Exhibit 4.2
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NAMCO SECURITIES CORP.
Company,
[NAME OF MASTER SERVICER]
Master Servicer,
and
[NAME OF TRUSTEE],
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of ____________ 1, ____
Mortgage Pass-Through Certificates
Series ____-____
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms
Accrued Certificate Interest........................................2
Adjustment Date.....................................................2
Advance .......................................................2
Agreement .......................................................2
Anniversary .......................................................2
Assignment .......................................................2
Assignment Agreement................................................3
Available Distribution Amount.......................................3
Bankruptcy Amount...................................................3
Bankruptcy Code.....................................................3
Bankruptcy Loss.....................................................3
Business Day .......................................................4
Cash Liquidation....................................................4
Certificate .......................................................4
Certificate Account.................................................4
Certificate Account Deposit Date....................................4
Certificateholder" or "Holder.......................................4
Certificate Owner...................................................4
Certificate Principal Balance.......................................4
Certificate Register................................................5
Closing Date .......................................................5
Code .......................................................5
Collateral Value....................................................5
Company .......................................................5
Converted Mortgage Loan.............................................5
Convertible Mortgage Loan...........................................5
Converting Mortgage Loan............................................5
Corporate Trust Office..............................................5
Custodial Account...................................................5
Cut-off Date .......................................................5
Debt Service Reduction..............................................6
Deficient Valuation.................................................6
Definitive Certificate..............................................6
Deleted Mortgage Loan...............................................6
Determination Date..................................................6
Distribution Date...................................................6
Due Date .......................................................6
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Due Period .......................................................6
Duff & Xxxxxx.......................................................6
Eligible Account....................................................6
Event of Default....................................................7
Excess Bankruptcy Loss..............................................7
Excess Fraud Loss...................................................7
Excess Special Hazard Loss..........................................7
Extraordinary Events................................................7
Extraordinary Losses................................................8
FDIC .......................................................8
FHLMC .......................................................8
FNMA .......................................................8
Fraud Losses .......................................................8
Fraud Loss Amount...................................................8
Funding Date .......................................................8
Gross Margin .......................................................9
Index .......................................................9
Initial Certificate Principal Balance...............................9
Insurance Policy....................................................9
Insurance Proceeds..................................................9
Late Collections....................................................9
Letter of Credit....................................................9
Letter of Credit Issuer.............................................9
Loan-to-Value Ratio................................................10
Master Servicer....................................................10
Maximum Interest Rate..............................................10
Minimum Interest Rate..............................................10
Monthly Payment....................................................10
Xxxxx'x ......................................................10
Mortgage ......................................................10
Mortgage File......................................................10
Mortgage Loan......................................................10
Mortgage Loan Schedule.............................................11
Mortgage Note......................................................12
Mortgage Rate......................................................12
Mortgaged Property.................................................12
Mortgagor ......................................................12
Net Mortgage Rate..................................................12
Nonrecoverable Advance.............................................12
Officers' Certificate..............................................12
Opinion of Counsel.................................................12
OTS ......................................................13
Outstanding Mortgage Loan..........................................13
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Ownership Interest.................................................13
Pass-Through Rate..................................................13
Percentage Interest................................................13
Periodic Cap ......................................................13
Permitted Instruments..............................................13
Person ......................................................14
Prepayment Assumption..............................................14
Prepayment Period..................................................15
Primary Hazard Insurance Policy....................................15
Primary Mortgage Insurance Policy..................................15
Principal Prepayment...............................................15
Purchase Price.....................................................15
Qualified Insurer..................................................15
Qualified Substitute Mortgage Loan.................................15
Rating Agency......................................................16
Realized Loss......................................................16
Record Date ......................................................17
Relief Act ......................................................17
Remittance Report..................................................17
REO Acquisition....................................................17
REO Disposition....................................................17
REO Imputed Interest...............................................17
REO Proceeds ......................................................17
REO Property ......................................................17
Request for Release................................................17
Required Insurance Policy..........................................17
Responsible Officer................................................18
Seller ......................................................18
Seller's Warranty Certificate......................................18
Servicing Account..................................................18
Servicing Advances.................................................18
Servicing Fee......................................................18
Servicing Fee Rate.................................................18
Servicing Officer..................................................18
Single Certificate.................................................18
Special Hazard Amount..............................................19
Special Hazard Percentage..........................................19
Standard & Poor's..................................................19
Stated Principal Balance...........................................19
Sub-Servicer ......................................................19
Sub-Servicer Remittance Date.......................................19
Sub-Servicing Account..............................................19
Sub-Servicing Agreement............................................20
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Transfer ......................................................20
Transferor ......................................................20
Trust Fund ......................................................20
Trustee ......................................................20
Trustee's Fee......................................................20
Uninsured Cause....................................................20
Voting Rights......................................................20
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
2.01. Conveyance of Mortgage Loans............................21
2.02. Acceptance of the Trust Fund by the Trustee.............24
2.03. Representations, Warranties and Covenants of the
Master Servicer and the Company.........................25
2.04. Representations and Warranties of the Seller;
Repurchase and Substitution ............................27
2.05. Issuance of Certificates Evidencing Interests
in the Trust Fund.......................................29
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
3.01. Master Servicer to Act as Master Servicer...............30
3.02. Sub-Servicing Agreements Between Master
Servicer and Sub-Servicers..............................31
3.03. Successor Sub-Servicers.................................32
3.04. Liability of the Master Servicer........................32
3.05. No Contractual Relationship Between
Sub-Servicers and Trustee or Certificateholders.........32
3.06. Assumption or Termination of Sub-Servicing
Agreements by Trustee...................................32
3.07. Collection of Certain Mortgage Loan Payments............33
3.08. Sub-Servicing Accounts..................................33
3.09. Collection of Taxes, Assessments and Similar
Items; Servicing Accounts...............................34
3.10. Custodial Account.......................................34
3.11. Permitted Withdrawals From the Custodial Account........35
3.12. Permitted Instruments...................................37
3.13. Maintenance of the Letter of Credit, Primary
Mortgage Insurance and Primary Hazard Insurance.........37
3.14. Enforcement of Due-on-Sale Clauses;
Assumption Agreements...................................39
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3.15. Realization Upon Defaulted Mortgage Loans...............40
3.16. Trustee to Cooperate; Release of Mortgage Files.........41
3.17. Servicing Compensation..................................42
3.18. Maintenance of Certain Servicing Policies...............43
3.19. Annual Statement as to Compliance.......................43
3.20. Annual Independent Public Accountants'
Servicing Statement.....................................44
3.21. Access to Certain Documentation.........................44
3.22. Title, Conservation and Disposition of REO Property.....45
3.23. Additional Obligations of the Master Servicer...........46
3.24. Additional Obligations of the Company...................47
3.25. Converted Mortgage Loans; Purchase Obligations
Upon Conversion; Administration by the Trustee..........47
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
4.01. Certificate Account; Distributions......................49
4.02. Statements to Certificateholders........................50
4.03. Remittance Reports; Advances by the Master Servicer.....51
4.04. Allocation of Realized Losses...........................53
4.05. Information Reports to be Filed by the Master Servicer..53
4.06. The Letter of Credit....................................53
4.07. Compliance with Withholding Requirements................55
ARTICLE V
THE CERTIFICATES
5.01 The Certificates........................................56
5.02. Registration of Transfer and Exchange of Certificates...56
5.03. Mutilated, Destroyed, Lost or Stolen Certificates.......57
5.04. Persons Deemed Owners...................................57
ARTICLE VI
THE COMPANY AND THE MASTER SERVICER
6.01. Liability of the Company and the Master Servicer........58
6.02. Merger, Consolidation or Conversion of the Company
or the Master Servicer..................................58
6.03. Limitation on Liability of the Company, the
Master Servicer and Others..............................58
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6.04. Limitation on Resignation of the Master Servicer........59
ARTICLE VII
DEFAULT
7.01. Events of Default.......................................60
7.02. Trustee to Act; Appointment of Successor................62
7.03. Notification to Certificateholders......................62
7.04. Waiver of Events of Default.............................63
ARTICLE VIII
CONCERNING THE TRUSTEE
8.01. Duties of Trustee.......................................64
8.02. Certain Matters Affecting the Trustee...................65
8.03. Trustee Not Liable for Certificates or Mortgage Loans...66
8.04. Trustee May Own Certificates............................66
8.05. Payment of Trustee's Fees...............................66
8.06. Eligibility Requirements for Trustee....................67
8.07. Resignation and Removal of the Trustee..................67
8.08. Successor Trustee.......................................68
8.09. Merger or Consolidation of Trustee......................69
8.10. Appointment of Co-Trustee or Separate Trustee...........69
8.11. Information Reports and Tax Returns.....................70
ARTICLE IX
TERMINATION
9.01. Termination Upon Repurchase or Liquidation
of All Mortgage Loans...................................71
ARTICLE X
MISCELLANEOUS PROVISIONS
10.01. Amendment...............................................73
10.02. Recordation of Agreement; Counterparts..................74
10.03. Limitation on Rights of Certificateholders..............74
10.04. Governing Law...........................................75
10.05. Notices.................................................75
10.06. Severability of Provisions..............................75
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10.07. Successors and Assigns; Third Party Beneficiary.........75
10.08. Article and Section Headings............................76
10.09. Notice to Rating Agencies and Certificateholder.........76
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Signatures
Acknowledgments
Exhibit A Form of A Certificate
Exhibit B Form of Irrevocable Letter of Credit
Exhibit C Form of Trustee Initial Certification
Exhibit D Form of Trustee Final Certification
Exhibit E Form of Remittance Report
Exhibit F-1 Request for Release
Exhibit F-2 Request for Release for Mortgage Loans Paid in Full
Exhibit G-1 Form of Investor Representation Letter
Exhibit G-2 Form of Transferor Representation Letter
Exhibit G-3 Form of Investor Representation Letter for Insurance Companies
Exhibit H Mortgage Loan Schedule
Exhibit I Seller's Warranty Certificate
Exhibit J Form of Notice Under Section 3.24
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This Pooling and Servicing Agreement, effective as of
__________ 1, ____, among NAMCO Securities Corp., as the company (together with
its permitted successors and assigns, the "Company"), [NAME OF MASTER SERVICER]
, as master servicer (together with its permitted successors and assigns, the
"Master Servicer"), and [NAME OF TRUSTEE], as trustee (together with its
permitted successors and assigns, the "Trustee"),
PRELIMINARY STATEMENT:
The Company intends to sell mortgage pass-through certificates
(the "Certificates"), which will evidence the entire beneficial ownership
interest in the Mortgage Loans (as defined herein). The Mortgage Loans have an
aggregate Stated Principal Balance as of the Cut-off Date equal to
$______________. The Mortgage Loans are adjustable rate mortgage loans having
terms to maturity at origination or modification of not more than 30 years.
In consideration of the mutual agreements herein contained,
the Company, the Master Servicer and the Trustee agree as follows:
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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 meanings
specified in this Article.
"Accrued Certificate Interest": With respect to each
Distribution Date, one month's interest accrued at the then applicable
Pass-Through Rate on the Certificate Principal Balance of the Certificates
immediately prior to such Distribution Date. Accrued Certificate Interest will
be calculated on the basis of a 360-day year consisting of twelve 30-day months.
In each case Accrued Certificate Interest on the Certificates will be reduced by
the amount of (i) Prepayment Interest Shortfalls, if any, which are not covered
by payments by the Master Servicer pursuant to Section 3.23 with respect to such
Distribution Date, (ii) the interest portion (adjusted to the related Net
Mortgage Rate) of any of Realized Losses (including Excess Special Hazard
Losses, Excess Fraud Losses, Excess Bankruptcy Losses and Extraordinary Losses)
not covered by draws on the Letter of Credit pursuant to Section 4.04, (iii) the
interest portion of Advances previously made with respect to a Mortgage Loan or
REO Property which remained unreimbursed following the Cash Liquidation or REO
Disposition of such Mortgage Loan or REO Property that was made with respect to
delinquencies that were ultimately determined to be Excess Special Hazard
Losses, Excess Fraud Losses, Excess Bankruptcy Losses or Extraordinary Losses,
and (iv) any other interest shortfalls, including interest that is not
collectible from the Mortgagor pursuant to the Relief Act or similar legislation
or regulations as in effect from time to time; with all such reductions
allocated to the Certificates, in proportion to their respective amounts of
Accrued Certificate Interest which would have resulted absent such reductions.
"Adjustment Date": With respect to each Mortgage Loan, the
date set forth in the related Mortgage Note on which the Mortgage Rate may
change and each semi-annual anniversary of such date. The first Adjustment Date
as to each Mortgage Loan is set forth in the Mortgage Loan Schedule.
"Advance": As to any Mortgage Loan, any advance made by the
Master Servicer on any Distribution Date pursuant to Section 4.03.
"Agreement": This Pooling and Servicing Agreement and all
amendments hereof.
"Anniversary": Each anniversary of ___________ 1, ____.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage, which assignment, notice of transfer or
equivalent instrument may be in the form of one or more blanket
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assignments covering Mortgages secured by Mortgaged Properties located in the
same county, if permitted by law.
Assignment Agreement": The Assignment and Assumption
Agreement, dated as of ____________, ____, between __________________ and the
Company relating to the transfer and assignment of the Mortgage Loans.
"Available Distribution Amount": With respect to each
Distribution Date, the Available Distribution Amount will be an amount equal to
(a) the sum of (i) the balance on deposit in the Custodial Account as of the
close of business on the related Determination Date and (ii) the aggregate
amount of any Advances made, all required amounts pursuant to Section 3.22 and
all amounts required to be paid by the Master Servicer pursuant to Sections 3.13
and 3.23 by deposits into the Certificate Account on the immediately preceding
Certificate Account Deposit Date, reduced by (b) the sum, as of the close of
business on the related Determination Date of (i) Monthly Payments collected but
due during a Due Period subsequent to the Due Period ending on the first day of
the month of the related Distribution Date, (ii) all interest or other income
earned on deposits in the Custodial Account, (iii) any other amounts
reimbursable or payable to the Master Servicer or any other Person pursuant to
Section 3.11, (iv) Insurance Proceeds, Liquidation Proceeds, Principal
Prepayments, REO Proceeds and the proceeds of Mortgage Loan purchases (or
amounts received in connection with substitutions) made pursuant to Section
2.02, 2.04 and 3.25, in each case received or made in the month of such
Distribution Date and (v) the Trustee's Fee.
"Bankruptcy Amount": As of any date of determination, an
amount, equal to the excess, if any, of (A) $______, over (B) the aggregate
amount of draws made under the Letter of Credit with respect to Bankruptcy
Losses since the Cut-off Date up to such date of determination in accordance
with Section 4.04.
The Bankruptcy Amount may be further reduced by the Master
Servicer (including accelerating the manner in which such coverage is reduced)
provided that prior to any such reduction, the Master Servicer shall (i) obtain
written confirmation from each Rating Agency that such reduction shall not
reduce the rating assigned to the Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
"Bankruptcy Code": The United States Bankruptcy Code of 1978,
as amended.
"Bankruptcy Loss": With respect to any Mortgage Loan, a
Deficient Valuation or Debt Service Reduction; provided, however, that a
Deficient Valuation or a Debt Service Reduction shall not be deemed a Bankruptcy
Loss hereunder so long as the Master Servicer has notified the Trustee in
writing that the Master Servicer is diligently pursuing any remedies that may
exist in connection with the related Mortgage Loan and either (A) the related
Mortgage Loan is not in default with regard to payments due thereunder or (B)
delinquent payments of principal and interest under the related Mortgage Loan
and any related escrow payments in respect of such
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Mortgage Loan are being advanced on a current basis by the Master Servicer, in
either case without giving effect to any Deficient Valuation or Debt Service
Reduction.
"Business Day": Any day other than (i) a Saturday or a Sunday
or (ii) a day on which banking institutions in the State of __________ or the
State of ________ (and such other state or states in which the Custodial
Account, the Certificate Account or the office of the Letter of Credit Issuer at
which draws under the Letter of Credit are to be made is at the time located)
are required or authorized by law or executive order to be closed.
"Cash Liquidation": As to any defaulted Mortgage Loan other
than a Mortgage Loan as to which an REO Acquisition occurred, the final receipt
by or on behalf of the Master Servicer of all Insurance Proceeds, Liquidation
Proceeds and other payments or cash recoveries which the Master Servicer
reasonably and in good faith expects to be finally recoverable with respect to
such Mortgage Loan.
"Certificate": Any one of the Certificates, executed by the
Trustee and authenticated by the Certificate Registrar substantially in the form
annexed hereto as Exhibit A.
"Certificate Account": The account or accounts created and
maintained pursuant to Section 4.01, which shall be entitled
"________________________________, as trustee, in trust for the registered
holders of NAMCO Securities Corp., Mortgage Pass-Through Certificates, Series
____-___" and which must be an Eligible Account.
"Certificate Account Deposit Date": The 20th day (or if such
20th day is not a Business Day, the Business Day immediately preceding such 20th
day) of the month.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that any
Certificate registered in the name of the Company or the Master Servicer or any
affiliate thereof shall be deemed not to be outstanding and the Voting Rights to
which it is entitled shall not be taken into account in determining whether the
requisite percentage of Voting Rights necessary to effect any such consent has
been obtained, except as otherwise provided in Section 10.01. The Trustee shall
be entitled to rely upon a certification of the Company or the Master Servicer
in determining if any Certificates are registered in the name of a respective
affiliate.
"Certificate Owner": With respect to a Book-Entry Certificate,
the Person who is the beneficial owner of such Certificate, as reflected on the
books of an indirect participating brokerage firm for which a Company
Participant acts as agent, if any, and otherwise on the books of a Company
Participant, if any, and otherwise on the books of the Company.
"Certificate Principal Balance": With respect to each
Certificate, on any date of determination, an amount equal to (i) the Initial
Certificate Principal Balance of such Certificate as specified on the face
thereof, minus (ii) the sum of (x) the aggregate of all amounts previously
distributed with respect to such Certificate (or any predecessor Certificate)
and applied to reduce the Certificate Principal Balance thereof pursuant to
Section 4.02(b) and (y) the aggregate of all
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reductions in Certificate Principal Balance deemed to have occurred in
connection with Realized Losses which were previously allocated to such
Certificate (or any predecessor Certificate) pursuant to Section 4.04.
"Certificate Register": The register maintained pursuant to
Section 5.02.
"Closing Date": _______ __, ____.
"Code": The Internal Revenue Code of 1986.
"Collateral Value": The appraised value of a Mortgaged
Property based upon the lesser of (i) the appraisal made at the time of the
origination of the related Mortgage Loan, or (ii) the sales price of such
Mortgaged Property at such time of origination. With respect to a Mortgage Loan
the proceeds of which were used to refinance an existing mortgage loan, the
appraised value of the Mortgaged Property based upon the appraisal (as reviewed
and approved by the Seller) obtained at the time of refinancing.
"Company": NAMCO Securities Corp., or its successor in
interest.
"Converted Mortgage Loan": Any Convertible Mortgage Loan with
respect to which the interest rate borne by such Mortgage Loan has been
converted from an adjustable interest rate to a fixed interest rate.
"Convertible Mortgage Loan": Any Mortgage Loan which by its
terms grants to the related Mortgagor the option to convert the interest rate
borne by such Mortgage Loan from an adjustable interest rate to a fixed interest
rate.
"Converting Mortgage Loan": Any Convertible Mortgage Loan with
respect to which the related Mortgagor has given notice of his intent to convert
from an adjustable interest rate to a fixed interest rate and prior to the
conversion of such Mortgage Loan.
"Corporate Trust Office": The principal office of the Trustee
at which at any particular time its corporate trust business with respect to
this Agreement shall be administered, which office at the date of the execution
of this instrument is located at __________________
_______________________________________________, Attention:
_______________________ Series ____-__.
"Custodial Account": The custodial account or accounts created
and maintained pursuant to Section 3.10 in a depository institution, as
custodian for the holders of the Certificates, for the holders of certain other
interests in mortgage loans serviced or sold by the Master Servicer and for the
Master Servicer, into which the amounts set forth in Section 3.10 shall be
deposited directly. Any such account or accounts shall be an Eligible Account.
"Cut-off Date": __________ 1, ____.
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"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, except such a
reduction constituting a Deficient Valuation or any reduction that results in a
permanent forgiveness of principal.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged Property in an
amount less than the then outstanding indebtedness under the Mortgage Loan,
which valuation results from a proceeding initiated by the Mortgagor under the
Bankruptcy Code.
"Definitive Certificate": Any definitive, fully registered
Certificate.
"Deleted Mortgage Loan": A Mortgage Loan replaced or to be
replaced with a Qualified Substitute Mortgage Loan.
"Determination Date": The 15th day (or if such 15th day is not
a Business Day, the Business Day immediately preceding such 15th day) of the
month of the related Distribution Date.
"Distribution Date": The 25th day of any month, or if such
25th day is not a Business Day, the Business Day immediately following such 25th
day commencing on ________ 25, ____.
"Due Date": The first day of the month of the related
Distribution Date.
"Due Period": With respect to any Distribution Date, the
period commencing on the second day of the month preceding the month of such
Distribution Date (or, with respect to the first Due Period, the day following
the Cut-off Date) and ending on the related Due Date.
["Duff & Xxxxxx": Xxxx & Xxxxxx Credit Rating Company or its
successor in interest.]
"Eligible Account": An account maintained with a federal or
state chartered depository institution (i) the short-term obligations of which
are rated by each of the Rating Agencies in its highest rating at the time of
any deposit therein, or (ii) insured by the FDIC (to the limits established by
such Corporation), the uninsured deposits in which account are otherwise secured
such that, as evidenced by an Opinion of Counsel (obtained by and at the expense
of the Person requesting that the account be held pursuant to this clause (ii))
delivered to the Trustee prior to the establishment of such account, the
Certificateholders will have a claim with respect to the funds in such account
and a perfected first priority security interest against any collateral (which
shall be limited to Permitted Instruments, each of which shall mature not later
than the Business Day immediately preceding the Distribution Date next following
the date of investment in such collateral or the Distribution Date if such
Permitted Instrument is an obligation of the institution that maintains the
Certificate Account or Custodial Account) securing such funds that is superior
to claims of any other depositors or general creditors of the depository
institution with
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which such account is maintained or (iii) a trust account or accounts maintained
with a federal or state chartered depository institution or trust company with
trust powers acting in its fiduciary capacity or (iv) an account or accounts of
a depository institution acceptable to the Rating Agencies (as evidenced in
writing by the Rating Agencies that use of any such account as the Custodial
Account or the Certificate Account will not have an adverse effect on the
then-current ratings assigned to the Certificates). Eligible Accounts may bear
interest.
"Event of Default": One or more of the events described in
Section 7.01.
"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 Special Hazard Loss": Any Special Hazard Loss, or
portion thereof, that exceeds the then applicable Special Hazard Amount.
"Extraordinary Events": Any of the following conditions with
respect to a Mortgaged Property or Mortgage Loan causing or resulting in a loss
which causes the liquidation of such Mortgage Loan:
(a) losses that are of a type that would be covered by the
fidelity bond and the errors and omissions insurance policy required to
be maintained pursuant to Section 3.18 but are in excess of the
coverage maintained thereunder;
(b) nuclear reaction or nuclear radiation or radioactive
contamination, all whether controlled or uncontrolled, and whether such
loss be direct or indirect, proximate or remote or be in whole or in
part caused by, contributed to or aggravated by a peril covered by the
definition of the term "Special Hazard Loss";
(c) hostile or warlike action in time of peace or war,
including action in hindering, combatting or defending against an
actual, impending or expected attack:
1. by any government or sovereign power, de jure or
de facto, or by any authority maintaining or using military,
naval or air forces; or
2. by military, naval or air forces; or
3. by an agent of any such government, power,
authority or forces;
(d) any weapon of war employing atomic fission or radioactive
force whether in time of peace or war; or
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(e) insurrection, rebellion, revolution, civil war, usurped
power or action taken by governmental authority in hindering,
combatting or defending against such an occurrence, seizure or
destruction under quarantine or customs regulations, confiscation by
order of any government or public authority; or risks of contraband or
illegal transportation or trade.
"Extraordinary Losses": Any loss incurred on a Mortgage Loan
caused by or resulting from an Extraordinary Event.
"FDIC": Federal Deposit Insurance Corporation or any
successor.
"FHLMC": Federal Home Loan Mortgage Corporation or any
successor.
["Fitch": Fitch Investors Service, Inc., or its successor in
interest.]
"FNMA": Federal National Mortgage Association or any
successor.
"Fraud Losses": Any Realized Loss sustained by reason of a
default arising from fraud, dishonesty or misrepresentation in connection with
the related Mortgage Loan.
"Fraud Loss Amount": As of any date of determination after the
Cut-off Date, an amount equal to: (X) up to and including the [first]
anniversary of the Cut-off Date an amount equal to ____% of the aggregate
outstanding principal balance of all of the Mortgage Loans as of the Cut-off
Date minus the aggregate amount of draws made under the Letter of Credit with
respect to Fraud Losses since the Cut-off Date up to such date of determination,
(Y) from the [first] to the fifth anniversary of the Cut-off Date, an amount
equal to (1) the lesser of (a) the Fraud Loss Amount as of the most recent
anniversary of the Cut-off Date and (b) ____% 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 aggregate amount of draws made under the
Letter of Credit with respect to Fraud Losses 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.
The Fraud Loss Amount may be further reduced by the Master
Servicer (including accelerating the manner in which such coverage is reduced)
provided that prior to any such reduction, the Master Servicer shall (i) obtain
written confirmation from each Rating Agency that such reduction shall not
reduce the rating assigned to the Certificates by such Rating Agency below the
lower of the then-current rating or the rating assigned to such Certificates as
of the Closing Date by such Rating Agency and (ii) provide a copy of such
written confirmation to the Trustee.
"Funding Date": With respect to each Mortgage Loan, the date
on which funds were advanced by or on behalf of the Seller and interest began to
accrue thereunder.
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"Gross Margin": As to each Mortgage Loan, the fixed percentage
set forth in the related Mortgage Note and indicated in Exhibit H hereto which
percentage is added to the Index on each Adjustment Date to determine (subject
to rounding in accordance with the related Mortgage Note, Periodic Cap, Maximum
Interest Rate and Minimum Interest Rate) the interest rate to be borne by such
Mortgage Loan until the next Adjustment Date.
"Index": With respect to any Mortgage Loan, the Cost of Funds
Index reflecting the monthly weighted average cost of funds of savings and loan
associations and savings banks, the home offices of which are located in
Arizona, California and Nevada, that are member institutions of the FHLB of San
Francisco, as published in THE WALL STREET JOURNAL, as most recently available
as of the date ____ days prior to the relevant Adjustment Date, or in the event
that such index is no longer available, an index selected by the Master Servicer
and reasonably acceptable to the Trustee that is based on comparable
information.
"Initial Certificate Principal Balance": With respect to the
Certificates, $------------.
"Insurance Policy": With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement in respect of such Mortgage Loan.
"Insurance Proceeds": Proceeds paid by any insurer pursuant to
the Primary Mortgage Insurance Policy and any other insurance policy covering a
Mortgage Loan to the extent such proceeds are not applied to the restoration of
the related Mortgaged Property or released to the Mortgagor in accordance with
the procedures that the Master Servicer would follow in servicing mortgage loans
held for its own account.
"Late Collections": With respect to any Mortgage Loan, all
amounts received during any Due Period, whether as late payments of Monthly
Payments or as Insurance Proceeds, Liquidation Proceeds or otherwise, which
represent late payments or collections of Monthly Payments due but delinquent
for a previous Due Period and not previously recovered.
"Letter of Credit": The irrevocable letter of credit covering
certain losses on the Mortgage Loans in all of the Mortgage Pools, in the form
of Exhibit B hereto, issued by the Letter of Credit Issuer, naming the Trustee
as beneficiary for the benefit of the Certificateholders, as the same may be
terminated, modified or reduced from time to time pursuant to its terms and
Section 4.06, and any replacement letter of credit obtained pursuant to Section
4.06.
"Letter of Credit Issuer": _____________, or if a replacement
Letter of Credit is issued in accordance with the terms hereof, the issuer of
such replacement Letter of Credit.
"Liquidation Proceeds": Amounts (other than Insurance
Proceeds) received by the Master Servicer in connection with the taking of an
entire Mortgaged Property by exercise of the power of eminent domain or
condemnation or in connection with the liquidation of a defaulted
9
Mortgage Loan through trustee's sale, foreclosure sale or otherwise, other than
amounts received in respect of REO Property.
"Loan-to-Value Ratio": As of any date, the fraction, expressed
as a percentage, the numerator of which is the current principal balance of the
related Mortgage Loan at the date of determination and the denominator of which
is the Collateral Value of the related Mortgaged Property.
"Master Servicer": [Name of Master Servicer], or any successor
master servicer appointed as herein provided.
"Maximum Interest Rate": As to any Mortgage Loan, the maximum
interest rate that may be borne by such Mortgage Loan as set forth in the
related Mortgage Note and indicated in Exhibit H, which rate may be applicable
to such Mortgage Loan at any time during the life of such Mortgage Loan.
"Minimum Interest Rate": As to any Mortgage Loan, the minimum
interest rate that may be borne by such Mortgage Loan as set forth in the
related Mortgage Note and indicated in Exhibit H hereto, which rate may be
applicable to such Mortgage Loan at any time during the life of such Mortgage
Loan.
"Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by a Mortgagor from time to time under the related Mortgage Note as
originally executed (after adjustment, if any, for Principal Prepayments and for
Deficient Valuations occurring prior to such Due Date, and after any adjustment
by reason of any bankruptcy or similar proceeding or any moratorium or similar
waiver or grace period).
["Moody's": Xxxxx'x Investors Service, Inc. or its successor
in interest.]
"Mortgage": The mortgage, deed of trust or any other
instrument securing the Mortgage Loan.
"Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement; provided, that
whenever the term "Mortgage File" is used to refer to documents actually
received by the Trustee, such term shall not be deemed to include such
additional documents required to be added unless they are actually so added.
"Mortgage Loan": Each of the mortgage loans, transferred and
assigned to the Trustee pursuant to Section 2.01 or Section 2.03 and from time
to time held in the Trust Fund, the Mortgage Loans originally so transferred,
assigned and held being identified in the Mortgage Loan Schedule attached hereto
as Exhibit H (and any Qualified Substitute Mortgage Loans). As used herein, the
term "Mortgage Loan" includes the related Mortgage Note and Mortgage.
10
"Mortgage Loan Schedule": As of any date of determination, the
schedule of Mortgage Loans included in the Trust Fund. The initial schedule of
Mortgage Loans with accompanying information transferred on the Closing Date to
the Trustee as part of the Trust Fund for the Certificates, attached hereto as
Exhibit H (as amended from time to time to reflect the addition of Qualified
Substitute Mortgage Loans) (and, for purposes of the Trustee's review of the
Mortgage Files pursuant to Section 2.02, in computer-readable form as delivered
to the Trustee), which list shall set forth the following information, if
applicable, with respect to each Mortgage Loan:
(i) the loan number and name of the Mortgagor;
(ii) xxx xxxxxx xxxxxxx, xxxx, xxxxx and zip code of the
Mortgaged Property;
(iii) the Mortgage Rate;
(iv) Maximum Interest Rate;
(v) Minimum Interest Rate;
(vi) Gross Margin;
(vii) the first Adjustment Rate;
(viii) the Periodic Cap;
(ix) the maturity date;
(x) the original principal balance;
(xi) the first payment date;
(xii) the type of Mortgaged Property;
(xiii) the Monthly Payment in effect as of the Cut-off Date;
(xiv) the principal balance as of the Cut-off Date;
(xv) the occupancy status;
(xvi) the purpose of the Mortgage Loan;
(xvii) the Collateral Value of the Mortgaged Property;
(xviii) the original term to maturity;
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(xix) the paid-through date of the Mortgage Loan;
(xx) the Loan-to-Value Ratio; and
(xxi) whether or not the Mortgage Loan was underwritten
pursuant to a limited documentation program.
The Mortgage Loan Schedule shall also set forth the total of
the amounts described under (xiv) above for all of the Mortgage Loans. The
Mortgage Loan Schedule may be in the form of more than one schedule,
collectively setting forth all of the information required. With respect to any
Qualified Substitute Mortgage Loan, the item described in clause (xiii) shall be
set forth as the date of substitution.
"Mortgage Note": The note or other evidence of the
indebtedness of a Mortgagor under a Mortgage Loan.
"Mortgage Rate": With respect to any Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan.
"Mortgaged Property": The underlying property securing a
Mortgage Loan.
"Mortgagor": The obligor or obligors on a Mortgage Note.
"Net Mortgage Rate": As to each Mortgage Loan, a per annum
rate of interest equal to the related Mortgage Rate as in effect from time to
time minus the Servicing Fee Rate.
"Nonrecoverable Advance": Any Advance previously made or
proposed to be made in respect of a Mortgage Loan which, in the good faith
judgment of the Master Servicer, will not or, in the case of a proposed Advance,
would not be ultimately recoverable from related Late Collections, Insurance
Proceeds, Liquidation Proceeds or REO Proceeds. The determination by the Master
Servicer that it has made a Nonrecoverable Advance or that any proposed Advance
would constitute a Nonrecoverable Advance, shall be evidenced by an Officers'
Certificate delivered to the Company and the Trustee.
"Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the Board, the President or a vice president
and by the Treasurer, the Secretary, or one of the assistant treasurers or
assistant secretaries of the Master Servicer or of the Sub-Servicer and
delivered to the Company and Trustee.
"Opinion of Counsel": A written opinion of counsel, who may be
counsel for the Company or the Master Servicer, reasonably acceptable to the
Trustee; except that any opinion of counsel relating to (a) the qualification of
any account required to be maintained pursuant to this Agreement as an Eligible
Account, or (b) resignation of the Master Servicer pursuant to Section 6.04 must
be an opinion of counsel who (i) is in fact independent of the Company and the
Master Servicer, (ii) does not have any direct financial interest or any
material indirect financial interest
12
in the Company or the Master Servicer or in an affiliate of either and (iii) is
not connected with the Company or the Master Servicer as an officer, employee,
director or person performing similar functions.
"OTS": Office of Thrift Supervision or any successor.
"Outstanding Mortgage Loan": As to any Due Date, a Mortgage
Loan (including an REO Property) which was not the subject of a Principal
Prepayment in full, Cash Liquidation or REO Disposition and which was not
purchased or substituted for prior to such Due Date pursuant to Sections 2.02,
2.04 or 3.25.
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in such
Certificate as the Holder thereof and any other interest therein, whether direct
or indirect, legal or beneficial, as owner or as pledgee.
"Pass-Through Rate": With respect to the Certificates and any
Distribution Date, a rate equal to the weighted average, expressed as a
percentage, of the Net Mortgage Rates of all Mortgage Loans in the Trust Fund 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 Stated
Principal Balances of such Mortgage Loans, which Stated Principal Balances shall
be the Stated Principal Balances of such Mortgage Loans at the close of business
on the immediately preceding Distribution Date after giving effect to the
distributions thereon allocable to principal (or, in the case of the initial
Distribution Date, at the close of business on the Cut-off Date).
"Percentage Interest": With respect to any Certificate, the
undivided percentage ownership interest equal to the initial Certificate
Principal Balance thereof divided by the aggregate Initial Certificate Principal
Balance of all of the Certificates.
"Periodic Cap": With respect to the Mortgage Loans, the
periodic rate cap which limits the increase or the decrease of the related
Mortgage Rate on any Adjustment Date to ----%.
"Permitted Instruments": Any one or more of the following:
(i)(a) direct 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 and (b) direct obligations
of, and obligations guaranteed as to timely payment by FHLMC or FNMA
if, at the time of investment, they are assigned the highest credit
rating by the Rating Agencies;
(ii) repurchase obligations (the collateral for which is held by
a third party or the Trustee) with respect to any security described in
clause (i) above, provided that the short-term unsecured obligations of
the party agreeing to repurchase such obligations are
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at the time rated by each Rating Agency in one of its two highest
long-term rating categories;
(iii) certificates of deposit, time deposits, demand deposits and
bankers' acceptances of any bank or trust company incorporated under
the laws of the United States or any state thereof or the District of
Columbia, provided that the short-term commercial paper of such bank or
trust company (or, in the case of the principal depository institution
in a depository institution holding company, the long-term unsecured
debt obligations of the depository institution holding company) at the
date of acquisition thereof has been rated by each Rating Agency in its
highest short-term rating;
(iv) commercial paper (having original maturities of not more
than nine months) of any corporation incorporated under the laws of the
United States or any state thereof or the District of Columbia which on
the date of acquisition has been rated by each Rating Agency in its
highest short-term rating;
(v) a money market fund or a qualified investment fund rated by
each Rating Agency in its highest rating available; and
(vi) if previously confirmed in writing to the Trustee, any other
obligation or security acceptable to each Rating Agency in respect of
mortgage pass-through certificates rated in each Rating Agency's
highest rating category;
provided, that no such instrument shall be a Permitted Instrument if such
instrument evidences either (a) the right to receive interest only payments with
respect to the obligations underlying such instrument or (b) both principal and
interest payments derived from obligations underlying such instrument where the
principal and interest payments with respect to such instrument provide a yield
to maturity exceeding 120% of the yield to maturity at par of such underlying
obligation.
"Person": Any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Prepayment Assumption": A prepayment assumption of ___% of
the standard prepayment assumption, used for determining the accrual of original
issue discount and market discount and premium on the Certificates for federal
income tax purposes. The standard prepayment assumption assumes a constant rate
of prepayment of mortgage loans of 0.2% per annum of the then outstanding
principal balance of such mortgage loans in the first month of the life of the
mortgage loans, increasing by an additional 0.2% per annum in each succeeding
month until the thirtieth month, and a constant 6% per annum rate of prepayment
thereafter for the life of such mortgage loans.
"Prepayment Interest Shortfall": With respect to any
Distribution Date, for each Mortgage Loan that was the subject of a partial
Principal Prepayment, a Principal Prepayment in full, or of a Cash Liquidation
or an REO Disposition during the related Prepayment Period, an
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amount equal to the amount of interest that would have accrued at the applicable
Net Mortgage Rate (i) in the case of a Principal Prepayment in full, Cash
Liquidation or REO Disposition on the principal balance of such Mortgage Loan
immediately prior to such prepayment (or liquidation), commencing on the date of
prepayment (or liquidation) and ending on the last day of the month of
prepayment or liquidation or (ii) in the case of a partial Principal Prepayment,
on the amount of such prepayment, commencing on the date as of which the
prepayment is applied and ending on the last day of the month of prepayment.
"Prepayment Period": As to any Distribution Date, the calendar
month preceding the month in which such Distribution Date occurs.
"Primary Hazard Insurance Policy": Each primary hazard
insurance policy required to be maintained pursuant to Section 3.13.
"Primary Mortgage Insurance Policy": Each primary mortgage
insurance policy required to be maintained pursuant to Section 3.13.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing
scheduled interest due on any date or dates in any month or months subsequent to
the month of prepayment.
"Purchase Price": With respect to any Mortgage Loan (or REO
Property) required to be purchased pursuant to Section 2.02, 2.04 or 3.25, an
amount equal to the sum of (i) 100% of the Stated Principal Balance thereof,
(ii) unpaid accrued interest (or REO Imputed Interest) at the sum of the
applicable Net Mortgage Rate, the rate at which the Trustee's Fee accrues on the
Stated Principal Balance thereof outstanding during each Due Period that such
interest was not paid or advanced, from the date through which interest was last
paid by the Mortgagor or advanced and distributed to Certificateholders together
with unpaid related Servicing Fees from the date through which interest was last
paid by the Mortgagor, in each case to the first day of the month in which such
Purchase Price is to be distributed, plus (iii) the aggregate of all Advances
made in respect thereof that were not previously reimbursed.
"Qualified Insurer": An insurance company duly qualified as
such under the laws of the state of its principal place of business and each
state having jurisdiction over such insurer in connection with the insurance
policy issued by such insurer, duly authorized and licensed in such states to
transact business in such states and to write the insurance provided by the
insurance policy issued by it, approved as an insurer by the Master Servicer, as
a FNMA-approved mortgage insurer and having a claims paying ability rating of at
least "AA" by ____________________ and which is acceptable to _____________. Any
replacement insurer with respect to a Mortgage Loan must have at least as high a
claims paying ability rating by _____________ and ___________________ as the
insurer it replaces had on the Closing Date.
"Qualified Substitute Mortgage Loan": A Mortgage Loan
substituted by the Company for a Deleted Mortgage Loan which must, on the date
of such substitution, as confirmed
15
in an Officers' Certificate delivered to the Trustee, (i) have an outstanding
principal balance, after deduction of the principal portion of the monthly
payment due in the month of substitution (or in the case of a substitution of
more than one Mortgage Loan for a Deleted Mortgage Loan, an aggregate
outstanding principal balance, after such deduction), not in excess of the
Stated Principal Balance of the Deleted Mortgage Loan (the amount of any
shortfall to be deposited by the Master Servicer, in the Custodial Account in
the month of substitution); (ii) have a Mortgage Rate and a Net Mortgage Rate no
lower than and not more than 1% per annum higher than the Mortgage Rate and Net
Mortgage Rate, respectively, of the Deleted Mortgage Loan as of the date of
substitution; (iii) have a remaining term to stated maturity not greater than
(and not more than one year less than) that of the Deleted Mortgage Loan; (iv)
comply with each representation and warranty set forth in Section 2 of the
Seller's Warranty Certificate; (v) have a Loan-to-Value Ratio as of the date of
substitution equal to or lower than the Loan-to-Value Ratio of the Deleted
Mortgage Loan as of such date; and (vi) be covered under a Primary Insurance
Policy if such Qualified Substitute Mortgage Loan has a Loan-to-Value Ratio in
excess of 80%. In the event that one or more mortgage loans are substituted for
one or more Deleted Mortgage Loans, the amounts described in clause (i) hereof
shall be determined on the basis of aggregate principal balances, the Mortgage
Rates described in clause (ii) hereof shall be determined on the basis of
weighted average Mortgage Rates, the Net Mortgage Rates described in clause (ii)
hereof shall be satisfied as to each such mortgage loan, the terms described in
clause (iii) shall be determined on the basis of weighted average remaining
terms to maturity, the Loan-to-Value Ratios described in clause (v) hereof shall
be satisfied as to each such mortgage loan and, except to the extent otherwise
provided in this sentence, the representations and warranties described in
clause (iv) hereof must be satisfied as to each Qualified Substitute Mortgage
Loan or in the aggregate, as the case may be.
"Rating Agency": [Standard & Poor's] [Xxxxx'x] [Fitch] [Xxxx &
Xxxxxx]. If either agency or a successor is no longer in existence, "Rating
Agency" shall be such statistical credit rating agency, or other comparable
Person, designated by the Company, notice of which designation shall be given to
the Trustee and the Master Servicer. References herein to the two highest long
term debt rating categories of a Rating Agency shall mean "AA" or better in the
case of [Standard & Poor's] [Fitch] [Duff & Xxxxxx] and "Aa2" or better in the
case of Xxxxx'x and references herein to the highest short-term debt rating of a
Rating Agency shall mean "D-1" or better in the case of [Duff & Xxxxxx] and
"A-1" in the case of [Standard & Poor's,] and in the case of any other Rating
Agency such references shall mean such rating categories without regard to any
plus or minus.
"Realized Loss": With respect to any Mortgage Loan or related
REO Property as to which a Cash Liquidation or REO Disposition has occurred, an
amount (not less than zero) equal to (i) the Stated Principal Balance of the
Mortgage Loan as of the date of Cash Liquidation or REO Disposition, plus (ii)
interest (and REO Imputed Interest, if any) at the related Net Mortgage Rate
from the Due Date as to which interest was last paid or advanced to
Certificateholders up to the date of the Cash Liquidation or REO Disposition on
the Stated Principal Balance of such Mortgage Loan outstanding during each Due
Period that such interest was not paid or advanced, minus (iii) the proceeds, if
any, received during the month in which such Cash Liquidation or REO Disposition
occurred, to the extent applied as recoveries of interest at the related Net
Mortgage Rate and to principal of the Mortgage Loan, net of the portion thereof
16
reimbursable to the Master Servicer or any Sub-Servicer with respect to related
Advances not previously reimbursed. With respect to each Mortgage Loan which has
become the subject of a Deficient Valuation, the difference between the
principal balance of the Mortgage Loan outstanding immediately prior to such
Deficient Valuation and the principal balance of the Mortgage Loan as reduced by
the Deficient Valuation. With respect to each Mortgage Loan which has become the
subject of a Debt Service Reduction, the amount of such Debt Service Reduction.
"Record Date": The last Business Day of the month immediately
preceding the month of the related Distribution Date.
"Relief Act": The Soldiers' and Sailors' Civil Relief Act of
1940, as amended.
"Remittance Report": A report prepared by the Master Servicer
providing the information set forth in Exhibit E attached hereto.
"REO Acquisition": The acquisition by the Master Servicer on
behalf of the Trustee for the benefit of the Certificateholders of any REO
Property pursuant to Section 3.15.
"REO Disposition": The receipt by the Master Servicer of
Insurance Proceeds, Liquidation Proceeds and other payments and recoveries
(including proceeds of a final sale) which the Master Servicer expects to be
finally recoverable from the sale or other disposition of the REO Property.
"REO Imputed Interest": As to any REO Property, for any
period, an amount equivalent to interest (at the Mortgage Rate that would have
been applicable to the related Mortgage Loan had it been outstanding) on the
unpaid principal balance of the Mortgage Loan as of the date of acquisition
thereof (as such balance is reduced by any income from the REO Property treated
as a recovery of principal pursuant to Section 3.15).
"REO Proceeds": Proceeds, net of directly related expenses,
received in respect of any REO Property (including, without limitation, proceeds
from the rental of the related Mortgaged Property and of any REO Disposition),
which proceeds are required to be deposited into the Custodial Account as and
when received.
"REO Property": A Mortgaged Property acquired by the Master
Servicer through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan.
"Request for Release": A release signed by a Servicing
Officer, in the form of Exhibits F-1 or F-2 attached hereto.
"Required Insurance Policy": With respect to any Mortgage
Loan, any Insurance Policy or any other insurance policy that is required to be
maintained from time to time under this Agreement or pursuant to the provisions
of a Mortgage Loan.
17
"Responsible Officer": When used with respect to the Trustee,
the Chairman or Vice Chairman of the Board of Directors or Trustees, the
Chairman or Vice Chairman of the Executive or Standing Committee of the Board of
Directors or Trustees, the President, the Chairman of the Committee on Trust
Matters, any vice president, any assistant vice president, the Secretary, any
assistant secretary, the Treasurer, any assistant treasurer, the Cashier, any
assistant cashier, any trust officer or assistant trust officer, the Controller
and any assistant controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Seller": [Name of Seller], and its successors and assigns.
"Seller's Warranty Certificate": The Seller's Warranty
Certificate of the Seller, dated _____ __, ____, in the form of Exhibit I
attached hereto.
"Servicing Account": The account or accounts created and
maintained pursuant to Section 3.09.
"Servicing Advances": All customary, reasonable and necessary
"out of pocket" costs and expenses incurred in connection with a default,
delinquency or other unanticipated event by the Master Servicer in the
performance of its servicing obligations, including, but not limited to, the
cost of (i) the preservation, restoration and protection of a Mortgaged
Property, (ii) any enforcement or judicial proceedings, including foreclosures,
(iii) the management and liquidation of any REO Property and (iv) compliance
with the obligations under the second paragraph of Section 3.01 and Section
3.09.
"Servicing Fee": As to each Mortgage Loan, an amount, payable
out of any payment of interest on the Mortgage Loan, equal to interest at the
related Servicing Fee Rate on the Stated Principal Balance of such Mortgage Loan
for the calendar month preceding the month in which the payment is due
(alternatively, in the event such payment of interest accompanies a Principal
Prepayment in full made by the Mortgagor, interest for the number of days
covered by such payment of interest).
"Servicing Fee Rate": With respect to each Mortgage Loan, the
per annum rate of -----%.
"Servicing Officer": Any officer of the Master Servicer
involved in, or responsible for, the administration and servicing of the
Mortgage Loans, whose name appears on a list of servicing officers furnished to
the Trustee by the Master Servicer, as such list may from time to time be
amended.
"Single Certificate": A Certificate evidencing the minimum
denomination of the Certificates as set forth in Section 5.01.
18
"Special Hazard Amount": As of any Distribution Date, an
amount equal to $________ (the initial "Special Hazard Amount") minus the sum of
(i) the aggregate amount of draws made under the Letter of Credit in accordance
with Section 4.04 since the Cut-off Date and (ii) the Adjustment Amount (as
defined below) as most recently calculated. For each anniversary of the Cut-off
Date, the Adjustment Amount shall be calculated and shall be equal to the
amount, if any, by which the amount calculated in accordance with the preceding
sentence (without giving effect to the deduction of the Adjustment Amount for
such anniversary) exceeds the greater of (A) the product of the Special Hazard
Percentage for such anniversary multiplied by the outstanding principal balance
of all of the Mortgage Loans on such anniversary and (B) twice the outstanding
principal balance of the Mortgage Loan which has the largest outstanding
principal balance on such Anniversary.
"Special Hazard Percentage": As of each anniversary of the
Cut-off Date, the greater of (i) 1% and (ii) the largest percentage obtained by
dividing the aggregate outstanding principal balance on such anniversary of the
Mortgage Loans secured by Mortgaged Properties located in a single, five-digit
zip code area in the State of California by the outstanding principal balance of
all the Mortgage Loans on such anniversary.
"[Standard & Poor's": Standard & Poor's Ratings Group, a
division of McGraw Hill, Inc. or its successor in interest.]
"Stated Principal Balance": With respect to any Mortgage Loan
or related REO Property at any given time, (i) the principal balance of the
Mortgage Loan outstanding as of the Cut-off Date, after application of principal
payments due on or before such date, whether or not received, minus (ii) the sum
of (a) the principal portion of the Monthly Payments due with respect to such
Mortgage Loan or REO Property during each Due Period ending prior to the most
recent Distribution Date which were received or with respect to which an Advance
was made, (b) all Principal Prepayments with respect to such Mortgage Loan or
REO Property, and all Insurance Proceeds, Liquidation Proceeds and net income
from a REO Property to the extent applied by the Master Servicer as recoveries
of principal in accordance with Section 3.15 with respect to such Mortgage Loan
or REO Property, which were distributed pursuant to Section 4.01 on any previous
Distribution Date and (c) any Realized Loss with respect thereto allocated
pursuant to Section 4.04 for any previous Distribution Date.
"Sub-Servicer": Any Person with which the Master Servicer has
entered into a Sub-Servicing Agreement and which meets the qualifications of a
Sub-Servicer pursuant to Section 3.02.
"Sub-Servicer Remittance Date": The 18th day of each month, or
if such day is not a Business Day, the immediately preceding Business Day.
"Sub-Servicing Account": An account established by a
Sub-Servicer which meets the requirements set forth in Section 3.08 and is
otherwise acceptable to the Master Servicer.
19
"Sub-Servicing Agreement": The written contract between the
Master Servicer and a Sub-Servicer and any successor Sub-Servicer relating to
servicing and administration of certain Mortgage Loans as provided in Section
3.02.
"Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation or other form of assignment of any Ownership Interest in a
Certificate.
"Transferor": Any Person who is disposing by Transfer of any
Ownership Interest in a Certificate.
"Trust Fund": The corpus of the trust created by this
Agreement, to the extent described herein, consisting of the Mortgage Loans,
such assets as shall from time to time be identified as deposited in respect of
the Mortgage Loans in the Custodial Account and in the Certificate Account,
property which secured a Mortgage Loan and which has been acquired by
foreclosure or deed in lieu of foreclosure, proceeds of any Primary Hazard
Insurance Policies, if any, and the Letter of Credit (or any alternate form of
credit support substituted therefor) and all proceeds thereof.
"Trustee": [Name of Trustee], or its successor in interest, or
any successor trustee appointed as herein provided.
"Trustee's Fee": As to each Mortgage Loan and as the
Distribution Date, an amount, payable out of any payment of interest on the
Mortgage Loan, equal to interest at ____% per annum on the Stated Principal
Balance of such Mortgage Loan as of the Due Date immediately preceding the month
in which such Distribution Date occurs.
"Uninsured Cause": Any cause of damage to property subject to
a Mortgage such that the complete restoration of such property is not fully
reimbursable by the hazard insurance policies or flood insurance policies
required to be maintained pursuant to Section 3.13.
"Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. The Voting Rights shall
be allocated among Holders of the Certificates, in proportion to the outstanding
Certificate Principal Balances of their respective Certificates.
20
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans.
The Company, as of the Closing Date, and concurrently with the
execution and delivery hereof, does hereby assign, transfer, sell, set over and
otherwise convey to the Trustee without recourse all the right, title and
interest of the Company in and to the Mortgage Loans identified on the Mortgage
Loan Schedule and all other assets included or to be included in the Trust Fund
for the benefit of the Certificateholders. Such assignment includes all
principal and interest received by the Master Servicer on or with respect to the
Mortgage Loans (other than payment of principal and interest due on or before
the Cut-off Date).
In connection with such transfer and assignment, the Company
has requested the Seller to deliver to, and deposit with the Trustee, the
following documents or instruments:
(i) the original Mortgage Note, endorsed by the Seller "Pay to
the order of [Name of Trustee], as trustee without recourse" or to "Pay
to the order of [Name of Trustee], as trustee for holders of NAMCO
Securities Corp., Mortgage Pass-Through Certificates, Series ____-__,
without recourse" with all intervening endorsements showing a complete
chain of endorsements from the originator to the Person endorsing it to
the Trustee;
(ii) the original recorded Mortgage or, if the original Mortgage
has not been returned from the applicable public recording office, a
copy of the Mortgage certified by the Seller to be a true and complete
copy of the original Mortgage submitted to the title insurance company
for recording;
(iii) a duly executed original Assignment of the Mortgage endorsed
by the Seller, without recourse, to "[Name of Trustee], as trustee" or
to "[Name of Trustee], as trustee for holders of NAMCO Securities Corp.
Mortgage Pass-Through Certificates, Series ____- ___", with evidence of
recording thereon;
(iv) the original recorded Assignment or Assignments of the
Mortgage showing a complete chain of assignment from the originator
thereof to the Person assigning it to the Trustee or, if any such
Assignment has not been returned from the applicable public recording
office, a copy of such Assignment certified by the Seller to be a true
and complete copy of the original Assignment submitted to the title
insurance company for recording;
(v) the original lender's title insurance policy, or, if such
policy has not been issued, any one of an original or a copy of the
preliminary title report, title binder or title
21
commitment on the Mortgaged Property with the original policy of the
insurance to be delivered promptly following the receipt thereof;
(vi) the original of any assumption, modification, extension or
guaranty agreement;
(vii) the original or a copy of the private mortgage insurance
policy or original certificate of private mortgage insurance, if
applicable; and
(viii) if any of the documents or instruments referred to above
were executed on behalf of the Mortgagor by another Person, the original power
of attorney or other instrument that authorized and empowered such Person to
sign, or a copy thereof certified by the Seller (or by an officer of the
applicable title insurance or escrow company) to be a true and correct copy of
the original.
The Seller is obligated pursuant to the Seller's Warranty
Certificate to deliver to the Trustee: (a) either the original recorded
Mortgage, or in the event such original cannot be delivered by the Seller, a
copy of such Mortgage certified as true and complete by the appropriate
recording office, in those instances where a copy thereof certified by the
Seller was delivered to the Trustee pursuant to clause (ii) above; and (b)
either the original Assignment or Assignments of the Mortgage, with evidence of
recording thereon, showing a complete chain of assignment from the originator to
the Seller, or in the event such original cannot be delivered by the Seller, a
copy of such Assignment or Assignments certified as true and complete by the
appropriate recording office, in those instances where copies thereof certified
by the Seller were delivered to the Trustee pursuant to clause (iv) above.
Notwithstanding anything to the contrary contained in this Section 2.01, in
those instances where the public recording office retains the original Mortgage
after it has been recorded, the Seller shall be deemed to have satisfied its
obligations hereunder upon delivery to the Trustee of a copy of such Mortgage
certified by the public recording office to be a true and complete copy of the
recorded original thereof.
If any Assignment is lost or returned unrecorded to the
Trustee because of any defect therein, the Seller is required to prepare a
substitute Assignment or cure such defect, as the case may be, and the Trustee
shall cause such Assignment to be recorded in accordance with this paragraph.
The Seller is required, as described in the Seller's Warranty
Certificate, to deliver to the Trustee the original of any documents assigned to
the Trustee pursuant to this Section 2.01 not later than 120 days after the
Closing Date.
All original documents relating to the Mortgage Loans which
are not delivered to the Trustee, to the extent delivered by the Seller to the
Master Servicer, are and shall be held by the Master Servicer in trust for the
benefit of the Trustee on behalf of the Certificateholders. Except as may
otherwise expressly be provided herein, neither the Company, the Master Servicer
nor the Trustee shall (and the Master Servicer shall ensure that no Sub-Servicer
shall) assign, sell, dispose of or transfer any interest in the Trust Fund or
any portion thereof, or
22
permit the Trust Fund or any portion thereof to be subject to any lien, claim,
mortgage, security interest, pledge or other encumbrance of, any other Person.
It is intended that the conveyance of the Mortgage Loans by
the Company to the Trustee as provided in this Section be, and be construed as,
a sale of the Mortgage Loans by the Company to the Trustee for the benefit of
the Certificateholders. It is, further, not intended that such conveyance be
deemed a pledge of the Mortgage Loans by the Company to the Trustee to secure a
debt or other obligation of the Company. However, in the event that the Mortgage
Loans are held to be property of the Company, or if for any reason this
Agreement is held or deemed to create a security interest in the Mortgage Loans,
then it is intended that, (a) this Agreement shall also be deemed to be a
security agreement within the meaning of Articles 8 and 9 of the New York
Uniform Commercial Code and the Uniform Commercial Code of any other applicable
jurisdiction; (b) the conveyance provided for in this Section shall be deemed to
be (1) a grant by the Company to the Trustee of a security interest in all of
the Company's right (including the power to convey title thereto), title and
interest, whether now owned or hereafter acquired, in and to (A) the Mortgage
Loans, including the Mortgage Notes, the Mortgages, any related insurance
policies and all other documents in the related Mortgage Files, (B) all amounts
payable to the holders of the Mortgage Loans in accordance with the terms
thereof and (C) all proceeds of the conversion, voluntary or involuntary, of the
foregoing into cash, instruments, securities or other property, including
without limitation all amounts from time to time held or invested in the
Certificate Account or the Custodial Account, whether in the form of cash,
instruments, securities or other property and (2) an assignment by the Company
to the Trustee of any security interest in any and all of the Seller's right
(including the power to convey title thereto), title and interest, whether now
owned or hereafter acquired, in and to the property described in the foregoing
clauses (1)(A) through (C) granted by North American Mortgage Company to the
Company pursuant to the Assignment Agreement; (c) the possession by the Trustee
or its agent of Mortgage Notes and such other items of property as constitute
instruments, money, negotiable documents or chattel paper shall be deemed to be
"possession by the secured party" or possession by a purchaser or a person
designated by such secured party, for purposes of perfecting the security
interest pursuant to the New York Uniform Commercial Code and the Uniform
Commercial Code of any other applicable jurisdiction (including, without
limitation, Sections 9-305, 8-313 or 8-321 thereof); and (d) notifications to
persons holding such property, and acknowledgments, receipts or confirmations
from persons holding such property, shall be deemed notifications to, or
acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Trustee for the purpose of perfecting
such security interest under applicable law. The Company and the Trustee shall,
to the extent consistent with this Agreement, take such actions as may be
necessary to ensure that, if this Agreement were deemed to create a security
interest in the Mortgage Loans, such security interest would be deemed to be a
perfected security interest of first priority under applicable law and will be
maintained as such throughout the term of the Agreement.
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SECTION 2.02. Acceptance of the Trust Fund by the Trustee.
The Trustee acknowledges receipt (subject to any exceptions
noted in the Initial Certification described below) of the documents referred to
in Section 2.01 above and all other assets included in the Trust Fund and
declares that it holds and will hold such documents and the other documents
delivered to it constituting the Mortgage Files, and that it holds or will hold
such other assets included in the Trust Fund (to the extent delivered or
assigned to the Trustee), in trust for the exclusive use and benefit of all
present and future Certificateholders.
The Trustee agrees, for the benefit of the Certificateholders,
to review each Mortgage File on or before the Closing Date to ascertain that all
documents required to be delivered to it are in its possession, and the Trustee
agrees to execute and deliver to the Company and the Master Servicer on the
Closing Date an Initial Certification in the form annexed hereto as Exhibit C to
the effect that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in such certification as not covered by such certification), (i) all
documents required to be delivered to it pursuant to this Agreement with respect
to such Mortgage Loan are in its possession, (ii) such documents have been
reviewed by it and appear regular on their face and relate to such Mortgage Loan
and (iii) based on its examination and only as to the foregoing documents, the
information set forth in items (i) - (vi) and (xiii) of the definition of the
"Mortgage Loan Schedule" accurately reflects information set forth in the
Mortgage File. Neither the Trustee nor the Master Servicer shall be under any
duty to determine whether any Mortgage File should include any of the documents
specified in clause (vi) of Section 2.01. Neither the Trustee nor the Master
Servicer shall be under any duty or obligation to inspect, review or examine
said documents, instruments, certificates or other papers to determine that the
same are genuine, enforceable or appropriate for the represented purpose or that
they have actually been recorded or that they are other than what they purport
to be on their face.
Within 90 days of the Closing Date the Trustee shall deliver
to the Company and the Master Servicer a Final Certification in the form annexed
hereto as Exhibit D evidencing the completeness of the Mortgage Files, with any
applicable exceptions noted thereon.
If in the process of reviewing the Mortgage Files and
preparing the certifications referred to above the Trustee finds any document or
documents constituting a part of a Mortgage File to be missing or defective in
any material respect, the Trustee shall promptly notify the Seller, the Master
Servicer and the Company. The Trustee shall promptly notify the Seller of such
defect and request that the Seller cure any such defect within 60 days from the
date on which the Seller was notified of such defect, and if the Seller does not
cure such defect in all material respects during such period, request that the
Seller purchase such Mortgage Loan from the Trust Fund on behalf of the
Certificateholders at the Purchase Price within 90 days after the date on which
the Seller was notified of such defect. It is understood and agreed that the
obligation of the Seller to cure a material defect in, or purchase any Mortgage
Loan as to which a material defect in a constituent document exists shall
constitute the sole remedy respecting such defect available to
Certificateholders or the Trustee on behalf of Certificateholders. The Purchase
Price for the purchased Mortgage Loan shall be deposited or caused to be
deposited upon receipt by the Master
24
Servicer in the Custodial Account and, upon receipt by the Trustee of written
notification of such deposit signed by a Servicing Officer, the Trustee shall
release or cause to be released to the Seller the related Mortgage File and
shall execute and deliver such instruments of transfer or assignment, in each
case without recourse, as the Seller shall require as necessary to vest in the
Seller ownership of any Mortgage Loan released pursuant hereto and at such time
the Trustee shall have no further responsibility with respect to the related
Mortgage File.
SECTION 2.03. Representations, Warranties and Covenants
of the Master Servicer and the Company.
(a) The Master Servicer hereby represents and warrants to and
covenants with the Company and the Trustee for the benefit of Certificateholders
that:
(i) The Master Servicer is, and throughout the term
hereof shall remain, a __________ duly organized, validly existing and
in good standing under the laws of the State of __________ (except as
otherwise permitted pursuant to Section 6.02), the Master Servicer is,
and shall remain, in compliance with the laws of each state in which
any Mortgaged Property is located to the extent necessary to perform
its obligations under this Agreement, and the Master Servicer is, and
shall remain, approved to sell mortgage loans to and service mortgage
loans for FNMA and FHLMC;
(ii) The execution and delivery of this Agreement by the
Master Servicer, and the performance and compliance with the terms of
this Agreement by the Master Servicer, will not violate the Master
Servicer's articles of incorporation or bylaws or constitute a default
(or an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in the breach of, any material
agreement or other instrument to which it is a party or which is
applicable to it or any of its assets;
(iii) The Master Servicer has the full power and authority
to enter into and consummate all transactions contemplated by this
Agreement, has duly authorized the execution, delivery and performance
of this Agreement, and has duly executed and delivered this Agreement;
(iv) This Agreement, assuming due authorization,
execution and delivery by the Company and the Trustee, constitutes a
valid, legal and binding obligation of the Master Servicer, enforceable
against the Master Servicer in accordance with the terms hereof,
subject to (A) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors'
rights generally, and (B) general principles of equity, regardless of
whether such enforcement is considered in a proceeding in equity or at
law;
(v) The Master Servicer is not in violation of, and its
execution and delivery of this Agreement and its performance and
compliance with the terms of this Agreement will not constitute a
violation of, any law, any order or decree of any court or arbiter, or
any order, regulation or demand of any federal, state or local
governmental or
25
regulatory authority, which violation is likely to affect materially
and adversely either the ability of the Master Servicer to perform its
obligations under this Agreement or the financial condition of the
Master Servicer;
(vi) No litigation is pending or, to the best of the
Master Servicer's knowledge, threatened against the Master Servicer
which would prohibit its entering into this Agreement or performing its
obligations under this Agreement or is likely to affect materially and
adversely either the ability of the Master Servicer to perform its
obligations under this Agreement or the financial condition of the
Master Servicer;
(vii) The Master Servicer will comply in all material
respects in the performance of this Agreement and with all reasonable
rules and requirements of each insurer under each Insurance Instrument;
(viii) The execution of this Agreement and the performance
of the Master Servicer's obligations hereunder do not require any
license, consent or approval of any state or federal court, agency,
regulatory authority or other governmental body having jurisdiction
over the Master Servicer, other than such as have been obtained; and
(ix) No information, certificate of an officer, statement
furnished in writing or report delivered to the Company, any affiliate
of the Company or the Trustee by the Master Servicer will, to the
knowledge of the Master Servicer, contain any untrue statement of a
material fact or omit a material fact necessary to make the
information, certificate, statement or report not misleading; and
It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.03(a) shall survive the
execution and delivery of this Agreement, and shall inure to the benefit of the
Company, the Trustee and the Certificateholders. Upon discovery by the Company,
the Trustee or the Master Servicer of a breach of any of the foregoing
representations, warranties and covenants that materially and adversely affects
the interests of the Company or the Trustee, the party discovering such breach
shall give prompt written notice to the other parties.
(b) The Company hereby represents and warrants to the Master
Servicer and the Trustee for the benefit of Certificateholders that as of the
Closing Date (or, if otherwise specified below, as of the date so specified):
(i) Immediately prior to the assignment of the Mortgage
Loans to the Trustee, the Company had good title to, and was
the sole owner of, each Mortgage Loan free and clear of any
pledge, lien, encumbrance or security interest (other than
rights to servicing and related compensation) and such
assignment validly transfers ownership of the Mortgage Loans
to the Trustee free and clear of any pledge, lien, encumbrance
or security interest;
26
(ii) No Mortgage Loan is one month or more delinquent in
payment of principal and interest as of the Cut-off Date and
no Mortgage Loan has been so delinquent more than once in the
12-month period prior to the Cut-off Date;
(iii) The information set forth in the Mortgage Loan
Schedule with respect to each Mortgage Loan or the Mortgage
Loans, as the case may be, is true and correct in all material
respects at the date or dates respecting which such
information is furnished;
(iv) The Mortgage Loans are fully-amortizing,
adjustable-rate mortgage loans with Monthly Payments due on
the first day of each month and terms to maturity at
origination or modification of not more than 30 years;
(v) Each Mortgage Loan secured by a Mortgaged Property
with a Loan- to-Value Ratio at origination in excess of 80% is
the subject of a Primary Mortgage Insurance Policy that
insures that portion of the principal balance thereof that
exceeds the amount equal to 75% of the appraised value of the
related Mortgaged Property. Each such Primary Mortgage
Insurance Policy is in full force and effect and the Trustee
is entitled to the benefits thereunder; and
(vi) The representations and warranties of the Seller
with respect to the Mortgage Loans and the remedies therefor
are as set forth in the Seller's Warranty Certificate.
[Other representations and warranties as applicable.]
It is understood and agreed that the representations and warranties set forth in
this Section 2.03(b) shall survive delivery of the respective Mortgage Files to
the Trustee.
Upon discovery by either the Company, the Master Servicer or
the Trustee of a breach of any representation or warranty set forth in this
Section 2.03 which materially and adversely affects the interests of the
Certificateholders in any Mortgage Loan, the party discovering such breach shall
give prompt written notice to the other parties.
SECTION 2.04. Representations and Warranties of the
Seller; Repurchase and Substitution.
The Company hereby assigns to the Trustee for the benefit of
Certificateholders its interest in respect of the representations and warranties
made by the Seller in the Seller's Warranty Certificate or the exhibits thereto.
Insofar as the Seller's Warranty Certificate relates to such representations and
warranties and any remedies provided thereunder for any breach of such
representations and warranties, such right, title and interest may be enforced
by the Trustee on behalf of the Certificateholders. Upon the discovery by the
Company, the Master Servicer or the Trustee of a breach of any of the
representations and warranties made in the Seller's Warranty
27
Certificate in respect of any Mortgage Loan which materially and adversely
affects the interests of the Certificateholders in such Mortgage Loan, the party
discovering such breach shall give prompt written notice to the other parties.
The Trustee shall promptly notify the Seller of such breach and request that
such Seller shall, within 90 days from the date that the Company, the Seller or
the Trustee was notified of such breach, either (i) cure such breach in all
material respects or (ii) purchase such Mortgage Loan from the Trust Fund at the
Purchase Price and in the manner set forth in Section 2.02; provided that in the
case of such breach, the Seller shall have the option to substitute a Qualified
Substitute Mortgage Loan or Loans for such Mortgage Loan if such substitution
occurs within 90 days following the Closing Date. Any such substitution must
occur within 90 days from the date the Seller was notified of the breach if such
90 day period expires before two years following the Closing Date. In the event
that the Seller elects to substitute a Qualified Substitute Mortgage Loan or
Loans for a Deleted Mortgage Loan pursuant to this Section 2.04, the Seller
shall deliver to the Trustee for the benefit of the Certificateholders with
respect to such Qualified Substitute Mortgage Loan or Loans, the original
Mortgage Note, the Mortgage, an Assignment of the Mortgage in recordable form,
and such other documents and agreements as are required by Section 2.01, with
the Mortgage Note endorsed as required by Section 2.01. No substitution will be
made in any calendar month after the Determination Date for such month. Monthly
Payments due with respect to Qualified Substitute Mortgage Loans in the month of
substitution shall not be part of the Trust Fund and will be retained by the
Master Servicer and remitted by the Master Servicer to the Seller on the next
succeeding Distribution Date. For the month of substitution, distributions to
Certificateholders will include the Monthly Payment due on a Deleted Mortgage
Loan for such month and thereafter the Seller shall be entitled to retain all
amounts received in respect of such Deleted Mortgage Loan. The Company shall
amend or cause to be amended the Mortgage Loan Schedule for the benefit of the
Certificateholders to reflect the removal of such Deleted Mortgage Loan and the
substitution of the Qualified Substitute Mortgage Loan or Loans and the Company
shall deliver the amended Mortgage Loan Schedule, to the Trustee. Upon such
substitution, the Qualified Substitute Mortgage Loan or Loans shall be subject
to the terms of this Agreement in all respects, the Seller shall be deemed to
have made the representations and warranties with respect to the Qualified
Substitute Mortgage Loan contained in the Seller's Warranty Certificate as of
the date of substitution, and the Company shall be deemed to have made with
respect to any Qualified Substitute Mortgage Loan or Loans, as of the date of
substitution, the representations and warranties set forth in Section 2.03
hereof, and the Seller shall be obligated to repurchase or substitute for any
Qualified Substitute Mortgage Loan as to which a repurchase or substitution
obligation has occurred pursuant to Section 3 of the Seller's Warranty
Certificate.
In connection with the substitution of one or more Qualified
Substitute Mortgage Loans for one or more Deleted Mortgage Loans, the Master
Servicer will determine the amount (if any) by which the aggregate principal
balance of all such Qualified Substitute Mortgage Loans as of the date of
substitution is less than the aggregate Stated Principal Balance of all such
Deleted Mortgage Loans (in each case after application of the principal portion
of the Monthly Payments due in the month of substitution that are to be
distributed to Certificateholders in the month of substitution). The Seller
shall provide the Master Servicer on the day of substitution for immediate
deposit in to the Custodial Account the amount of such shortfall, without any
reimbursement therefor. The Seller shall give notice in writing to the Trustee
of such event,
28
which notice shall be accompanied by an Officers' Certificate as to the
calculation of such shortfall. The costs of any substitution as described above,
including any related assignments, opinions or other documentation in connection
therewith shall be borne by the Seller.
Except as expressly set forth herein neither the Trustee nor
the Master Servicer is under any obligation to discover any breach of the above
mentioned representations and warranties. It is understood and agreed that the
obligation of the Seller to cure such breach or to so purchase or substitute for
any Mortgage Loan as to which such a breach has occurred and is continuing shall
constitute the sole remedy respecting such breach available to
Certificateholders or the Trustee on behalf of Certificateholders. In addition,
if the first scheduled Monthly Payment is due during the first month after its
closing date (as such term is used in the Seller's Warranties Certificate) and
such Monthly Payment is not received by the Master Servicer within 30 days of
the due date in accordance with the terms of the related Mortgage Note, the
Master Servicer shall promptly notify the Seller and the Trustee and the Seller
shall purchase such Mortgage Loan from the Trust Fund at the Purchase Price or
substitute a Qualified Substitute Mortgage Loan therefor within 15 days from the
date that the Seller was notified.
SECTION 2.05. Issuance of Certificates Evidencing
Interests in the Trust Fund.
The Trustee acknowledges the assignment to it of the Mortgage
Loans and the delivery of the Mortgage Files to it together with the assignment
to it of all other assets included in the Trust Fund, receipt of which is hereby
acknowledged. Concurrently with such delivery and in exchange therefor, the
Trustee, pursuant to the written request of the Company executed by an officer
of the Company, has executed and caused to be authenticated, and delivered to or
upon the order of the Company, the Certificates in authorized denominations
which evidence ownership of the entire Trust Fund.
29
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
SECTION 3.01. Master Servicer to Act as Master Servicer.
The Master Servicer shall service and administer the Mortgage
Loans for the benefit of the Certificateholders, in accordance with this
Agreement and the customary and usual standards of practice of prudent
institutional mortgage lenders servicing comparable mortgage loans for their own
account in the respective states in which the Mortgaged Properties are located.
Subject to the foregoing, the Master Servicer shall have full power and
authority, acting alone and/or through Sub-Servicers as provided in Section
3.02, to do or cause to be done any and all things in connection with such
servicing and administration that it may deem necessary or desirable. Without
limiting the generality of the foregoing, the Master Servicer in its own name or
in the name of a Sub-Servicer is hereby authorized and empowered by the Trustee
when the Master Servicer believes it appropriate in its best judgment, to (i)
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 the Mortgaged Properties, (ii) institute foreclosure
pro ceedings or obtain a deed-in-lieu of foreclosure so as to convert the
ownership of such properties, and (iii) hold or cause to be held title to such
properties, on behalf of the Trustee and Certifi cateholders. The Master
Servicer shall service and administer the Mortgage Loans in accordance with
applicable state and federal law and shall provide to the Mortgagors any reports
required to be provided to them thereby. Subject to Section 3.16, the Trustee
shall furnish to the Master Servicer and any Sub-Servicer any powers of attorney
and other documents necessary or appropriate to enable the Master Servicer and
any Sub-Servicer to carry out their servicing and administrative duties
hereunder. The Trustee shall not be responsible for any action taken by the
Master Servicer or any Sub-Servicer pursuant to the application of such powers
of attorney.
In accordance with the standards of the preceding paragraph,
the Master Servicer shall advance or cause to be advanced funds as necessary for
the purpose of effecting the payment of taxes and assessments on the Mortgaged
Properties, which advances shall be reimbursable in the first instance from
related collections from the Mortgagors pursuant to Section 3.09, and further as
provided in Section 3.11. No costs incurred by the Master Servicer or by
Sub-Servicers in effecting the payment of taxes and assessments on the Mortgaged
Properties shall, for the purpose of calculating distributions to
Certificateholders, be added to the amount owing under the related Mortgage
Loans, notwithstanding that the terms of such Mortgage Loans so permit.
The Master Servicer may approve a request for a partial
release of the Mortgaged Property, easement, consent to alteration or demolition
and other similar matters if it has determined, exercising its good faith
business judgement in the same manner as it would if it were the owner of the
related Mortgage Loan, that such approval will not adversely affect the security
for, or the timely and full collectability of, the related Mortgage Loan. Any
fee collected by the
30
Master Servicer for processing such request will be retained by the Master
Servicer as additional servicing compensation.
The relationship of the Master Servicer (and of any successor
to the Master Servicer under this Agreement) to the Trustee under this Agreement
is intended by the parties to be that of an independent contractor and not that
of a joint venturer, partner or agent.
SECTION 3.02. Sub-Servicing Agreements Between Master
Servicer and Sub-Servicers.
(a) The Master Servicer may enter into Sub-Servicing
Agreements with Sub- Servicers for the servicing and administration of the
Mortgage Loans and for the performance of any and all other activities of the
Master Servicer hereunder. Each Sub-Servicer shall be either (i) an institution
the accounts of which are insured by the FDIC or (ii) another entity that
engages in the business of originating or servicing mortgage loans, and in
either case shall be authorized to transact business in the state or states in
which the related Mortgaged Properties it is to service are situated, if and to
the extent required by applicable law to enable the Sub-Servicer to perform its
obligations hereunder and under the Sub-Servicing Agreement, and in either case
shall be a FHLMC or FNMA approved mortgage servicer. Each Sub-Servicing
Agreement must impose on the Sub-Servicer requirements conforming to the
provisions set forth in Section 3.08 and provide for servicing of the Mortgage
Loans consistent with the terms of this Agreement. With the consent of the
Trustee, which consent shall not be unreasonably withheld, the Master Servicer
and the Sub-Servicers may enter into Sub-Servicing Agreements and make
amendments to the Sub-Ser vicing Agreements or enter into different forms of
Sub-Servicing Agreements; provided, however, that any such amendments or
different forms shall be consistent with and not violate the provisions of this
Agreement.
(b) As part of its servicing activities hereunder, the Master
Servicer, for the benefit of the Trustee and the Certificateholders, shall
enforce the obligations of each Sub-Servicer under the related Sub-Servicing
Agreement, including, without limitation, any obligation to make advances in
respect of delinquent payments as required by a Sub-Servicing Agreement, or to
purchase a Mortgage Loan on account of defective documentation or on account of
a breach of a representation or warranty, as described in Section 2.02. Such
enforcement, including, without limitation, the legal prosecution of claims,
termination of Sub-Servicing Agreements and the pursuit of other appropriate
remedies, shall be in such form and carried out to such an extent and at such
time as the Master Servicer, in its good faith business judgment, would require
were it the owner of the related Mortgage Loans. The Master 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.
31
SECTION 3.03. Successor Sub-Servicers.
The Master Servicer shall be entitled to terminate any
Sub-Servicing Agreement and the rights and obligations of any Sub-Servicer
pursuant to any Sub-Servicing Agreement in accor dance with the terms and
conditions of such Sub-Servicing Agreement. In the event of termination of any
Sub-Servicer, all servicing obligations of such Sub-Servicer shall be assumed
simultaneously by the Master Servicer without any act or deed on the part of
such Sub-Servicer or the Master Servicer, and the Master Servicer either shall
service directly the related Mortgage Loans or shall enter into a Sub-Servicing
Agreement with a successor Sub-Servicer which qualifies under Section 3.02.
SECTION 3.04. Liability of the Master Servicer.
Notwithstanding any Sub-Servicing Agreement, any of the
provisions of this Agreement relating to agreements or arrangements between the
Master Servicer and a Sub- Servicer or reference to actions taken through a
Sub-Servicer or otherwise, the Master Servicer shall remain obligated and
primarily liable to the Trustee and Certificateholders for the servicing and
administering of the Mortgage Loans in accordance with the provisions of Section
3.01 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 Master Servicer alone were servicing and administering the Mortgage
Loans. For purposes of this Agreement, the Master Servicer shall be deemed to
have received payments on Mortgage Loans when the Sub-Servicer has received such
payments. The Master Servicer shall be entitled to enter into any agreement with
a Sub-Servicer for indemnification of the Master Servicer by such Sub-Servicer
and nothing contained in this Agreement shall be deemed to limit or modify such
indemnification.
SECTION 3.05. No Contractual Relationship Between
Sub-Servicers and Trustee or
Certificateholders.
Any Sub-Servicing Agreement that may be entered into and any
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 Master 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
except as set forth in Section 3.06.
SECTION 3.06. Assumption or Termination of Sub-Servicing
Agreements by Trustee.
In the event the Master Servicer shall for any reason no
longer be the master servicer (including by reason of an Event of Default), the
Trustee or its designee shall thereupon assume all of the rights and obligations
of the Master Servicer under each Sub-Servicing Agreement that the Master
Servicer may have entered into, unless the Trustee is then permitted and elects
to terminate any Sub-Servicing Agreement in accordance with its terms. The
Trustee,
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its designee or the successor servicer for the Trustee shall be deemed to have
assumed all of the Master Servicer's interest therein and to have replaced the
Master Servicer as a party to each Sub- Servicing Agreement to the same extent
as if the Sub-Servicing Agreements had been assigned to the assuming party,
except that the Master Servicer shall not thereby be relieved of any liability
or obligations under the Sub-Servicing Agreements, and the Master Servicer shall
continue to be entitled to any rights or benefits which arose prior to its
termination as master servicer.
The Master Servicer at its expense shall, upon request of the
Trustee, deliver to the assuming party all documents and records relating to
each Sub-Servicing Agreement and the Mortgage Loans then being serviced and an
accounting of amounts collected and held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of the Sub-Servicing
Agreements to the assuming party.
SECTION 3.07. Collection of Certain Mortgage Loan Payments.
The Master Servicer shall make reasonable efforts to collect
all payments called for under the terms and provisions of the Mortgage Loans,
and shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Insurance Policy, follow such
collection procedures as it would follow with respect to mortgage loans
comparable to the Mortgage Loans and held for its own account. The Master
Servicer shall not be required to institute or join in litigation with respect
to collection of any payment (whether under a Mortgage, Mortgage Note, Primary
Hazard Insurance Policy, Primary Mortgage Insurance Policy or otherwise or
against any public or governmental authority with respect to a taking or
condemnation) if it reasonably believes that it is prohibited by applicable law
from enforcing the provision of the Mortgage or other instrument pursuant to
which such payment is required. Consistent with the foregoing, the Master
Servicer may in its discretion waive any prepayment fees, late payment charge or
other charge, except as otherwise required under applicable law. The Master
Servicer shall be responsible for preparing and distributing all information
statements relating to payments on the Mortgage Loans, in accordance with all
applicable federal and state tax laws and regulations.
SECTION 3.08. Sub-Servicing Accounts.
In those cases where a Sub-Servicer is servicing a Mortgage
Loan pursuant to a Sub-Servicing Agreement, the Sub-Servicer will be required to
establish and maintain one or more accounts (collectively, the "Sub-Servicing
Account"). The Sub-Servicing Account shall be an Eligible Account and shall
otherwise be acceptable to the Master Servicer. All amounts held in a
Sub-Servicing Account shall be held in trust for the Trustee for the benefit of
the Certificateholders. The Sub-Servicer will be required to deposit into the
Sub-Servicing Account no later than the first Business Day after receipt all
proceeds of Mortgage Loans received by the Sub-Servicer, less its servicing
compensation and any unreimbursed expenses and advances, to the extent permitted
by the Sub-Servicing Agreement. On each Sub-Servicer Remittance Date the
Sub-Servicer will be required to remit to the Master Servicer for deposit into
the Custodial Account all funds held in the Sub-Servicing Account with respect
to any Mortgage Loan as of the Sub-Servicer Remittance Date, after deducting
from such remittance an amount equal to the
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servicing compensation and unreimbursed expenses and advances to which it is
then entitled pursuant to the related Sub-Servicing Agreement, to the extent not
previously paid to or retained by it. In addition, on each Sub-Servicer
Remittance Date the Sub-Servicer will be required to remit to the Master
Servicer any amounts required to be advanced pursuant to the related Sub-
Servicing Agreement. The Sub-Servicer will also be required to remit to the
Master Servicer, within one Business Day of receipt, the proceeds of any
Principal Prepayment made by the Mortgagor and any Insurance Proceeds or
Liquidation Proceeds.
SECTION 3.09. Collection of Taxes, Assessments and
Similar Items; Servicing Accounts.
The Master Servicer and the Sub-Servicers shall establish and
maintain one or more accounts (the "Servicing Accounts"), and shall deposit and
retain therein all collections from the Mortgagors (or related advances from
Sub-Servicers) for the payment of taxes, assessments, Primary Hazard Insurance
Policy premiums, and comparable items for the account of the Mortgagors, to the
extent that the Master Servicer customarily escrows for such amounts.
Withdrawals of amounts so collected from a Servicing Account may be made only to
(i) effect payment of taxes, assessments, Primary Hazard Insurance Policy
premiums and comparable items; (ii) reimburse the Master Servicer (or a
Sub-Servicer to the extent provided in the related Sub- Servicing Agreement) out
of related collections for any payments made pursuant to Sections 3.01 (with
respect to taxes and assessments) and 3.13 (with respect to Primary Hazard
Insurance Policies); (iii) refund to Mortgagors any sums as may be determined to
be overages; or (iv) clear and terminate the Servicing Account at the
termination of this Agreement pursuant to Section 9.01. As part of its servicing
duties, the Master Servicer or Sub-Servicers shall, if and to the extent
required by law, pay to the Mortgagors interest on funds in Servicing Accounts
from its or their own funds, without any reimbursement therefor.
SECTION 3.10. Custodial Account.
(a) The Master Servicer shall establish and maintain one or
more accounts (collectively, the "Custodial Account") in which the Master
Servicer shall deposit or cause to be deposited no later than the first Business
Day after receipt or as and when received from the Sub- Servicers, the following
payments and collections received or made by or on behalf of it subsequent to
the Cut-off Date, or received by it prior to the Cut-off Date but allocable to a
period subsequent thereto (other than in respect of principal and interest on
the Mortgage Loans due on or before the Cut-off Date):
(i) all payments on account of principal, including
Principal Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans,
not including any portion thereof representing interest on account of
the related Servicing Fee Rate;
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(iii) all Insurance Proceeds, other than proceeds that represent
reimbursement of costs and expenses incurred by the Master Servicer in
connection with presenting claims under the related Insurance Policies,
Liquidation Proceeds and REO Proceeds;
(iv) all proceeds of any Mortgage Loan or REO Property
repurchased or purchased in accordance with Sections 2.02, 2.04, 3.25
or 9.01 and all amounts required to be deposited in connection with the
substitution of a Qualified Substitute Mortgage Loan pursuant to
Section 2.04;
(v) any amounts required to be deposited in the Custodial
Account pursuant to Section 3.12, 3.13 or 3.22; and
(vi) all amounts required to be deposited pursuant to Section
3.25.
For purposes of the immediately preceding sentence, the
Cut-off Date with respect to any Qualified Substitute Mortgage Loan shall be
deemed to be the date of substitution.
The foregoing requirements for deposit in the Custodial
Account shall be exclusive. In the event the Master Servicer shall deposit in
the Custodial Account any amount not required to be deposited therein, it may
withdraw such amount from the Custodial Account, any provision herein to the
contrary notwithstanding. The Custodial Account shall be maintained as a
segregated account, separate and apart from trust funds created for mortgage
pass-through certificates of other series, and the other accounts of the Master
Servicer.
(b) Funds in the Custodial Account may be invested in
Permitted Instruments in accordance with the provisions set forth in Section
3.12. The Master Servicer shall give notice to the Trustee and the Company of
the location of the Custodial Account after any change thereof.
(c) Payments in the nature of late payment charges, prepayment
fees, assumption fees and reconveyance fees received on the Mortgage Loans shall
not be deposited in the Custodial Account, but rather shall be received and held
by the Master Servicer as additional servicing compensation.
SECTION 3.11. Permitted Withdrawals From the Custodial
Account.
The Master Servicer may, from time to time as provided herein,
make withdrawals from the Custodial Account of amounts on deposit therein
pursuant to Section 3.10 that are attributable to the Mortgage Loans for the
following purposes:
(i) to make deposits into the Certificate Account in
the amounts and in the manner provided for in Section 4.01, such
deposit to include interest collections on the Mortgage Loans at the
Net Mortgage Rate [and net of amounts reimbursed therefrom];
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(ii) to pay to itself, the Company, the Seller or any
other appropriate person, as the case may be, with respect to each
Mortgage Loan that has previously been purchased, repurchased or
replaced pursuant to Sections 2.02, 2.04 or 9.01 all amounts received
thereon and not yet distributed as of the date of purchase, repurchase
or substitution;
(iii) to reimburse itself or any Sub-Servicer for
Advances not previously reimbursed, the Master Servicer's or any
Sub-Servicer's right to reimbursement pursuant to this clause (iii)
being limited to amounts received which represent Late Collections (net
of the related Servicing Fees) of Monthly Payments on Mortgage Loans
with respect to which such Advances were made and as further provided
in Section 3.15;
(iv) to reimburse or pay itself, the Trustee or the
Company for expenses incurred by or reimbursable to the Master
Servicer, the Trustee or the Company pursuant to Sections 3.22, 6.03,
8.05, 10.01(c) or 10.01(g), except as otherwise provided in such
Sections;
(v) to reimburse itself or any Sub-Servicer for costs
and expenses incurred by or reimbursable to it relating to the
prosecution of any claims pursuant to Section 3.13 that are in excess
of the amounts so recovered;
(vi) to reimburse itself or any Sub-Servicer for unpaid
Servicing Fees and unreimbursed Servicing Advances, the Master
Servicer's or any Sub-Servicer's right to reimbursement pursuant to
this clause (vi) with respect to any Mortgage Loan being limited to
late recoveries of the payments for which such advances were made
pursuant to Section 3.01 or Section 3.09 and any other related Late
Collections;
(vii) to pay itself as servicing compensation (in
addition to the Servicing Fee), on or after each Distribution Date, any
interest or investment income earned on funds deposited in the
Custodial Account for the period ending on such Distribution Date,
subject to Section 8.05;
(viii) to reimburse itself or any Sub-Servicer for any
Advance previously made which itself has determined to be a
Nonrecoverable Advance, provided that such Advance was made with
respect to a delinquency that ultimately constituted an Excess Special
Hazard Loss, Excess Fraud Loss, Excess Bankruptcy Loss or Extraordinary
Loss; and
(ix) to clear and terminate the Custodial Account at the
termination of this Agreement pursuant to Section 9.01.
The Master Servicer shall keep and maintain separate
accounting records on a Mortgage Loan by Mortgage Loan basis, for the purpose of
justifying any withdrawal from the Custodial Account pursuant to such clauses
(ii), (iii), (iv), (v), (vi), (vii) and (viii).
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SECTION 3.12. Permitted Instruments.
Any institution maintaining the Custodial Account shall at the
direction of the Master Servicer invest the funds in such account in Permitted
Instruments, each of which shall mature not later than the Business Day
immediately preceding the Distribution Date next following the date of such
investment (except that if such Permitted Instrument is an obligation of the
insti tution that maintains such account, then such Permitted Instrument shall
mature not later than such Distribution Date) and shall not be sold or disposed
of prior to its maturity. All income and gain realized from any such investment
as well as any interest earned on deposits in the Custodial Account shall be for
the benefit of the Master Servicer. The Master Servicer shall deposit in the
Custodial Account (with respect to investments made hereunder of funds held
therein) an amount equal to the amount of any loss incurred in respect of any
such investment immediately upon realization of such loss without right of
reimbursement.
SECTION 3.13. Maintenance of the Letter of Credit, Primary
Mortgage Insurance and Primary Hazard
Insurance.
(a) The Master Servicer covenants and agrees to exercise its
best reasonable efforts to maintain and keep the Letter of Credit in full force
and effect in accordance with Section 4.06 until the termination of the Trust
Fund created hereby, unless the amount available to be drawn thereunder has been
exhausted or unless the Letter of Credit has been terminated pursuant to the
terms thereof or hereof. As to any Distribution Date, with respect to any
Mortgage Loan as to which liquidation has been completed (which shall be deemed
to have occurred when the Master Servicer determines that it has received all
Insurance Proceeds (other than proceeds from a drawing under the Letter of
Credit), Liquidation Proceeds and other recoveries which the Master Servicer
deems to be recoverable) during the preceding calendar month or was deemed to
have occurred during such preceding calendar month in accordance with Section
3.07 (other than any Mortgage Loan relating to a Mortgaged Property which has
suffered an Extraordinary Loss), by 12:00 Noon, New York City time, on the
related Certificate Account Deposit Date, the Trustee shall draw on the Letter
of Credit, after receipt of the written statement of the Master Servicer
delivered pursuant to Section 4.04, pursuant to the terms thereof. In lieu of a
draw under the Letter of Credit as provided above, North American Mortgage
Company, at its sole option, may, on the Certificate Account Deposit Date upon
which such draw could otherwise be made, deposit an amount equal to such draw
into the Certificate Account. After any drawing under the Letter of Credit or
payment by North American Mortgage Company pursuant to this Section 3.13(a), the
Trustee shall assign to North American Mortgage Company any rights in or to the
related Mortgage Loan and such Mortgage Loan will thereafter no longer be part
of the Trust Fund. Upon receipt by North American Mortgage Company of any
amounts in connection with a Mortgage Loan so assigned to it, North American
Mortgage Company shall supply the Trustee with an Officers' Certificate which
sets forth such amount, and (except in the case of a payment made by North
American Mortgage Company in lieu of a draw on the Letter of Credit) North
American Mortgage Company shall cause the Letter of Credit Issuer to be
reimbursed to the extent required for reinstatement of the available amount
under the Letter of Credit. Upon receipt by the Trustee of such an Officers'
Certificate, if the Letter of Credit remains outstanding, the Trustee shall
request the reinstatement of the amount remaining under the Letter of Credit in
an amount
37
equal to such recovered amount by delivering a certificate to the Letter of
Credit Issuer substantially in the form of Annex B to the Letter of Credit.
Notwithstanding the foregoing, draws on the Letter of Credit,
or payments in lieu thereof, in connection with Fraud Losses shall not exceed in
the aggregate Fraud Loss Amount.
(b) The Master Servicer may terminate the Letter of Credit or
reduce the amount thereof (pursuant to Section 4.06(d)) or substitute an
alternative form of credit enhancement therefor, provided that prior to any such
reduction, termination or substitution, the Master Servicer shall obtain written
confirmation from the Rating Agency that such reduction, termination or
substitution would not adversely affect the then-current rating assigned to the
Certificates by such Rating Agency and provide a copy of such confirmation to
the Trustee and, provided that the Master Servicer obtains on Opinion of Counsel
to the effect that obtaining any such alternative form of credit support will
not adversely affect the classification of the Trust Fund as a grantor trust for
federal income tax purposes.
(c) The Master Servicer shall not take, or permit any
Sub-servicer to take, any action which would result in non-coverage under any
applicable Primary Mortgage Insurance Policy of any loss which, but for the
actions of the Master Servicer or Sub-servicer, would have been covered
thereunder. To the extent coverage is available, the Master Servicer shall keep
or cause to be kept in full force and effect each such Primary Mortgage
Insurance Policy until the principal balance of the related Mortgage Loan
secured by a Mortgaged Property is reduced to 75% or less of the Collateral
Value in the case of such a Mortgage Loan having a Loan-to-Value Ratio at
origination in excess of 80%. The Master Servicer shall not cancel or refuse to
renew any such Primary Mortgage Insurance Policy, or consent to any Sub-servicer
canceling or refusing to renew any such Primary Mortgage 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 Mortgage Insurance Policy for such
canceled or non-renewed policy is maintained with a Qualified Insurer.
(d) In connection with its activities as administrator and
servicer of the Mortgage Loans, the Master Servicer agrees to present or to
cause the related Sub-servicer to present, on behalf of the Master Servicer, the
Sub-servicer, if any, the Trustee and Certificateholders, claims to the insurer
under any Primary Mortgage Insurance Policies, in a timely manner in accordance
with such policies, and, in this regard, to take or cause to be taken such
reasonable action as shall be necessary to permit recovery under any Primary
Mortgage Insurance Policies respecting defaulted Mortgage Loans. Pursuant to
Section 3.10, any Insurance Proceeds collected by or remitted to the Master
Servicer under any Primary Mortgage Insurance Policies shall be deposited in the
Custodial Account, subject to withdrawal pursuant to Section 3.11.
(e) The Master Servicer shall cause to be maintained for each
Mortgage Loan primary hazard insurance with extended coverage on the related
Mortgaged Property in an amount equal to the lesser of 100% of the replacement
value of the improvements, as determined by the insurance company, on such
Mortgaged Property or the unpaid principal balance of the Mortgage
38
Loan. The Master Servicer shall also cause to be maintained on property acquired
upon foreclosure, or deed in lieu of foreclosure, of any Mortgage Loan, fire
insurance with extended coverage in an amount equal to the replacement value of
the improvements thereon. Pursuant to Section 3.10, any amounts collected by the
Master Servicer under any such policies (other than amounts to be applied to the
restoration or repair of the related Mortgaged Property or property thus
acquired or amounts released to the Mortgagor in accordance with the Master
Servicer's normal servicing procedures) shall be deposited in the Custodial
Account, subject to withdrawal pursuant to Section 3.11. Any cost incurred by
the Master Servicer in maintaining any such 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. It is understood and agreed that no earthquake or other
additional insurance is to be required of any Mortgagor or maintained on
property acquired in respect of a Mortgage 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. When the improvements securing a Mortgage
Loan are located at the time of origination of such Mortgage Loan in a federally
designated special flood hazard area, the Master Servicer shall cause flood
insurance (to the extent available) to be maintained in respect thereof. Such
flood insurance shall be in an amount equal to the lesser of (i) the replacement
value of the improvements, which are part of such Mortgaged Property on a
replacement cost basis and (ii) the maximum amount of such insurance available
for the related Mortgaged Property under the national flood insurance program
(assuming that the area in which such Mortgaged Property is located is
participating in such program).
In the event that the Master Servicer shall obtain and
maintain a blanket fire insurance policy with extended coverage insuring against
hazard losses on all of the Mortgage Loans, it shall conclusively be deemed to
have satisfied its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case the Master Servicer shall, in the event that
there shall not have been maintained on the related Mortgaged Property a policy
complying with the first two sentences of this Section 3.13 and there shall have
been a loss which would have been covered by such policy, deposit in the
Certificate Account the amount not otherwise payable under the blanket policy
because of such deductible clause. Any such deposit by the Master Servicer shall
be made on the Certificate Account Deposit Date next preceding the Distribution
Date which occurs in the month following the month in which payments under any
such policy would have been deposited in the Custodial Account. In connection
with its activities as administrator and servicer of the Mortgage Loans, the
Master Servicer agrees to present, on behalf of itself, the Trustee and
Certificateholders, claims under any such blanket policy.
SECTION 3.14. Enforcement of Due-on-Sale Clauses;
Assumption Agreements.
The Master Servicer will, to the extent it has knowledge of
any conveyance or prospective conveyance by any Mortgagor of the Mortgaged
Property (whether by absolute conveyance or by contract of sale, and whether or
not the Mortgagor remains or is to remain liable under the Mortgage Note or the
Mortgage), exercise or cause to be exercised its rights to accele rate the
maturity of such Mortgage Loan under any "due-on-sale" clause applicable
thereto;
39
provided, however, that the Master Servicer shall not exercise any such rights
if it reasonably believes that it is prohibited by law from doing so or if such
enforcement will adversely affect or jeopardize required coverage under the
Insurance Instruments. If the Master Servicer is unable to enforce such
"due-on-sale" clause (as provided in the previous sentence) or if no
"due-on-sale" clause is applicable, the Master Servicer or the Sub-Servicer will
enter into an assumption and modification agreement with the Person to whom such
property has been conveyed or is proposed to be conveyed, pursuant to which such
Person becomes liable under the Mortgage Note and, to the extent permitted by
applicable state law, the Mortgagor remains liable thereon; provided, however,
that the Master Servicer shall not enter into any assumption and modification
agreement if the coverage provided under the Primary Insurance Policy, if any,
would be impaired by doing so. The Master Servicer is also authorized to enter
into a substitution of liability agreement with such Person, pursuant to which
the original Mortgagor is released from liability and such Person is substituted
as the Mortgagor and becomes liable under the Mortgage Note, if the Master
Servicer shall have determined in good faith that such substitution will not
adversely affect the collectability of the Mortgage Loan. Any fee collected by
or on behalf of the Master Servicer for entering into an assumption or
substitution of liability agreement will be retained by or on behalf of the
Master Servicer as additional servicing compensation. In connection with any
such assumption, no material term of the Mortgage Note (including but not
limited to the Mortgage Rate, the amount of the Monthly Payment and any other
term affecting the amount or timing of payment on the Mortgage Loan) may be
changed. The Master Servicer shall notify the Trustee that any such substitution
or assumption agreement has been completed by forwarding to the Trustee the
original copy of such substitution or assumption agreement, which copy shall be
added to the related Mortgage File and shall, for all purposes, be considered a
part of such Mortgage File to the same extent as all other documents and
instruments constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision
of this Agreement, the Master Servicer shall not be deemed to be in default,
breach or any other violation of its obligations hereunder by reason of any
assumption of a Mortgage Loan by operation of law or any assumption that the
Master Servicer may be restricted by law from preventing, for any reason
whatsoever. For purposes of this Section 3.14, the term "assumption" is deemed
to also include a sale of a Mortgaged Property that is not accompanied by an
assumption or substitution of liability agreement.
SECTION 3.15. Realization Upon Defaulted Mortgage Loans.
The Master Servicer shall exercise reasonable efforts,
consistent with the procedures that the Master Servicer would use in servicing
loans for its own account, to foreclose upon or otherwise comparably convert
(which may include an REO Acquisition) the ownership of properties securing such
of the Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments
pursuant to Section 3.07, and which are not released from the Trust Fund
pursuant to any other provision hereof. The Master Servicer shall use reasonable
efforts to realize upon such defaulted Mortgage Loans in such manner as will
maximize the receipt of principal and interest by Certificateholders, taking
into account, among other things, the timing of foreclosure proceedings. The
foregoing is subject to the provisions that, in any case in which Mortgaged
Property shall have suffered
40
damage from an Uninsured Cause, the Master Servicer shall not be required to
expend its own funds toward the restoration of such property unless it shall
determine in (i) that such restoration will increase the net proceeds of
liquidation of the related Mortgage Loan to Certificateholders after
reimbursement to itself for such expenses, and (ii) that such expenses will be
recoverable by the Master Servicer through Insurance Proceeds or Liquidation
Proceeds from the related Mortgaged Property, as contemplated in Section 3.11.
The Master Servicer shall be responsible for all other costs and expenses
incurred by it in any such proceedings; provided, however, that it shall be
entitled to reimbursement thereof from the related Mortgaged Property, as
contemplated in Section 3.11.
The proceeds of any Cash Liquidation or REO Disposition, as
well as any recovery resulting from a partial collection of Insurance Proceeds
or Liquidation Proceeds or any income from an REO Property, will be applied in
the following order of priority: first, to reimburse the Master Servicer or any
Sub-Servicer for any related unreimbursed Servicing Advances, pursuant to
Section 3.11(vi) or 3.22; second, to accrued and unpaid interest on the Mortgage
Loan or REO Imputed Interest, at the Mortgage Rate, to the date of the Cash
Liquidation or REO Disposition, or to the Due Date prior to the Distribution
Date on which such amounts are to be distributed if not in connection with a
Cash Liquidation or REO Disposition; and third, as a recovery of principal of
the Mortgage Loan. If the amount of the recovery so allocated to interest is
less than a full recovery thereof, that amount will be allocated as follows:
first, on a pro rata basis, to unpaid Servicing Fees; and second, to interest at
the related Net Mortgage Rate. The portion of the recovery so allocated to
unpaid Servicing Fees shall be reimbursed to the Master Servicer or any
Sub-Servicer pursuant to Section 3.11(vi). The portions of the recovery so
allocated to interest at the related Net Mortgage Rate and to principal of the
Mortgage Loan shall be applied as follows: first, to reimburse the Trustee for
any unpaid Trustee's Fees, second, to reimburse the Master Servicer or any
Sub-Servicer for any related unreimbursed Advances in accordance with Section
3.11(iii) or 3.22, and third, for distribution in accordance with the provisions
of Section 4.01(b).
SECTION 3.16. Trustee to Cooperate; Release of Mortgage
Files.
Upon the payment in full of any Mortgage Loan, or the receipt
by the Master Servicer of a notification that payment in full shall be escrowed
in a manner customary for such purposes, the Master Servicer will immediately
notify the Trustee 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 Custodial
Account pursuant to Section 3.10 have been or will be so deposited) of a
Servicing Officer and shall request delivery to it of the Mortgage File in the
form of the Request for Release attached hereto as Exhibit F-2. Upon receipt of
such certification and request, the Trustee shall promptly release the related
Mortgage File to the Master Servicer. Subject to the receipt by the Master
Servicer of the proceeds of such payment in full and the payment of all related
fees and expenses, the Master Servicer shall arrange for the release to the
Mortgagor of the original cancelled Mortgage Note. The Master Servicer shall
provide for preparation of the appropriate instrument of satisfaction covering
any Mortgage Loan which pays in full and the Trustee shall cooperate in the
execution and return of such instrument to provide for its delivery or recording
as may be required. All
41
other documents in the Mortgage File shall be retained by the Master Servicer to
the extent required by applicable law. No expenses incurred in connection with
any instrument of satisfac tion or deed of reconveyance shall be chargeable to
the Custodial Account or the Certificate Account.
From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
the Insurance Instruments or any other insurance policy relating to the Mortgage
Loan, the Trustee shall, upon request of the Master Servicer and delivery to the
Trustee of a Request for Release in the form attached hereto as Exhibit F-1,
release the related Mortgage File to the Master Servicer, and the Trustee shall
execute such documents as the Master Servicer shall prepare and request as being
necessary to the prosecution of any such proceedings. Such Request for Release
shall obligate the Master Servicer to return each document previously requested
from the Mortgage File to the Trustee when the need therefor by the Master
Servicer no longer exists, unless the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Custodial Account or the Mortgage File or such document has been delivered to an
attorney, or to a public trustee or other public official as required by law,
for purposes of initiating or pursuing legal action or other proceedings for the
foreclosure of the Mortgaged Property either judicially or non-judicially, and
the Master Servicer has delivered to the Trustee a certificate of a Servicing
Officer certifying as to the name and address of the Person to which such
Mortgage File or such document was delivered and the purpose or purposes of such
delivery. Upon receipt of a certificate of a Servicing Officer stating that such
Mortgage Loan was liquidated and that all amounts received or to be received in
connection with such liquidation which are required to be deposited into the
Custodial Account have been or will be so deposited, or that such Mortgage Loan
has become an REO Property, the servicing receipt shall be released by the
Trustee to the Master Servicer.
Upon written request of a Servicing Officer, the Trustee shall
execute and deliver to the Master Servicer any court pleadings, requests for
trustee's sale or other documents prepared by the Master Servicer that are
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. Each such request that such
pleadings or documents be executed by the Trustee shall include a certification
as to the reason such documents or pleadings are required and that the execution
and delivery thereof by the Trustee will not 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 3.17. Servicing Compensation.
As compensation for its activities hereunder, the Master
Servicer shall be entitled to retain, from deposits to the Custodial Account of
amounts representing payments or recoveries of interest, the Servicing Fees with
respect to each Mortgage Loan (less any portion of such amounts retained by any
Sub-Servicer). In addition, the Master Servicer shall be entitled to
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recover unpaid Servicing Fees out of related Late Collections to the extent
permitted in Section 3.11.
The Master Servicer also shall be entitled pursuant to Section
3.11 to receive from the Custodial Account, as additional servicing compensation
interest or other income earned on deposits therein, as well as any prepayment
fees, assumption fees, late payment fees and reconveyance fees. The Master
Servicer shall be required to pay all expenses incurred by it in connection with
its servicing activities hereunder (including payment of fees and commissions
for the Letter of Credit, payment of the premiums for any Primary Mortgage
Insurance Policy or blanket policy insuring against hazard losses pursuant to
Section 3.13, payment of the servicing compensation of the Sub-Servicer to the
extent not retained by it), and shall not be entitled to xxxx bursement therefor
except as specifically provided in Section 3.11. The Servicing Fee may not be
transferred in whole or in part except in connection with the transfer of all of
the Master Servicer's responsibilities and obligations under this Agreement.
SECTION 3.18. Maintenance of Certain Servicing Policies.
During the term of its service as Master Servicer, the Master
Servicer shall maintain in force (i) a policy or policies of insurance covering
errors and omissions in the performance of its obligations as servicer hereunder
and (ii) a fidelity bond in respect of its officers, employees or agents. Each
such policy or policies and bond shall, together, comply with the requirements
from time to time of FNMA or FHLMC for persons performing servicing for mortgage
loans purchased by such corporation. The Master Servicer shall prepare and
present, on behalf of itself, the Trustee and Certificateholders, claims under
any such errors and omissions policy or policies or fidelity bond in a timely
fashion in accordance with the terms of such policy or bond, and upon the filing
of any claim on any policy or bond described in this Section, the Master
Servicer shall promptly notify the Trustee of any such claims and the Trustee
shall notify the Rating Agency of such claim.
SECTION 3.19. Annual Statement as to Compliance.
The Master Servicer will deliver to the Trustee and the
Company on or before _____ __ of each year, beginning with _____ __, ____, an
Officers' Certificate stating, as to each signatory thereof, that (i) a review
of the activities of the Master Servicer during the preceding calendar year and
of its performance under this Agreement has been made under such officers'
supervision, and (ii) to the best of such officers' knowledge, based on such
review, the Master Servicer has fulfilled in all material respects 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 officers and the nature and status thereof. Copies of such
certificate shall be provided by the Trustee to any Certificateholder upon
request at the Master Servicer's expense, provided such statement is delivered
by the Master Servicer to the Trustee.
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SECTION 3.20. Annual Independent Public Accountants'
Servicing Statement.
On or before March 31 of each year, beginning with March 31,
19__, the Master Servicer at its expense shall furnish to the Company and the
Trustee a statement from a firm of independent certified public accountants
(which is a member of the American Institute of Certified Public Accountants) to
the effect that, based on an examination by such firm conducted substantially in
compliance with the Uniform Single Attestation Program for Mortgage Bankers or
the Audit Program for Mortgages serviced for FHLMC, the servicing of mortgage
loans under agreements (including this Agreement) substantially similar to each
other was conducted in compliance with such agreements except for such
significant exceptions or errors in record that, in the opinion of the firm, the
Uniform Single Attestation Program for Mortgage Bankers or the Audit Program for
Mortgages serviced for FHLMC requires it to report. In rendering its statement
such firm may rely, as to the matters relating to the direct servicing of
mortgage loans by Sub-servicers, upon comparable statements for examinations
conducted substantially in compliance with the Uniform Single Attestation
Program for Mortgage Bankers or the Audit Program for Mortgages serviced for
FHLMC (rendered within one year of such statement) of firms of independent
public accountants with respect to those Sub-servicers which also have been the
subject of such an examination. Copies of such statement shall be provided by
the Trustee to any Certificateholder upon request at the Master Servicer's
expense, provided such statement is delivered by the Master Servicer to the
Trustee.
SECTION 3.21. Access to Certain Documentation.
(a) The Master Servicer shall provide to the OTS, the FDIC and
other federal banking regulatory agencies, and their respective examiners,
access to the documentation regarding the Mortgage Loans required by applicable
regulations of the OTS, the FDIC and such other agencies. Such access shall be
afforded without charge, but only upon reasonable and prior written request and
during normal business hours at the offices of the Master Servicer designated by
it. Nothing in this Section shall derogate from the obligation of the Master
Servicer to observe any applicable law prohibiting disclosure of information
regarding the Mortgagors and the failure of the Master Servicer to provide
access as provided in this Section as a result of such obligation shall not
constitute a breach of this section.
(b) The Master Servicer shall afford the Company and the
Trustee, upon reasonable notice, during normal business hours access to all
records maintained by the Master Servicer in respect of its rights and
obligations hereunder and access to officers of the Master Servicer responsible
for such obligations. Upon request, the Master Servicer shall furnish the
Company and the Trustee with its most recent financial statements and such other
information as the Master Servicer possesses regarding its business, affairs,
property and condition, financial or otherwise to the extent related to the
servicing of the Mortgage Loans. The Company may, but is not obligated to,
enforce the obligations of the Master Servicer hereunder and may, but is not
obligated to, perform, or cause a designee to perform, any defaulted obligation
of the Master Servicer hereunder or exercise the rights of the Master Servicer
hereunder; provided that the Master Servicer shall not be relieved of any of its
obligations hereunder by virtue of such
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performance by the Company or its designee. The Company shall not have any
responsibility or liability for any action or failure to act by the Master
Servicer and is not obligated to supervise the performance of the Master
Servicer under this Agreement or otherwise.
SECTION 3.22. Title, Conservation and Disposition of REO
Property.
This Section shall apply only to REO Properties acquired for
the account of the Trust Fund, and shall not apply to any REO Property relating
to a Mortgage Loan which was purchased or repurchased from the Trust Fund
pursuant to any provision hereof. In the event that title to any such REO
Property is acquired, the deed or certificate of sale shall be issued to the
Trustee, or to its nominee, on behalf of the Certificateholders. Pursuant to its
efforts to sell such REO Property, the Master Servicer shall either itself or
through an agent selected by the Master Servicer protect and conserve such REO
Property in the same manner and to such extent as is customary in the locality
where such REO Property is located and may, incident to its conservation and
protection of the interests of the Certificateholders, rent the same, or any
part thereof, as the Master Servicer deems to be in the best interest of the
Certificateholders for the period prior to the sale of such REO Property.
The Master Servicer shall segregate and hold all funds
collected and received in connection with the operation of any REO Property
separate and apart from its own funds and general assets. The Master Servicer
shall deposit, or cause to be deposited, on a daily basis in the Custodial
Account all revenues received with respect to the REO Properties, net of any
directly related expenses incurred or withdraw therefrom funds necessary for the
proper operation, management and maintenance of the REO Property.
If as of the date of acquisition of title to any REO Property
there remain outstanding unreimbursed Servicing Advances with respect to such
REO Property or any outstanding Advances allocated thereto the Master Servicer,
upon an REO Disposition, shall be entitled to reimbursement for any related
unreimbursed Servicing Advances and any unreimbursed related Advances as well as
any unpaid Servicing Fees from proceeds received in connection with the REO
Disposition, as further provided in Section 3.15.
Subject to the first paragraph of this Section 3.22, the REO
Disposition shall be carried out by the Master Servicer at such price and upon
such terms and conditions as the Master Servicer shall determine to be in the
best economic interest of the Trust Fund.
The Master Servicer shall deposit the proceeds from the REO
Disposition, net of any payment to the Master Servicer as provided above, in the
Custodial Account upon receipt thereof for distribution in accordance with
Section 4.01, including any such net proceeds which are in excess of the
applicable Stated Principal Balance plus all unpaid REO Imputed Interest thereon
through the date of the REO Disposition.
Notwithstanding the foregoing provisions of this Section 3.22,
with respect to any Mortgage Loan as to which the Master Servicer has received
notice of, or has actual knowledge of, the presence of any toxic or hazardous
substance on the Mortgaged Property, the Master
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Servicer shall promptly request the Trustee and the Company to provide
directions and instructions with respect to such Mortgage Loan and shall act in
accordance with any such directions and instructions jointly provided by the
Trustee and the Company. Notwithstanding the preceding sentence of this Section
3.22, with respect to any Mortgage Loan described by such sentence, the Master
Servicer shall not, on behalf of the Trustee, either (i) obtain title to the
related Mortgaged Property as a result of or in lieu of foreclosure or
otherwise, or (ii) otherwise acquire possession of, the related Mortgaged
Property, unless (i) the Company and the Trustee jointly direct the Master
Servicer to take such action and (ii) either (A) the Master Servicer has, at
least 30 days prior to taking such action, obtained and delivered to the Company
an environmental audit report prepared by a Person who regularly conducts
environmental audits using customary industry standards or (B) the Company has
directed the Master Servicer not to obtain an environmental audit report. If the
Trustee and the Company have not jointly provided directions and instructions to
the Master Servicer in connection with any such Mortgage Loan within 30 days of
a request by the Master Servicer for such directions and instructions, then the
Master Servicer shall take such action as it deems to be in the best economic
interest of the Trust Fund (other than proceeding against the Mortgaged
Property) and is hereby authorized at such time as it deems appropriate to
release such Mortgaged Property from the lien of the related Mortgage.
The cost of the environmental audit report contemplated by
this Section 3.22 shall be advanced by the Master Servicer as an expense of the
Trust Fund, and the Master Servicer shall be reimbursed therefor from the
Custodial Account as provided in Section 3.11, any such right of reimbursement
being prior to the rights of the Certificateholders to receive any amount in the
Custodial Account.
If the Master Servicer determines, as described above, that it
is in the best economic interest of the Trust Fund to take such actions as are
necessary to bring any such Mortgaged Property in compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged Property, then
the Master Servicer shall take such action as it deems to be in the best
economic interest of the Trust Fund. The cost of any such compliance,
containment, clean-up or remediation shall be advanced by the Master Servicer as
an expense of the Trust Fund, and the Master Servicer shall be entitled to be
reimbursed therefor from the Custodial Account as provided in Section 3.11, any
such right of reimbursement being prior to the rights of the Certificateholders
to receive any amount in the Custodial Account.
SECTION 3.23. Additional Obligations of the Master Servicer.
On each Certificate Account Deposit Date, the Master Servicer
shall deliver to the Trustee for deposit in the Certificate Account from its own
funds and without any right of reimbursement therefor, a total amount equal to
the aggregate of the Prepayment Interest Shortfalls for such Distribution Date;
provided that the Master Servicer's obligations under this subsection on any
Distribution Date shall not be more than the total amount of its master
servicing compensation payable in such month.
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SECTION 3.24. Additional Obligations of the Company.
The Company agrees that on or prior to the tenth day after the
Closing Date, the Company shall provide the Trustee with a written notification,
substantially in the form of Exhibit J attached hereto, relating to the
Certificates, setting forth (i)(a) if less than 10% of the aggregate Certificate
Principal Balance of the Certificates has been sold as of such date, the value
calculated pursuant to clause (b)(iii) of Exhibit J hereto, or, (b) if 10% or
more of the Certificates has been sold as of such date but no single price is
paid for at least 10% of the aggregate Certificate Principal Balance of the
Certificates, then the weighted average price at which the Certificates were
sold and the aggregate percentage of Certificates sold, (c) the first single
price at which at least 10% of the aggregate Certificate Principal Balance of
such class of Certificates was sold or, (d) if any Certificates are retained by
the Company or an affiliated corporation, or are delivered to the Seller, the
fair market value thereof as of the Closing Date, (ii) the prepayment assumption
used in pricing the Certificates, and (iii) such other information as to matters
of fact as the Trustee may reasonably request to enable it to comply with its
reporting requirements with respect to such Certificates to the extent such
information can in the good faith judgment of the Company be determined by it.
SECTION 3.25. Converted Mortgage Loans; Purchase
Obligations Upon Conversion; Administration
by the Trustee.
(a) The Trustee, as Noteholder (as defined in the Mortgage
Notes for the Mortgage Loans), hereby authorizes and directs the Master
Servicer, on behalf of the Noteholder, to determine fixed interest rates into
which Mortgagors under Convertible Mortgage Loans may convert the adjustable
interest rates on their Mortgage Notes in accordance with the fixed formula set
forth in such Mortgage Notes. The Master Servicer agrees to make such
determinations and otherwise administer the Convertible Mortgage Loans as
contemplated in the Mortgage Notes until the later to occur of (i) the date on
which all the Convertible Mortgage Loans have become Converted Mortgage Loans,
and (ii) the last date on which Mortgagors have the option to convert the
adjustable interest rates on their Mortgage Notes to fixed interest rates.
(b) Upon becoming aware of the intent to convert any
Convertible Mortgage Loan the Master Servicer will promptly notify the Trustee
(if it holds the related Mortgage File) and (if the Seller is not then the
Master Servicer) the Seller. Prior to the day on which a Convertible Mortgage
Loan has become a Converted Mortgage Loan, the Seller shall be obligated
pursuant to the terms of the Seller's Warranty Certificate to purchase a
Converting Mortgage Loan at the Purchase Price. All amounts paid by the Seller
in connection with the purchase of a Converting Mortgage Loan will be deposited
in the Custodial Account. A failure by the Seller to purchase a Converting
Mortgage Loan will constitute an Event of Default for the Seller in its capacity
as Master Servicer under this Agreement pursuant to Section 7.01.
(c) A Converting Mortgage Loan or a Converted Mortgage Loan
shall remain in the Trust Fund and all payments in respect thereof shall remain
in the Trust Fund unless and until such Converting Mortgage Loan or Converted
Mortgage Loan is purchased by the Seller pursuant to Section 3.25(b).
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(d) Upon any purchase of a Converting Mortgage Loan by the
Seller pursuant to Section 3.25(b) and the deposit in the Custodial Account of
the Purchase Price, the Trustee shall give the Master Servicer written notice
thereof, and the Trustee shall release, or cause to be released, the related
Mortgage File, shall execute and deliver such instruments of transfer or
assignment (which shall be prepared by, and be at the expense of the Seller), in
each case without recourse, as the Seller, a third party, or the Trustee, as
purchaser thereof, shall require as necessary to vest in the Seller ownership of
any Mortgage Loan released pursuant hereto and at such time the Trustee shall
have no further responsibility with respect to the related Mortgage File and
whereupon such Converted Mortgage Loan shall cease to be a part of the Trust
Fund.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Certificate Account; Distributions.
(a) The Trustee shall establish and maintain a Certificate
Account, in which the Master Servicer shall cause to be deposited on behalf of
the Trustee on or before 3:00 P.M. New York time on each Certificate Account
Deposit Date by wire transfer of immediately available funds an amount equal to
the sum of (i) any Advance for the immediately succeeding Distribution Date,
(ii) any amount required to be deposited in the Certificate Account pursuant to
Sections 3.11, 3.13, 3.23 or 4.03(b) and (iii) all other amounts constituting
or, if not otherwise applicable to the payment of the Trustee's Fee, that would
constitute the Available Distribution Amount for the immediately succeeding
Distribution Date. The Trustee shall transfer from the Certificate Account to
itself, the Trustee's Fee on each Certificate Account Deposit Date. Such amounts
do not constitute part of the Available Distribution Amount.
(b) On each Distribution Date the Trustee shall distribute to
each Certificateholder of record on the next preceding Record Date (other than
as provided in Section 9.01 respecting the final distribution) either in
immediately available funds (by wire transfer or otherwise) to the account of
such Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder has so notified the Trustee at least 5
Business Days prior to the related Record Date and such Certificateholder is the
registered owner of Certificates the aggregate Initial Certificate Principal
Balance of which is not less than $2,500,000, or otherwise by check mailed to
such Certificateholder at the address of such Holder appearing in the
Certificate Register, such Certificateholder's share (based on the aggregate of
the Percentage Interests represented by Certificates held by such Holder) of the
Available Distribution Amount.
(c) The Trustee shall, upon written request from the Master
Servicer, invest or cause the institution maintaining the Certificate Account to
invest the funds in the Certificate Account in Permitted Instruments designated
in the name of the Trustee for the benefit of the Certificateholders, which
shall mature not later than the Business Day next preceding the Distribution
Date next following the date of such investment (except that (i) any investment
in obligations of the institution with which the Certificate Account is
maintained may mature on such Distribution Date and (ii) any other investment
may mature on such Distribution Date if the Trustee shall agree to advance funds
on such Distribution Date to the Certificate Account in the amount payable on
such investment on such Distribution Date, pending receipt thereof to the extent
necessary to make distributions on the Certificates) and shall not be sold or
disposed of prior to maturity. All income and gain realized from any such
investment shall be for the benefit of the Master Servicer 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 shall be deposited in the Certificate Account
by the Master Servicer out of its own funds immediately as realized without
right of reimbursement.
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SECTION 4.02. Statements to Certificateholders.
On each Distribution Date the Trustee shall forward or cause
to be forwarded by mail to each Holder of a Certificate and to the Company and
the Master Servicer a statement as to such distribution setting forth the
following information as to the Certificates to the extent applicable:
(i) (a) the amount of such distribution to the
Certificateholders applied to reduce the Certificate Principal Balance
thereof, and (b) the aggregate amount included therein representing
Principal Prepayments;
(ii) the amount of such distribution to the Certificateholders
allocable to interest;
(iii) if the distribution to the Certificateholders is less than
the full amount that would be distributable to such Certificateholders
if there were sufficient funds available therefor, the amount of the
shortfall;
(iv) the amount of any Advance by the Master Servicer pursuant to
Section 4.03;
(v) the number and aggregate Stated Principal Balance of the
Mortgage Loans after giving effect to the distribution of principal on
such Distribution Date;
(vi) the aggregate Certificate Principal Balance of the
Certificates, after giving effect to the amounts distributed on such
Distribution Date, separately identifying any reduction thereof due to
Realized Losses other than pursuant to an actual distribution of
principal;
(vii) the amount of Servicing Fees paid to the Master Servicer;
(viii) on the basis of the most recent reports furnished to it by
Subservicers, the number and aggregate principal balances of Mortgage
Loans that are delinquent (A) one month, (B) two months and (C) three
months, and the number and aggregate principal balance of Mortgage
Loans that are in foreclosure;
(ix) the number, aggregate principal balance and book value of
any REO Properties;
(x) the aggregate Accrued Certificate Interest remaining unpaid,
if any, for the Certificates, after giving effect to the distribution
made on such Distribution Date;
(xi) the Special Hazard Amount, Fraud Loss Amount and Bankruptcy
Amount as of the close of business on such Distribution Date and a
description of any change in the calculation of such amounts;
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(xii) the aggregate amount of Realized Losses allocated to the
Certificates on such Distribution Date;
(xiii) the aggregate amount of any recoveries on previously
foreclosed loans from the Seller due to a breach of representation or
warranty;
(xiv) the weighted average remaining term to maturity of the
Mortgage Loans after giving effect to the amounts distributed on such
Distribution Date; and
(xv) the weighted average Mortgage Rates of the Mortgage Loans
after giving effect to the amounts distributed on such Distribution
Date.
In the case of information furnished pursuant to subclauses
(i) and (ii) above, the amounts shall also be expressed as a dollar amount per
Single Certificate.
Within a reasonable period of time after the end of each
calendar year, the Trustee shall prepare and forward to each Person who at any
time during the calendar year was a Holder of a Certificate, a statement
containing the information set forth in subclauses (i) and (ii) above,
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Trustee shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Trustee pursuant to any requirements of the
Code and regulations thereunder as from time to time are in force.
SECTION 4.03. Remittance Reports; Advances by the Master
Servicer.
(a) By 11:00 A.M. New York time the Business Day following
each Determination Date, the Master Servicer shall deliver to the Trustee a
report, prepared as of the close of business on the Determination Date (the
"Determination Date Report"), by telecopy or in a mutually agreeable electronic
format. The Determination Date Report and any written information supplemental
thereto shall include such information with respect to the Mortgage Loans that
is reasonably available to the Master Servicer and that is required by the
Trustee for purposes of making the calculations referred to in the following
paragraph, as set forth in written specifications or guidelines issued by the
Trustee from time to time. Not later than 2:00 P.M. New York time on the
Certificate Account Deposit Date, the Trustee shall furnish by telecopy to the
Master Servicer a statement (the information in such statement to be made
available to Certificateholders or the Company by the Master Servicer on
request) setting forth (i) the Available Distribution Amount, (ii) the amounts
required to be withdrawn from the Custodial Account and deposited into the
Certificate Account on the immediately succeeding Certificate Account Deposit
Date pursuant to clause (iii) of Section 4.01(a); and (iii) such other
information with respect to the Mortgage Loans as the Trustee may reasonably
require to perform the calculations necessary to make the distributions
contemplated by Section 4.01 and to prepare the statements to Certificateholders
contemplated by Section 4.02. The determination by the Trustee of such amounts
shall, in the absence of obvious error, be presumptively deemed to be correct
for all purposes hereunder.
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(b) Not later than 2:00 P.M. New York time on the Certificate
Account Deposit Date, the Trustee shall notify the Master Servicer of the
aggregate amount of Advances required to be made for the related Distribution
Date, which shall be the aggregate amount of Monthly Payments (with each
interest portion thereof adjusted to be net of the related Servicing Fee Rate),
less the amount of any related Debt Service Reductions or reductions in the
amount of interest collectable from the Mortgagor pursuant to the Relief Act, on
the Outstanding Mortgage Loans as of the related Due Date, which Monthly
Payments were delinquent as of the close of business as of the related
Determination Date. On or before 3:00 P.M. New York time on each Certificate
Account Deposit Date, the Master Servicer shall either (i) deposit in the
Certificate Account from its own funds, or funds received therefor from the
Sub-Servicers, an amount equal to the Advances to be made by the Master Servicer
in respect of the related Distribution Date, (ii) withdraw from amounts on
deposit in the Custodial Account and deposit in the Certificate Account all or a
portion of the amounts held for future distribution in discharge of any such
Advance, or (iii) make advances in the form of any combination of (i) and (ii)
aggregating the amount of such Advance. Any portion of the amounts held for
future distribution so used shall be replaced by the Master Servicer by deposit
in the Custodial Account on or before 12:00 P.M. New York time on any future
Certificate Account Deposit Date to the extent that funds attributable to the
Mortgage Loans that are available in the Custodial Account for deposit in the
Certificate Account on such Certificate Account Deposit Date shall be less than
payments to Certificateholders required to be made on the following Distribution
Date. Such allocations shall be conclusive for purposes of reimbursement to the
Master Servicer from recoveries on the Mortgage Loans pursuant to Section 3.11.
The determination by the Master Servicer that it has made a Nonrecoverable
Advance or that any proposed Advance, if made, would constitute a Nonrecoverable
Advance, shall be evidenced by a certificate of a Servicing Officer delivered to
the Seller and the Trustee. The Trustee shall deposit all funds it receives
pursuant to this Section 4.03 into the Certificate Account.
(c) In the event that the Master Servicer determines on the
Certificate Account Deposit Date that it will be unable to deposit in the
Certificate Account an amount equal to the Advance required to be made for the
immediately succeeding Distribution Date in the amount determined by the Trustee
pursuant to paragraph (b) above, it shall give notice to the Trustee of its
inability to advance (such notice may be given by telecopy), not later than 3:00
P.M., New York time, on such Business Day, specifying the portion of such amount
that it will be unable to deposit. If the Master Servicer shall have determined
that it is not obligated to make the entire Advance because all or a lesser
portion of such Advance would not be recoverable from Insurance Proceeds,
Liquidation Proceeds or otherwise, the Master Servicer shall promptly deliver to
the Trustee for the benefit of the Certificateholders an Officer's Certificate
setting forth the reasons for the Master Servicer's determination. Not later
than 5:00 P.M., New York time, on the Certificate Account Deposit Date, unless
by such time the Master Servicer shall have directly or indirectly deposited in
the Certificate Account the entire amount of the Advances required to be made
for the related Distribution Date, pursuant to Section 7.01, the Trustee shall
(a) terminate all of the rights and obligations of the Master Servicer under
this Agreement in accordance with Section 7.01 and (b) assume the rights and
obligations of the Master Servicer hereunder, including the obligation to
deposit in the Certificate Account an amount equal to the Advance for the
immediately succeeding Distribution Date.
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SECTION 4.04. Allocation of Realized Losses.
Prior to each Distribution Date, the Master Servicer shall
determine the total amount of Realized Losses, if any, that resulted from any
Cash Liquidation, Debt Service Reduction, Deficient Valuation or REO Disposition
that occurred during the related Prepayment Period. The amount of each Realized
Loss shall be evidenced by an Officers' Certificate by the Master Servicer.
Realized Losses shall be allocated to the Letter of Credit and to the
Certificates as determined by the Trustee in accordance with the following
provisions. All Realized Losses, other than Excess Special Hazard Losses, Excess
Bankruptcy Losses, Excess Fraud Losses or Extraordinary Losses shall first be
covered by draws on the Letter of Credit by the Master Servicer pursuant to
Section 4.06 and then allocated to the Certificates, in reduction of the
Certificate Principal Balance thereof. Any Excess Special Hazard Losses, Excess
Bankruptcy Losses, Excess Fraud Losses and Extraordinary Losses on the Mortgage
Loans will be allocated to the Certificates. Any allocation of the principal
portion of Realized Losses to a Certificate shall be made by reducing the
Certificate Principal Balance thereof by the amount so allocated, which
allocation shall be deemed to have occurred at the close of business on such
Distribution Date. Allocations of the interest portions of Realized Losses shall
be made by operation of the definition of "Accrued Certificate Interest". All
Realized Losses and all other losses allocated to the Certificates under this
Section 4.04 will be allocated among the Certificates in proportion to the
Percentage Interests evidenced thereby.
SECTION 4.05. Information Reports to be Filed by the
Master Servicer.
The Master Servicer or the Sub-Servicers shall file the
information returns with respect to the receipt of mortgage interest received in
a trade or business, reports of foreclosures and abandonments of any Mortgaged
Property and the information returns relating to cancellation of indebtedness
income with respect to any Mortgaged Property required by Sections 6050H, 6050J
and 6050P of the Code, respectively, and deliver to the Trustee an Officers'
Certificate stating that such reports have been filed. Such reports shall be in
form and substance sufficient to meet the reporting requirements imposed by such
Sections 6050H, 6050J and 6050P of the Code.
SECTION 4.06. The Letter of Credit.
(a) Except as otherwise set forth herein, the Master Servicer
hereby covenants and agrees to exercise its best reasonable efforts to maintain
or cause the Letter of Credit (or substitute credit enhancement), to be
maintained to the extent and in the form and amount and for the purposes set
forth in this Agreement. The Trustee shall draw on the Letter of Credit at the
times and in the manner set forth herein and therein.
(b) In the event that at any time the Letter of Credit remains
outstanding the short-term unsecured debt obligations of the Letter of Credit
Issuer are downgraded to "A-1" by Standard & Poor's, then, the Master Servicer
shall promptly notify the Trustee of such downgrade and, within 60 days of such
event, either (i) the Master Servicer shall obtain a replacement letter of
credit or other form of credit enhancement in accordance with this Section
4.06(b).
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Prior to delivering any replacement letter of credit or other
form of credit enhancement to the Trustee pursuant to this Section 4.06(b), the
Master Servicer shall (i) obtain an Opinion of Counsel to the effect that such
replacement letter of credit or alternative form of credit support will not
adversely affect the classification of the Trust Fund as a grantor trust for
federal income tax purposes and (ii) written confirmation from the Rating Agency
that such replacement letter of credit or alternative form of credit enhancement
would not have adversely affected the then-current rating assigned to the
Certificates by such Rating Agency and deliver to the Trustee an Opinion of
Counsel to the effect that such replacement letter of credit or alternative form
of credit enhancement is a valid and legally binding obligation of the related
letter of credit issuer or issuer of such alternate form of credit enhancement
in accordance with its terms. Any replacement letter of credit shall be in
generally the same form as the form of Letter of Credit attached as Exhibit B
hereto, shall be issued by a Qualified Bank and the initial amount available to
be drawn thereunder shall equal the amount remaining under the previous Letter
of Credit. The cost of obtaining and maintaining any replacement letter of
credit or alternative form of credit enhancement shall be borne by the Master
Servicer.
The Trustee acknowledges such grant and accepts the trusts
under this Section 4.06 in accordance with the provisions hereof.
(c) Upon receipt of a certificate of a Servicing Officer of
the Master Servicer or the Company instructing the Trustee to reduce, modify or
terminate the amounts available under the Letter of Credit in accordance with
Section 3.13 and (i) in the case of a modification (but not a reduction or
termination of the Letter of Credit), an Opinion of Counsel to the effect that
any such modification of the Letter of Credit will not adversely affect the
classification of the Trust Fund as a grantor trust for federal income tax
purposes, and (ii) written confirmation from the Rating Agency to the effect
that the then-current rating assigned to the Certificates by such Rating Agency
will not be adversely affected by any such reduction, modification or
termination, the Trustee shall reduce, modify or terminate the Letter of Credit
pursuant to such instructions and Section 3.13 shall be deemed modified to the
extent set forth in such instructions.
On the Determination Date immediately following each
anniversary of the Cut-off Date the Master Servicer shall provide the Trustee
with a certificate of a Servicing Officer which sets forth the amounts, if any,
by which the amount available under the Letter of Credit, the Bankruptcy Amount,
the Fraud Loss Amount and the Special Hazard Amount are to be reduced in
accordance with the definitions thereof. In addition, for purposes of reducing
the amount available under the Letter of Credit, the Bankruptcy Amount, the
Fraud Loss Amount and the Special Hazard Amount, as applicable, the Master
Servicer shall notify the Trustee by means of a certificate of a Servicing
Officer of any amounts deposited by the Master Servicer in the Certificate
Account pursuant to Sections 3.11(a), 3.12(b) and 3.20(a). Upon receipt of each
certificate of a Servicing Officer the Trustee will promptly notify the Letter
of Credit Issuer of such reductions in the form of Annex C to the Letter of
Credit.
In addition, for purposes of reducing the amount available
under the Letter of Credit, the Special Hazard Amount, the Fraud Loss Amount and
the Bankruptcy Amount, as applicable, upon realization thereof, the Master
Servicer shall notify the Trustee by means of an
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Officer's Certificate of any losses incurred by the Master Servicer in
connection with any Mortgage Loan purchased pursuant to Section 3.13, separately
identifying any such losses which would have been either Special Hazard Losses,
Fraud Losses or Bankruptcy Losses, had the Mortgage Loan not been so purchased.
Upon receipt of such an Officers' Certificate, the Trustee shall promptly notify
the Letter of Credit Issuer of such reduction by delivering a certificate to the
Letter of Credit Issuer substantially in the form of Annex C to the Letter of
Credit. Upon receipt by the Trustee of such an Officers' Certificate, if the
Letter of Credit remains outstanding, the Trustee shall request the
reinstatement of the amount available under the Letter of Credit (and the Fraud
Loss Amount, Bankruptcy Amount or Special Hazard Amount, if applicable) under
the Letter of Credit in an amount equal to such recovered amount be delivering a
certificate to the Letter of Credit Issuer substantially in the form of Annex B
to the Letter of Credit.
(d) Upon termination of the Trust Fund pursuant to Article IX
or upon termination of the Letter of Credit pursuant to the terms of this
Agreement (including a draw of the entire amount available under the Letter of
Credit pursuant to Section 4.06(b)), the Trustee shall provide the Letter of
Credit Issuer with a certificate of termination pursuant to the provisions of
the Letter of Credit.
SECTION 4.07. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the
Trustee shall comply with all federal withholding requirements respecting
payments to Certificateholders of interest or original issue discount on the
Mortgage Loans, and payments of interest or discount on amounts invested by the
Trustee as agent for Certificateholders pursuant to an election made under
Section 4.01 hereof, that the Trustee reasonably believes are applicable under
the Code. The consent of Certificateholders shall not be required for such
withholding. In the event the Trustee withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee shall, together with
its monthly report to such Certificateholders pursuant to Section 4.02 hereof,
indicate such amount withheld.
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ARTICLE V
THE CERTIFICATES
SECTION 5.01 The Certificates.
The Certificates will be substantially in the form annexed
hereto as Exhibits A. The Certificates will be issuable in registered form only.
The Certificates shall be issuable in minimum dollar denominations of $1,000 and
integral multiples of $1 in excess thereof, except that one Certificate may be
issued in an amount such that the denomination of such Certificate and the
aggregate denomination of all other outstanding Certificates together equal the
aggregate Certificate Principal Balance of the Certificates.
Upon original issue, the Certificates shall, upon the written
request of the Company executed by an officer of the Company, be executed and
delivered by the Trustee, authenticated by the Trustee and delivered to or upon
the order of the Company upon receipt by the Trustee of the documents specified
in Section 2.01. The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee in its capacity as trustee hereunder by a
Responsible Officer. Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Trustee shall bind
the Trustee, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Certificates
or did not hold such offices at the date of such Certificates. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any
purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form provided for herein executed by the
Trustee by manual signature, and such certificate upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates issued on the Closing
Date shall be dated the Closing Date and any Certificates delivered thereafter
shall be dated the date of their authentication.
SECTION 5.02. Registration of Transfer and Exchange of
Certificates.
The Trustee shall maintain a Certificate Register in which,
subject to such reasonable regulations as it may prescribe, the Trustee shall
provide for the registration of Certif icates and of transfers and exchanges of
Certificates as herein provided.
Upon surrender for registration of transfer of any Certificate
at the office of the Trustee maintained for such purpose, the Trustee shall
execute and the Trustee or the Authenticating Agent shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates of a like aggregate initial Certificate Principal Balance.
Every Certificate surrendered for transfer shall be accompanied by notification
of the account of the designated transferee or transferees for the purpose of
receiving distributions pursuant to Section 4.01 by wire transfer, if any such
transferee desires and is eligible for distribution by wire transfer.
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At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized denominations of a like aggregate
initial Certificate Principal Balance, upon surrender of the Certificates to be
exchanged at the office of the Certificate Registrar. Whenever any Certificates
are so surrendered for exchange the Trustee shall execute, authenticate and
deliver the Certificates 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 Trustee or the Certificate Registrar) be
duly endorsed by, or be accompanied by a written instru ment of transfer in the
form satisfactory to the Trustee or the Certificate Registrar duly executed by,
the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made to the Certificateholders for
any transfer or exchange of Certificates, but the Trustee may require payment of
a sum sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certi ficates.
All Certificates surrendered for transfer and exchange shall
be canceled and retained by the Trustee in accordance with the Trustee's
standard procedures.
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen
Certificates.
If (i) any mutilated Certificate is surrendered to the Trustee
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Certificate, and (ii) there is delivered to the Trustee such
security or indemnity as may be required by it to save it harmless, then, in the
absence of notice to the Trustee that such Certificate has been acquired by a
bona fide purchaser, the Trustee shall execute, authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of the same initial Certificate Principal
Balance. Upon the issuance of any new Certificate under this Section, the
Trustee may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Any replacement Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
SECTION 5.04. Persons Deemed Owners.
The Company, the Master Servicer, the Trustee and any agent of
any of them may treat the person in whose name any Certificate is registered as
the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 4.01 and for all other purposes whatsoever, and neither the
Company, the Master Servicer, the Trustee nor any agent of any of them shall be
affected by notice to the contrary.
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ARTICLE VI
THE COMPANY AND THE MASTER SERVICER
SECTION 6.01. Liability of the Company and the Master
Servicer.
The Company and the Master Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
upon and undertaken by the Company and the Master Servicer herein.
SECTION 6.02. Merger, Consolidation or Conversion of the
Company or the Master Servicer.
The Company and the Master Servicer each will keep in full
effect its existence, rights and franchises as a corporation under the laws of
the state of its incorporation, and each 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 respective duties under this Agreement; and provided further
that the Rating Agencies' ratings of the Certificates immediately prior to such
merger or consolidation will not be qualified, reduced or withdrawn as a result
thereof (as evidenced by a letter to such effect from the Rating Agencies).
Any Person into which the Company or the Master Servicer may
be merged, consolidated or converted, or any corporation resulting from any
merger or consolidation to which the Company or the Master Servicer shall be a
party, or any Person succeeding to the business of the Company or the Master
Servicer, shall be the successor of the Company or the Master Servicer, as the
case may be, 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 Master Servicer shall be qualified to sell mortgage loans to and
service mortgage loans for FNMA or FHLMC.
SECTION 6.03. Limitation on Liability of the Company, the
Master Servicer and Others.
Neither the Company, the Master Servicer nor any of the
directors, officers, employees or agents of the Company or the Master Servicer
shall be under any liability to the Trust Fund or the Certificateholders for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Company or the Master Servicer (but this
provision shall protect the above described persons) against any breach of
warranties or representations made herein, or against any specific liability
imposed on the Master Servicer pursuant to Section 3.01 or any other Section
hereof; and provided further that this provision shall not protect the Company,
the Master 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
58
duties or by reason of reckless disregard of obligations and duties hereunder.
The Company, the Master Servicer and any director, officer, employee or agent of
the Company or the Master Servicer may rely in good faith on any document of any
kind PRIMA FACIE properly executed and submitted by any Person respecting any
matters arising hereunder. The Company, the Master Servicer and any director,
officer, employee or agent of the Company or the Master Servicer shall be
indemnified and held harmless by the Trust Fund against any loss, liability or
expense incurred in connection with any legal action relating to this Agreement
or the Certificates, other than any loss, liability or expense related to Master
Servicer's servicing obligations with respect to any specific Mortgage Loan or
Mortgage Loans (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement) or related to the Master Servicer's
obligations under Section 3.01, or any loss, liability or expense incurred by
reason of willful misfeasance, bad faith or gross negligence in the performance
of duties hereunder or by reason of reckless disregard of obligations and duties
hereunder. Neither the Company nor the Master Servicer shall be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its respective duties under this Agreement and which in its
opinion may involve it in any expense or liability; provided, however, that the
Company or the Master Servicer may in its sole discretion undertake any such
action which it may deem necessary or desirable with respect to this Agreement
and the rights and duties of the parties hereto and the interests of the
Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom (except any action or
liability related to the Master Servicer's obligations under Section 3.01) shall
be expenses, costs and liabilities of the Trust Fund, and the Company and the
Master Servicer shall be entitled to be reimbursed therefor from the Certificate
Account as provided in Section 3.11, any such right of reimbursement being prior
to the rights of Certificateholders to receive any amount in the Certificate
Account.
SECTION 6.04. Limitation on Resignation of the Master
Servicer.
The Master Servicer shall not resign from the obligations and
duties hereby imposed on it except (a) upon appointment of a successor servicer
reasonably acceptable to the Trustee and upon receipt by the Trustee of a letter
from each Rating Agency that such a resignation and appointment will not, in and
of itself, result in a downgrading of the Certificates or (b) upon determination
that its duties hereunder are no longer permissible under applicable law (any
such determination permitting the resignation of the Master Servicer to be
evidenced by an Opinion of Counsel (at the expense of the resigning Master
Servicer) to such effect delivered to the Trustee). No such resignation shall
become effective until the Trustee or a successor servicer shall have assumed
the Master Servicer's responsibilities, duties, liabilities and obligations
hereunder.
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ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default.
"Event of Default", wherever used herein, means any one of the
following events:
(i) any failure by the Master Servicer to remit to the Trustee
for distribution to the Certificateholders any payment (other than an
Advance) required to be made under the terms of the Certificates or
this Agreement which continues unremedied for a period of one day after
the date upon which written notice of such failure, requiring the same
to be remedied, shall have been given to the Master Servicer by the
Company (with a copy to the Trustee) or the Trustee, or to the Master
Servicer, the Company and the Trustee by the Holders of Certificates
entitled to at least 25% of the Voting Rights; or
(ii) any failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants
or agreements on the part of the Master Servicer contained in the
Certificates or in this Agreement (including any breach of the Master
Servicer's representations and warranties pursuant to Section 2.03(a)
which materially and adversely affects the interests of the
Certificateholders) which continues unremedied for a period of 30 days
after the date on which written notice of such failure, requiring the
same to be remedied, shall have been given to the Master Servicer by
the Company (with a copy to the Trustee) or the Trustee, or to the
Master Servicer, the Company and the Trustee by the Holders of
Certificates entitled to at least 25% of the Voting Rights; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in an involuntary case under any present
or future federal or state bankruptcy, insolvency or similar law or the
appointment of a conservator or receiver or liquidator in any
insolvency, readjustment of debt, marshalling of assets and liabilities
or similar proceedings, or for the winding-up or liquidation of its
affairs, shall have been entered against the Master Servicer and such
decree or order shall have remained in force undischarged or unstayed
for a period of 60 consecutive days; or
(iv) the Master 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 Master Servicer or of or relating to all or
substantially all of its property; or
(v) the Master Servicer shall admit in writing its inability to
pay its debts generally as they become due, file a petition to take
advantage of or otherwise voluntarily commence a case or proceeding
under any applicable bankruptcy, insolvency, reorganization or other
similar statute, make an assignment for the benefit of its creditors,
or voluntarily suspend payment of its obligations; or
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(vi) the Master Servicer shall fail to deposit in the Certificate
Account on any Certificate Account Deposit Date an amount equal to any
required Advance.
If the Master Servicer shall fail to make any deposit in the Certificate Account
as required by Section 4.01, the Trustee shall give the Master Servicer notice
pursuant to clause (i) not later than the Business Day following the Certificate
Account Deposit Date. If an Event of Default described in clauses (i) - (v) of
this Section shall occur, then, and in each and every such case, so long as such
Event of Default shall not have been remedied, the Company or the Trustee may,
and at the direction of the Holders of Certificates entitled to at least 51% of
the Voting Rights, the Trustee shall, by notice to the Master Servicer (and to
the Company if given by the Trustee or to the Trustee if given by the Company)
terminate all of the rights and obligations of the Master Servicer under this
Agreement and in and to the Trust Fund, other than its rights as a
Certificateholder hereunder and the Company, terminate all of the rights and
obligations of the Master Servicer under this Agreement and in and to the Trust
Fund, other than its rights as a Certificateholder hereunder. In addition, any
failure of the Master Servicer to repurchase a Converting Mortgage Loan pursuant
to Section 3.25 shall constitute an Event of Default, and in such event, all of
the rights and obligations of the Master Servicer hereunder may be terminated in
accordance with the preceding sentence. If an Event of Default described in
clause (vi) hereof shall occur, the Trustee shall, by notice to the Master
Servicer and the Company, terminate all of the rights and obligations of the
Master Servicer under this Agreement and in and to the Trust Fund, other than
its rights as a Certificateholder hereunder. On or after the receipt by the
Master Servicer of such notice, all authority and power of the Master Servicer
under this Agreement, whether with respect to the Certificates (other than as a
holder thereof) or the Mortgage Loans or otherwise, shall pass to and be vested
in the Trustee pursuant to and under this Section, and, without limitation, the
Trustee is hereby authorized and empowered to execute and deliver, on behalf of
the Master Servicer, as attorney-in-fact or otherwise, any and all documents and
other instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents, or otherwise. The Master Servicer agrees to cooperate with
the Trustee in effecting the termination of the Master Servicer's respon
sibilities and rights hereunder, including, without limitation, the transfer to
the Trustee or its appointed agent for administration by it of all cash amounts
which shall at the time be deposited by the Master Servicer or should have been
deposited to the Custodial or the Certificate Account or thereafter be received
with respect to the Mortgage Loans. The Trustee shall not be deemed to have
breached any obligation hereunder as a result of a failure to make or delay in
making any distribution as and when required hereunder caused by the failure of
the Master Servicer to remit any amounts received on it or to deliver any
documents held by it with respect to the Mortgage Loans. For purposes of this
Section 7.01, the Trustee shall not be deemed to have knowledge of an Event of
Default unless a Responsible Officer of the Trustee assigned to and working in
the Trustee's Corporate Trust Division has actual knowledge thereof or unless
notice of any event which is in fact such an Event of Default is received by the
Trustee and such notice references the Certificates, the Trust Fund or this
Agreement.
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SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer receives a notice of
termination pursuant to Section 7.01, the Trustee or its appointed agent shall
be the successor in all respects to the Master Servicer in its capacity as
Master Servicer under this Agreement and the transactions set forth or provided
for herein and shall be subject thereafter to all the responsibilities, duties
and liabilities relating thereto placed on the Master Servicer including the
obligation to make Advances which have been or will be required to be made
(except for the responsibilities, duties and liabilities contained in Section
2.03 and its obligations to deposit amounts in respect of losses incurred prior
to the date of succession pursuant to Section 3.12) by the terms and provisions
hereof; and provided further, that any failure to perform such duties or
responsibilities caused by the Master Servicer's failure to provide information
required by Section 4.03 shall not be considered a default by the Trustee
hereunder. As compensation therefor, the Trustee shall be entitled to all funds
relating to the Mortgage Loans which the Master Servicer would have been
entitled to charge to the Custodial Account and the Certificate Account if the
Master Servicer had continued to act hereunder. Notwithstanding the above, the
Trustee may, if it shall be unwilling to so act, or shall, if it is unable to so
act or if the Holders of Certificates entitled to at least 51% of the Voting
Rights so request in writing to the Trustee, appoint, or petition a court of
competent jurisdiction to appoint, any FNMA- or FHLMC-approved mortgage
servicing institution having a net worth of not less than $10,000,000 as the
successor to the Master Servicer hereunder in the assumption of all or any part
of the responsibilities, duties or liabilities of the Master Servicer hereunder.
Pending appointment of a successor to the Master Servicer hereunder, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on Mortgage Loans as it and such
successor shall agree; provided, however, that no such compensation shall be in
excess of that permitted the Master Servicer hereunder. The Trust ee and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession; provided, however, that such
succession shall not reduce the ratings of the Certificates below the original
ratings thereof.
Any successor, including the Trustee, to the Master Servicer
shall maintain in force during its term as master servicer hereunder the
Insurance Policies and fidelity bonds to the same extent as the Master Servicer
is so required pursuant to Sections 3.13 and 3.18.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any such termination or appointment of a successor to
the Master Servicer, the Trustee shall give prompt notice thereof to
Certificateholders.
(b) Within 60 days after 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.
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SECTION 7.04. Waiver of Events of Default.
The Holders representing at least 66% of the Voting Rights of
Certificates affected by a default or Event of Default hereunder, may waive such
default or Event of Default (other than an Event of Default set forth in Section
7.01(vi); PROVIDED, HOWEVER, that (a) a default or Event of Default under clause
(i) of Section 7.01 may be waived only by all of the Holders of Certificates
affected by such default or Event of Default and (b) no waiver pursuant to this
Section 7.04 shall affect the Holders of Certificates in the manner set forth in
the second paragraph of Section 10.01 or materially adversely affect any
non-consenting Certificateholder. Upon any such waiver of a default or Event of
Default by the Holders representing the requisite percentage of Voting Rights of
Certificates affected by such default or Event of Default, such default or Event
of Default shall cease to exist and shall be deemed to have been remedied for
every purpose hereunder. No such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon except to the
extent expressly so waived.
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ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. 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 perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Default occurs and is continuing, 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 his
own affairs. Any permissive right of the Trustee enumerated in this Agreement
shall not be construed as a duty.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to deter mine whether they
conform to the requirements of this Agreement. If any such instrument is found
not to conform to the requirements of this Agreement in a material manner, the
Trustee shall take action as it deems appropriate to have the instrument
corrected.
The Trustee shall sign on behalf of the Trust Fund any tax
return that the Trustee is required to sign pursuant to applicable federal,
state or local tax laws.
The Trustee covenants and agrees that it shall perform its
obligations hereunder in a manner so as to maintain the status of the Trust Fund
as a grantor trust and to prevent the imposition of any federal, state or local
income, prohibited transaction, contribution or other tax on the Trust Fund to
the extent that maintaining such status and avoiding such taxes are reasonably
within the control of the Trustee and are reasonably within the scope of its
duties under this Agreement.
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 misconduct; 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;
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(ii) The Trustee shall not be personally liable for an
error of judgment made in good faith by a Responsible Officer
or Responsible Officers of the Trustee, unless it shall be
proved that the Trustee was negligent in ascertaining the
pertinent facts;
(iii) The Trustee shall not be personally liable with
respect to any action taken, suffered or omitted to be taken
by it in good faith in accordance with the direction of
Holders of Certificates entitled to at least 25% of the Voting
Rights relating to the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee,
under this Agreement.
SECTION 8.02. Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(a) The Trustee may request and 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 reasonably 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
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
therewith;
(c) The Trustee shall be under no obligation to
exercise any of the trusts or powers vested in it by this
Agreement or to make any investigation of matters arising
hereunder 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 his own affairs;
(d) The Trustee shall not be personally liable for any
action taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
65
(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 entitled to at least 25% of the
Voting Rights; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to
it by the terms of this Agreement, the Trustee may require
reasonable indemnity against such expense or liability as a
condition to taking any such action. The reasonable expense of
every such reasonable examination shall be paid by the Master
Servicer or, if paid by the Trustee, shall be repaid by the
Master Servicer upon demand; and
(f) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or
by or through agents or attorneys.
SECTION 8.03. Trustee Not Liable for Certificates or
Mortgage Loans.
The recitals contained herein and in the Certificates, other
than the signature of the Trustee on the Certificates and the certificate of
authentication, shall be taken as the statements of the Company or the Master
Servicer, as the case may be, and the Trustee assumes no respons ibility for
their correctness. The Trustee makes no representations or warranties as to the
validity or sufficiency of this Agreement or of the Certificates or of any
Mortgage Loan or related document, other than the signature of the Trustee on
the Certificates and the Certificate of Authentication. The Trustee shall not be
accountable for the use or application by the Company or the Master 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 Seller in respect of the Mortgage Loans
or deposited in or withdrawn from the Custodial Account or the Certificate
Account or any other account by or on behalf of the Company or the Master
Servicer, other than any funds held by or on behalf of the Trustee in accordance
with Section 4.01.
SECTION 8.04. 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 8.05. Payment of Trustee's Fees.
The Trustee shall withdraw from the Certificate Account on
each Distribution Date and pay to itself the Trustee's Fee. Except as otherwise
provided in this Agreement, the Trustee and any director, officer, employee or
agent of the Trustee shall be indemnified by the Trust Fund and held harmless
against any loss, liability or "unanticipated out-of-pocket" expense incurred or
paid to third parties (which expenses shall not include salaries paid to
employees, or allocable
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overhead, of the Trustee) in connection with the acceptance or administration of
its trusts hereunder or the Certificates, other than any loss, liability or
expense incurred by reason of willful misfeasance, bad faith or negligence in
the performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder all such amounts shall be payable from funds in
the Custodial Account as provided in Section 3.11. The provisions of this
Section 8.05 shall survive the termination of this Agreement.
The Master Servicer shall indemnify the Trustee and any
director, officer, employee or agent of the Trustee against any loss, liability
or expense that may be sustained in connection with this Agreement related to
the willful misfeasance, bad faith or negligence in the performance of its
duties hereunder.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or a
national banking association organized and doing business under the laws of any
state or the United States of America or the District of Columbia, 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. In addition, the Trustee shall at all times be
acceptable to the Rating Agency rating the Certificates. If such corporation
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 8.07. The corporation or national banking association serving as Trustee
may have normal banking and trust relationships with the Seller and its
affiliates or the Master Servicer and its affiliates; provided, however, that
such corporation cannot be an affiliate of the Master Servicer other than the
Trustee in its role as successor to the Master Servicer.
SECTION 8.07. Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the
trusts hereby created by giving notice thereof to the Company, the Master
Servicer and to all Certificateholders; provided, that such resignation shall
not be effective until a successor trustee is appointed and accepts appointment
in accordance with the following provisions. Upon receiving such notice of
resignation, the Company shall promptly appoint a successor trustee who meets
the eligibility requirements of Section 8.06 by written instrument, in
duplicate, which instrument shall be delivered to the resigning Trustee and to
the successor trustee. A copy of such instrument shall be delivered to the
Certificateholders and the Master Servicer by the Company. If no successor
trustee shall have been so appointed and have accepted appointment within 60
days after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdic tion for the appointment of a successor
trustee; provided, however, that the resigning Trustee shall
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not resign and be discharged from the trusts hereby created until such time as
the Rating Agency rating the Certificates approves the successor trustee.
If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Company or the Master Servicer, 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, or if the rating of the long-term debt obligations of the Trustee
is not acceptable to the Rating Agency in respect of mortgage pass-through
certificates having a rating equal to the then current rating on the
Certificates, then the Company may remove the Trustee and appoint a successor
trustee who meets the eligibility requirements of Section 8.06 by written
instrument, in duplicate, which instrument shall be delivered to the Trustee so
removed and to the successor trustee. A copy of such instrument shall be
delivered to the Certificateholders and the Master Servicer by the Company.
The Holders of Certificates entitled to at least 51% of the
Voting Rights may at any time remove the Trustee and appoint a successor trustee
by written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which instruments
shall be delivered to the Master Servicer, one complete set to the Trustee so
removed and one complete set to the successor so appointed. A copy of such
instrument shall be delivered to the Certificateholders and the Master Servicer
by the Company.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.
SECTION 8.08. Successor Trustee.
Any successor trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the Master Servicer and to its
predecessor trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the prede cessor 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 Master 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 8.06.
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Upon acceptance of appointment by a successor trustee as
provided in this Section, the Master Servicer shall mail notice of the
succession of such trustee hereunder to all Holders of Certificates at their
addresses as shown in the Certificate Register. If the Master Servicer fails to
mail such notice within ten days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the Master Servicer.
SECTION 8.09. Merger or Consolidation of Trustee.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated or any corporation resulting from
any merger, conversion or consolidation to which the Trustee shall be a party,
or any corporation 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 8.06, 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.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions hereof, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing the same may at the time be located,
the Company and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Per sons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this Section
8.10, such powers, duties, obligations, rights and trusts as the Company and the
Trustee may consider necessary or desirable. If the Company 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 8.06 hereunder and no notice to Holders of
Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be
required under Section 8.08 hereof.
In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Master Servicer hereunder), the Trustee shall be incompetent
or unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Fund or any
portion thereof in any such jurisdiction) shall be exercised and performed by
such separate trustee or co-trustee at the direction of the Trustee.
Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each
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of them. Every instrument appointing any separate trustee or co-trustee shall
refer to this Agreement and the conditions of this Article VIII. Each separate
trustee and co-trustee, upon its acceptance of the trusts conferred, shall be
vested with the estates or property specified in its instrument of appointment,
either jointly with the Trustee or separately, as may be provided therein,
subject to all the provisions of this Agreement, specifically including every
provision of this Agreement relating to the conduct of, affecting the liability
of, or affording protection to, the Trustee. Every such instrument shall be
filed with the Trustee.
Any separate trustee or co-trustee may, at any time,
constitute the Trustee, its agent or attorney-in-fact, with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name. If any separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, all
of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 8.11. Information Reports and Tax Returns. The Trustee
shall prepare, execute and timely file such information reports or returns as
may be required from time to time under any applicable federal, state or local
law with respect to the Trust Fund or the Certificateholders and shall timely
provide Certificateholders of such Series with information as to the Master
Servicer's determination of monthly income accrued by the Trust Fund. [Unless
there is a statutory or administrative clarification to the contrary, as
evidenced by an Opinion of Counsel delivered to the Trustee, requiring such
information reports or returns to be prepared based on a different method, the
Trustee shall prepare such information returns or reports based on a constant
yield method with respect to the Certificates of such Series, using the
Prepayment Assumption and a representative initial offering price for
Certificates in computing such constant yield.]
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ARTICLE IX
TERMINATION
SECTION 9.01. Termination Upon Repurchase or
Liquidation of All Mortgage Loans.
The respective obligations and responsibilities of the
Company, the Master Servicer and the Trustee created hereby (other than the
obligations of the Master Servicer to provide for and the Trustee to make
payments to Certificateholders as hereafter set forth) shall terminate upon
payment to the Certificateholders of all amounts held by or on behalf of the
Trustee and required to be paid to them hereunder following the earlier to occur
of (i) the repurchase by the Master Servicer of all Mortgage Loans and each REO
Property in respect thereof remaining in the Trust Fund at a price equal to (a)
100% of the unpaid principal balance of each Mortgage Loan (other than one as to
which a REO Property was acquired) on the day of repurchase together with
accrued interest on such unpaid principal balance at the related Net Mortgage
Rate to the first day of the month in which the proceeds of such repurchase are
to be distributed, plus (b) the appraised value of any REO Property less the
good faith estimate of the Master Servicer of liquidation expenses to be
incurred in connection with its disposal thereof, such appraisal to be conducted
by an appraiser mutually agreed upon by the Master Servicer and the Trustee at
the expense of the Master Servicer, (but not more than the unpaid principal
balance of the related Mortgage Loan, together with accrued interest on that
balance at the Net Mortgage Rate to the first day of the month of repurchase),
and (ii) the final payment or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan remaining in the Trust Fund (or the
disposition of all REO Property in respect thereof); provided, however, that in
no event shall the trust created hereby continue beyond expiration of 21 years
from the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the
late ambassador of the United States to the Court of St. Xxxxx, living on the
date hereof. In the case of any repurchase by the Master Servicer pursuant to
clause (i), the Master Servicer shall include in such repurchase price the
amount of any Advances that will be reimbursed to the Master Servicer pursuant
to Section 3.11(iii) and the Master Servicer shall exercise reasonable efforts
to cooperate fully with the Trustee in effecting such repurchase and the
transfer of the Mortgage Loans and related Mortgage Files and related records to
the Master Servicer.
The right of the Master Servicer to repurchase all Mortgage
Loans pursuant to (i) above shall be conditioned upon the aggregate Stated
Principal Balance of such Mortgage Loans at the time of any such repurchase
aggregating an amount equal to or less than __% of the aggregate Stated
Principal Balance of the Mortgage Loans at the Cut-off Date. If such right is
exercised, the Master Servicer upon such repurchase shall provide to the
Trustee, the certification required by Section 3.16.
Notice of any termination, specifying the Distribution Date
upon which the Certificateholders may surrender their Certificates to the
Trustee for payment of the final distri bution and cancellation, shall be given
promptly by the Master Servicer by letter to the Trustee and shall be given
promptly by the Trustee to the Certificateholders mailed (a) in the event such
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notice is given in connection with the Master Servicer's election to repurchase,
not earlier than the 15th day and not later than the 25th day of the month next
preceding the month of such final distribution or (b) otherwise during the month
of such final distribution on or before the Determination Date in such month, in
each case specifying (i) the Distribution Date upon which final payment of the
Certificates will be made upon presentation and surrender of Certificates at the
office of the Certificate Registrar therein designated, (ii) the amount of any
such final payment and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable, pay ments being made only upon presentation
and surrender of the Certificates at the office of the Certificate Registrar
therein specified. In the event such notice is given in connection with the
Master Servicer's election to repurchase, the Master Servicer shall deposit in
the Custodial Account pursuant to Section 3.10 on the last day of the related
Prepayment Period an amount equal to the above-described repurchase price
payable out of its own funds. Upon presentation and surrender of the
Certificates by the Certificateholders, the Trustee shall distribute to the
Certificateholders (i) the amount otherwise distributable on such Distribution
Date, if not in connection with the Master Servicer's election to repurchase, or
(ii) if the Master Servicer elected to so repurchase, an amount determined as
follows: with respect to each Certificate, the outstand ing Certificate
Principal Balance thereof, plus one month's interest thereon at the applicable
Pass- Through Rate and any previously unpaid Accrued Certificate Interest. Upon
certification to the Trustee by a Servicing Officer, following such final
deposit, the Trustee shall promptly release the Mortgage Files as directed by
the Master Servicer for the remaining Mortgage Loans, and the Trustee shall
execute all assignments, endorsements and other instruments required by the
Master Servicer as being necessary to effectuate such transfer.
In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the time
specified in the above-mentioned notice, the Trustee shall give a second notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
six months after the second notice all of the Certificates shall not have been
surrendered for cancellation, the Trustee shall take reasonable steps as
directed by the Company, or appoint an agent to take 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 subject hereto. If, within nine months after the second
notice, all of the Certificates shall not have been surrendered for
cancellation, the Trustee shall be entitled to all unclaimed funds and other
assets which remain subject hereto.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. Amendment.
This Agreement may be amended from time to time by the
Company, the Master Servicer and the Trustee without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be defective or incon sistent with any other
provisions herein or to correct any error, (iii) to change the timing and/or
nature of deposits in the Certificate Account, provided that (a) such change
would not adversely affect in any material respect the interests of any
Certificateholder, as evidenced by an Opinion of Counsel, and (b) such change
would not adversely affect the then-current rating of any rated class of
Certificates, as evidenced by a letter from each applicable Rating Agency, (iv)
to make any other provisions with respect to matters or questions arising this
Agreement which are not materially inconsistent with the provisions thereof,
provided that such action will not adversely affect in any material respect the
interests of any Certificateholder, or (v) to amend specified provisions that
are not material to holders of any class of Certificates offered hereunder.
This Agreement may also be amended from time to time by the
Company, the Master Servicer and the Trustee with the consent of the Holders of
Certificates entitled to at least 66-2/3% of the Voting Rights for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Holders of Certificates; provided, however, that no such amendment shall (i)
reduce in any manner the amount of, or 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 Certifi cate, or (ii) reduce the aforesaid
percentage of Certificates the Holders of which are required to consent to any
such amendment, without the consent of the Holders of all Certificates then
outstanding. Notwithstanding any other provision of this Agreement, for purposes
of the giving or withholding of consents pursuant to this Section 10.01,
Certificates registered in the name of the Seller or the Master Servicer or any
affiliate thereof shall be entitled to Voting Rights with respect to matters
described in clauses (i) and (ii) of this paragraph.
Promptly after the execution of any such amendment the Trustee
shall furnish a statement describing the amendment to each Certificateholder.
It shall not be necessary for the consent of
Certificateholders under this Section 10.01 to approve the particular form of
any proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable regulations as the Trustee may prescribe.
Prior to executing any amendment pursuant to this Section, the
Trustee shall be entitled to receive an Opinion of Counsel (provided by the
Person requesting such amendment) to the effect that such amendment is
authorized or permitted by this Agreement. The cost of an
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Opinion of Counsel delivered pursuant to this Section 10.01 shall be an expense
of the party requesting such amendment, but in any case shall not be an expense
of the Trustee.
The Trustee may, but shall not be obligated to enter into any
amendment pursuant to this Section that affects its rights, duties and
immunities under this Agreement or otherwise.
SECTION 10.02. B Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Master Servicer and at the expense of the Company on direction
by the Trustee, but only upon direction accompanied by an Opinion of Counsel to
the effect that such recordation materially and beneficially affects the
interests of the Certificateholders.
For the purpose of facilitating the recordation of this
Agreement as herein provided and for other purposes, this Agreement may be
executed simultaneously in any number of counter parts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
constitute but one and the same instrument.
SECTION 10.03. BLimitation 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 for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
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 notice of an Event of
Default, or of a default by the Seller or the Trustee in the performance of any
obligation hereunder, and of the continuance thereof, as hereinbefore provided,
and unless also the Holders of Certificates entitled to at least 25% of the
Voting Rights shall have made written request upon the Trustee to institute such
action, suit or proceeding in its own name as Trustee hereunder and shall have
offered to the Trustee such reasonable indemnity as it may require
74
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 is understood and intended, and expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates shall have any right in any manner whatever
by virtue of any provision of this Agreement to affect, disturb or prejudice the
rights of the Holders of any other of such Certificates, or to obtain or seek to
obtain priority over or preference to any other such Holder, or to enforce any
right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
SECTION 10.04. Governing Law.
This Agreement and the Certificates 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 10.05. Notices.
All demands, notices and direction hereunder shall be in
writing and shall be deemed effective upon receipt when delivered to (a) in the
case of the Company, ____________, ____________________________________,
Attention: ________________, or such other address as may hereafter be furnished
to the Trustee and the Master Servicer in writing by the Company, (b) in the
case of the Trustee, ______________________________________________ __________,
Attention: _________________________________, or such other address as may
hereafter be furnished to the Master Servicer and the Company in writing by the
Trustee and (c) in the case of the Master Servicer, Attention:
________________________ or such other address as may hereafter be furnished to
the Company and the Trustee in writing. Any notice required or permitted to be
mailed to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Certificate Register. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.
SECTION 10.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be for any reason whatsoever held invalid, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.
SECTION 10.07. Successors and Assigns; Third Party
Beneficiary.
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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 Trustee and
the Certificateholders. The parties hereto agree that the Seller is the intended
third party beneficiary of Sections 3.07, 3.10 and 3.22 hereof, and that the
Seller may enforce such provisions to the same extent as if the Seller were a
party to this Agreement.
SECTION 10.08. Article and Section Headings.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
SECTION 10.09. Notice to Rating Agencies and
Certificateholder.
The Trustee shall use its best efforts to promptly provide
notice to the Rating Agencies referred to below and the Letter of Credit Issuer
with respect to each of the following of which it has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been
cured;
3. The resignation or termination of the Master Servicer or
the Trustee;
4. The repurchase or substitution of Mortgage Loans pursuant
to Section 2.04;
5. The final payment to Certificateholders; and
6. Any change in the location of the Custodial Account or the
Certificate Account.
In addition, the Trustee shall promptly furnish to the Rating
Agency copies of the following:
1. Each report to Certificateholders described in Section
4.02;
2. Each annual independent public accountants' servicing
report received as described in Section 3.20; and
3. Each Master Servicer compliance report received as
described in Section 3.19.
Any such notice pursuant to this Section 10.09 shall be in
writing and shall be deemed to have been duly given if personally delivered or
mailed by first class mail, postage prepaid, or by express delivery service to
(i) in the case of [______________________________]
_________________________________________________________, Attention:
___________, and (ii) in the case of
[_____________________________________________________________
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__________] or, in each case, such other address as such Rating Agency may
designate in writing to the parties thereto.
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IN WITNESS WHEREOF, the Company, the Master Servicer and the
Trustee 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.
NAMCO SECURITIES CORP.
Company
By:
--------------------------------------
[NAME OF MASTER SERVICER],
Master Servicer
By:
--------------------------------------
[NAME OF TRUSTEE]
Trustee
By:
--------------------------------------
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EXHIBITS
[See Exhibit 4.1]
79
