mortgage, except for the termination of such a lien upon
completion of the foreclosure or trustee's sale.
Section 5.23. Servicing and Other Compensation. The Servicer, as
compensation for its activities hereunder, shall be entitled to receive, on or
prior to each Distribution Date, the amounts provided for as the Servicing Fee
and as reimbursement for Nonrecoverable Advances, Servicing Advances and
reimbursement for Advances, all as specified by Section 5.09. The amount of
compensation or reimbursement provided for shall be accounted for on a Mortgage
Loan-by-Mortgage Loan basis.
Additional servicing compensation in the form of assumption fees,
prepayment fees and late payment charges shall be retained by the Servicer, to
the extent permitted by applicable law. The Servicer shall be required to pay
all expenses incurred by it in connection with its servicing activities
hereunder (including the fees and expenses of the Trustee and any Sub-Servicer)
and shall not be entitled to reimbursement therefor except as specifically
provided in Sections 5.09 and 5.21.
Section 5.24. 1934 Act Reports. (a) The Servicer shall, on behalf of
the Trust, make all filings ("Periodic Reports") required to be made by the
Depositor or the Trust (other than the filings relating to the closing of this
transaction) with respect to the Class A Certificates, the Class M Certificates,
the Class B-1 Certificates and the Class B-2 Certificates pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and the rules
and regulations of the Securities and Exchange Commission (the "Commission")
thereunder.
(b) Within 30 days after the beginning of the first fiscal year during
which the Trust's obligation to file Periodic Reports pursuant to the Exchange
Act shall have been suspended, the Servicer shall prepare, or cause to be
prepared, a notice on Commission Form 15 ("Form 15") and is hereby authorized to
and shall execute such Form 15 on the Trust's behalf; provided, however, that
the Servicer shall be under no obligation to prepare such notice if the number
of Certificateholders exceeds 300. The Servicer shall file any notice on Form 15
with the Commission in accordance with the provisions of Rule 15d-6 under the
Exchange Act.
Section 5.25. Annual Statement as to Compliance.
The Servicer will deliver to the Depositor and the Trustee on or before
April 15 of each year, beginning with April 15 in the year which begins not less
than three months after the Closing Date, an Officers' Certificate stating, as
to each signer thereof, that (i) a review of the activities of the Servicer
during the preceding calendar year and of performance under this Agreement has
been made under such officer's supervision, (ii) to the best of such officer's
knowledge, based on such review, the Servicer has fulfilled all its obligations
under this Agreement throughout such year, or, if there has been a default in
the fulfillment of any such obligation, specifying each such default known to
such officer and the nature and status thereof
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and (iii) to the best of such officer's knowledge, each Sub-Servicer has
fulfilled its obligations under its Sub-Servicing Agreement in all material
respects, or if there has been a material default in the fulfillment of such
obligations, specifying such default known to such officers and the nature and
status thereof. Copies of such statement shall be provided to each Rating Agency
by the Servicer. Copies of such statement shall also be provided by the Servicer
to any Certificateholder upon request. If the Servicer shall fail to provide
such copies and a Responsible Officer of the Trustee is aware that the Servicer
has not so provided copies, the Trustee shall provide such copies at the
Servicer's expense if the Trustee has received such statement.
Section 5.26. Annual Independent Public Accountants' Servicing Report.
On or before April 15 of each year, beginning with April 15 in the year which
begins not less than three months after the Closing Date, the Servicer at its
expense shall cause a firm of independent public accountants which is a member
of the American Institute of Certified Public Accountants to furnish a statement
to the Depositor and the Trustee to the effect that such firm has examined
certain documents and records relating to the servicing of the Mortgage Loans
and that, on the basis of such examination conducted substantially in compliance
with the Uniform Single Audit Program for Mortgage Bankers, such servicing has
been conducted in compliance with the manner of servicing set forth in pooling
and servicing agreements substantially similar to this Agreement, except for (i)
such exceptions as such firm shall believe to be immaterial and (ii) such other
exceptions as shall be set forth in such statement. Copies of such statement
shall be provided to each Rating Agency, and, upon request, to the
Certificateholders, by the Servicer, or by the Trustee at the Servicer's expense
if the Trustee has received such statement and the Servicer shall fail to
provide such copies and the Trustee is aware that the Servicer has not so
provided copies.
Section 5.27. Access to Certain Documentation; Rights of the Depositor
in Respect of the Servicer. The Servicer shall provide access to the Trustee,
Certificateholders which are savings and loan associations, banks or insurance
companies or examiners of any federal or state banking or insurance regulatory
authority to the documentation regarding the Mortgage Loans if so required by
applicable regulations of any regulatory authority, such access to be afforded
subject to reimbursement for expenses without charge but only upon reasonable
request and during normal business hours at the offices of the Servicer
designated by it. The Depositor may, but is not obligated to, enforce the
obligations of the Servicer under this Agreement and may, but is not obligated
to, appoint and cause a designee to perform, any defaulted obligations of the
Servicer hereunder or exercise the rights of the Servicer hereunder; provided
that the Servicer shall not be relieved of any of its obligations hereunder by
virtue of the appointment of a designee by the Depositor or its designee. The
Depositor shall not assume any responsibility or liability for any action or
failure to take action by the Servicer and is not obligated to supervise the
performance of the Servicer under this Agreement or otherwise.
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Section 5.28. REMIC-Related Covenants. For as long as the Trust Fund
shall exist, the Servicer and the Trustee shall act in accordance herewith to
assure continuing treatment of the Trust Fund as a REMIC. In particular:
(a) The Servicer shall not create, or permit the creation of, any
"interests" in the REMIC within the meaning of Section 860G(a) of the Code other
than the "regular interests" in the REMIC designated as such in Section 2.04(a)
and the Residual Interest;
(b) As of all times as may be required by the Code, the Servicer will
ensure that substantially all of the assets of the Trust Fund will consist of
"qualified mortgages" as defined in section 860G(a)(3) of the Code and
"permitted investments" as defined in section 860G(a)(5) of the Code. The
Servicer and the Trustee, upon the direction of the Servicer, also will maintain
records that are sufficient to indicate the Trust Fund's compliance with
applicable requirements of the Code (and applicable Proposed, Temporary or final
Treasury Regulations) relating to the assets held by the Trust Fund. Further,
the Servicer shall not permit and the Trustee shall not accept the transfer or
substitution of any Mortgage Loan other than pursuant to Section 3.03, 5.01 or
5.21 of this Agreement, and the Servicer shall, in any case, not permit
substitution later than two years from the Closing Date unless the Servicer and
the Trustee have received an Opinion of Counsel, which will not be an expense of
the Trust Fund, that such transfer or substitution would not adversely affect
the REMIC status of the Trust Fund or would not otherwise be prohibited by this
Agreement;
(c) The Servicer shall ensure that the Trust Fund does not receive a
fee or other compensation for services and that the Trust Fund does not receive
any income from assets other than "qualified mortgages" within the meaning of
section 860G(a)(3) of the Code or "permitted investments" within the meaning of
section 860G(a)(5) of the Code, and shall take whatever action it deems
necessary to avoid any material tax imposed by the Code on the Trust Fund;
(d) The Trustee shall not sell or permit the sale of all or any portion
of the Mortgage Loans or of any Eligible Investment unless such sale is as a
result of a repurchase of the Mortgage Loans pursuant to this Agreement or the
Trustee has received an Opinion of Counsel, which will not be an expense of the
Trust Fund or the Trustee, to the effect that such sale (i) is pursuant to a
"qualified liquidation" as defined in section 860F(a)(4) of the Code and as
described in Section 11.01 hereof, or (ii) would not be treated as a "prohibited
transaction" within the meaning of section 860F(a)(2) of the Code that results
in the realization of a material amount of gain or loss for federal income tax
purposes;
(e) The Trustee shall not accept any contribution to the Trust Fund
after the Startup Day without an Opinion of Counsel (which shall not be an
expense of the Trustee) that such contribution is included within the exceptions
provided in Section 860G(d)(2) of the Code and, therefore, will not be subject
to the tax imposed by Section 860G(d)(1) of the Code; and
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(f) Notwithstanding anything to the contrary in this Agreement, the
Servicer and the Trustee, at the direction of the Servicer, shall take any other
action or refuse to take any action otherwise required (including adjusting the
Purchase Price for any Mortgage Loan) where the Servicer deems such action or
inaction reasonably necessary to ensure the REMIC status of the Trust Fund under
the Code and applicable regulations or to avoid the imposition of any material
tax liability on the Trust Fund that will affect amounts distributable to the
Certificateholders.
(g) In the event that any applicable federal, state or local tax,
including interest, penalties or assessments, additional amounts or additions to
tax, is imposed on the Trust Fund, such tax shall be treated in the same manner
as a Realized Loss and shall be charged against amounts otherwise distributable
to the Holders of the Certificates, except as provided in the last sentence of
this Section 5.28 (g). The Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent shall withdraw from the Collection Account
sufficient funds to pay or provide for the payment of, and to actually pay, such
tax as is estimated to be legally owed by (but such authorization shall not
prevent the Trustee or, if a Paying Agent has been appointed under Section 4.05,
the Paying Agent from contesting, at the expense of the Trust Fund (other than
as a consequence of a breach of its obligations under this Agreement), any such
tax in appropriate proceedings, and withholding payment of such tax, if
permitted by law, pending the outcome of such proceedings). The Trustee or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent is hereby
authorized to and shall segregate, into a separate non-interest bearing account,
the net income from any "prohibited transaction" under Code Section 860F(a), the
amount of any taxable contribution to the Trust Fund after the Startup Day that
is subject to tax under Code Section 860G(d), and 35% of any estimated "net
income from foreclosure property" under Section 860G(c) and use such income or
amount, to the extent necessary, to pay such tax. To the extent that any such
tax is paid to the Internal Revenue Service or applicable state or local tax
authorities, the Trustee or a Paying Agent has been appointed under Section
4.05, the Paying Agent shall retain an equal amount from future amounts
otherwise distributable to the Holder of the Class A-R Certificate and shall
distribute such retained amounts to the Holders of the other Classes of
Certificates, to the extent they remain outstanding, until they are fully
reimbursed for any amount of such taxes previously charged to the then Holder of
the Class R Certificate. Neither the Trustee nor the Servicer shall be
responsible for any taxes imposed on the Trust Fund except to the extent such
taxes arise as a consequence of a breach of their respective obligations under
this Agreement.
[End of Article V]
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ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS
Section 6.01. Distributions. (a) On each Distribution Date, the Paying
Agent shall apply an amount equal to the Available Distribution Amount in the
following order of priority:
(i) to the Non-PO Class A Certificateholders, all distributable
amounts up to the sum of (A) the Aggregate Class A Interest Accrual
Amount and (B) the Aggregate Class A Interest Shortfall;
(ii) the balance, if any, of the Available Distribution Amount
shall be allocated, first, pro rata (in accordance with the maximum
amounts distributable in accordance with this clause (ii)) between (A)
the Non-PO Class A Certificateholders, the amounts distributable
pursuant to (b)(ii)(A) below, up to the Non-PO Class A Optimal
Principal Amount and (B) the Class A-P Certificateholders, the Class
A-P Amount, in accordance with (b)(ii)(B) below and second, to the
Class A-P Certificateholders, the Class A-P Shortfall Amount, in
accordance with (b)(iii) below;
(iii) to the Class M Certificateholders, the balance, if any, of
the Available Distribution Amount after making the distributions
provided for in paragraphs (i) and (ii) above, in accordance with, and
up to the amount calculated pursuant to, Section 6.01(c) below;
(iv) to the Class B Certificateholders, the balance, if any, of
the Available Distribution Amount after making the distributions
provided for in paragraphs (i) through (iii) above, in accordance
with, and up to the amounts calculated pursuant to, Section 6.01(d)
below; and
(v) to the Class A-R Certificateholders the balance, if any, of
the Available Distribution Amount remaining after the distributions
provided for in paragraphs (i) through (iv) above.
(b) Amounts payable to the Class A Certificateholders on any
Distribution Date shall be distributed as follows:
(i) to the extent the amount available for distribution pursuant
to (a)(i) is sufficient:
(A) to the Class A-1 Certificateholders, (1) the Class A-1
Interest Accrual Amount plus (2) the Class A-1 Shortfall from the
preceding Distribution Date;
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(B) to the Class A-2 Certificateholders, (1) the Class A-2
Interest Accrual Amount plus (2) the Class A-2 Shortfall from the
preceding Distribution Date;
(C) to the Class A-3 Certificateholders, (1) the Class A-3
Interest Accrual Amount plus (2) the Class A-3 Shortfall from the
preceding Distribution Date;
(D) to the Class A-4 Certificateholders, (1) the Class A-4
Interest Accrual Amount plus (2) the Class A-4 Shortfall from the
preceding Distribution Date;
(E) to the Class A-5 Certificateholders, (1) the Class A-5
Interest Accrual Amount plus (2) the Class A-5 Shortfall from the
preceding Distribution Date;
(F) to the Class A-6 Certificateholders, (1) the Class A-6
Interest Accrual Amount plus (2) the Class A-6 Shortfall from the
preceding Distribution Date;
(G) to the Class A-7 Certificateholders, (1) the Class A-7
Interest Accrual Amount plus (2) the Class A-7 Shortfall from the
preceding Distribution Date;
(H) to the Class A-R Certificateholder, (1) the Class A-R
Interest Accrual Amount plus (2) the Class A-R Shortfall from the
preceding Distribution Date; and
(I) to the Class A-X Certificateholders, (1) the Class A-X
Interest Accrual Amount plus (2) the Class A-X Shortfall from the
preceding Distribution Date;
(ii) concurrently, (A) to the Non-PO Class A Certificateholders,
up to the Non-PO Class A Optimal Principal Amount, allocated among the
Non-PO Class A Certificates in accordance with the Non-PO Class A
Principal Payment Rules and (B) to the Class A-P Certificateholders,
the Class A-P Amount;
(iii) to the Class A-P Certificateholders, the Class A-P
Shortfall Amount; provided, however, that any amounts distributed
pursuant to this Section 6.01(b)(iii) shall not cause a further
reduction in the Outstanding Certificate Principal Balance of the
Class A-P Certificates.
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(iv) If the Available Distribution Amount is insufficient to make
the distributions set forth in (b)(i) above, the Paying Agent shall
distribute the Available Distribution Amount to the Non-PO Class A
Certificateholders pro rata in accordance with the amounts otherwise
distributable to them pursuant to (b)(i)(A)-(I) above.
(c) Amounts payable on any Distribution Date to the Class M
Certificateholders shall be distributed up to an amount equal to (A) the Class M
Interest Accrual Amount plus (B) the Class M Shortfall from the preceding
Distribution Date plus (C) the portion of the Subordinated Optimal Principal
Amount allocable (pursuant to Section 6.01(e)) to the Class M Certificates plus
(D) any Carry-over Subordinated Principal Amounts with respect to the Class M
Certificates.
(d) Amounts payable on any Distribution Date to the Class B
Certificateholders pursuant to Section 6.01(a)(iv) shall be distributed in the
following priority:
(1) first, to the Class B-1 Certificateholders, up to an amount
equal to (A) the Class B-1 Interest Accrual Amount plus (B) the Class
B-1 Shortfall from the preceding Distribution Date plus (C) the pro
rata portion, if any, of the Subordinated Optimal Principal Amount
allocable to the Class B-1 Certificates in accordance with Section
6.01(e) plus (D) any Carry-over Subordinated Principal Amounts with
respect to the Class B-1 Certificates plus (E) any portion of the
Subordinated Optimal Principal Amount allocated to the Class M
Certificates in excess of the Outstanding Certificate Principal
Balance of such Class;
(2) second, to the Class B-2 Certificateholders, up to an amount
equal to (A) the Class B-2 Interest Accrual Amount plus (B) the Class
B-2 Shortfall from the preceding Distribution Date plus (C) the pro
rata portion, if any, of the Subordinated Optimal Principal Amount
allocable to the Class B-2 Certificates in accordance with Section
6.01(e) plus (D) any Carry-over Subordinated Principal Amounts with
respect to the Class B-2 Certificates plus (E) any portion of the
Subordinated Optimal Principal Amount allocated to the Class B-1
Certificates in excess of the Outstanding Certificate Principal
Balance of such Class;
(3) third, to the Class B-3 Certificateholders, up to an amount
equal to (A) the Class B-3 Interest Accrual Amount plus (B) the Class
B-3 Shortfall from the preceding Distribution Date plus (C) the pro
rata portion, if any, of the Subordinated Optimal Principal Amount
allocable to the Class B-3 Certificates in accordance with Section
6.01(e) plus (D) any Carry-over Subordinated Principal Amounts with
respect to the Class B-3 Certificates plus (E) any portion of the
Subordinated Optimal Principal Amount allocated to the Class B-2
Certificates in excess of the Outstanding Certificate Principal
Balance of such Class;
(4) fourth, to the Class B-4 Certificateholders, up to an amount
equal to (A) the Class B-4 Interest Accrual Amount plus (B) the Class
B-4 Shortfall from the preceding Distribution Date plus (C) the pro
rata portion, if any, of the Subordinated Optimal Principal Amount
allocable to the Class B-4 Certificates in accordance with Section
6.01(e) plus (D) any
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Carry-over Subordinated Principal Amounts with respect to the Class
B-4 Certificates plus (E) any portion of the Subordinated Optimal
Principal Amount allocated to the Class B-3 Certificates in excess of
the Outstanding Certificate Principal Balance of such Class; and
(5) fifth, to the Class B-5 Certificateholders, up to an amount
equal to (A) the Class B-5 Interest Accrual Amount plus (B) the Class
B-5 Shortfall from the preceding Distribution Date plus (C) the pro
rata portion, if any, of the Subordinated Optimal Principal Amount
allocable to the Class B-5 Certificates in accordance with Section
6.01(e) plus (D) any Carry-over Subordinated Principal Amounts with
respect to the Class B-5 Certificates plus (E) any portion of the
Subordinated Optimal Principal Amount allocated to the Class B-4
Certificates in excess of the Outstanding Certificate Principal
Balance of such Class.
(e) On each Distribution Date, the Subordinated Optimal Principal
Amount shall be allocated among the Classes of Subordinated Certificates
entitled, pursuant to the next succeeding sentence, to an allocation of
principal on such Distribution Date, pro rata based upon the Outstanding
Certificate Principal Balances of all such Classes so entitled. With respect to
the Subordinated Certificates, on each Distribution Date, principal shall be
distributable to (1) any Class of Subordinated Certificates which has current
Credit Support (before giving effect to any distribution of principal and any
Realized Losses allocable on such Distribution Date) greater than or equal to
the Original Credit Support for such Class; (2) the Class having the lowest
numerical class designation of any outstanding Class of Subordinated
Certificates which does not meet the criteria in (1) above; and (3) the Class
B-5 Certificates if all other outstanding Classes of Subordinated Certificates
meet the criteria in (1) above or if no other Class of Subordinated Certificates
is outstanding; provided, however, that no Class of Subordinated Certificates
shall receive any distributions of principal if any Class of Subordinated
Certificates having a lower numerical class designation than such Class fails to
meet the criteria in (1) above. For purposes of this paragraph, the Class M
Certificates shall be deemed to have a lower numerical class designation than
each Class of Class B Certificates.
(f) The Servicer shall make all calculations necessary to make the
distributions described in this Section 6.01. All distributions made to
Certificateholders of any Class on each Distribution Date will be made to the
Certificateholders of the respective Class of record on the next preceding
Record Date, except that the final distribution with respect to each Class shall
be made as provided in the forms of Certificates. All distributions made to
Certificateholders shall be based on the Percentage Interest of the Class
represented by their respective Certificates, and shall be made either by
transfer in immediately available funds to the account of such Holder at a bank
or other financial or depository institution having appropriate facilities
therefor, if such Holder has so notified the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, in writing at least 10
Business Days prior to the first Distribution Date for which distribution by
wire transfer is to be made and such Holder's Certificates of such Class in the
aggregate evidence an original denomination of not less than $5,000,000 or such
Holder holds a 100% Percentage Interest of such Class or, if not, by check
mailed to the address of the Person entitled thereto as it appears on the
Certificate Register,
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except that the final distribution in retirement of the Certificates will be
made only upon presentation and surrender of the Certificates at the office
specified in the final Distribution Notice. If on any Determination Date, the
Servicer determines that there are no Mortgage Loans outstanding and no other
funds or assets in the Trust Fund other than the funds in the Certificate
Account, the Trustee or if a Paying Agent has been appointed under Section 4.05,
the Paying Agent shall promptly send the final distribution notice to each
Certificateholder specifying the manner in which the final distribution will be
made.
Section 6.02. Statements to the Certificateholders. (a) Not later than
the second Business Day prior to each Distribution Date, the Servicer shall send
to the Paying Agent and the Trustee the relevant information for purposes of
this Section 6.02. Not later than each Distribution Date, the Paying Agent shall
send to each Certificateholder, the Depositor, the Trustee (if other than the
Paying Agent), the Servicer, any co-trustee, and each Rating Agency a statement
setting forth the following information, after giving effect to the
distributions to be made by the Paying Agent pursuant to Section 6.01 on or as
of such Distribution Date:
(i) with respect to each Class of Certificates the amount of such
distribution to Holders of such Class allocable to principal;
(ii) with respect to each Class of Certificates the amount of
such distribution to Holders of such Class allocable to interest;
(iii) the aggregate amount of any Principal Prepayments and
Repurchase Proceeds included in the distributions to
Certificateholders;
(iv) the aggregate amount of any Advances by the Servicer
pursuant to Section 6.03;
(v) the number of Outstanding Mortgage Loans and the Mortgage
Pool Principal Balance as of the close of business as of the end of
the related Principal Prepayment Period;
(vi) the related amount of the Servicing Fees (as adjusted
pursuant to Section 6.05) retained or withdrawn from the Collection
Account by the Servicer;
(vii) the number and aggregate principal amounts of Mortgage
Loans (A) delinquent (1) one Monthly Payment, (2) two Monthly Payments
and (3) three or more Monthly Payments and (B) in foreclosure, in each
case, as of the end of the related Principal Prepayment Period;
(viii) the number and the principal balance of Mortgage Loans
with respect to any real estate acquired through foreclosure or grant
of a deed in lieu of foreclosure;
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(ix) the aggregate amount of all Advances recovered during the
related Due Period;
(x) with respect to the following Distribution Date, the Class A
Percentage, the Class M Percentage, the Class B Percentage, the Class
A Principal Balance, the Class M Principal Balance, the Class B
Principal Balance, the Non-PO Class A Percentage, the Non-PO Class A
Prepayment Percentage, and the level of Credit Support, if any, with
respect to each class of Subordinated Certificates;
(xi) the aggregate amount of Realized Losses during the related
Due Period and the aggregate amount of Realized Losses since the
Cut-off Date;
(xii) the allocation to each Class of Certificates of any
Realized Losses during the related Due Period;
(xiii) the Outstanding Certificate Principal Balance of each
Class of Certificates after giving effect to the distributions to each
Class on such Distribution Date; and
(xiv) the amount of any Compensating Interest Shortfalls on such
Distribution Date.
The Paying Agent's responsibility for sending the above information to
the Certificateholders is limited to the availability, timeliness and accuracy
of the information derived from the Servicer.
Upon reasonable advance notice in writing if required by federal
regulation, the Servicer will provide to each Certificateholder which is a
savings and loan association, bank or insurance company certain reports and
access during business hours to information and documentation regarding the
Mortgage Loans sufficient to permit such Certificateholder to comply with
applicable regulations of regulatory authorities with respect to investment in
the Certificates; provided, that the Servicer shall be entitled to be reimbursed
by each such Certificateholder for the Servicer's actual expenses incurred in
providing such reports and access.
(b) The Servicer shall cause to be prepared, and the Servicer or the
Trustee, as required by applicable law, shall file, any and all tax returns,
information statements or other filings required to be delivered to
Certificateholders and any governmental taxing authority pursuant to any
applicable law with respect to the Trust Fund and the transactions contemplated
hereby (the Servicer or the Trustee may, at its option but with the consent of
the other, which consent shall not be unreasonably withheld, appoint an
organization which regularly engages in the preparation and filing of such
documents on a continuous basis for profit and which represents itself to be
expert in such matters) and the Servicer shall maintain a record of the
information necessary for the application of Section 860E(e) of the Code and
shall make such information available as required by Section 860D(a)(6) of the
Code; provided, however, that the
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Servicer shall notify the Trustee of the Trustee's obligation to make any such
filings and that any fees of the organization appointed as provided above shall
be paid by the Servicer; and provided further that if an organization is
employed, as described above, to prepare and file any such filings, neither the
Trustee nor the Servicer shall be liable for any errors by such organization.
Section 6.03. Advances by the Servicer. If, on any Determination Date,
the Servicer determines that any Monthly Payments due on the immediately
preceding Due Date have not been received, the Servicer shall, unless it
determines in its sole discretion that such amounts will not be recoverable from
Late Collections, Liquidation Proceeds or otherwise, make an Advance on or
before the related Distribution Date in an amount equal to the amount of such
delinquent Monthly Payments, after adjustment of any delinquent interest payment
for the Servicing Fee. For purposes of this Section 6.03, the delinquent Monthly
Payments referred to in the preceding sentence shall be deemed to include an
amount equal to the Monthly Payments that would have been due on Mortgage Loans
which have been foreclosed or otherwise terminated and in connection with which
the Servicer acquired and continues to own the Mortgaged Properties on behalf of
the Certificateholders. If the Servicer makes an Advance, it shall on or prior
to such Distribution Date either (i) deposit in the Collection Account an amount
equal to such Advance, (ii) cause to be made an appropriate entry in the records
of the Collection Account that funds in such account being held for future
distribution or withdrawal have been, as permitted by this Section 6.03, used by
the Servicer to make such Advance or (iii) make Advances in the form of any
combination of clauses (i) and (ii) aggregating the amount of such Advance. Any
funds being held in the Collection Account for future distribution to
Certificateholders and so used pursuant to clause (ii) or (iii) above shall be
replaced by the Servicer from its own funds by deposit into the Collection
Account on or before any subsequent Distribution Date to the extent that funds
in the Collection Account on such Distribution Date shall be less than the
amount of payments required to be made to Certificateholders on such
Distribution Date. Any such Advance shall be included with the distribution to
the Certificateholders on the related Distribution Date. If the Servicer
determines not to make a Nonrecoverable Advance, it shall on the related
Determination Date furnish to the Trustee, any co-trustee, and each Rating
Agency notice of such determination. The Servicer shall be entitled to be
reimbursed from the Collection Account for all Advances and Nonrecoverable
Advances as provided in Section 5.09.
Section 6.04. Allocation of Realized Losses. (a) Prior to each
Determination Date, the Servicer shall determine (i) the total amount of
Realized Losses, if any, incurred during the related Principal Prepayment
Period; (ii) whether and to what extent such Realized Losses constitute Excess
Losses; and (iii) the respective portions of such Realized Losses allocable to
interest and to principal.
(b) The principal portion of any Realized Losses other than Excess
Losses shall be allocated as follows: first, to the Class B-5 Certificates until
the Outstanding Certificate Principal Balance of the Class B-5 Certificates has
been reduced to zero; second, to the Class B-4 Certificates until the
Outstanding Certificate Principal Balance of the Class B-4 Certificates has
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been reduced to zero; third, to Class B-3 Certificates until the Outstanding
Certificate Principal Balance of the Class B-3 Certificates has been reduced to
zero; fourth, to the Class B-2 Certificates until the Outstanding Certificate
Principal Balance of the Class B-2 Certificates has been reduced to zero; fifth,
to the Class B-1 Certificates until the Outstanding Certificate Principal
Balance of the Class B-1 Certificates has been reduced to zero; sixth, to the
Class M Certificates until the Outstanding Certificate Principal Balance of the
Class M Certificates has been reduced to zero; and seventh, to the Non-PO Class
A Certificates on a pro rata basis until the Outstanding Certificate Principal
Balance of the Non-PO Class A Certificates has been reduced to zero; provided,
however, that if a Realized Loss occurs with respect to a Discount Mortgage Loan
(A) the amount of such Realized Loss equal to the product of (i) the amount of
such Realized Loss and (ii) the PO Percentage with respect to such Discount
Mortgage Loan will be allocated to the Class A-P Certificates and (B) the
remainder of such Realized Loss will be allocated as described above. The
principal portion of any Excess Losses shall be allocated among all Classes of
Certificates on a pro rata basis; provided, however, that the applicable PO
Percentage of any Excess Losses on the Discount Mortgage Loans shall be
allocated to the Class A-P Certificates.
(c) 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.
(d) In the event that a recovery is made with respect to any Realized
Loss, the amount of such recovery shall be distributed on the next Distribution
Date first to the Class A Certificateholders, up to the amount to which such
Realized Loss was allocated to the Class A Certificateholders; second to the
Class M Certificateholders, up to the amount to which such Realized Loss was
allocated to the Class M Certificateholders; third to the Class B-1
Certificateholders, up to the amount to which such Realized Loss was allocated
to the Class B-1 Certificateholders; fourth to the Class B-2 Certificateholders,
up to the amount to which such Realized Loss was allocated to the Class B-2
Certificateholders; fifth to the Class B-3 Certificateholders, up to the amount
to which such Realized Loss was allocated to the Class B-3 Certificateholders;
sixth to the Class B-4 Certificateholders, up to the amount to which such
Realized Loss was allocated to the Class B-4 Certificateholders; and seventh to
the Class B-5 Certificateholders, up to the amount to which such Realized Loss
was allocated to the Class B-5 Certificateholders.
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Section 6.05. Compensating Interest; Allocation of Certain Interest
Shortfalls.
(a) Upon a Principal Prepayment of a Mortgage Loan, the Servicer shall
deposit into the Collection Account from its own funds, as a reduction of its
servicing compensation hereunder, an amount, if any, by which the amount of the
interest that would otherwise accrue with respect to such Mortgage Loan from the
date of prepayment to the Due Date in the related Due Period at the Net Mortgage
Rate exceeds the amount of the interest (adjusted to the Net Mortgage Rate)
collected from the Mortgagor with respect to such period (such amount,
"Compensating Interest"); provided, however, that with respect to any
Distribution Date, the Servicer's obligation to deposit any such amount is
limited to an amount equal to the product of (i) one-twelfth of 0.125% and (ii)
the aggregate Scheduled Principal Balance of the Mortgage loans with respect to
such Distribution Date.
(b) On any Distribution Date, the excess, if any, of (X) Compensating
Interest with respect to such Distribution Date over (Y) the amount deposited in
the Collection Account pursuant to (a) above for such Distribution Date shall
equal the "Compensating Interest Shortfall" with respect to such Distribution
Date. On any Distribution Date, the Compensating Interest Shortfall shall be
allocated pro rata among the outstanding Classes of Class A, Class M and Class B
Certificates based on the amount of interest to which each such Class would
otherwise be paid on such Distribution Date had there been no such Compensating
Interest Shortfall.
(c) The interest portion of any Realized Losses ("Realized Loss
Interest Shortfall") shall be allocated as follows: first, to the Class B-5
Certificates, second, to the Class B-4 Certificates, third, to the Class B-3
Certificates, fourth, to the Class B-2 Certificates, fifth, to the Class B-1
Certificates, sixth, to the Class M Certificates, in each case until the
Outstanding Certificate Principal Balance thereof has been reduced to zero, and
seventh, the remainder thereof shall be allocated to the Non-PO Class A
Certificates pro rata among the outstanding Classes of Non-PO Class A
Certificates based on the amount of interest to which each such Class would
otherwise be paid on such Distribution Date had there been no such Realized Loss
Interest Shortfall.
Section 6.06. Subordination. The rights of the Class B
Certificateholders to receive distributions in respect of the Class B
Certificates on any Distribution Date shall be subordinated to the rights of the
Class A and Class M Certificateholders to receive distributions in respect of
the Class A and Class M Certificates. The rights of the Class M
Certificateholders to receive distributions in respect of the Class M
Certificates on any Distribution Date shall be subordinated to the rights of the
Class A Certificateholders to receive distributions in respect of the Class A
Certificates. The rights of the Class B-1 Certificateholders to receive
distributions in respect of the Class B-1 Certificates on any Distribution Date
shall be subordinate to the rights of the Class A and Class M Certificateholders
to receive distributions in respect of such Class A and Class M Certificates.
Each Class of Class B Certificates (other than the Class B-1 Certificates) is
subordinated to the Class A Certificates, the Class M Certificates and each
Class
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of Class B Certificates having a lower numerical class designation than such
Class of Class B Certificates. The rights of the Servicer, as servicer, to
receive funds from the Collection Account, pursuant to Section 5.09, on account
of the Servicing Fee (except as provided in Section 6.05) in respect of each
Mortgage Loan, assumption fees, late payment charges and other mortgagor
charges, reimbursement of Advances and expenses or otherwise, shall not be
subordinated to the rights of the Class A, Class M or Class B
Certificateholders. Amounts held by the Servicer or the Trustee for future
distribution to the Class M or Class B Certificateholders, including, without
limitation, in the Collection Account, shall not be distributed in respect of
the Class M or Class B Certificates except in accordance with the terms of this
Agreement. The Class B Certificateholders are deemed to have granted a security
interest in such amounts to the Class A and Class M Certificateholders to secure
the rights of the Class A and Class M Certificateholders to receive
distributions in priority over the Class B Certificateholders. The Class M
Certificateholders are deemed to have granted a security interest in such
amounts to the Class A Certificateholders to secure the rights of the Class A
Certificateholders to receive distributions in priority over the Class A
Certificateholders.
Section 6.07. Determination of LIBOR.
LIBOR applicable to the calculation of the Certificate Rates on the
Class A-5 and Class A-6 Certificates for any Interest Accrual Period (other than
the initial Interest Accrual Period) will be determined by the Servicer on each
Rate Adjustment Date as follows:
For any Interest Accrual Period other than the first Interest Accrual
Period, the rate for United States dollar deposits for one month which appears
on the Telerate Screen Page 3750 as of 11:00 A.M., London, England time, on the
LIBOR Business Day prior to the first day of such Interest Accrual Period. For
the first Interest Accrual Period, LIBOR shall equal _________% with respect to
the Class A-5 and Class A-6 Certificates. 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 LIBOR or
comparable rates as may be reasonably selected by the Servicer), the rate will
be the Reference Bank Rate. If no such quotations can be obtained and no
Reference Bank Rate is available, LIBOR will be LIBOR applicable to the
preceding Distribution Date.
The establishment of LIBOR by the Servicer on any Rate Adjustment Date
on the Servicer's subsequent calculation of the Certificate Rates applicable to
the Class A-5 and Class A-6 Certificates for the relevant Interest Accrual
Period, in the absence of manifest error, will be final and binding.
[End of Article VI]
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ARTICLE VII
REPORTS TO BE PREPARED BY THE SERVICER
Section 7.01. Servicer Shall Provide Information as Reasonably
Required. The Servicer shall furnish to the Trustee, during the term of this
Agreement, such periodic, special, or other reports or information, whether or
not provided for herein, as shall be necessary, reasonable, or appropriate in
respect to the Trustee, or otherwise in respect to the purposes of this
Agreement, all such reports or information to be as provided by and in
accordance with such applicable instructions and directions as the Trustee may
reasonably require.
Section 7.02. Federal Information Returns and Reports to
Certificateholders.
(a) For Federal income tax purposes, the taxable year of the Trust Fund
shall be a calendar year and the Servicer shall maintain or cause the
maintenance of the books of the Trust Fund on the accrual method of accounting.
(b) The Servicer shall prepare and file or cause to be filed with the
Internal Revenue Service federal tax or information returns with respect to the
Trust Fund and the Certificates containing such information and at the times and
in the manner as may be required by the Code or applicable Treasury regulations,
and shall furnish to each Certificateholder at any time during the calendar year
for which such returns or reports are made such statements or information at the
times and in the manner as may be required thereby. Without limitation on any
other requirement of this Section 7.02, the Servicer shall make available the
information necessary for the application of Section 860E(e) of the Code within
60 days of such request. With respect to the Class A-R Certificate, the Servicer
shall provide such information or cause such information to be provided to (i)
the Internal Revenue Service, (ii) the transferor of a Class A-R Certificate to
a Disqualified Organization and (iii) a Pass-Thru Entity that holds a Class A-R
Certificate with one or more record holders that are Disqualified Organizations.
The Servicer also shall provide or cause to be provided promptly the above
described computation and information relating to the tax on transfers to
Disqualified Organizations or holdings by Pass-Thru Entities within 60 days
after becoming aware of the transfer to a Disqualified Organization or Pass-Thru
Entity with one or more Disqualified Organization owners, as the case may be. In
addition, except as may be provided in Treasury Regulations, any person holding
an interest in a Pass-Thru Entity as a nominee for another will, with respect to
such interest, be treated as a Pass-Thru Entity. In connection with the
foregoing, the Servicer shall provide the name, address and telephone number of
the person who can be contacted to obtain information required to be reported to
the holders of regular interests in the REMIC (the "REMIC Reporting Agent") as
required by IRS Form 8811. The Trustee hereby designates [NAME] to serve as the
REMIC Reporting Agent. The Servicer shall indicate the election to treat the
Trust Fund as a REMIC (which election shall apply to the taxable period ending
[DATE] and each calendar year thereafter) in such manner as the Code or
applicable Treasury regulations may prescribe. The Trustee shall sign all tax
information returns filed pursuant to this Section 7.02 and any other
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returns as may be required by the Code, and in doing so shall rely entirely
upon, and shall have no liability for information provided by, or calculations
provided by, the Servicer. The Servicer is hereby designated as the "tax matters
person" (within the meaning of Treas. Reg. ss.1.860F-4(d)) for the Trust Fund.
Any Holder of a Class A-R Certificate will by acceptance thereof so appoint the
Servicer as agent and attorney-in-fact for the purpose of acting as tax matters
person. In the event that the Code or applicable Treasury Regulations prohibit
the Trustee from signing tax or information returns or other statements, or the
Servicer from acting as tax matters person (as an agent or otherwise), the
Trustee or the Servicer, as the case may be, shall take whatever action that in
its sole good faith judgment is necessary for the proper filing of such
information returns or for the provision of a tax matters person, including
designation of the Holder of a Class A-R Certificate to sign such returns or act
as tax matters person. Each Holder of a Class A-R Certificate shall be bound by
this Section 7.02 by virtue of its acceptance of a Class A-R Certificate.
[End of Article VII]
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ARTICLE VIII
THE DEPOSITOR AND THE SERVICER
Section 8.01. Indemnification; Third Party Claims. The Servicer agrees
to indemnify the Depositor and the Trustee and hold the Depositor and the
Trustee, their officers, directors, employees and agents harmless against any
and all claims, losses, penalties, fines, forfeitures, legal fees and related
costs, judgments, and any other costs, fees and expenses that the Depositor or
the Trustee may sustain in any way related to failure of the Servicer to perform
its duties and service the Mortgage Loans in compliance with the terms of this
Agreement; provided that no such indemnification shall be required with respect
to acts of a prior Servicer. The Servicer shall immediately notify the Depositor
and the Trustee if a claim is made by a third party with respect to this
Agreement or the Mortgage Loans, assume (with the consent of the Depositor and
the Trustee) the defense of any such claim and pay all expenses in connection
therewith, including counsel fees, and promptly pay, discharge and satisfy any
judgment or decree which may be entered against it, the Depositor or the Trustee
in respect of such claim. This right to indemnification shall survive the
termination of this Agreement.
Section 8.02. Merger or Consolidation of the Depositor or the Servicer.
The Depositor and the Servicer will each keep in full effect its existence,
rights and franchises as a corporation, 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. The Servicer will not sell all
or substantially all of its assets without the prior written consent of the
Depositor and the Trustee.
Any person into which the Depositor or the Servicer may be merged or
consolidated, or to whom the Depositor or the Servicer has sold substantially
all of its assets, or any corporation resulting from any merger, conversion or
consolidation to which the Depositor or the Servicer shall be a party, or any
Person succeeding to the business of the Depositor or the Servicer, shall be the
successor of the Depositor or the Servicer 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, however, that the
successor or surviving Person to the Servicer shall satisfy the requirements of
Section 8.05 with respect to the qualifications of a successor to the Servicer.
Notwithstanding anything else in this Section 8.02 and Section 8.04 to
the contrary, the Servicer may assign its rights and delegate its duties and
obligations under this Agreement; provided that the Person accepting such
assignment or delegation shall be a Person which is qualified to service
mortgage loans on behalf of FNMA or FHLMC, is approved in advance in writing by
the Trustee and the Depositor, is willing to service the Mortgage Loans and
executes and delivers to the Depositor and the Trustee an agreement, in form and
substance reasonably satisfactory to the Depositor and the Trustee, which
contains an assumption by such
86
Person of the due and punctual performance and observance of each covenant and
condition to be performed or observed by the Servicer under this Agreement;
provided further that each Rating Agency's rating of any of the Classes of
Certificates that have been rated in effect immediately prior to such assignment
and delegation will not be qualified or reduced or withdrawn as a result of such
assignment and delegation. In the case of any such assignment and delegation,
the Servicer shall be released from its obligations as Servicer under this
Agreement, except that the Servicer shall remain liable for all liabilities and
obligations incurred by it as Servicer hereunder prior to the satisfaction of
the conditions to such assignment and delegation set forth in the next preceding
sentence.
Section 8.03. Limitation on Liability of the Depositor, the Servicer,
the Trustee and Others. Neither the Depositor, the Servicer nor any of the
directors, officers, employees or agents of the Depositor or the Servicer shall
be under any liability to the Trustee or the Certificateholders for any action
taken, or for refraining from the taking of any action, in good faith pursuant
to this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Depositor or the Servicer against any breach of
warranties or representations made herein, or failure to perform its obligations
in strict compliance with this Agreement, or any liability which would otherwise
be imposed by reason of any breach of the terms and conditions of this
Agreement. The Depositor, the Servicer, the Trustee, and any director, officer,
employee or agent of the Depositor, the Servicer or the Trustee 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. Neither the Depositor, the
Trustee nor the Servicer shall be under any obligation to appear in, prosecute
or defend any legal action which is not incidental to its respective duties to
service the Mortgage Loans in accordance with this Agreement and which in its
opinion may cause it to incur any expenses or liability; provided, however, that
the Depositor, the Trustee or the Servicer may in its discretion (and, in the
case of the Depositor or the Servicer, 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. In such event, the legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities payable from the Collection Account and the Depositor, the Servicer
or the Trustee shall be entitled to be reimbursed therefor out of the Collection
Account as provided by Section 4.06; provided that no such right of
reimbursement shall exist with respect to the Servicer when such claim relates
to the failure of the Servicer to service the Mortgage Loans in strict
compliance with the terms of this Agreement or to a breach of a representation
or warranty made by the Servicer hereunder.
Section 8.04. Depositor and Servicer Not to Resign. Except as described
in Section 8.02, neither the Depositor nor the Servicer shall assign this
Agreement or resign from the obligations and duties hereby imposed on it except
by mutual consent of the Depositor, the Servicer and all of the
Certificateholders unless the determination is made that its duties hereunder
are no longer permissible under applicable law and such incapacity cannot be
cured by the Depositor or the Servicer. Any such determination permitting the
resignation of the
87
Depositor or the Servicer shall be evidenced by an opinion of independent
counsel to such effect delivered to the Trustee which opinion of counsel shall
be in form and substance acceptable to the Trustee. Upon any such assignment or
resignation, the Depositor or the Servicer, as appropriate, shall send notice to
all Certificateholders of the effect of such assignment or resignation upon the
then current rating of the Class of Certificates by each Rating Agency whose
rating on such Class is then in effect. No such resignation shall become
effective until a successor shall have assumed the Depositor's or the Servicer's
responsibilities and obligations hereunder in the manner provided in Section
8.05. Any purported assignment or resignation which does not comply with the
requirements of this Section shall be of no effect.
Section 8.05. Successor to the Servicer. In connection with the
termination of the Servicer's responsibilities and duties under this Agreement
pursuant to Section 8.04 or 9.01, the Trustee shall (i) succeed to and assume
all of the Servicer's responsibilities, rights, duties and obligations as
Servicer (but not in any other capacity) under this Agreement (except that the
Trustee shall not be obligated to make Advances if prohibited by applicable law
nor to effectuate repurchases or substitutions of Mortgage Loans pursuant to
Section 2.02 and except that the Trustee makes no representations and warranties
pursuant to Sections 3.01 and 3.02). Prior to the termination of the Servicer's
responsibilities, duties and liabilities under this Agreement, the Trustee may
appoint a successor having a net worth of not less than $15,000,000 and which is
a FNMA or FHLMC approved seller/servicer in good standing and which shall
succeed to all rights and assume all of the responsibilities, duties and
liabilities of the Servicer under this Agreement, except as aforesaid, if the
Trustee receives a letter from each Rating Agency that such appointment would
not result in a reduction or withdrawal of the current rating of any Class of
Certificates that is rated by a Rating Agency. Any co-trustee appointed pursuant
to Section 10.10 for purposes of this Section 8.05 shall have an obligation to
make Advances pursuant to Section 6.03 during such time as the Trustee is the
Servicer, which obligation shall be joint and several with that of the Trustee
as Servicer. If the Trustee has become the successor to the Servicer in
accordance with this Section or Section 9.03, then notwithstanding the above,
the Trustee may, if it shall be unwilling to so act, or shall, if it is unable
to so act, appoint, or petition a court of competent jurisdiction to appoint,
any established housing and home finance institution having a net worth of not
less than $15,000,000 and which is a FNMA or FHLMC approved seller/servicer in
good standing as the successor to the Servicer hereunder in the assumption of
all of the responsibilities, duties or liabilities of the Servicer hereunder. In
connection with any such appointment and assumption, the Trustee may make such
arrangements for the compensation of such successor out of payments on Mortgage
Loans as it and such successor shall agree or such court shall determine;
provided, however, that no such compensation shall be in excess of that
permitted under this Agreement without the consent of all of the
Certificateholders. If the Servicer's duties, responsibilities and liabilities
under this Agreement should be terminated pursuant to Section 8.02, 8.04 or
9.01, the Servicer shall discharge such duties and responsibilities during the
period from the date it acquires knowledge of such termination until the
effective date thereof with the same degree of diligence and prudence which it
is obligated to exercise under this Agreement, and shall take no action
whatsoever that might impair or prejudice the rights or financial condition of
its successor or the
88
Trust Fund. The resignation or removal of the Servicer pursuant to Section 8.02,
8.04 or 9.01 shall not become effective until a successor shall be appointed
pursuant to this Section and shall in no event relieve the Servicer of liability
for breach of the representations and warranties made pursuant to Section 3.03.
Any successor appointed as provided herein shall execute, acknowledge
and deliver to the Servicer and to the Trustee an instrument accepting such
appointment, whereupon such successor shall become fully vested with all the
rights, powers, duties, responsibilities, obligations and liabilities of the
Servicer, with like effect as if originally named as a party to this Agreement
and the Certificates. Any termination or resignation of the Servicer or this
Agreement pursuant to Section 8.02, 8.04, 9.01 or 11.01 shall not affect any
claims that the Trustee may have against the Servicer for events or actions
taken or not taken by the Servicer arising prior to any such termination or
resignation.
The Servicer shall timely deliver to the successor the funds that were,
or were required to be, in the Collection Account and the Escrow Account, if
any, and all Mortgage Files and related documents, statements and recordkeeping
held by it hereunder and the Servicer shall account for all funds and shall
execute and deliver such instruments and do such other things as may reasonably
be required to more fully and definitely vest and confirm in the successor all
such rights, powers, duties, responsibilities, obligations and liabilities of
the Servicer.
Upon a successor's acceptance of appointment as such, the Servicer
shall notify, in writing, the Trustee, the Certificateholders and each Rating
Agency of such appointment.
Section 8.06. Maintenance of Ratings. The Servicer shall cooperate with
the Depositor and take any action that may be reasonably necessary to maintain
the current rating or ratings on the Certificates.
[End of Article VIII]
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ARTICLE IX
DEFAULT
Section 9.01. Events of Default. If one or more of the following Events
of Default shall occur and be continuing, that is to say:
(i) any failure by the Servicer to remit any payment required to be
made or distributed under the terms of this Agreement which continues unremedied
for a period of three Business Days after the date upon which written notice of
such failure, requiring the same to be remedied, shall have been given to the
Servicer by the Trustee or the Depositor or to the Servicer, the Trustee and the
Depositor by the Holders of Certificates of any Class evidencing, as to such
Class, Percentage Interests aggregating not less than 25%; or
(ii) a breach by the Servicer in a material respect of any
representation or warranty set forth in Section 3.02, or failure on the part of
the Servicer duly to observe or perform in any material respect any other of the
covenants or agreements on the part of the Servicer set forth in this Agreement,
which continues unremedied for a period of 60 days after the date on which
written notice of such breach or failure, requiring the same to be remedied,
shall have been given to the Servicer by the Trustee or the Depositor or to the
Servicer, the Trustee and the Depositor by the Holders of Certificates of any
Class evidencing, as to such Class, Percentage Interests aggregating not less
than 25%; or
(iii) the Servicer shall notify the Trustee in writing that it is
unable to make an Advance required to be made in accordance with Section 6.03;
or;
(iv) a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or 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 Servicer and such decree or order
shall have remained in force undischarged or unstayed for a period of 60 days;
or
(v) the Servicer shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings of or relating to the Servicer or
of or relating to all or substantially all of the Servicer's property; or
(vi) the Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations.
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then, and in each and every such case, so long as an Event of Default shall not
have been remedied, the Trustee shall notify the Certificateholders and each
Rating Agency of such Event of Default. The Trustee may, and at the written
direction of the Holders of Certificates evidencing Percentage Interests
aggregating more than 50%, shall, by notice in writing to the Servicer,
terminate all the rights and obligations of the Servicer under this Agreement
and in and to the Mortgage Loans and the proceeds thereof. On or after the
receipt by the Servicer of such written notice, all authority and power of the
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the successor appointed pursuant to
Section 8.05. Upon written request from the Trustee, the Servicer shall prepare,
execute and deliver, any and all documents and other instruments, place in such
successor's possession all Mortgage Files, and 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
the Mortgage Loans and related documents, or otherwise, at the Servicer's sole
expense. The Servicer agrees to cooperate with the Trustee and any co-trustee in
effecting the termination of the Servicer's responsibilities and rights
hereunder, including, without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited or
should have been credited by the Servicer to the Collection Account or Escrow
Account or thereafter received with respect to the Mortgage Loans. The Trustee
will have no obligation to take any action or institute, conduct or defend any
litigation under this Agreement at the request, order or direction of any of the
Holders of Certificates unless such Certificateholders have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which the Trustee may incur.
Section 9.02. Waiver of Defaults. The Trustee may waive any default by
the Servicer in the performance of its obligations hereunder and its
consequences, except that a default in the making of any required distribution
on any of the Certificates may only be waived by the holders of a majority of
the Percentage Interests of the affected Certificateholders. Upon any such
waiver of a past default, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been 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.
Section 9.03. Trustee to Act; Appointment of Successor. On and after
the time the Servicer receives a notice of termination pursuant to Section 9.01,
the Trustee or its appointed agent shall be the successor in all respects to the
Servicer to the extent provided in Section 8.05.
Section 9.04. Notification to Certificateholders and the Rating
Agencies.
(a) Upon any such termination pursuant to Section 9.01, the Trustee
shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register and to each Rating
Agency.
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(b) Within 60 days of a Responsible Officer of the Trustee having
received written notice of the occurrence of any Event of Default, the Trustee
shall transmit by mail to all Holders of Certificates notice of each such Event
of Default hereunder known to the Trustee, unless such Event of Default shall
have been cured or waived.
[End of Article IX]
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ARTICLE X
CONCERNING THE TRUSTEE
Section 10.01. Duties of Trustee. The Trustee, prior to the occurrence
of an Event of Default and after the curing of all Events of Default which may
have occurred, undertakes to, and is empowered to, perform such duties and only
such duties as are specifically set forth in this Agreement. Any permissive
right of the Trustee as enumerated in this Agreement shall not be construed as a
duty; provided that in case an Event of Default has occurred (which has not been
cured), the Trustee shall exercise such of the rights and powers vested in it by
this Agreement, and use the same degree of care and skill in their exercise as a
prudent man would exercise or use under the circumstances in the conduct of such
man's own affairs.
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, and, if the Trustee is acting as the
successor Servicer pursuant to Section 8.05 or 9.03, its own willful misconduct
with respect to its servicing obligations; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the
curing 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
such duties and obligations as are specifically set forth in this Agreement, no
implied covenants or obligations shall be read into this Agreement against the
Trustee and, in the absence of bad faith on the part of the Trustee, the Trustee
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions furnished to
the Trustee and conforming to the requirements of this Agreement;
(ii) The Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining the
pertinent facts; and
(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
direction of Certificateholders of any Class holding Certificates which
evidence, as to such Class, Percentage Interests aggregating not less than 25%
as to the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Agreement.
Section 10.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 10.01:
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(a) The Trustee may rely upon and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate, certificate
of auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) The Trustee may consult with counsel, and any advice or Opinion of
Counsel shall be full and complete authorization and protection in respect of
any action taken or suffered or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(c) The Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Agreement or to institute, conduct or
defend any litigation hereunder or in relation hereto at the request, order or
direction of any of the Certificateholders, pursuant to the provisions of this
Agreement, unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of an Event
of Default (which has not been cured), to exercise such of the rights and powers
vested in it by this Agreement, and to use the same degree of care and skill in
their exercise as a prudent man would exercise or use under the circumstances in
the conduct of such man's own affairs;
(d) Neither the Trustee nor any of its directors, officers, employees
or agents shall be personally liable for any action taken, suffered or omitted
by it in good faith and believed by it or any of them to be authorized or within
the discretion or rights or powers conferred upon the Trustee by this Agreement;
(e) Prior to the occurrence of an Event of Default hereunder and after
the curing of all Events of Default which may have occurred, 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 of any Class
evidencing, as to such Class, Percentage Interests aggregating not less than 25%
(in the case of conflicting requests by two or more 25% or greater Percentage
Interests, the Trustee shall act in accordance with the first such request);
provided, however, that if the payment within a reasonable time to the Trustee
of the costs, expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Trustee, not reasonably assured
to the Trustee by the security afforded to it by the terms of this Agreement,
the Trustee may require reasonable indemnity against such expense or liability
as a condition to such proceeding. The reasonable expense of every such
examination shall be paid by the Servicer, if an Event of Default
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shall have occurred and is continuing, and otherwise by the Certificateholder
requesting the investigation;
(f) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
subcontractors or attorneys; and
(g) Nothing in this Agreement shall be construed to require the Trustee
(acting in its capacity as Trustee) to expend its own funds.
Section 10.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
authentication of the Certificates by an authorized signatory of the Trustee)
shall be taken as the statements of the Depositor or the Servicer, as the case
may be, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations or warranties as to the validity or sufficiency
of this Agreement or of the Certificates (except that (except as set forth
herein) the Certificates shall be duly and validly executed and authenticated by
it) or of any Mortgage Loan or related document. The Trustee shall not be
accountable for the use or application by the Depositor or the Servicer 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 or the Servicer in respect of the
Mortgage Loans or deposited in or withdrawn from the Collection Account by the
Depositor or the Servicer. The Trustee, in its capacity as trustee hereunder,
shall have no responsibility for the timeliness or the amount of payments made
by the Paying Agent to the Certificateholders.
Section 10.04. Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights it would have if it were not Trustee.
Section 10.05. Fees and Expenses. The Servicer covenants and agrees to
pay to the Trustee from time to time, and the Trustee shall be entitled to,
reasonable compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) for all services
rendered by it in the execution of the trust hereby created and in the exercise
and performance of any of the powers and duties hereunder of the Trustee, and
the Servicer will pay or reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Agreement (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all persons not regularly in its employ, and the expenses incurred by the
Trustee in connection with the appointment of an office or agency pursuant to
Section 10.11) except any such expense, disbursement or advance as may arise
from its negligence or bad faith. Notwithstanding anything to the contrary in
this Agreement, this Section shall survive the termination of this Agreement.
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Section 10.06. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be an entity having its principal office in a state
and city acceptable to the Depositor and organized and doing business under the
laws of such state or the United States of America, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 and subject to supervision or examination by federal or state
authority. The Trustee shall not be an affiliate of either Seller or the
Depositor. If such entity publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its 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, the Trustee shall resign immediately in the manner
and with the effect specified in Section 10.07.
Section 10.07. Resignation and Removal of the Trustee. The Trustee, and
any co-trustee may at any time resign and be discharged from the trusts hereby
created by giving written notice thereof to the Depositor, the Servicer and each
Rating Agency. Upon receiving such notice of resignation, the Depositor shall
promptly appoint a successor trustee or co-trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee; provided that such appointment
does not result in a reduction or withdrawal of the rating of any of the Classes
of Certificates that have been rated. 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, the Trustee shall cease to be eligible in accordance
with the provisions of Section 10.06 and shall fail to resign after written
request therefor by the Depositor, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged bankrupt or insolvent, or a receiver
of the Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, then the Depositor
may remove the Trustee and appoint a successor trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee.
The Holders of Certificates evidencing in the aggregate more than 50%
of Percentage Interest may at any time remove the Trustee and appoint a
successor trustee by written instrument or instruments, in triplicate, signed by
such Holders or their attorneys-in-fact duly authorized, one complete set of
which instruments shall be delivered to the Depositor, one complete set to the
Trustee so removed and one complete set to the successor so appointed.
Any resignation or removal of the Trustee or any resignation of any
co-trustee and appointment of a successor trustee or co-trustee pursuant to any
of the provisions of this Section shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 10.08, or upon
acceptance of appointment by a co-trustee, as applicable, unless with
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respect to a co-trustee, the Trustee receives written notice from each Rating
Agency that the failure to appoint a successor co-trustee would not result in a
withdrawal or reduction of the rating of any of the Classes of Certificates that
have been rated, in which case the resignation of any co-trustee shall be
effective upon receipt of such written notice. Any co-trustee may not be removed
unless the Depositor and the Trustee each receive written notice from each
Rating Agency that such removal would not result in a withdrawal or reduction of
the rating of any of the Classes of Certificates that have been rated, in which
case the removal of any co-trustee shall be effective upon receipt of such
written notice.
Section 10.08. Successor Trustee. Any successor trustee appointed as
provided in Section 10.07 shall execute, acknowledge and deliver to the
Depositor and to its predecessor trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective, and such successor trustee shall
become effective and such successor trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if originally
named as trustee herein. The predecessor trustee shall deliver to the successor
trustee all Mortgage Files and related documents and statements held by it
hereunder, and the Depositor, the Servicer and the predecessor trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for more fully and certainly vesting and confirming in the successor
trustee all such rights, powers, duties and obligations.
No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 10.06. Prior to the appointment of any
successor trustee becoming effective, the Depositor shall have received from
each Rating Agency written confirmation that such appointment would not result
in a reduction of the rating of the Class A or Class M Certificates.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Depositor shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register, to the Servicer, any Sub- Servicer and to each Rating
Agency. If the Depositor fails to mail such notice within 10 days after
acceptance of appointment by the successor trustee, the successor trustee shall
cause such notice to be mailed at the expense of the Depositor.
Section 10.09. Merger or Consolidation of Trustee. Any entity into
which the Trustee may be merged or converted or with which it may be
consolidated or any entity resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any entity succeeding to
the business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be eligible under the provisions of Section
10.06, 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.
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Section 10.10. Appointment of Co-Trustee or Separate Trustee. At any
time, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Trust Fund or property securing the same may at the time
be located, the Depositor and the Trustee acting jointly shall have the power
and shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, of any part of the Trust Fund, and to vest in such Person or Persons,
in such capacity, such title to the Trust Fund, or any part thereof, and,
subject to the other provisions of this Section 10.10, such powers, duties,
obligations, rights and trusts as the Depositor and the Trustee may consider
necessary or desirable. If the Depositor shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or in
case an 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 10.06, hereunder, and no notice to Holders of
Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be
required under Section 10.08 hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 10.10, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly and severally, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed (whether as
Trustee hereunder or as successor to the 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 by such separate trustee or co-trustee at the direction of the
Trustee.
Every instrument appointing any separate trustee or co-trustee shall
refer to this Agreement and the conditions of this Article X. 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.
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.
Section 10.11. Appointment of Office or Agency. The Trustee may appoint
an office or agency in The City of New York where Certificates may be
surrendered for registration of transfer or exchange. The Trustee will maintain
an office at the address stated in Section 12.07 hereof where notices and
demands to or upon the Trustee in respect of the Certificates may be served.
[End of Article X]
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ARTICLE XI
TERMINATION
Section 11.01. Termination. The respective obligations and
responsibilities of the Depositor, the Servicer (except the duty to pay the
Trustee's fees and expenses and indemnification hereunder) and the Trustee shall
terminate upon (i) the later of the final payment or other liquidation (or any
Advance with respect thereto) of the last Mortgage Loan or the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and the remittance of all funds due hereunder; or (ii) at the
option of the Servicer, on any Distribution Date which occurs in the month next
following a Due Date on which the aggregate unpaid Principal Balance of all
Outstanding Mortgage Loans is less than 10% of the aggregate unpaid Principal
Balance of the Mortgage Loans on the Cut-off Date, so long as the Servicer
deposits or causes to be deposited in the Collection Account during the
Principal Prepayment Period related to such Distribution Date (and provides
notice to the Trustee of its intention to so deposit on or before the 20th day
of such Principal Prepayment Period) an amount equal to the Purchase Price for
each Outstanding Mortgage Loan, less any unreimbursed Advances made with respect
to any Mortgage Loan (which amount shall offset completely any unreimbursed
Advances for which the Servicer is otherwise entitled to reimbursement), and,
with respect to all property acquired in respect of any Mortgage Loan remaining
in the Trust Fund, an amount equal to the fair market value of such property, as
determined by an appraisal to be conducted by an appraiser selected by the
Trustee, less unreimbursed Advances made with respect to any Mortgage Loan with
respect to which property has been acquired; provided, however, that in no event
shall the trust created hereby continue beyond the expiration of 21 years from
the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late
ambassador of the United States to the Court of St. James's, living on the date
hereof. Notwithstanding the foregoing, a termination may be effected by the
making of such optional repurchases only if the termination of the Trust Fund
satisfies the requirement for a "qualified liquidation" of the Trust Fund within
the meaning of Section 860F(a)(4) of the Code and that the purchases of the
Outstanding Mortgage Loans pursuant to the Section 11.01 will not constitute
"prohibited transactions" within the meaning of Section 860F(a)(2) of the Code.
Notice of any termination, specifying the Distribution Date upon which
all Certificateholders may surrender their Certificates to the Trustee or, if a
Paying Agent has been appointed pursuant to Section 4.05, the Paying Agent for
payment and cancellation, shall be given promptly by the Trustee or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent, (upon direction
by the Depositor 10 days prior to the date such notice is to be mailed) by
signed letter to Certificateholders and each Rating Agency mailed no later than
the 25th day of the month preceding the month of such final distribution
specifying (i) the Distribution Date upon which final payment on the
Certificates will be made upon presentation and surrender of Certificates at the
office or agency of the Trustee or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, therein designated and (ii) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments being
made only upon
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presentation and surrender of the Certificates at the office or agency of the
Trustee or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, therein specified. The Servicer shall indicate the date of adoption of
the plan of qualified liquidation in a statement attached to the final federal
income tax return of the Trust Fund. After giving such notice, the Trustee or if
a Paying Agent has been appointed under Section 4.05, the Paying Agent shall not
register the transfer or exchange of any Certificates. If such notice is given
in connection with the Servicer's election to purchase the Outstanding Mortgage
Loans, the Servicer shall deposit in the Collection Account after adoption of
the plan during the applicable Principal Prepayment Period an amount equal to
the purchase price as determined as provided in clause (ii) of the preceding
paragraph and on the Distribution Date on which such termination is to occur,
Certificateholders will be entitled to the amount of such purchase price but not
amounts in excess thereof, all as provided herein. Upon presentation and
surrender of the Certificates, the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, shall notify the Servicer and
the Servicer shall cause to be distributed to Certificateholders an amount equal
to (a) the amount otherwise distributable on such Distribution Date, if not in
connection with a purchase; or (b) if the Servicer elected to so purchase, the
purchase price determined as provided in clause (ii) of the preceding paragraph.
Following such final deposit the Trustee shall promptly release to the Servicer
the Mortgage Files for the remaining Mortgage Loans, and the Trustee shall
execute all assignments, endorsements and other instruments necessary to
effectuate such transfer and shall have no further responsibility with regard to
said Mortgage Files.
If all of the Certificateholders shall not surrender their Certificates
for cancellation within three months after the time specified in the
above-mentioned written notice, at the close of the 90 day period beginning
after the written notice is given, each remaining Certificateholder will be
credited with an amount that would have been otherwise distributed to such
Certificateholder, and the Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, 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 three months
after the second notice all the Certificates shall not have been surrendered for
cancellation, the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, shall appoint an agent to take appropriate and
reasonable 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 which remain in the Trust Fund hereunder.
[End of Article XI]
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ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. 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.
Section 12.02. 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
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding-up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No Certificateholder shall have any right to vote (except as expressly
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 person 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 of any provision of
this Agreement to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Agreement, unless such Holder previously
shall have given to the Trustee a written notice of default and of the
continuance thereof, as hereinbefore provided, and the Holders of Certificates
of any Class evidencing in the aggregate not less than 25% of the Percentage
Interests of such Class shall have made written request upon the Trustee to
institute such action, suit or proceeding in its own name as Trustee hereunder
(in the case of conflicting requests by two or more 25% or greater Percentage
Interests, the Trustee shall act in accordance with the first such request) 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 of any Class shall have any right in
any manner whatever by virtue of any provision of this Agreement to affect,
disturb or prejudice the rights of the Holders of any other of such Certificates
of such Class or any other Class, 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
Certificateholders of such Class or all Classes, as the case may be.
101
For the protection and enforcement of the provisions of this Section, each and
every Certificateholder and the Trustee shall be entitled to such relief as can
be given either at law or in equity.
Section 12.03. Amendment. This Agreement may be amended from time to
time by the Depositor, the Servicer and the Trustee, without the consent of any
of the Certificateholders, to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions herein, to
ensure continuing treatment of the Trust Fund as a REMIC to avoid or minimize
the risk of imposition of any tax on the Trust Fund pursuant to the Code, or to
make any other provisions with respect to matters or questions arising under
this Agreement which shall not be materially inconsistent with the provisions of
this Agreement, provided that such actions shall not, as evidenced by an Opinion
of Counsel, adversely affect in any material respect the interests of any
Certificateholder of a Class having an Outstanding Certificate Principal Balance
of greater than zero or cause the Trust Fund to fail to qualify as a REMIC.
This Agreement may also be amended from time to time by the Depositor,
the Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interest of
each Class of Certificates having an Outstanding Certificate Principal Balance
greater than zero and affected thereby 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 of such Class; provided, however, that no such amendment shall (i)
reduce in any manner the amount of, or delay the timing of, payments received on
Mortgage Loans which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, (ii) reduce the aforesaid
percentage of Certificates of any class the Holders of which are required to
consent to any such amendment or (iii) change the percentage specified in clause
(ii) of the first paragraph of Section 11.01, without the consent of the Holders
of all Certificates of such Class then outstanding.
Promptly after the execution of any such amendment the Trustee shall
furnish written notification of the substance of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 12.03 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 12.04. Counterparts. This Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
102
Section 12.05. Duration of Agreement. This Agreement shall continue in
existence and effect until terminated as herein provided.
Section 12.06. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
Section 12.07. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by first class or registered mail, postage
prepaid, to (i) in the case of the Depositor, Chase Manhattan Acceptance
Corporation, 000 Xxxx Xxxxxxxxx, 0xx Xxxxx Xxxxx, Xxxxxxxxx Lake, New Jersey
07675, Attention: Structured Finance, (ii) in the case of the Servicer, Chase
Manhattan Mortgage Corporation, 0000 Xxxxxx Xxxxx, Xxxxxxxx, Xxxx 00000,
Attention: Investor Accounting (with a copy to Chase Manhattan Mortgage
Corporation, 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000, Attention:
Structured Finance), (iii) in the case of the Trustee, [TRUSTEE], [ADDRESS],
Attention: Corporate Trust Department, (iv) in the case of [Rating Agency],
[ADDRESS], (v) in the case of [Rating Agency], [ADDRESS], and (vi) in the case
of any of the foregoing persons, such other addresses as may hereafter be
furnished by any such persons to the other parties to this Agreement.
[End of Article XII]
103
IN WITNESS WHEREOF, the Depositor, the Servicer 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.
CHASE MANHATTAN ACCEPTANCE
CORPORATION
By: _____________________________
Name:
Title:
CHASE MANHATTAN MORTGAGE
CORPORATION
By: _____________________________
Name:
Title:
[TRUSTEE],
as Trustee
By: _____________________________
Name:
Title:
104
EXHIBIT A
MORTGAGE LOAN SCHEDULE
EXHIBIT B
CONTENTS OF MORTGAGE FILE
(A) (I) Original Mortgage Note (or a lost note affidavit (including a
copy of the original Mortgage Note)) or (II) original Consolidation, Extension
and Modification Agreement (or a lost note affidavit (including a copy of the
original Consolidation, Extension and Modification Agreement), in either case
endorsed, "Pay to the order of [TRUSTEE], as trustee, without recourse."
(B) The original Mortgage (including all riders thereto) with evidence
of recording thereon, or a copy thereof certified by the public recording office
in which such mortgage has been recorded or, if the original Mortgage has not
been returned from the applicable public recording office, a true certified
copy, certified by the Seller, of the original Mortgage together with a
certificate of the Seller certifying that the original Mortgage has been
delivered for recording in the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located.
(C) The original Assignment of Mortgage to "[TRUSTEE], as trustee,"
which assignment shall be in form and substance acceptable for recording, or a
copy certified by the Seller as a true and correct copy of the original
Assignment which has been sent for recordation. Subject to the foregoing, such
assignments may, if permitted by law, be by blanket assignments for Mortgage
Loans covering Mortgaged Properties situated within the same county. If the
Assignment of Mortgage is in blanket form, a copy of the Assignment of Mortgage
shall be included in the related individual Mortgage File.
(D) The original policy of title insurance, including riders and
endorsements thereto, or if the policy has not yet been issued, a written
commitment or interim binder or preliminary report of title issued by the title
insurance or escrow company.
(E) Originals of all recorded intervening Assignments of Mortgage, or
copies thereof, certified by the public recording office in which such
Assignments or Mortgage have been recorded showing a complete chain of title
from the originator to the Depositor, with evidence of recording, thereon, or a
copy thereof certified by the public recording office in which such Assignment
of Mortgage has been recorded or, if the original Assignment of Mortgage has not
been returned from the applicable public recording office, a true certified
copy, certified by the Seller of the original Assignment of Mortgage together
with a certificate of the Seller certifying that the original Assignment of
Mortgage has been delivered for recording in the appropriate public recording
office of the jurisdiction in which the Mortgaged Property is located.
(F) Originals, or copies thereof certified by the public recording
office in which such documents have been recorded, of each assumption,
extension, modification, written assurance or substitution agreements, if
applicable, or if the original of such document has not been returned from the
applicable public recording office, a true certified copy, certified by the
Seller, of such original document together with certificate of Seller certifying
the original of such document has been delivered for recording in the
appropriate recording office of the jurisdiction in which the Mortgaged Property
is located.
(G) If the Mortgaged Note or Mortgage or any other material document or
instrument relating to the Mortgaged Loan has been signed by a person on behalf
of the Mortgagor, the original power of attorney or other instrument that
authorized and empowered such person to sign bearing evidence that such
instrument has been recorded, if so required in the appropriate jurisdiction
where the Mortgaged Property is located (or, in lieu thereof, a duplicate or
conformed copy of such instrument, together with a certificate of receipt from
the recording office, certifying that such copy represents a true and complete
copy of the original and that such original has been or is currently submitted
to be recorded in the appropriate governmental recording office of the
jurisdiction where the Mortgaged Property is located), or if the original power
of attorney or other such instrument has been delivered for recording in the
appropriate public recording office of the jurisdiction in which the Mortgaged
Property is located.
EXHIBIT C
FORMS OF CLASS A CERTIFICATES
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS 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, AS
AMENDED.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN CHASE
MANHATTAN ACCEPTANCE CORPORATION, THE SERVICER OR THE TRUSTEE REFERRED TO BELOW
OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR INTEREST
REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR INSURED
BY CHASE MANHATTAN ACCEPTANCE CORPORATION, CHASE MANHATTAN MORTGAGE CORPORATION,
THE TRUSTEE OR BY ANY OF THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR
INSTRUMENTALITY.
MORTGAGE PASS-THROUGH CERTIFICATE
Series [ ] CLASS A-1
Number 98-[ ]-A-1 Original Denomination:
$____________________
Cut-off Date: [DATE] Final Scheduled Distribution
Date: __________________
First Distribution Date:
[DATE] Approximate Aggregate Original
Denomination of all Class A-1
Certificate Rate: ___% Certificates: $________________
evidencing an interest in distributions allocable to the Class A-1 Certificates
with respect to a pool of conventional one- to four-family mortgage loans formed
and sold by
CHASE MANHATTAN ACCEPTANCE CORPORATION CUSIP: ______________
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to the Trustee for
registration of transfer, exchange or payment, and any certificate issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
This certifies that Cede & Co. is the registered owner of the ownership
interest evidenced by this Certificate (obtained by dividing the Original
Denomination of this Certificate by the aggregate Original Denomination of all
Class A-1 Certificates) in certain monthly distributions with respect to a pool
(the "Mortgage Pool") of conventional one- to four-family adjustable rate
mortgage loans (the "Mortgage Loans") formed and sold by Chase Manhattan
Acceptance Corporation (the "Company"), which Mortgage Loans are secured by
Mortgaged Properties, and in certain other property held in trust for the
benefit of the Certificate holders (collectively, the "Trust Fund"). The
Mortgage Loans are serviced by Chase Manhattan Mortgage Corporation (in such
capacity, the "Servicer"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of [DATE] (the "Agreement") among the Company, the
Servicer and [TRUSTEE], as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth below. To the extent not defined
herein, the capitalized terms used herein shall have the meanings assigned in
the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class
A (the "Class A Certificates") and 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 the acceptance hereof assents and by which such
Holder is bound. Also issued under the Agreement are Certificates designated as
Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class M (the "Class
M Certificates") and Class B (the "Class B Certificates"). The Class A
Certificates, the Class M Certificates and the Class B Certificates are
collectively referred to as the "Certificates".
Pursuant to the terms of the Agreement, the Trustee or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent, will distribute
from funds in the Certificate Account the amount as described on the reverse
hereof on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
[DATE]. Such distributions will be made to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month in which such payment is made, or if such last day
is not a Business Day, the Business Day immediately preceding such last day (the
"Record Date").
Distributions on this Certificate will be made either by check mailed
to the address of the Person entitled thereto, as such name and address shall
appear on the Certificate
Register, or by wire transfer in immediately available funds to the account of
such Holder at a bank or other financial or depository institution having
appropriate facilities therefor, if such Holder has so notified the Paying Agent
in writing at least 10 Business Days prior to the first Distribution Date for
which distribution by wire transfer is to be made, and such Holder's
Certificates evidence an aggregate original principal balance of not less than
$5,000,000 or such Holder holds a 100% Percentage Interest of such Class.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office of the
Trustee or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, or agency appointed by the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, for the purpose and specified in
such notice of final distribution.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, 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 Company has caused this Certificate to be duly
executed.
Dated: [DATE] CHASE MANHATTAN ACCEPTANCE
CORPORATION
By: ___________________________________
Certificate of Authentication
This is one of the Class A-1 Certificates
referred to in the within-mentioned
Agreement.
[TRUSTEE, as Trustee or] THE CHASE MANHATTAN BANK
as Authenticating Agent
By: __________________________
Authorized Signatory
REVERSE OF CERTIFICATE
MORTGAGE PASS-THROUGH CERTIFICATE
Series [ ]
This Certificate is one of a duly authorized issue of Certificates,
designated as Multi-Class Mortgage Pass-Through Certificates, Series [ ], issued
in ten Classes of Class A Certificates, one Class of Class M Certificates and
five Classes of Class B Certificates, each evidencing an interest in certain
distributions with respect to a pool of adjustable rate one- to four-family
first Mortgage Loans formed and sold by the Company and certain other property
conveyed by the Company to the Trustee. The Class A Certificates evidence in the
aggregate the Class A Percentage of distributions relating to repayments of
principal and interest on such Mortgage Loans. The Class M Certificates evidence
in the aggregate the Class M Percentage of distributions relating to repayments
of principal and interest on such Mortgage Loans.
Following the initial issuance of the Certificates, the Principal
Balance of this Certificate will be different from the Original Denomination
shown above. Anyone acquiring this Certificate may ascertain its current
Principal Balance by inquiry of the Trustee.
The Holder, by its acceptance of this Certificate, agrees that it will
look solely to the Trust Fund and certain amounts resulting from credit
enhancements for payment hereunder and that the Trustee is not liable to the
Holders 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 Trustee will cause to be kept at its Corporate Trust Office in New
York, New York, or at the office of any Paying Agent appointed under the
Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee (or any Paying Agent, as the case
may be) will provide for the registration of Certificates and of transfers and
exchanges of Certificates. Upon surrender for registration of transfer of any
Certificate at any office or agency of the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, maintained for such
purpose, the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee or
transferees, a Certificate of a like Class and dated the date of authentication
by the Authenticating Agent.
No service charge will be made to the Holder for any transfer or
exchange of the Certificate, but the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, may require payment of a sum
sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of the
Certificate. Prior to due presentation of a Certificate for registration of
transfer, the Company, the Servicer, the Paying Agent and the Trustee may treat
the person in whose name any Certificate is registered as the owner of such
Certificate and the Percentage Interest in the Trust Fund evidenced thereby for
the purpose of receiving distributions pursuant to the Agreement and for all
other purposes whatsoever, and neither the Company, the Servicer, the Paying
Agent nor the Trustee will be affected by notice to the contrary.
The Agreement may be amended from time to time by the Company, the
Servicer and the Trustee, without the consent of any of the Certificateholders,
to cure any ambiguity, to correct or supplement any provisions therein which may
be inconsistent with the other provisions therein, to ensure continuing
treatment of the Trust Fund as a REMIC, or to make any other provisions with
respect to matters or questions arising under the Agreement which are not
materially inconsistent with the provisions of the Agreement, provided that such
action does not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Certificateholder.
The Agreement may also be amended from time to time by the Company, the
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
reduce in any manner the amount of, or delay the timing of, payments received on
Mortgage Loans which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, (ii) reduce the aforesaid
percentage of Certificates of any Class the Holders of which are required to
consent to any such amendment or (iii) change the percentage specified in clause
(ii) of the first paragraph of Section 11.01 of the Agreement, without the
consent of the Holders of all Certificates of such Class then outstanding.
The respective obligations and responsibilities of the Company, the
Servicer and the Trustee under the Agreement will terminate upon (i) the later
of the final payment or other liquidation (or any Advance with respect thereto)
of the last Mortgage Loan or the disposition of all property acquired upon the
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due thereunder; or (ii) at the option of the Servicer,
on any Distribution Date which occurs in the month following a Due Date on which
the aggregate unpaid Principal Balance of the Outstanding Mortgage Loans is less
than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans on the
Cut-off Date, so long as the Servicer deposits or causes to be deposited in the
Collection Account during the Principal Prepayment Period related to such
Distribution Date an amount equal to the Purchase Price for each Mortgage Loan,
less any unreimbursed Advances made with respect to any Mortgage Loan, and with
respect to all property acquired in respect of any Mortgage Loan remaining in
the Trust Fund, an amount equal to the fair market value of such property, as
determined by an appraisal to be conducted by an appraiser selected by the
Trustee, less unreimbursed Advances made with respect to the Mortgage Loan with
respect to which property has been acquired; provided, however, that in no event
shall the trust created hereby continue beyond the earlier of (i) 32 years
after the Closing Date and (ii) 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. James's, living on the date hereof.
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF
ASSIGNEE)
-----------------------
-----------------------
-------------------------------------------------------------
(Please Print or Type Name and Address of Assignee)
-------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) _______________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon the
face of the within Certificate in every particular,
without alteration or enlargement or any change
whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
EXHIBIT D
FORM OF CLASS M CERTIFICATE
THIS CLASS M CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS 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, AS
AMENDED.
NO TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE COMPANY SHALL HAVE
RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE TRANSFEREE OF THIS
CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE EITHER (A) IS NOT AN EMPLOYEE
BENEFIT PLAN (A "PLAN") WITHIN THE MEANING OF SECTION 406 OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), AND IS NOT
DIRECTLY OR INDIRECTLY PURCHASING ANY CERTIFICATE ON BEHALF OF, AS INVESTMENT
MANAGER OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH ASSETS OF A PLAN OR, IN
THE CASE OF AN INSURANCE COMPANY, THE ASSETS OF ANY SEPARATE ACCOUNTS TO EFFECT
SUCH ACQUISITION OR (B) THE SOURCE OF FUNDS FOR THE PURCHASE OF THE CERTIFICATES
IS AN "INSURANCE COMPANY GENERAL ACCOUNT" WITHIN THE MEANING OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60"), 60 FED. REG. 35925 (JULY 12,
1995), AND THE CONDITIONS SET FORTH IN SECTION I AND SECTION III OF PTCE 95-60
ARE SATISFIED WITH RESPECT TO THE PURCHASE AND HOLDING OF THE CERTIFICATES, OR
(ii) IF THIS CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE NAME OF A PLAN
SUBJECT TO TITLE I OF ERISA, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE") (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT
ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO IS USING THE
ASSETS OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, AN OPINION OF COUNSEL TO THE
EFFECT THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE
ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" PURSUANT TO THE
DEPARTMENT OF LABOR PLAN ASSET REGULATIONS SET FORTH IN 29 C.F.R. ss.2510.3-101
AND TO BE SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR THE
PROHIBITED TRANSACTION PROVISIONS OF THE CODE, WILL NOT CONSTITUTE OR RESULT IN
A PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406 OR SECTION 407 OF
ERISA OR SECTION 4975 OF THE CODE, AND WILL NOT SUBJECT THE TRUSTEE, THE
SERVICER, THE COMPANY OR ANY OF THEIR AFFILIATES TO ANY OBLIGATION OR LIABILITY
(INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE)
RELATING TO THE CERTIFICATES.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN CHASE
MANHATTAN ACCEPTANCE CORPORATION, THE SERVICER OR THE TRUSTEE REFERRED TO BELOW
OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR INTEREST
REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR INSURED
BY CHASE MANHATTAN ACCEPTANCE CORPORATION, CHASE MANHATTAN MORTGAGE CORPORATION,
THE TRUSTEE OR BY ANY OF THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR
INSTRUMENTALITY.
MORTGAGE PASS-THROUGH CERTIFICATE
Series [ ], CLASS M
Number 98-[ ]-M-1 Original Denomination
$_____________________
Cut-off Date: [DATE] Final Scheduled Distribution
Date: _________________
First Distribution Date:
[DATE] Approximate Aggregate Original
Denomination of all Class M
Certificate Rate: ___% Certificates: $_______________
evidencing an interest in distributions allocable to the Class M Certificates
with respect to a pool of conventional one- to four-family mortgage loans formed
and sold by
CHASE MANHATTAN ACCEPTANCE CORPORATION CUSIP: ____________
This certifies that _______________________________ is the registered
owner of the ownership interest evidenced by this Certificate (obtained by
dividing the Original Denomination of this Certificate by the aggregate Original
Denomination of all Class M Certificates) in certain monthly distributions with
respect to a pool (the "Mortgage Pool") of conventional one- to four-family
adjustable rate mortgage loans (the "Mortgage Loans") formed and sold by Chase
Manhattan Acceptance Corporation (the "Company"), which Mortgage Loans are
secured by Mortgaged Properties, and in certain other property held in trust for
the benefit of the Certificate holders (collectively, the "Trust Fund"). The
Mortgage Loans are serviced by Chase Manhattan Mortgage Corporation (in such
capacity, the "Servicer"). The Trust Fund was created pursuant to a Pooling and
Servicing Agreement dated as of [DATE] (the "Agreement") among the Company, the
Servicer and [TRUSTEE], as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth below. To the extent not defined
herein, the capitalized terms used herein shall have the meanings assigned in
the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class
M (the "Class M Certificates") and 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 the acceptance hereof assents and by which such
Holder is bound. Also issued under the Agreement are Certificates designated as
Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class A (the "Class
A Certificates") and Class B (the "Class B Certificates"). The Class A
Certificates are senior to, and the Class B Certificates are subordinate to, the
Class M Certificates in right of payment to
the extent described herein and in the Agreement. The Class A Certificates,
Class M Certificates and Class B Certificates are collectively referred to as
the "Certificates".
Pursuant to the terms of the Agreement, the Trustee or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent, will distribute
from funds in the Certificate Account the amount as described on the reverse
hereof on the 25th day of each month or, if such 25th day is not a Business Day,
the Business Day immediately following (the "Distribution Date"), commencing on
[DATE]. Such distributions will be made to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month preceding the month in which such payment is made, or if such last day
is not a Business Day, the Business Day immediately preceding such last day (the
"Record Date").
Distributions on this Certificate will be made either by check mailed
to the address of the Person entitled thereto, as such name and address shall
appear on the Certificate Register, or by wire transfer in immediately available
funds to the account of such Holder at a bank or other financial or depository
institution having appropriate facilities therefor, if such Holder has so
notified the Paying Agent in writing at least 10 Business Days prior to the
first Distribution Date for which distribution by wire transfer is to be made,
and such Holder's Certificates evidence an aggregate original principal balance
of not less than $5,000,000 or such Holder holds a 100% Percentage Interest of
such Class. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee or, if a Paying Agent
has been appointed under Section 4.05, the Paying Agent, of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office of the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, or agency appointed by the Trustee or, if a Paying Agent
has been appointed under Section 4.05, the Paying Agent, for the purpose and
specified in such notice of final distribution.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Authenticating Agent, 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 Company has caused this Certificate to be duly
executed.
Dated: [DATE] CHASE MANHATTAN ACCEPTANCE
CORPORATION
By: ________________________________
Certificate of Authentication
This is one of the Class M Certificates
referred to in the within-mentioned
Agreement.
[TRUSTEE, as Trustee or] THE CHASE MANHATTAN BANK
as Authenticating Agent
By: _____________________________
Authorized Signatory
REVERSE OF CERTIFICATE
MORTGAGE PASS-THROUGH CERTIFICATE
Series [ ]
This Certificate is one of a duly authorized issue of Certificates,
designated as Multi-Class Mortgage Pass-Through Certificates, Series [ ], issued
in ten Classes of Class A Certificates, one Class of Class M Certificates and
five Classes of Class B Certificates, each evidencing an interest in certain
distributions with respect to a pool of adjustable rate one- to four-family
first Mortgage Loans formed and sold by the Company and certain other property
conveyed by the Company to the Trustee. The Class A Certificates evidence in the
aggregate the Class A Percentage of distributions relating to repayments of
principal and interest on such Mortgage Loans. The Class M Certificates evidence
in the aggregate the Class M Percentage of distributions relating to repayments
of principal and interest on such Mortgage Loans.
Following the initial issuance of the Certificates, the Principal
Balance of this Certificate will be different from the Original Denomination
shown above. Anyone acquiring this Certificate may ascertain its current
Principal Balance by inquiry of the Trustee.
The Holder, by its acceptance of this Certificate, agrees that it will
look solely to the Trust Fund and certain amounts resulting from credit
enhancements for payment hereunder and that the Trustee is not liable to the
Holders 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 Trustee will cause to be kept at its Corporate Trust Office in New
York, New York, or at the office of any Paying Agent appointed under the
Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee (or any Paying Agent, as the case
may be) will provide for the registration of Certificates and of transfers and
exchanges of Certificates. Upon surrender for registration of transfer of any
Certificate at any office or agency of the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, maintained for such
purpose, the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee or
transferees, a Certificate of a like Class and dated the date of authentication
by the Authenticating Agent.
No service charge will be made to the Holder for any transfer or
exchange of the Certificate, but the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of the Certificate. Prior to due
presentation of a Certificate for registration of transfer, the Company, the
Servicer and the Trustee may treat the person in whose name any Certificate is
registered as the owner of such
Certificate and the Percentage Interest in the Trust Fund evidenced thereby for
the purpose of receiving distributions pursuant to the Agreement and for all
other purposes whatsoever, and neither the Company, the Servicer, the Paying
Agent nor the Trustee will be affected by notice to the contrary.
The Agreement may be amended from time to time by the Company, the
Servicer and the Trustee, without the consent of any of the Certificateholders,
to cure any ambiguity, to correct or supplement any provisions therein which may
be inconsistent with the other provisions therein, to ensure continuing
treatment of the Trust Fund as a REMIC, or to make any other provisions with
respect to matters or questions arising under the Agreement which are not
materially inconsistent with the provisions of the Agreement, provided that such
action does not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Certificateholder.
The Agreement may also be amended from time to time by the Company, the
Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interests of
each Class of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
reduce in any manner the amount of, or delay the timing of, payments received on
Mortgage Loans which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, (ii) reduce the aforesaid
percentage of Certificates of any Class the Holders of which are required to
consent to any such amendment or (iii) change the percentage specified in clause
(ii) of the first paragraph of Section 11.01 of the Agreement, without the
consent of the Holders of all Certificates of such Class then outstanding.
The respective obligations and responsibilities of the Company, the
Servicer and the Trustee under the Agreement will terminate upon (i) the later
of the final payment or other liquidation (or any Advance with respect thereto)
of the last Mortgage Loan or the disposition of all property acquired upon the
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due thereunder; or (ii) at the option of the Servicer,
on any Distribution Date which occurs in the month following a Due Date on which
the aggregate unpaid Principal Balance of the Outstanding Mortgage Loans is less
than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans on the
Cut-off Date, so long as the Servicer deposits or causes to be deposited in the
Collection Account during the Principal Prepayment Period related to such
Distribution Date an amount equal to the Purchase Price for each Mortgage Loan,
less any unreimbursed Advances made with respect to any Mortgage Loan, and with
respect to all property acquired in respect of any Mortgage Loan remaining in
the Trust Fund, an amount equal to the fair market value of such property, as
determined by an appraisal to be conducted by an appraiser selected by the
Trustee, less unreimbursed Advances made with respect to the Mortgage Loan with
respect to which property has been acquired; provided, however, that in no event
shall the trust created hereby continue beyond the earlier of (i) 32 years
after the Closing Date and (ii) 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.
James's, living on the date hereof.
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF ASSIGNEE)
-------------------
-------------------
-------------------------------------------------------------
(Please Print or Type Name and Address of Assignee)
-------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) _______________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon the
face of the within Certificate in every particular,
without alteration or enlargement or any change
whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
EXHIBIT E
FORMS OF CLASS B CERTIFICATES
THIS CLASS B-1 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AND THE CLASS M CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS 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, AS
AMENDED.
THIS CLASS B-1 CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS SOLD OR TRANSFERRED IN TRANSACTIONS
WHICH ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT OR UNDER APPLICABLE STATE LAW
AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 4.02 OF THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
CLASS B-1 CERTIFICATE
Original Denomination
$_______________________
Aggregate Original Principal
Balance of all Class B-1
Certificates: $______________
Cut-off Date: [DATE] Number 98-[ ]-B-1-1
First Distribution Date:
[DATE]
Certificate Rate: ___%
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
Series [ ]
evidencing an ownership interest in distributions allocable to a pool
of conventional one- to four-family mortgage loans formed and sold by
CHASE MANHATTAN ACCEPTANCE CORPORATION
This Certificate does not represent an obligation of or interest in
Chase Manhattan Acceptance Corporation ("CMAC" or the "Depositor"), the Servicer
or the Trustee referred to below or any of their affiliates. Neither this
Certificate, the REMIC regular interest represented hereby nor the underlying
Mortgage Loans are guaranteed or insured by CMAC, Chase Manhattan Mortgage
Corporation, the Trustee or by any of their affiliates or by any governmental
agency or instrumentality.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE WILL BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN ABOVE.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
NO TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE COMPANY SHALL HAVE
RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE TRANSFEREE OF THIS
CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE EITHER (A) IS NOT AN EMPLOYEE
BENEFIT PLAN (A "PLAN") WITHIN THE MEANING OF SECTION 406 OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), AND IS NOT
DIRECTLY OR INDIRECTLY PURCHASING ANY CERTIFICATE ON BEHALF OF, AS INVESTMENT
MANAGER OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH ASSETS OF A PLAN OR, IN
THE CASE OF AN INSURANCE COMPANY, THE ASSETS OF ANY SEPARATE ACCOUNTS TO EFFECT
SUCH ACQUISITION OR (B) THE SOURCE OF FUNDS FOR THE PURCHASE OF THE CERTIFICATES
IS AN "INSURANCE COMPANY GENERAL ACCOUNT" WITHIN THE MEANING OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60"), 60 FED. REG. 35925 (JULY 12,
1995), AND THE CONDITIONS SET FORTH IN SECTION I AND SECTION III OF PTCE 95-60
ARE SATISFIED WITH RESPECT TO THE PURCHASE AND HOLDING OF THE CERTIFICATES, OR
(ii) IF THIS CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE NAME OF A PLAN
SUBJECT TO TITLE I OF ERISA, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE") (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT
ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO IS USING THE
ASSETS OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, AN OPINION OF COUNSEL TO THE
EFFECT THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE
ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" PURSUANT TO THE
DEPARTMENT OF LABOR PLAN ASSET REGULATIONS SET FORTH IN 29 C.F.R. ss.2510.3-101
AND TO BE SUBJECT TO THE FIDUCIARY
RESPONSIBILITY PROVISIONS OF ERISA OR THE PROHIBITED TRANSACTION PROVISIONS OF
THE CODE, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE
MEANING OF SECTION 406 OR SECTION 407 OF ERISA OR SECTION 4975 OF THE CODE, AND
WILL NOT SUBJECT THE TRUSTEE, THE SERVICER, THE COMPANY OR ANY OF THEIR
AFFILIATES TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES
UNDER ERISA OR SECTION 4975 OF THE CODE) RELATING TO THE CERTIFICATES.
This certifies that _____________________________ is the registered
owner of the ownership interest (the "Ownership Interest") evidenced by this
Certificate (obtained by dividing the Original Denomination of this Certificate
by the aggregate Original Denomination of all Class B-1 Certificates) in certain
distributions with respect to a pool of conventional one- to four-family first
mortgage loans (the "Mortgage Loans") formed and sold by Chase Manhattan
Acceptance Corporation (hereinafter called the "Depositor"), and certain other
property held in trust for the benefit of Certificate holders (collectively, the
"Trust Fund"). The Mortgage Loans are serviced by Chase Manhattan Mortgage
Corporation (the "Servicer") and are secured by first mortgages on Mortgaged
Properties. The Trust Fund was created pursuant to a Pooling and Servicing
Agreement (the "Agreement"), dated as of [DATE] among the Depositor, the
Servicer and [TRUSTEE], as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the
Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class
B-1 (the "Class B-1 Certificate") and 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 the acceptance hereof assents and by which
Agreement such Holder is bound.
Distributions on this Certificate will be made either by check mailed
to the address of the Person entitled thereto, as such name and address shall
appear on the Certificate Register, or by wire transfer in immediately available
funds to the account of such Holder at a bank or other financial or depository
institution having appropriate facilities therefor, if such Holder has so
notified the Paying Agent in writing at least 10 Business Days prior to the
first Distribution Date for which distribution by wire transfer is to be made,
and such Holder's Certificates evidence an aggregate original principal balance
of not less than $5,000,000 or such Holder holds a 100% Percentage Interest of
such Class.
The rights of the Class B Certificateholders to receive distributions
in respect of the Class B Certificates on any Distribution Date are subordinated
to the rights of the Class A and Class M Certificateholders and the holders of
any Class or Classes of Class B Certificates having a lower numerical class
designation to receive distributions in respect of the Class A and Class M
Certificates and such Class B Certificates to the extent, and only to the
extent, set forth in the Agreement. Amounts properly distributed to the Class B
Certificateholders pursuant to the
Agreement will be deemed released from the Trust Fund, and the Class B
Certificateholders will not in any event be required to refund any such
distributed amounts. 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 specified in such notice of final
distribution.
The Trustee will cause to be kept at its Corporate Trust Office in New
York, New York, or at the office of any Paying Agent appointed under the
Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, will provide for the
registration of Certificates and of transfers and exchanges of Certificates.
Upon surrender for registration of transfer of any Certificate at any office or
agency of the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, maintained for such purpose, the Trustee or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent, will, subject to
the limitations set forth in the Agreement, authenticate and deliver, in the
name of the designated transferee or transferees, a Certificate of a like class
and dated the date of authentication by the Authenticating Agent.
No service charge will be made to the Holder for any transfer or
exchange of the Certificate, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of the Certificate. Prior to due
presentation of a Certificate for registration of transfer, the Depositor, the
Servicer, the Paying Agent and the Trustee may treat the person in whose name
any Certificate is registered as the owner of such Certificate and the Ownership
Interest in the Trust Fund evidenced thereby for the purpose of receiving
distributions pursuant to the Agreement and for all other purposes whatsoever,
and neither the Depositor, the Servicer nor the Trustee will be affected by
notice to the contrary.
The Agreement may be amended from time to time by the Depositor, the
Servicer and the Trustee, without the consent of any of the Certificateholders,
to cure any ambiguity, to correct or supplement any provisions therein, which
may be inconsistent with any other provisions therein, to ensure continuing
treatment of the Trust Fund or its assets as a REMIC and to avoid the imposition
of certain tax liabilities, or to make any other provisions with respect to
matters or questions arising under the Agreement which are not materially
inconsistent with the provisions of the Agreement, provided that such action
does not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Certificateholder.
The Agreement may also be amended from time to time by the Depositor,
the Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66% of the Percentage Interest of each
Class of Certificates affected thereby for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of the
Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
reduce in any
manner the amount of, or delay the timing of, payments received on the Mortgage
Loans which are required to be distributed on any Certificate without the
consent of the Holder of such Certificate, (ii) reduce the aforesaid percentage
of Certificates of any Class the Holders of which are required to consent to any
such amendment or (iii) change the percentage specified in clause (ii) of the
first paragraph of Section 11.01 of the Agreement, without the consent of the
Holders of all Certificates of such Class then outstanding.
The respective obligations and responsibilities of the Depositor, the
Servicer and the Trustee under the Agreement will terminate upon: (i) the later
of the final payment or other liquidation (or any Advance with respect thereto)
of the last Mortgage Loan or the disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due thereunder; or (ii) at the option of the Servicer,
on any Distribution Date which occurs in the month next following a Due Date on
which the aggregate unpaid Principal Balance of the Outstanding Mortgage Loans
is less than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans
on the Cut-off Date, so long as the Servicer deposits or causes to be deposited
in the Collection Account during the Principal Prepayment Period related to such
Distribution Date an amount equal to the Purchase Price for each Mortgage Loan,
less any unreimbursed Advances made with respect to any Mortgage Loan and, with
respect to all property acquired in respect of any Mortgage Loan remaining in
the Trust Fund, an amount equal to the fair market value of such property, as
determined by an appraisal to be conducted by an appraiser selected by the
Trustee, less unreimbursed Advances made with respect to the Mortgage Loan with
respect to which property has been acquired; provided, however, that in no event
shall the trust created hereby continue beyond the earlier of (i) 32 years after
the Closing Date and (ii) 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. James's, living on the date hereof.
IN WITNESS WHEREOF, the Depositor has caused this Certificate to be
duly executed.
Dated: [DATE] CHASE MANHATTAN ACCEPTANCE
CORPORATION
By: ______________________________
Authorized Officer
This is one of the Class B-1
Certificates referred to
in the within-mentioned
Agreement.
[TRUSTEE, as Trustee or] THE CHASE MANHATTAN BANK
as Authenticating Agent
By: ________________________
Authorized Signatory
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF ASSIGNEE)
----------------------
----------------------
-------------------------------------------------------------
(Please Print or Type Name and Address of Assignee)
-------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) _______________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon the
face of the within Certificate in every particular,
without alteration or enlargement or any change
whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
EXHIBIT F
FORM OF CLASS A-R CERTIFICATE
AS MORE FULLY PROVIDED BY SECTION 4.02(i) OF THE AGREEMENT, CERTAIN SPECIFIED
ENTITIES INCLUDING (A) THE UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION
THEREOF, ANY FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY
OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN INSTRUMENTALITY THAT
IS A CORPORATION ALL OF WHOSE ACTIVITIES ARE SUBJECT TO TAX UNDER CHAPTER 1 OF
SUBTITLE A OF THE CODE AND (EXCEPT IN THE CASE OF FHLMC) A MAJORITY OF WHOSE
BOARD OF DIRECTORS IS NOT SELECTED BY THE UNITED STATES, OR ANY STATE OR
POLITICAL SUBDIVISION THEREOF), (B) ANY ORGANIZATION THAT IS EXEMPT FROM TAX
IMPOSED BY CHAPTER 1 OF SUBTITLE A OF THE CODE, OTHER THAN (X) A TAX-EXEMPT
FARMERS' COOPERATIVE WITHIN THE MEANING OF SECTION 521 OF THE CODE OR (Y) AN
ORGANIZATION THAT IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE ON
"UNRELATED BUSINESS INCOME", (C) A CORPORATION OPERATING ON A COOPERATIVE BASIS
THAT IS ENGAGED IN FURNISHING ELECTRIC ENERGY OR PROVIDING TELEPHONE SERVICE TO
PERSONS IN RURAL AREAS (WITHIN THE MEANING OF SECTION 1381(a)(2)(C) OF THE CODE)
AND (D) CERTAIN FOREIGN PERSONS ARE PROHIBITED FROM ACQUIRING BENEFICIAL
OWNERSHIP OF A CLASS A-R CERTIFICATE.
CLASS A-R CERTIFICATE
Cut-off Date: [DATE] Original Denomination
$______________________
First Distribution Date: Aggregate Original Principal
[DATE] Balance of all Class A-R
Certificates: $__________
Cut-off Date: [DATE] Number 98-[ ]-A-R-1
Certificate Rate: ___%
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
Series [ ]
evidencing an ownership interest in distributions allocable to
the Residual Interest Certificates with respect to a pool of
conventional one- to four-family first mortgage loans formed
and sold by
CHASE MANHATTAN ACCEPTANCE CORPORATION
This Certificate does not represent an obligation of or interest in
Chase Manhattan Acceptance Corporation, the Servicer or the Trustee referred to
below or any of their affiliates. Neither this Certificate nor the underlying
Mortgage Loans are guaranteed or insured by Chase Manhattan Acceptance
Corporation, Chase Manhattan Mortgage Corporation, the Trustee or by any of
their affiliates or by any governmental agency or instrumentality.
NO TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE DEPOSITOR SHALL HAVE
RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE TRANSFEREE OF THIS
CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE EITHER (A) IS NOT AN EMPLOYEE
BENEFIT PLAN (A "PLAN") WITHIN THE MEANING OF SECTION 406 OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), AND IS NOT
DIRECTLY OR INDIRECTLY PURCHASING ANY CERTIFICATE ON BEHALF OF, AS INVESTMENT
MANAGER OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH ASSETS OF A PLAN OR, IN
THE CASE OF AN INSURANCE COMPANY, THE ASSETS OF ANY SEPARATE ACCOUNTS TO EFFECT
SUCH ACQUISITION OR (B) THE SOURCE OF FUNDS FOR THE PURCHASE OF THE CERTIFICATES
IS AN "INSURANCE COMPANY GENERAL ACCOUNT" WITHIN THE MEANING OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60"), 60 FED. REG. 35925 (JULY 12,
1995), AND THE CONDITIONS SET FORTH IN SECTION I AND SECTION III OF PTCE 95-60
ARE SATISFIED WITH RESPECT TO THE PURCHASE AND HOLDING OF THE CERTIFICATES, OR
(ii) IF THIS CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE NAME OF A PLAN
SUBJECT TO TITLE I OF ERISA, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE") (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT
ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO IS USING THE
ASSETS OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, AN OPINION OF COUNSEL TO THE
EFFECT THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE
ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" PURSUANT TO THE
DEPARTMENT OF LABOR PLAN ASSET REGULATIONS SET FORTH IN 29 C.F.R. ss.2510.3-101
AND TO BE SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR THE
PROHIBITED TRANSACTION PROVISIONS OF THE CODE, WILL NOT CONSTITUTE OR RESULT IN
A PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406 OR SECTION 407 OF
ERISA OR SECTION 4975 OF THE CODE, AND WILL NOT SUBJECT THE TRUSTEE, THE
SERVICER, THE COMPANY OR ANY OF THEIR AFFILIATES TO ANY OBLIGATION OR LIABILITY
(INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE)
RELATING TO THE CERTIFICATES.
This certifies that ____________________ is the registered owner of an
undivided interest in certain monthly distributions with respect to a pool (the
"Mortgage Pool) of conventional one- to four-family first mortgage loans (the
"Mortgage Loans") formed and sold by Chase Manhattan Acceptance Corporation
(hereinafter called the "Depositor", which term includes any successor entity
under the Agreement referred to below) and certain other property held in trust
for the benefit of Certificateholders (collectively, the "Trust Fund"). The
Mortgage Loans are serviced by Chase Manhattan Mortgage Corporation (the
"Servicer") and are secured by first mortgages on Mortgaged Properties. The
Trust Fund was created pursuant to a Pooling and Servicing Agreement (the
"Agreement") dated as of [DATE] among the Depositor, the Servicer and [TRUSTEE],
as trustee (the "Trustee"), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class
A-R (the "Class A-R Certificate") and 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 the acceptance hereof assents and by which
Agreement such Holder is bound. All payments made under this Certificate will be
made in accordance with the terms of the Agreement. Also issued under the
Agreement are Certificates designated as Multi-Class Mortgage Pass-Through
Certificates Series [ ], Class A, Class M, Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates. The Class A Certificates, the Class M
Certificates, the Class B Certificates and the Class A-R Certificates are
collectively referred to as the "Certificates".
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 or, if a Paying Agent has been appointed under Section 4.05, the
Paying Agent, for that purpose and specified in such notice of final
distribution.
The Trustee will cause to be kept at its Corporate Trust Office in New
York, New York, or at the office of any Paying Agent appointed under the
Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, will provide for the
registration of Certificates and of transfers and exchanges of Certificates.
Upon surrender for registration of transfer of any Certificate at any office or
agency of the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, maintained for such purpose, the Trustee will, subject
to the limitations set forth in the Agreement, authenticate and deliver, in the
name of the designated transferee or transferees, a Certificate of a like class
and dated the date of authentication by the Trustee.
No service charge will be made to the Holder for any transfer or
exchange of the Certificate, but the Trustee may require payment of a sum
sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of the Certificate. Prior to due presentation of a Certificate for
registration of transfer, the Depositor, the Servicer, the Paying Agent and the
Trustee may treat the person in whose name any Certificate is registered as the
owner of such Certificate and the Ownership Interest in the Trust Fund evidenced
thereby for the purpose of receiving distributions pursuant to the Agreement and
for all other purposes whatsoever, and neither the Depositor, the Servicer, the
Paying Agent nor the Trustee will be affected by notice to the contrary.
The Agreement may be amended from time to time by the Depositor, the
Servicer and the Trustee, without the consent of any of the Certificateholders,
to cure any ambiguity, to correct or supplement any provisions therein, which
may be inconsistent with any other provisions therein, to ensure continuing
treatment of the Trust Fund or its assets as a REMIC and to avoid the imposition
of certain tax liabilities, or to make any other provisions with respect to
matters or questions arising under the Agreement which are not materially
inconsistent with the provisions of the Agreement, provided that such action
does not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Certificateholder.
The Agreement may also be amended from time to time by the Depositor,
the Servicer and the Trustee with the consent of the Holders of Certificates
evidencing in the aggregate not less than 66-2/3% of the Percentage Interest of
each Class of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Agreement or of modifying in any manner the rights of the Holders of
Certificates of such Class; provided, however, that no such amendment may (i)
reduce in any manner the amount of, or delay the timing of, payments received on
the Mortgage Loans which are required to be distributed on any Certificate
without the consent of the Holder of such Certificate, (ii) reduce the aforesaid
percentage of Certificates of any Class the Holders of which are required to
consent to any such amendment or (iii) change the percentage specified in clause
(ii) of the first paragraph of Section 11.01 of the Agreement, without the
consent of the Holders of all Certificates of such Class then outstanding.
An election will be made to treat the Trust Fund as a REMIC for federal
income tax purposes. The Class A Certificates, the Class M Certificates, the
Class B Certificates will represent regular interests in the REMIC. The Class
A-R Certificate constitutes the Residual Interest in the REMIC.
The respective obligations and responsibilities of the Depositor, the
Servicer and the Trustee under the Agreement will terminate upon: (i) the later
of the final payment or other liquidation (or any Advance with respect thereto)
of the last Mortgage Loan or the disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due thereunder; or (ii) at the option of the Servicer,
on any Distribution Date which occurs in the month next following a Due Date on
which the aggregate unpaid Principal Balance of all Outstanding Mortgage Loans
is less than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans
on the Cut-off Date, so long as the Servicer
deposits or causes to be deposited in the Collection Account during the
Principal Prepayment Period related to such Distribution Date an amount equal to
the Purchase Price for each Mortgage Loan, less unreimbursed Advances made with
respect to any Mortgage Loan and, with respect to all property acquired in
respect of any Mortgage Loan remaining in the Trust Fund, an amount equal to the
fair market value of such property, as determined by an appraisal to be
conducted by an appraiser selected by the Trustee, less any Advances made with
respect to the Mortgage Loan with respect to which property has been acquired;
provided, however, that in no event shall the trust created hereby continue
beyond the earlier of (i) 32 years after the Closing Date and (ii) 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.
James's, living on the date hereof.
IN WITNESS WHEREOF, the Depositor has caused this Certificate to be
duly executed.
Dated: [DATE] CHASE MANHATTAN MORTGAGE
CORPORATION
By: ______________________________
Authorized Officer
This is the Class A-R
Certificate referred to
in the within-mentioned
Agreement.
[TRUSTEE, as Trustee or] THE CHASE MANHATTAN BANK
as Authenticating Agent
By: ________________________
Authorized Signatory
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF ASSIGNEE)
-----------------
-----------------
-------------------------------------------------------------
(Please Print or Type Name and Address of Assignee)
-------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) _______________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon the
face of the within Certificate in every particular,
without alteration or enlargement or any change
whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
EXHIBIT G
FORM OF TRUSTEE CERTIFICATION
[DATE]
Chase Manhattan Acceptance Corporation
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, XX 00000
Re: Pooling and Servicing Agreement dated as of [DATE] among
Chase Manhattan Acceptance Corporation, Chase Manhattan
Mortgage Corporation as servicer and [TRUSTEE], as trustee,
Multi-Class Mortgage Pass-Through Certificates, Series [ ]
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Trustee, hereby certifies that [,
except as set forth in Schedule A hereto,] as to each Mortgage Loan listed in
the Mortgage Loan Schedule attached hereto (other than any Mortgage Loan paid in
full or listed on the attachment hereto) it has reviewed the Mortgage File and
the Mortgage Loan Schedule and has determined that:
(i) All documents in the Mortgage File required to be delivered to the
Trustee pursuant to Section 2.01 of the Pooling and Servicing Agreement are in
its possession;
(ii) In connection with each Mortgage Loan or Assignment thereof as to
which documentary evidence of recording was not received on the Closing Date, it
has received evidence of such recording; and
(iii) Such documents have been reviewed by it and such documents do not
contain any material omissions or defects within the meaning of Section 2.01 or
2.02.
The Trustee further certifies that as to each Mortgage Loan, the
Trustee holds the Mortgage Note without any Responsible Officer of the Trustee
having received written notice (a) of any adverse claims, liens or encumbrances,
(b) that any Mortgage Note was overdue or has been dishonored, (c) of evidence
on the face of any Mortgage Note or Mortgage of any security interest therein,
or (d) of any defense against or claim to the Mortgage Note by any other party.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond confirming (i) that the Mortgage Loan
number and the name of the Mortgagor in each Mortgage File conform to the
respective Mortgage Loan number and name
listed on the Mortgage Loan Schedule and (ii) the existence in each Mortgage
File of each of the documents listed in subparagraphs (i)(A) through (G),
inclusive, of Section 2.01 in the Agreement. The Trustee makes no
representations or warranties as to the validity, legality, sufficiency,
enforceability or genuineness of any of the documents contained in each Mortgage
Loan or the collectibility, insurability, effectiveness or suitability of any
such Mortgage Loan.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.
[TRUSTEE],
as Trustee
By: ______________________________
Name: ______________________________
Title: ______________________________
EXHIBIT H
FORM OF INVESTMENT LETTER
(Accredited Investor)
[DATE]
Chase Manhattan Mortgage Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Re: Chase Manhattan Acceptance Corporation
Multi-Class Mortgage Pass-Through
Certificates, Series [ ], [Class B- ]
Ladies and Gentlemen:
______________ (the "Purchaser") intends to purchase from
_________________________ (the "Transferor") $_______ by original principal
balance (the "Transferred Certificates") of Multi-Class Mortgage Pass-Through
Certificates, Series [ ], [Class B- ] (the "Certificates"), issued pursuant to a
pooling and servicing agreement, dated as of [DATE] (the "Pooling and Servicing
Agreement"), among Chase Manhattan Acceptance Corporation (the "Depositor"),
Chase Manhattan Mortgage Corporation, as Servicer (the "Servicer"), and
[TRUSTEE], as trustee (the "Trustee"). [The Purchaser intends to register the
Transferred Certificate in the name of ____________________, as nominee for
__________________.] All terms used and not otherwise defined herein shall have
the meanings set forth in the Pooling and Servicing Agreement.
For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Purchaser certifies, represents and warrants
to, and covenants with, the Depositor and the Trustee that:
1. The Purchaser understands that (a) the Certificates have not been
registered or qualified under the Securities Act of 1933, as amended (the
"Securities Act"), or the securities laws of any state, (b) neither the
Depositor nor the Trustee is required, and neither of them intends, to so
register or qualify the Certificates, (c) the Certificates cannot be resold
unless (i) they are registered and qualified under the Securities Act and the
applicable state securities laws or (ii) an exemption from registration and
qualification is available and (d) the Pooling and Servicing Agreement contains
restrictions regarding the transfer of the Certificates.
2. The Certificates will bear a legend to the following effect:
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), THE INVESTMENT COMPANY ACT OF 1940, AS
AMENDED (THE "1940 ACT") OR ANY STATE SECURITIES OR "BLUE SKY" LAWS,
AND MAY NOT, DIRECTLY OR INDIRECTLY, BE SOLD OR OTHERWISE TRANSFERRED,
OR OFFERED FOR SALE, UNLESS SUCH TRANSFER IS NOT SUBJECT TO
REGISTRATION UNDER THE ACT, THE 1940 ACT AND ANY APPLICABLE STATE
SECURITIES LAWS AND SUCH TRANSFER ALSO COMPLIES WITH THE OTHER
PROVISIONS OF SECTION 4.02 OF THE POOLING AND SERVICING AGREEMENT. NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE TRUSTEE SHALL
HAVE RECEIVED, IN FORM AND SUBSTANCE SATISFACTORY TO THE SERVICER AND
THE TRUSTEE (A) AN INVESTMENT LETTER FROM THE PROSPECTIVE INVESTOR;
AND (B) REPRESENTATIONS FROM THE TRANSFEROR REGARDING THE OFFERING AND
SALE OF THE CERTIFICATES.
NO TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE DEPOSITOR
SHALL HAVE RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE
TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE
EITHER (A) IS NOT AN EMPLOYEE BENEFIT PLAN (A "PLAN") WITHIN THE
MEANING OF SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED ("ERISA"), AND IS NOT DIRECTLY OR INDIRECTLY
PURCHASING ANY CERTIFICATE ON BEHALF OF, AS INVESTMENT MANAGER OF, AS
NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH ASSETS OF A PLAN OR, IN THE
CASE OF AN INSURANCE COMPANY, THE ASSETS OF ANY SEPARATE ACCOUNTS TO
EFFECT SUCH ACQUISITION OR (B) THE SOURCE OF FUNDS FOR THE PURCHASE OF
THE CERTIFICATES IS AN "INSURANCE COMPANY GENERAL ACCOUNT" WITHIN THE
MEANING OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE
95-60"), 60 FED. REG. 35925 (JULY 12, 1995), AND THE CONDITIONS SET
FORTH IN SECTION I AND SECTION III OF PTCE 95-60 ARE SATISFIED WITH
RESPECT TO THE PURCHASE AND HOLDING OF THE CERTIFICATES, OR (ii) IF
THIS CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE NAME OF A PLAN
SUBJECT TO TITLE I OF ERISA, OR SECTION 4975 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED (THE "CODE") (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER
PERSON WHO IS USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH
ACQUISITION, AN
OPINION OF COUNSEL TO THE EFFECT THAT THE PURCHASE OR HOLDING OF THIS
CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND BEING
DEEMED TO BE "PLAN ASSETS" PURSUANT TO THE DEPARTMENT OF LABOR PLAN
ASSET REGULATIONS SET FORTH IN 29 C.F.R. ss.2510.3-101 AND TO BE
SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR THE
PROHIBITED TRANSACTION PROVISIONS OF THE CODE, WILL NOT CONSTITUTE OR
RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406
OR SECTION 407 OF ERISA OR SECTION 4975 OF THE CODE, AND WILL NOT
SUBJECT THE TRUSTEE, THE SERVICER, THE COMPANY OR ANY OF THEIR
AFFILIATES TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE) RELATING TO THE
CERTIFICATES.
3. The Purchaser is acquiring the Transferred Certificates for its own
account [for investment only]*/ and not with a view to or for sale or other
transfer in connection with any distribution of the Transferred Certificates in
any manner that would violate the Securities Act or any applicable state
securities laws, subject, nevertheless, to the understanding that disposition of
the Purchaser's property shall at all times be and remain within its control.
4. The Purchaser (a) is a substantial, sophisticated institutional
investor having such knowledge and experience in financial and business matters,
and in particular in such matters related to securities similar to the
Certificates, such that it is capable of evaluating the merits and risks of
investment in the Certificates, (b) is able to bear the economic risks of such
an investment and (c) is an "accredited investor" within the meaning of Rule
501(a) promulgated pursuant to the Securities Act.
5. The Purchaser will not nor has it authorized nor will it authorize
any person to (a) offer, pledge, sell, dispose of or otherwise transfer any
Certificate, any interest in any Certificate or any other similar security to
any person in any manner, (b) solicit 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)
otherwise approach or negotiate with respect to any Certificate, any interest in
any Certificate or any other similar security with any person in any manner, (d)
make any general solicitation by means of general advertising or in any other
manner, or (e) take any other action, that would constitute a distribution of
any Certificate under the Securities Act or the Investment Company Act of 1940,
as amended (the "1940 Act"), that would render the disposition of any
Certificate a violation of Section 5 of the Securities Act or any state
securities law, or that would require registration or qualification pursuant
thereto. Neither the Purchaser nor anyone acting on its behalf has offered the
Certificates for sale or made any general solicitation by means of general
advertising or in
--------
*/ Not required of a broker/dealer purchaser.
any other manner with respect to the Certificates. The Purchaser will not sell
or otherwise transfer any of the Certificates, except in compliance with the
provisions of the Pooling and Servicing Agreement.
6. [This paragraph may be deleted if the Purchaser provides the Opinion
of Counsel referred to in clause (ii) of Section 4.02(d) of the Pooling and
Servicing Agreement.] The Purchaser either (A) is not an employee benefit plan
within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or a plan within the meaning of Section 4975
of the Internal Revenue Code of 1986, as amended (the "Code") (each, a "Plan"),
and is not directly or indirectly purchasing any Certificate on behalf of, as
investment manager of, as named fiduciary of, as trustee of or with assets of a
Plan or directly or indirectly purchasing any certificates with the assets of
any insurance company separate account or of any Plan or (B) is an insurance
company and the source of funds for the purchase of the certificates is an
"insurance company general account" within the meaning of Prohibited Transaction
Class Exemption 95-60 ("PTCE 95-60"), 60 Fed. Reg. 35925 (July 12, 1995), and
the conditions set forth in Section I and III of PTCE 95-60 are satisfied with
respect to the purchase and holding of the Certificates.
7. Prior to the sale or transfer by the Purchaser of any of the
Certificates, the Purchaser will obtain from any subsequent purchaser
substantially the same certifications, representations, warranties and covenants
contained in the foregoing paragraphs and in this letter or a letter
substantially in the form of Exhibit I to the Pooling and Servicing Agreement.
8. The Purchaser agrees to indemnify the Trustee, the Servicer and the
Depositor against any liability that may result from any misrepresentation made
herein.
Very truly yours,
[PURCHASER]
By: ______________________
Name: ______________________
Title: ______________________
Chase Manhattan Mortgage Corporation
[TRUSTEE]
[DATE]
Page 1
EXHIBIT I
FORM OF RULE 144A INVESTMENT LETTER
(Qualified Institutional Buyer)
[DATE]
Chase Manhattan Mortgage Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
The Chase Manhattan Bank
Global Trust Services
15th Floor
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Re: Chase Manhattan Acceptance Corporation,
Multi-Class Mortgage Pass-Through
Certificates, Series [ ], [Class B- ]
Ladies and Gentlemen:
______________ (the "Purchaser") intends to purchase from
_________________________ (the "Transferor") $_______ by original principal
balance (the "Transferred Certificates") of Multi-Class Mortgage Pass-Through
Certificates, Series [ ], [Class B-] (the "Certificates"), issued pursuant to a
pooling and servicing agreement, dated as of [DATE] (the "Pooling and Servicing
Agreement"), among Chase Manhattan Acceptance Corporation (the "Depositor"),
Chase Manhattan Mortgage Corporation, as Servicer (the "Servicer"), and
[TRUSTEE], as trustee (the "Trustee"). [The Purchaser intends to register the
Transferred Certificate in the name of ____________________, as nominee for
__________________.] All terms used and not otherwise defined herein shall have
the meanings set forth in the Trust Agreement.
For good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Purchaser certifies, represents and warrants
to, and covenants with, the Depositor and the Trustee that:
In connection with our acquisition of the above Transferred
Certificates we certify that (a) we understand that the Certificates are not
being registered under the Securities Act of
Chase Manhattan Mortgage Corporation
[TRUSTEE]
[DATE]
Page 2
1933, as amended (the "Act"), or any state securities laws and are being
transferred to us in a transaction that is exempt from the registration
requirements of the Act and any such laws, (b) we have such knowledge and
experience in financial and business matters that we are capable of evaluating
the merits and risks of investments in the Certificates, (c) we have had the
opportunity to ask questions of and receive answers from the Depositor
concerning the purchase of the Transferred Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Transferred Certificates, (d) we are not an employee benefit plan
within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended, or a plan within the meaning of Section 4975 of the
Internal Revenue Code of 1986, as amended (each, a "Plan"), nor are we directly
or indirectly purchasing any Certificate on behalf of, as investment manager of,
as named fiduciary of, as trustee of or with assets of a Plan or directly or
indirectly purchasing any certificates with the assets of any insurance company
separate account or of any Plan [OR ALTERNATIVELY, IN THE CASE OF AN INSURANCE
COMPANY, IS AN INSURANCE COMPANY AND THE SOURCE OF FUNDS FOR THE PURCHASE OF THE
CERTIFICATES] is an "insurance company general account" within the meaning of
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60"), 50 Fed. Reg. 35925
(July 12, 1995), and the conditions set forth in Section I and Section III of
PTCE 95-60 are satisfied with respect to the purchase and holding of the
Certificates, (e) we have not, nor has anyone acting on our behalf offered,
transferred, pledged, sold or otherwise disposed of the Certificates, any
interest in the Certificates or any other similar security to, or solicited any
offer to buy or accept a transfer, pledge or other disposition of the
Certificates, any interest in the Certificates or any other similar security
from, or otherwise approached or negotiated with respect to the Certificates,
any interest in the Certificates or any other similar security with, any person
in any manner, or made any general solicitation by means of general advertising
or in any other manner, or taken any other action, that would constitute a
distribution of the Certificates under the Securities Act or that would render
the disposition of the Certificates a violation of Section 5 of the Securities
Act or require registration pursuant thereto, nor will act, nor has authorized
or will authorize any person to act, in such manner with respect to the
Certificates, (f) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act and have completed one of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2. We
are aware that the sale of the Transferred Certificates to us is being made in
reliance on Rule 144A. We are acquiring the Transferred Certificates for our own
account or for resale pursuant to Rule 144A and further understand that such
Certificates may be resold, pledged or transferred only (i) to a person
reasonably believed by us, based upon certifications of such purchaser or
information we have in our possession, to be a qualified institutional buyer
that purchases for its own account or
Chase Manhattan Mortgage Corporation
[TRUSTEE]
[DATE]
Page 3
for the account of a qualified institutional buyer to whom notice is given that
the resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
pursuant to another exemption from registration under the Securities Act.
We agree to indemnify the Trustee, the Servicer and the Depositor
against any liability that may result from any misrepresentation made herein.
Very truly yours,
[PURCHASER]
By: ________________________
Name: ________________________
Title: ________________________
ANNEX 1
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with the purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis $____________*/ in securities (except
for the excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule 144A)
and (ii) the Buyer satisfies the criteria in the category marked below.
____ Corporation, etc. The Buyer is a corporation (other
than a bank, savings and loan association or similar
institution), Massachusetts or similar business
trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended.
____ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District
of Columbia, the business of which is substantially confined to
banking and is supervised by Federal, State or territorial
banking commission or similar official or is a foreign bank or
equivalent institution, and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
____ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association,
cooperative bank, homestead association or similar
institution, which is supervised and examined by a
State or Federal authority having supervision over
such institution or is a foreign savings and loan
association or equivalent institution and (b) has an
audited net
--------------
* Buyer must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Buyer is a dealer, and, in that case,
Buyer must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, a copy of which
is attached hereto.
____ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934, as amended.
____ Insurance Company. The Buyer is an insurance company
whose primary and predominant business activity is
the writing of insurance or the reinsuring of risks
underwritten by insurance companies and which is
subject to supervision by the insurance commissioner
or a similar official or agency of the State,
territory or the District of Columbia.
____ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency
or instrumentality of the State or its political subdivisions,
for the benefit of its employees.
____ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security
Act of 1974, as amended.
____ Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940, as
amended.
____ Small Business Investment Company. Buyer is 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, as amended.
____ Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment
Advisors Act of 1940, as amended.
3. The term "securities" as used for purposes of the calculation of the
dollar amount in paragraph 2 excludes: (i) securities of issuers that are
affiliated with the Buyer, (ii) securities that are part of an unsold allotment
to or subscription by the Buyer, if the Buyer is a dealer, (iii) securities
issued or guaranteed by the U.S. or any instrumentality thereof, (iv) bank
deposit notes and certificates of deposit, (v) loan participations, (vi)
repurchase agreements, (vii) securities owned but subject to a repurchase
agreement and (viii) currency, interest rate and commodity swaps.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the cost
of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph,
except (i) where the Buyer reports its securities holdings in its financial
statements on the basis of their market value, and (ii) no current information
with respect to the cost of those securities has been published. If clause (ii)
in the preceding sentence applies, the securities may be valued at market.
Further, in determining such aggregate amount, the Buyer may have included
securities owned by subsidiaries of the Buyer, but only if such subsidiaries are
consolidated with the Buyer in its financial statements prepared in accordance
with generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Buyer's direction. However, such securities
were not included if the Buyer is a majority-owned, consolidated subsidiary of
another enterprise and the Buyer is not itself a reporting company under the
Securities Exchange Act of 1934, as amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan as provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
By: ____________________
Name: ____________________
Title: ____________________
Date: ____________________
ANNEX 2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A"), because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
____ The Buyer owned $___________ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
____ The Buyer is part of a Family of Investment Companies which
owned in the aggregate $__________ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two
or more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities
of issuers that are affiliated with the Buyer or are part of the Buyer's Family
of Investment Companies, (ii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iii) bank deposit notes and certificates of deposit,
(iv) loan participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned will
notify the parties listed in the Rule 144A Transferee Certificate to which this
certification relates of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of the Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
By: ________________________
Name: ________________________
Title: ________________________
IF AN ADVISER:
----------------------------------
Print Name of Buyer
Date: ____________________________
EXHIBIT J
FORM OF SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT
This SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT (the "Agreement")
is made and entered into as of [DATE], between Chase Manhattan Mortgage
Corporation, (the "Company") and _____________________ (the "Purchaser").
PRELIMINARY STATEMENT
__________________ (the "Owner") is the holder of the entire interest
in Chase Manhattan Acceptance Corporation Multi-Class Mortgage Pass-Through
Certificates, Series [ ], Class B-5 (the "Class B-5 Certificates"). The Class
B-5 Certificates were issued pursuant to a Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") among Chase Manhattan Acceptance Corporation,
(the "Company"), Chase Manhattan Mortgage Corporation as servicer thereunder
(the "Servicer") and [TRUSTEE], as trustee (the "Trustee").
The Owner intends to resell all of the Class B-5 Certificates directly
to the Purchaser on or promptly after the date hereof.
In connection with such sale, the parties hereto have agreed that the
Company, as Servicer, will engage in certain special servicing procedures
relating to foreclosures for benefit of the Purchaser, and that the Purchaser
will deposit funds in a collateral fund to cover any losses attributable to such
procedures as well as all advances and costs in connection therewith, as set
forth herein.
In consideration of the mutual agreements herein contained, the receipt
and sufficiency of which are hereby acknowledged, the Company and the Purchaser
agree to the following:
ARTICLE I.
DEFINITIONS
Section 1.01. Defined Terms.
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in the State of New York are required or
authorized by law or executive order to be closed.
Collateral Fund: The fund established and maintained pursuant to
Section 3.01 hereof.
Collateral Fund Permitted Investments: Either: (i) obligations of, or
obligations fully guaranteed as to principal and interest by, the United States,
or any agency or instrumentality thereof, provided such obligations are backed
by the full faith and credit of the United States, (ii) a money market fund
rated in the highest rating category by a nationally recognized rating agency
selected by the Company, (iii) cash, (iv) mortgage pass-through certificates
issued or guaranteed by GNMA, FNMA or FHLMC, (v) commercial paper (including
both non-interest bearing discount obligations and interest bearing obligations
payable on demand or on a specified date), the issuer of which may be an
affiliate of the Company, having at the time of such investment a rating of at
least A-1 by Standard and Poor's Corporation ("S&P") or at least D-1 by Duff &
Xxxxxx Credit Rating Co. ("DCR") and (vi) demand and time deposits in,
certificates of deposit of, any depository institution or trust company (which
may be an affiliate of the Company) incorporated under the laws of the United
States of America or any state thereof and subject to supervision and
examination by federal and/or state banking authorities, so long as at the time
of such investment either (x) the long-term debt obligations of such depository
institution or trust company have a rating of at least AA by S&P or DCR or (y)
the certificate of deposit or other unsecured short-term debt obligations of
such depository institution or trust company have a rating of at least D-1 by
DCR or A-1 by S&P and, for each of the preceding clauses (i), (iv), (v) and
(vi), the maturity thereof shall be not later than the earlier to occur of (A)
30 days from the date of the related investment and (B) the next succeeding
Distribution Date.
Commencement of Foreclosure: The first official action required under
local law in order to commence foreclosure proceedings or to schedule a
trustee's sale under a deed of trust, including (i) in the case of a mortgage,
any filing or service of process necessary to commence an action to foreclose,
or (ii) in the case of a deed of trust, the posting, publishing, filing or
delivery of a notice of sale, but not including in either case (x) any notice of
default, notice of intent to foreclose or sell or any other action prerequisite
to the actions specified in (i) or (ii) above and upon the consent of the
Purchaser which will be deemed given unless expressly withheld within two
Business Days of notification, (y) the acceptance of a deed-in-lieu of
foreclosure (whether in connection with a sale of the related property or
otherwise) or (z) initiation and completion of a short pay-off.
Current Appraisal: With respect to any Mortgage Loan as to which the
Purchaser has made an Election to Delay Foreclosure, an appraisal of the related
Mortgaged Property obtained by the Purchaser at its expense from an appraiser
(which shall not be an affiliate of the Purchaser) acceptable to the Company as
nearly contemporaneously as practicable to the time of the Purchaser's election,
prepared based on the Company's customary requirements for such appraisals.
Election to Delay Foreclosure: Any election by the Purchaser to delay
the Commencement of Foreclosure, made in accordance with Section 2.02(b).
Election to Foreclose: Any election by the Purchaser to proceed with
the Commencement of Foreclosure, made in accordance with Section 2.03(a).
Required Collateral Fund Balance: As of any date of determination, an
amount equal to the aggregate of all amounts previously required to be deposited
in the Collateral Fund pursuant to Section 2.02(d) (after adjustment for all
withdrawals and deposits pursuant to Section 2.02(e)) and Section 2.03(b) (after
adjustment for all withdrawals and deposits pursuant to Section 2.03(c)) and
Section 3.02 to be reduced by all withdrawals therefrom pursuant to Section
2.02(g) and Section 2.03(d).
Section 1.02. Definitions Incorporated by Reference.
All capitalized terms not otherwise defined in this Agreement shall
have the meanings assigned in the Pooling and Servicing Agreement.
ARTICLE II.
SPECIAL SERVICING PROCEDURES
Section 2.01. Reports and Notices.
(a) In connection with the performance of its duties under the Pooling
and Servicing Agreement relating to the realization upon defaulted Mortgage
Loans, the Company, as Servicer, shall provide to the Purchaser the following
notices and reports:
(i) Within five Business Days after each Distribution Date (or
included in or with the monthly statement to Certificateholders
pursuant to the Pooling and Servicing Agreement), the Company shall
provide to the Purchaser a report indicating for the Trust the number
of Mortgage Loans that are (A) thirty days, (B) sixty days, (C) ninety
days or more delinquent or (D) in foreclosure, and indicating for each
such Mortgage Loan the outstanding principal balance.
(ii) Prior to the Commencement of Foreclosure in connection with
any Mortgage Loan, the Company shall provide the Purchaser with a
notice (sent by telecopier) of such proposed and imminent foreclosure,
stating the loan number and the aggregate amount owing under the
Mortgage Loan.
(b) If requested by the Purchaser, the Company shall make its servicing
personnel available (during their normal business hours) to respond to
reasonable
inquiries by the Purchaser in connection with any Mortgage Loan identified in a
report under subsection (a)(i)(B), (a)(i)(C), (a)(i)(D) or (a)(ii) which has
been given to the Purchaser; provided, that (1) the Company shall only be
required to provide information that is readily accessible to its servicing
personnel and is non-confidential and (2) the Company shall not be required to
provide any written information under this subsection.
(c) In addition to the foregoing, the Company shall provide to the
Purchaser such information as the Purchaser may reasonably request concerning
each Mortgage Loan that is at least sixty days delinquent and each Mortgage Loan
which has become real estate owned, through the final liquidation thereof;
provided that the Company shall only be required to provide information that is
readily accessible to its servicing personnel and is non-confidential.
(d) With respect to all Mortgage Loans which are serviced at any time
by the Company through a Subservicer, the Company shall be entitled to rely for
all purposes hereunder, including for purposes of fulfilling its reporting
obligations under this Section 2.01 on the accuracy and completeness of any
information provided to it by the applicable Subservicer.
Section 2.02. Purchaser's Election to Delay Foreclosure Proceedings.
(a) The Purchaser directs the Company that in the event that the
Company does not receive written notice of the Purchaser's election pursuant to
subsection (b) below within 24 hours (exclusive of any intervening non-Business
Days) of transmission of the notice provided by the Company under Section
2.01(a)(ii), subject to extension as set forth in Section 2.02(b), the Company
shall proceed with the Commencement of Foreclosure in respect of such Mortgage
Loan in accordance with its normal foreclosure policies without further notice
to the Purchaser. Any foreclosure that has been initiated may be discontinued
(i) without notice to the Purchaser, if the Mortgage Loan has been brought
current or if a refinancing or prepayment occurs with respect to the Mortgage
Loan (including by means of a short payoff approved by the Company) (ii) with
notice to the Purchaser if the Company has reached the terms of a forbearance
agreement with the borrower. In such latter case the Company may complete such
forbearance agreement unless instructed otherwise by the Purchaser within one
Business Day of notification.
(b) In connection with any Mortgage Loan with respect to which a notice
under Section 2.01(a)(ii) has been given to the Purchaser, the Purchaser may
elect, for reasonable cause as determined by the Purchaser, to instruct the
Company to delay the Commencement of Foreclosure until such term as the
Purchaser determines that the Company may proceed with the Commencement of
Foreclosure. Such election must be evidenced by written notice received within
24 hours (exclusive of any intervening non-Business Days) of transmission of the
notice provided by the Company under Section 2.01(a)(ii). Such 24 hour period
shall be extended for no longer than an additional four Business Days after the
receipt of the information if the Purchaser requests additional information
related to such foreclosure; provided, however that the Purchaser will have at
least one Business Day to respond to any
requested additional information. Any such additional information shall (i) not
be confidential in nature and (ii) be obtainable by the Company from existing
reports, certificates or statements or otherwise be readily accessible to its
servicing personnel. The Purchaser agrees that it has no right to deal with the
mortgagor. If the Company's normal foreclosure policy includes acceptance of a
deed-in-lieu of foreclosure or short payoff, the Purchaser will be notified and
given one Business Day to respond.
(c) With respect to any Mortgage Loan as to which the Purchaser has
made an Election to Delay Foreclosure, the Purchaser shall obtain a Current
Appraisal as soon as practicable, and shall provide the Company with a copy of
such Current Appraisal.
(d) Within two Business Days of making any Election to Delay
Foreclosure, the Purchaser shall remit by wire transfer to the Company, for
deposit in the Collateral Fund, an amount, as calculated by the Company, equal
to the sum of (i) 125% of the greater of the outstanding Principal Balance of
the Mortgage Loan and the value shown in the Current Appraisal referred to in
subsection (c) above (or, if such Current Appraisal has not yet been obtained,
the Company's estimate thereof, in which case the required deposit under this
subsection shall be adjusted upon obtaining of such Current Appraisal), and (ii)
three months' interest on the Mortgage Loan at the applicable Mortgage Rate. If
any Election to Delay Foreclosure extends for a period in excess of three months
(such excess period being referred to herein as the "Excess Period"), the
Purchaser shall remit by wire transfer in advance to the Company for deposit in
the Collateral Fund the amount, as calculated by the Company, equal to interest
on the Mortgage Loan at the applicable Mortgage Rate for the Excess Period. The
terms of this Agreement shall no longer apply to the servicing of any Mortgage
Loan upon the failure of the Purchaser to deposit the above amounts relating to
the Mortgage Loan within two Business Days of the Election to Delay Foreclosure.
(e) With respect to any Mortgage Loan as to which the Purchaser has
made an Election to Delay Foreclosure, the Company may withdraw from the
Collateral Fund from time to time amounts necessary to reimburse the Company for
all Advances and Liquidation Expenses thereafter made by the Company as Servicer
in accordance with the Pooling and Servicing Agreement. To the extent that the
amount of any such Liquidation Expense is determined by the Company based on
estimated costs, and the actual costs are subsequently determined to be higher,
the Company may withdraw the additional amount from the Collateral Fund. In the
event that the Mortgage Loan is brought current by the Mortgagor and the
foreclosure action is discontinued, the amounts so withdrawn from the Collateral
Fund shall be redeposited therein as and to the extent that reimbursement
therefor from amounts paid by the Mortgagor is not prohibited pursuant to the
Pooling and Servicing Agreement. Except as provided in the preceding sentence,
amounts withdrawn from the Collateral Fund to cover Advances and Liquidation
Expenses shall not be redeposited therein or otherwise reimbursed to the
Purchaser. If and when any such Mortgage Loan is brought current by the
Mortgagor, all amounts remaining in the Collateral Fund in respect of such
Mortgage Loan (after adjustment for all withdrawals and deposits pursuant to
this subsection) shall be released to the Purchaser.
(f) With respect to any Mortgage Loan as to which the Purchaser has
made an Election to Delay Foreclosure, the Company shall continue to service the
Mortgage Loan in accordance with its customary procedures (other than the delay
in Commencement of Foreclosure as provided herein). If and when the Purchaser
shall notify the Company that it believes that it is appropriate to do so, the
Company shall proceed with the Commencement of Foreclosure. In any event, if the
Mortgage Loan is not brought current by the mortgagor by the time the loan
becomes 6 months delinquent, the Purchaser's election shall no longer be
effective and at the Purchaser's option, either (i) the Purchaser shall purchase
the Mortgage Loan from the Trust Fund at a purchase price equal to the fair
market value as shown on the Current Appraisal, to be paid by (x) applying any
balance in the Collateral Fund to such purchase price, and (y) to the extent of
any deficiency, by wire transfer of immediately available funds to the Company
or Trustee; or (ii) the Company shall proceed with the Commencement of
Foreclosure.
(g) Upon the occurrence of a liquidation with respect to any Mortgage
Loan as to which the Purchaser made an Election to Delay Foreclosure and as to
which the Company proceeded with the Commencement of Foreclosure in accordance
with subsection (f) above, the Company shall calculate the amount, if any, by
which the value shown on the Current Appraisal obtained under subsection (c)
exceeds the actual sales price obtained for the related Mortgaged Property (net
of Liquidation Expenses and accrued interest related to the extended foreclosure
period), and the Company shall withdraw the amount of such excess from the
Collateral Fund, shall remit the same to the Trust Fund and in its capacity as
Servicer shall apply such amount as additional Liquidation Proceeds pursuant to
the Pooling and Servicing Agreement. After making such withdrawal, all amounts
remaining in the Collateral Fund in respect of such Mortgage Loan (after
adjustment for all withdrawals and deposits pursuant to subsection (e)) shall be
released to the Purchaser.
Section 2.03. Purchaser's Election to Commence Foreclosure Proceedings.
(a) In connection with any Mortgage Loan identified in a report under
Section 2.01(a)(i)(B), the Purchaser may elect, for reasonable cause as
determined by the Purchaser, to instruct the Company to proceed with the
Commencement of Foreclosure as soon as practicable. Such election must be
evidenced by written notice received by the Company by 5:00 p.m., New York City
time, on the third Business Day following the delivery of such report under
Section 2.01(a)(i).
(b) Within two Business Days of making any Election to Foreclose, the
Purchaser shall remit to the Company, for deposit in the Collateral Fund, an
amount, as calculated by the Company, equal to 125% of the current Principal
Balance of the Mortgage Loan and three months' interest on the Mortgage Loan at
the applicable Mortgage Rate. If and when any such Mortgage Loan is brought
current by the Mortgagor, all amounts in the Collateral Fund in respect of such
Mortgage Loan shall be released to the Purchaser. The terms of this Agreement
shall no longer apply to the servicing of any Mortgage Loan upon the failure of
the
Purchaser to deposit the above amounts relating to the Mortgage Loans within two
Business Days at the Election to Foreclose.
(c) With respect to any Mortgage Loan as to which the Purchaser has
made an Election to Foreclose, the Company shall continue to service the
Mortgage Loan in accordance with its customary procedures (other than to proceed
with the Commencement of Foreclosure as provided herein). In connection
therewith, the Company shall have the same rights to make withdrawals for
Advances and Liquidation Expenses from the Collateral Fund as are provided under
Section 2.02(e), and the Company shall make reimbursements thereto to the
limited extent provided under such subsection. The Company shall not be required
to proceed with the Commencement of Foreclosure if (i) the same is stayed as a
result of the Mortgagor's bankruptcy or is otherwise barred by applicable law,
or to the extent that all legal conditions precedent thereto have not yet been
complied with or (ii) the Company believes there is a breach of representation
or warranties by the Company, which may result in a repurchase or substitution
of such Mortgage Loan, or (iii) the Company reasonably believes the Mortgaged
Property may be contaminated with or affected by hazardous wastes or hazardous
substances (and the Company supplies the Purchaser with information supporting
such belief). The Company will repurchase or substitute a Mortgage Loan pursuant
to the preceding clause (ii) within the time period specified in the Pooling and
Servicing Agreement. Any foreclosure that has been initiated may be discontinued
(i) without notice to the Purchaser if the Mortgage Loan has been brought
current or if a refinancing or prepayment occurs with respect to the Mortgage
Loan (including by means of a short payoff approved by the Company), or (ii)
with notice to the Purchaser if the Company has reached the terms of a
forbearance agreement unless instructed otherwise by the Purchaser within two
Business Days of notification.
(d) Upon the occurrence of a liquidation with respect to any Mortgage
Loan as to which the Purchaser made an Election to Foreclose and as to which the
Company proceeded with the Commencement of Foreclosure in accordance with
subsection (c) above, the Company shall calculate the amount, if any, by which
the Principal Balance of the Mortgage Loan at the time of liquidation (plus all
unreimbursed Advances and Liquidation Expenses in connection therewith other
than those paid from the Collateral Fund) exceeds the actual sales price
obtained for the related Mortgaged Property, and the Company shall withdraw the
amount of such excess from the Collateral Fund, shall remit the same to the
Trust Fund and in its capacity as Servicer shall apply such amount as additional
Liquidation Proceeds pursuant to the Pooling and Servicing Agreement. After
making such withdrawal, all amounts remaining in the Collateral Fund (after
adjustment for all withdrawals and deposits pursuant to subsection (c)) in
respect of such Mortgage Loan shall be released to the Purchaser.
Section 2.04. Termination.
(a) With respect to all Mortgage Loans included in the Trust Fund, the
Purchaser's rights to make any Election to Delay Foreclosure or any Election to
Foreclose and the Company's obligations under Section 2.01 shall terminate (i)
at such time as the Certificate
Principal Balance of the Class B-5 Certificates has been reduced to zero, (ii)
if the greater of (x) 43% (or such lower or higher percentages that represents
the Company's actual historical loss experience with respect to the Mortgage
Loans in the related pool) of the aggregate principal balance of all Mortgage
Loans that are in foreclosure or are more than 90 days delinquent on a
contractual basis and REO properties or if the aggregate amount that the Company
estimates will be required to be withdrawn from the Collateral Fund with respect
to Mortgage Loans as to which the Purchaser has made an Election to Delay
Foreclosure or an Election to Foreclose exceeds (z) the Outstanding Certificate
Principal Balance of the Class B-5 Certificates, or (iii) upon any transfer by
the Purchaser of any interest (other than the minority interest therein, but
only if the transferee provides written acknowledgment to the Company of the
Purchaser's right hereunder and that such transferee will have no rights
hereunder) in the Class B-5 Certificates (whether or not such transfer is
registered under the Pooling and Servicing Agreement), including any such
transfer in connection with a termination of the Trust Fund. Except as set forth
above, this Agreement and the respective rights, obligations and
responsibilities of the Purchaser and the Company hereunder shall terminate upon
the later to occur of (i) the final liquidation of the last Mortgage Loan as to
which the Purchaser made any Election to Delay Foreclosure or any Election to
Foreclose and the withdrawal of all remaining amounts in the Collateral Fund as
provided herein and (ii) ten (10) Business Day's notice.
(b) Purchaser's rights pursuant to Section 2.02 or 2.03 of this
Agreement shall terminate with respect to a Mortgage loan as to which the
Purchaser has exercised its rights under Section 2.02 or 2.03 hereof, upon
Purchaser's failure to deposit any amounts required pursuant to Section 2.02(d)
or 2.03(b).
(c) Neither the Servicer nor any of its directors, officers, employees
or agents shall be under any liability for any action taken or for refraining
from the taking of any action in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability which would otherwise be
imposed by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties hereunder. The Servicer and any director, officer, employee or agent
thereof may rely in good faith on any document of any kind prima facie properly
executed and submitted by an Person respecting any matters arising hereunder.
ARTICLE III.
COLLATERAL FUND; SECURITY INTEREST
Section 3.01. Collateral Fund.
Upon receipt from the Purchaser of the initial amount required to be
deposited in the Collateral Fund pursuant to Article 11, the Company shall
establish and maintain with itself
as a segregated account on its books and records an account (the "Collateral
Fund"), entitled "Chase Manhattan Mortgage Corporation, as Servicer, for the
benefit of registered holders of Chase Manhattan Acceptance Corporation
Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class B-5." Amounts
in the Collateral Fund shall continue to be the property of the Purchaser,
subject to the first priority security interest granted hereunder for the
benefit of the Certificate holders, until withdrawn from the Collateral Fund
pursuant to Section 2.02 or 2.03 hereof.
Upon the termination of this Agreement and the liquidation of all
Mortgage Loans as to which the Purchaser has made any Election to Delay
Foreclosure or any Election to Foreclose pursuant to Section 2.04 hereof, the
Company shall distribute to the Purchaser all amounts remaining in the
Collateral Fund together with any investment earnings thereon.
The Collateral Fund shall be an "outside reserve fund" within the
meaning of the REMIC Provisions, beneficially owned by the Purchaser. In no
event shall the Purchaser (i) take or cause the Trustee or the Company to take
any action that could cause any REMIC established under the Trust Agreement to
fail to qualify as a REMIC or cause the imposition on any such REMIC of any
"prohibited transaction" or "prohibited contribution" taxes or (ii) cause the
Trustee or the Company to fail to take any action necessary to maintain the
status of any such REMIC as a REMIC.
Section 3.02. Collateral Fund Permitted Investments.
The Company shall, at the written direction of the Purchaser invest the
funds in the Collateral Fund in Collateral Fund Permitted Investments. Such
direction shall not be changed more frequently than quarterly. In the absence of
any direction, the Company shall select such investments in accordance with the
definition of Collateral Fund Permitted Investments in its discretion.
All income and gain realized from any investment as well as any
interest earned on deposits in the Collateral Fund (net of any losses on such
investments) and any payments of principal made in respect of any Collateral
Fund Permitted Investment shall be deposited in the Collateral Fund upon
receipt. All costs and realized losses associated with the purchase and sale of
Collateral Fund Permitted Investments shall be borne by the Purchaser and the
amount of net realized losses shall be deposited by the Purchaser in the
Collateral Fund. The Company shall periodically (but not more frequently than
monthly) distribute to the Purchaser upon request an amount of cash, to the
extent cash is available therefor in the Collateral Fund, equal to the amount by
which the balance of the Collateral Fund, after giving effect to all other
distributions to be made from the Collateral Fund on such date, exceeds the
Required Collateral Fund Balance. Any amounts so distributed shall be released
from the lien and security interest of this Agreement.
Section 3.03. Grant of Security Interest.
The Purchaser grants to the Company and the Trustee for the benefit of
the Certificateholders a security interest in and lien on all of the Purchaser's
right, title and interest, whether now owned or hereafter acquired, in and to:
(1) the Collateral Fund, (2) all amounts deposited in the Collateral Fund and
Collateral Fund Permitted Investments in which such amounts are invested (and
the distributions and proceeds of such investments) and (3) all cash and
non-cash proceeds of any of the foregoing, including proceeds of the voluntary
or involuntary conversion thereof (all of the foregoing collectively, the
"Collateral").
The Purchaser acknowledges the lien on and security interest in the
Collateral for the benefit of the Certificateholders. The Purchaser shall take
all actions requested by the Company or the Trustee as may be reasonably
necessary to perfect the security interest created under this Agreement in the
Collateral and cause it to be prior to all other security interests and liens,
including the execution and delivery to the Company for filing of appropriate
financing statements in accordance with applicable law. The Company shall file
appropriate continuation statements, or appoint an agent on its behalf to file
such statements, in accordance with applicable law.
Section 3.04. Collateral Shortfalls.
In the event that amounts on deposit in the Collateral Fund at any time
are insufficient to cover any withdrawals therefrom that the Company or the
Trustee is then entitled to make hereunder, the Purchaser shall be obligated to
pay such amounts to the Company or the Trustee immediately upon demand. Such
obligation shall constitute a general corporate obligation of the Purchaser.
ARTICLE IV.
MISCELLANEOUS PROVISIONS
Section 4.01. Amendment.
This Agreement may be amended from time to time by the Company and the
Purchaser by written agreement signed by the Company and the Purchaser.
Section 4.02. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original, and
such counterparts shall constitute but one and the same instrument.
Section 4.03. Governing Law.
This Agreement shall be construed in accordance with the laws of the
State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 4.04. Notices.
All demands, notices and direction hereunder shall be in writing or by
telecopy and shall be deemed effective upon receipt to:
(a) in the case of the Company,
Chase Manhattan Mortgage Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
or such other address as may hereafter be furnished in writing by the Company,
or
(b) in the case of the Purchaser, with respect to notices pursuant to
Section 2.01,
[PURCHASER]
[ADDRESS]
Attn: ________________
Phone: ________________
Fax: ________________
with respect to all other notices pursuant to this Agreement,
---------------------------
[ADDRESS]
Attn: _________________
Phone: _________________
Fax: _________________
or such other address as may hereafter be furnished in writing by the Purchaser.
Section 4.05. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever, including regulatory, 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.
Section 4.06. Successors and Assigns.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the respective successors and assigns of the parties hereto, and all
such provisions shall inure to the benefit of the Certificateholders; provided,
however, that the rights under this Agreement cannot be assigned by the
Purchaser without the consent of the Company.
Section 4.07. Article and Section Headings.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
Section 4.08. Confidentiality.
The Purchaser agrees that all information supplied by or on behalf of
the Company pursuant to Sections 2.01 or 2.02, including individual account
information, is the property of the Company and the Purchaser agrees to hold
such information confidential and not to disclose such information.
IN WITNESS WHEREOF, the Company and the Purchaser have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.
CHASE MANHATTAN MORTGAGE
CORPORATION
By: ____________________
Name: ____________________
Title: ____________________
-------------------------
By: ____________________
Name: ____________________
Title: ____________________
EXHIBIT K
FORM OF TRANSFEREE'S LETTER
CHASE MANHATTAN ACCEPTANCE CORPORATION Series [ ]
[DATE]
Chase Manhattan Acceptance Corporation
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, XX 00000
Ladies and Gentlemen:
We propose to purchase Chase Manhattan Acceptance Corporation's
Multi-Class Mortgage Pass-Through Certificates, Series [ ], Class A-R, described
in the Prospectus Supplement, dated [DATE], and Prospectus, dated [DATE].
1. We certify that (a) we are not a disqualified organization and (b)
we are not purchasing such Class A-R Certificates on behalf of a disqualified
organization; for this purpose the term "disqualified organization" means the
United States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or instrumentality of any
of the foregoing (except any entity treated as other than an instrumentality of
the foregoing for purposes of Section 168(h)(2)(D) of the Internal Revenue Code
of 1986, as amended (the "Code")), any organization (other than a cooperative
described in Section 521 of the Code) that is exempt from taxation under the
Code (unless such organization is subject to tax on excess inclusions) and any
organization that is described in Section 1381(a)(2)(C) of the Code. We
understand that any breach by us of this certification may cause us to be liable
for an excise tax imposed upon transfers to disqualified organizations.
2. We certify that (a) we have historically paid our debts as they
became due, (b) we intend, and believe that we will be able, to continue to pay
our debts as they become due in the future, (c) we understand that, as
beneficial owner of the Class A-R Certificates, we may incur tax liabilities in
excess of any cash flows generated by the Class A-R Certificates, and (d) we
intend to pay any taxes associated with holding the Class A-R Certificates as
they become due.
3. We acknowledge that we will be the beneficial owner of the Class A-R
Certificates and:*/
-------------
*/ Check appropriate box and if necessary fill in the name of the Transferee's
nominee.
______ The Class A-R Certificates will be registered in our name.
______ The Class A-R Certificates will be held in the name of our
nominee,
____________________, which is not a disqualified organization.
4. Unless Chase Manhattan Acceptance Corporation ("CMAC") has consented
to the transfer to us by executing the form of Consent affixed hereto as
Appendix B, we certify that we are a U.S. person; for this purpose the term
"U.S. person" means a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in or under the laws of the
United States or any political subdivision thereof, an estate that is subject to
United States federal income tax regardless of the source of its income, or any
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
fiduciaries have the authority to control all sunstantial decisions of the
trust. We agree that any breach by us of this certification shall render the
transfer of any interest in the Class A-R Certificates to us absolutely null and
void and shall cause no rights in the Class A-R Certificates to vest in us.
5. We agree that in the event that at some future time we wish to
transfer any interest in the Class A-R Certificates, we will transfer such
interest in the Class A-R Certificates only (a) to a transferee that (i) is not
a disqualified organization and is not purchasing such interest in the Class A-R
Certificates on behalf of a disqualified organization, (ii) is a U.S. person and
(iii) has delivered to CMAC a letter in the form of this letter (including the
affidavit appended hereto) and, if requested by CMAC, an opinion of counsel (in
a form acceptable to CMAC) that the proposed transfer will not cause the
interest in the Class A-R Certificates to be held by a disqualified organization
or a person who is not a U.S. person or (b) with the written consent of CMAC.
6. We hereby designate Chase Manhattan Mortgage Corporation as our
fiduciary to act as the tax matters person for the Series [ ] REMIC.
Very truly yours,
[PURCHASER]
By: __________________________
Name: __________________________
Title: __________________________
Accepted as of __________ __, 199_
CHASE MANHATTAN ACCEPTANCE CORPORATION
By: _________________________________
Name: ______________________________
Title: ______________________________
APPENDIX A
Affidavit pursuant to (i) Section 860E(e)(4) of the Internal
Revenue Code of 1986, as amended, and (ii) certain
provisions of the Pooling and Servicing Agreement
Under penalties of perjury, the undersigned declares that the following
is true:
(1) He or she is an officer of _________________________ (the "Transferee"),
(2) the Transferee's Employee Identification number is __________,
(3) the Transferee is not a "disqualified organization" (as defined below), has
no plan or intention of becoming a disqualified organization, and is not
acquiring any of its interest in the Chase Manhattan Acceptance
Corporation, Multiclass Mortgage Pass-Through Certificates, Series [ ],
Class A-R on behalf of a disqualified organization or any other entity,
(4) unless Chase Manhattan Acceptance Corporation ("CMAC") has consented to the
transfer to the Transferee by executing the form of Consent affixed as
Appendix B to the Transferee's Letter to which this Certificate is affixed
as Appendix A, the Transferee is a "U.S. person" (as defined below),
(5) that no purpose of the transfer is to avoid or impede the assessment or
collection of tax,
(6) the Transferee has historically paid its debts as they became due,
(7) the Transferee intends, and believes that it will be able, to continue to
pay its debts as they become due in the future,
(8) the Transferee understands that, as beneficial owner of the Class A-R
Certificates, it may incur tax liabilities in excess of any cash flows
generated by the Class A-R Certificates,
(9) the Transferee intends to pay any taxes associated with holding the Class
A-R Certificates as they become due, and
(10) The Transferee consents to any amendment of the Pooling and Servicing
Agreement that shall be deemed necessary by CMAC (upon advice of counsel)
to constitute a reasonable arrangement to ensure that the Class A-R
Certificates will not be owned directly or indirectly by a disqualified
organization;
For purpose of this affidavit, the term "disqualified organization" means the
United States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or instrumentality of any
of the foregoing (except any entity treated as other than an instrumentality of
the foregoing for purposes of Section 168(h)(2)(D) of the Internal Revenue Code
of 1986, as amended (the "Code")), any organization (other than a cooperative
described in Section 521 of the Code) that is exempt from taxation under the
Code (unless such organization is subject to tax on excess inclusions) and any
organization that is described in Section 1381(a)(2)(C) of the Code and the term
"U.S. person" means a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in or under the laws of the
United States or any political subdivision thereof, an estate that is subject to
United States federal income tax regardless of the source of its income, or any
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
fiduciaries have the authority to control all sunstantial decisions of the trust
---------------------------------
By: _________________________
----------------------------------
Address of Investor for receipt of distribution:
Address of Investor for receipt of tax information:
(Corporate Seal)
Attest:
________________________
________________________, Secretary
Personally appeared before me the above-named ______________, known or proved to
me to be the same person who executed the foregoing instrument and to be the
_______ of the Investor, and acknowledged to me that he executed the same as his
free act and deed and the free act and deed of the Investor.
Subscribed and sworn before me this ____ day of ______, 19__ .
--------------------------
Notary Public
County of ______
State of _______
My commission expires the ___________ day of ____________
By: __________________________
Name: __________________________
Title: __________________________
Dated: _____________
APPENDIX B
CONSENT
_________________________ (Transferee)
_________________________
_________________________
Ladies and Gentlemen:
Chase Manhattan Acceptance Corporation ("CMAC") hereby consents to the
transfer to, and registration in the name of, the Transferee (or, if applicable,
registration in the name of such Transferee's nominee of the Multiclass Mortgage
Pass-Through Certificates, Series [ ], Class A-R described in the Transferee's
Letter to which this Consent is appended, notwithstanding CMAC's knowledge that
the Transferee is not a U.S. person (as defined in such Transferee's Letter).
CHASE MANHATTAN ACCEPTANCE
CORPORATION
Dated: _______________ By: ______________________________
EXHIBIT L
REQUEST FOR RELEASE OF DOCUMENTS
To: [TRUSTEE]
[ADDRESS]
Re:
In connection with the administration of the Mortgage Loans held by you, as
Trustee, 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.
Mortgage Loan Number:
Mortgagor Name, Address & Zip Code:
Reason for Requesting Documents (check one):
_______ 1. Mortgage Paid in Full
_______ 2. Foreclosure
_______ 3. Substitution
_______ 4. Other Liquidation
_______ 5. Nonliquidation Reason: _________________________
By: _____________________________
(authorized signer)
Issuer: _________________________
Address: ________________________
________________________
Date: ___________________________
Trustee
[TRUSTEE]
Please acknowledge the execution of the above request by your signature and
date below:
____________________________ ________________
Signature Date
Documents returned to Trustee:
____________________________ ________________
Trustee Date
