Exhibit 99.1
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EXECUTION COPY
XXXXXX XXXXXXX CAPITAL I INC.
Depositor
XXXXX FARGO BANK, NATIONAL ASSOCIATION
Master Servicer and Securities Administrator
and
LASALLE BANK NATIONAL ASSOCIATION
Trustee and Custodian
---------------------------
POOLING AND SERVICING AGREEMENT
Dated as of July 1, 2006
---------------------------
XXXXXX XXXXXXX MORTGAGE LOAN TRUST 2006-11
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-11
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS........................................................19
Section 1.01. Definitions....................................................19
ARTICLE II DECLARATION OF TRUST; ISSUANCE OF CERTIFICATES....................80
Section 2.01. Creation and Declaration of Trust Fund;
Conveyance of Mortgage Loans...................................80
Section 2.02. Acceptance of Trust Fund by Trustee; Review of
Documentation for Trust Fund...................................83
Section 2.03. Representations and Warranties of the Depositor................84
Section 2.04. Representations and Warranties of the Depositor
and the Seller as to the Mortgage Loans........................86
Section 2.05. Representations and Warranties of the Seller;
Discovery of Breach; Repurchase or Substitution
of Mortgage Loans..............................................86
Section 2.06. Grant Clause...................................................90
Section 2.07. Depositor's Option to Purchase Breached Mortgage Loans.........91
Section 2.08. Release of Mortgage Documents for Servicing....................91
ARTICLE III THE CERTIFICATES.................................................92
Section 3.01. The Certificates...............................................92
Section 3.02. Registration...................................................92
Section 3.03. Transfer and Exchange of Certificates..........................93
Section 3.04. Cancellation of Certificates...................................96
Section 3.05. Replacement of Certificates....................................96
Section 3.06. Persons Deemed Owners..........................................97
Section 3.07. Temporary Certificates.........................................97
Section 3.08. Appointment of Paying Agent....................................97
Section 3.09. Book-Entry Certificates........................................98
ARTICLE IV ADMINISTRATION OF THE TRUST FUND..................................99
Section 4.01. Custodial Accounts; Distribution Account.......................99
Section 4.02. Permitted Withdrawals from the Custodial Accounts
and the Distribution Account..................................101
Section 4.03. [Reserved]....................................................102
Section 4.04. [Reserved]....................................................102
Section 4.05. Reports to Trustee and Certificateholders.....................102
ARTICLE V DISTRIBUTIONS TO HOLDERS OF CERTIFICATES..........................105
Section 5.01. Distributions Generally.......................................105
Section 5.02. Priorities of Distribution....................................106
Section 5.03. Allocation of Principal Payments to Class 1-A Certificates....117
Section 5.04. Allocation of Losses..........................................118
Section 5.05. Advances by the Master Servicer...............................120
Section 5.06. Compensating Interest Payments................................121
Section 5.07. [Reserved]....................................................121
Section 5.08. Cross-Collateralization; Adjustments to Available Funds.......121
Section 5.09. Determination of Pass-Through Rates for LIBOR Certificates....122
Section 5.10 The Reserve Fund..............................................124
ARTICLE VI CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR;
EVENTS OF DEFAULT................................................125
Section 6.01. Duties of Trustee and the Securities Administrator............125
Section 6.02. Certain Matters Affecting the Trustee and the
Securities Administrator......................................128
Section 6.03. Trustee and Securities Administrator Not Liable
for Certificates..............................................129
Section 6.04. Trustee and the Securities Administrator May Own
Certificates..................................................130
Section 6.05. Eligibility Requirements for Trustee..........................130
Section 6.06. Resignation and Removal of Trustee and the
Securities Administrator......................................130
Section 6.07. Successor Trustee and Successor Securities Administrator......134
Section 6.08. Merger or Consolidation of Trustee or the Securities
Administrator.................................................135
Section 6.09. Appointment of Co-Trustee, Separate Trustee or Custodian......135
Section 6.10. Authenticating Agents.........................................137
Section 6.11. Indemnification of the Trustee and the Securities
Administrator.................................................137
Section 6.12. Fees and Expenses of the Master Servicer, Securities
Administrator, the Trustee and the Custodians.................138
Section 6.13. Collection of Monies..........................................139
Section 6.14. Events of Default; Trustee To Act; Appointment of Successor...139
Section 6.15. Additional Remedies of Trustee Upon Event of Default..........144
Section 6.16. Waiver of Defaults............................................144
Section 6.17. Notification to Holders.......................................144
Section 6.18. Directions by Certificateholders and Duties of Trustee
During Event of Default.......................................144
Section 6.19. Action Upon Certain Failures of the Master Servicer and
Upon Event of Default.........................................145
Section 6.20. Preparation of Tax Returns and Other Reports..................145
Section 6.21. Certain Matters Regarding any Custodian Appointed Hereunder...145
ARTICLE VII PURCHASE OF MORTGAGE LOANS AND TERMINATION OF THE TRUST FUND....146
Section 7.01. Purchase of Mortgage Loans; Termination of Trust Fund
Upon Purchase or Liquidation of All Mortgage Loans............146
Section 7.02. Procedure Upon Redemption of Trust Fund.......................148
Section 7.03. Additional Trust Fund Termination Requirements................149
ARTICLE VIII RIGHTS OF CERTIFICATEHOLDERS...................................150
Section 8.01. Limitation on Rights of Holders...............................150
Section 8.02. Access to List of Holders.....................................151
Section 8.03. Acts of Holders of Certificates...............................151
ii
ARTICLE IX ADMINISTRATION AND SERVICING OF MORTGAGE LOANS BY
THE MASTER SERVICER..............................................152
Section 9.01. Duties of the Master Servicer; Enforcement of Servicers'
and Master Servicer's Obligations.............................152
Section 9.02. Assumption of Master Servicing by Trustee.....................155
Section 9.03. Representations and Warranties of the Master Servicer.........156
Section 9.04. Compensation to the Master Servicer...........................157
Section 9.05. Merger or Consolidation.......................................158
Section 9.06. Resignation of Master Servicer and Securities Administrator...158
Section 9.07. Assignment or Delegation of Duties by the Master Servicer
and Securities Administrator..................................159
Section 9.08. Limitation on Liability of the Master Servicer and Others.....160
Section 9.09. Indemnification; Third-Party Claims...........................160
Section 9.10. Eligibility Requirements for Securities Administrator.........160
Section 9.11. Annual Statement as to Compliance.............................161
ARTICLE X REMIC ADMINISTRATION..............................................162
Section 10.01. REMIC Administration.........................................162
Section 10.02. Prohibited Transactions and Activities.......................164
Section 10.03. Indemnification with Respect to Prohibited Transactions
or Loss of REMIC Status......................................165
Section 10.04. REO Property.................................................165
Section 10.05. Fidelity.....................................................166
ARTICLE XI MISCELLANEOUS PROVISIONS.........................................166
Section 11.01. Binding Nature of Agreement; Assignment......................166
Section 11.02. Entire Agreement.............................................166
Section 11.03. Amendment....................................................167
Section 11.04. Voting Rights................................................168
Section 11.05. Provision of Information.....................................168
Section 11.06. Governing Law................................................168
Section 11.07. Notices......................................................169
Section 11.08. Severability of Provisions...................................169
Section 11.09. Indulgences; No Waivers......................................169
Section 11.10. Headings Not To Affect Interpretation........................169
Section 11.11. Benefits of Agreement........................................169
Section 11.12. Special Notices to the Rating Agencies.......................170
Section 11.13. Conflicts....................................................170
Section 11.14. Counterparts.................................................170
Section 11.15. No Petitions.................................................171
Section 11.16. Indemnification by Trust.....................................171
ARTICLE XII EXCHANGE ACT REPORTING..........................................171
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Section 12.01. Filing Obligations...........................................171
Section 12.02. Form 10-D Reporting..........................................173
Section 12.03. Form 8-K Reporting...........................................174
Section 12.04. Form 10-K Reporting..........................................175
Section 12.05. Xxxxxxxx-Xxxxx Certification.................................177
Section 12.06. Reports on Assessment of Compliance and Attestation..........177
Section 12.07. Use of Subcontractors........................................178
Section 12.08. Indemnification by the Master Servicer and the
Securities Administrator.....................................179
Section 12.09. Indemnification by the Custodian.............................179
iv
ATTACHMENTS
Exhibit A Forms of Certificates
Exhibit B Form of Residual Certificate Transfer Affidavit (Transferee)
Exhibit C Form of Residual Certificate Transfer Affidavit (Transferor)
Exhibit D [Reserved]
Exhibit E List of Purchase and Servicing Agreements
Exhibit F List of Custodial Agreements
Exhibit G Assignment and Notice of Transfer with respect to each
Additional Collateral Mortgage Loan
Exhibit H Form of Rule 144A Transfer Certificate
Exhibit I Form of Purchaser's Letter for Institutional Accredited
Investors
Exhibit J Form of ERISA Transfer Affidavit
Exhibit K Form of Letter of Representations with the Depository Trust
Company
Exhibit L-1 Form of Initial Custodian Certification
Exhibit L-2 Form of Final Custodian Certification
Exhibit M Assignment and Notice of Transfer with respect to each
Additional Collateral Mortgage Loan
Exhibit N Additional Disclosure Required Under Regulation AB
Exhibit O Form of Servicing Criteria to be Addressed in Assessment of
Compliance Statement
Exhibit P Additional Disclosure Notification
Exhibit Q Glossary of Terms for Standard & Poor's LEVELS(R) Version 5.7
File Format
Exhibit R Form of Lost Note Affidavit
Schedule A Mortgage Loan Schedule
Schedule B Principal Balances Schedule
v
This POOLING AND SERVICING AGREEMENT, dated as of July 1, 2006 (the
"Agreement"), by and among XXXXXX XXXXXXX CAPITAL I INC., a Delaware
corporation, as depositor (the "Depositor"), LASALLE BANK NATIONAL
ASSOCIATION, a national banking association, as trustee (the "Trustee"), and
as a custodian (a "Custodian") and XXXXX FARGO BANK, NATIONAL ASSOCIATION, in
its separate capacities as master servicer (the "Master Servicer"), as
securities administrator (the "Securities Administrator") and, in its capacity
as Securities Administrator, as auction administrator (the "Auction
Administrator") and acknowledged by XXXXXX XXXXXXX MORTGAGE CAPITAL INC., a
New York corporation, as seller (the "Seller"), for purposes of Section 2.05.
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the parties
hereto agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby conveyed to
the Trustee in return for the Certificates. As provided herein, the Trustee
will make multiple elections to treat segregated pools of assets subject to
this Agreement for federal income tax purposes (other than the Additional
Collateral and the Group 1 Reserve Fund) as the following five separate real
estate mortgage investment conduits (each, a "REMIC"): REMIC 1A, REMIC 1B,
REMIC 2, REMIC 3 and the Master REMIC. REMIC 1A will consist of the Mortgage
Loans comprising Loan Group 1, excluding any rights of the Trust Fund in
respect of the Additional Collateral and the Group 1 Reserve Fund. REMIC 1B
will consist of the Mortgage Loans comprising Loan Groups 2 and 3 excluding
any rights of the Trust Fund in respect of the Additional Collateral. Each of
REMIC 1A and REMIC 1B will issue uncertificated REMIC regular interests (the
"REMIC 1A Regular Interests" and the "REMIC 1B Regular Interests",
respectively, and collectively, the "REMIC 1 Regular Interests"). The REMIC 1A
Regular Interests and REMIC 1B Regular Interests will represent the "regular
interests" in REMIC 1A and REMIC 1B, respectively, and the Class R1A Interest
and Class R1B Interest will represent the single Class of "residual interest"
in each of REMIC 1A and REMIC 1B.
The Trustee will hold the REMIC 1 Regular Interests for the benefit of
REMIC 2. REMIC 2 will consist of the REMIC 1 Interests and will be evidenced
by the REMIC 2 Regular Interests, which will constitute the regular interests
in REMIC 2 (the "REMIC 2 Regular Interests") and the Class R2 Interest, which
will represent the single Class of "residual interest" in REMIC 2.
The Trustee will hold the REMIC 2 Regular Interests for the benefit of
REMIC 3. REMIC 3 will consist of the REMIC 2 Interests and will be evidenced
by the REMIC 3 Regular Interests, which will constitute the regular interests
in REMIC 3 (the "REMIC 3 Regular Interests") and the Class R3 Interest, which
will represent the single Class of "residual interest" in REMIC 3.
The Trustee will hold the REMIC 3 Regular Interests for the benefit of
the Master REMIC. The Master REMIC will consist of the REMIC 3 Interests and
will be evidenced by the Certificates (other than the Class A-R Certificates),
which will constitute the regular interests in the Master REMIC (the "Regular
Certificates") and the Class MR Interest, which will represent the single
Class of "residual interest" in the Master REMIC. The Class A-R Certificates
will represent the beneficial ownership of each of the Class R1A, Class R1B,
Class R2, R3 and Class MR Interests. The "latest possible maturity date" for
federal income tax purposes of all regular and residual interests created
hereunder will be the Latest Possible Maturity Date.
REMIC 1A
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The REMIC 1A Interests, each of which (except for the Class R1A
Interests) is hereby designated as a REMIC regular interest for federal income
tax purposes, will have the principal balances, Pass-Through Rates and
Corresponding Master REMIC Certificates as set forth in the following table:
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REMIC 1A Interest Initial Principal Balance Interest Rate Corresponding Master REMIC
Certificate
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1A-1-A-1 (1) (2) Class 1-A-1
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1A-1-A-2 (1) (2) Class 1-A-2
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1A-1-A-3 (1) (2) Class 1-A-3
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1A-1-A-4 (1) (2) Class 1-A-4
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1A-1-A-5 (1) (2) Class 1-A-5
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1A-1-A-6 (1) (2) Class 1-A-6
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1A-1-M-1 (1) (2) Class 1-M-1
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1A-1-M-2 (1) (2) Class 1-M-2
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1A-1-M-3 (1) (2) Class 1-M-3
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1A-1-M-4 (1) (2) Class 1-M-4
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1A-1-M-5 (1) (2) Class 1-M-5
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1A-1-M-6 (1) (2) Class 1-M-6
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1A-1-B-1 (1) (2) Class 1-B-1
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1A-1-B-2 (1) (2) Class 1-B-2
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1A-1-B-3 (1) (2) Class 1-B-3
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1A-Accrual (1) N/A(2) N/A
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1A-P-1 $100 N/A(3) Class X-0
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X0X (4) N/A(4) N/A
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(1) For each Distribution Date, following the allocation of scheduled
principal, prepayments and Realized Losses: (i) each such Class of
Interests (other than the Class 1A-Accrual Interest) will have a
principal balance equal to 50% of the principal balance in respect of
the Corresponding Class of Certificates, (ii) the Class 1A-Accrual
Interests will have a principal balance equal to 50% of the principal
balance of Mortgage Loans plus 50% of the Overcollateralized Amount.
2
(2) The interest rate with respect to any Distribution Date (and the
related Interest Accrual Period) for this REMIC Interest is a per annum
rate equal to the Net WAC Pass-Through Rate.
(3) The Class 1A-P-1 Interest will not be entitled to any interest, but
will be entitled to 100% of any prepayment premiums paid on the Group 1
Mortgage Loans.
(4) The R1A Interest is the sole Class of residual interest in REMIC 1A.
It pays no interest or principal.
REMIC 1B
--------
Except as provided below, REMIC 1B will issue a single regular
interest corresponding to each Mortgage Loan in Collateral Allocation Group 2,
Collateral Allocation Group 3, Collateral Allocation Group 4A and Collateral
Allocation Group 4B having a Net Mortgage Rate equal to that of its
corresponding Mortgage Loan and allocated principal, interest and Realized
Losses in the same manner as such items are allocated to their corresponding
Mortgage Loans.
REMIC 1B will issue a single regular interest corresponding to
each Mortgage Loan in Loan Group 2 and Loan Group 3 having a Net Mortgage Rate
less than or equal to 6.00%, two regular interests (referred to collectively
herein as the "Class 1-A Interests" and the "Class 1-B Interests") for each
Mortgage Loan in Loan Group 2 and Loan Group 3 having a Net Mortgage Rate
greater than 6.00%.
Each REMIC 1B Regular Interest corresponding to a Mortgage Loan in
Loan Group 2 and Loan Group 3 having a Net Mortgage Rate less than or equal to
6.00% will have a Pass Through Rate of 6.00% and a principal balance,
following the allocation of scheduled principal, prepayments of principal and
Realized Losses, equal to the product of: (i) the Non-A-P Percentage of the
related Mortgage Loan and (ii) the related Mortgage Loan's principal balance.
For purposes of the calculating the Calculation Rate, each of the foregoing
REMIC 1B Regular Interests relating to a Group 2 Mortgage Loan will be treated
as part of Collateral Allocation Group 2 and each of the foregoing REMIC 1B
Regular Interests relating to a Group 3 Mortgage Loan will be treated as part
of Collateral Allocation Group 3.
Each of the Class 1-A Interests relating to a Mortgage Loan in
Loan Group 2 and Loan Group 3 having a Net Mortgage Rate that exceeds 6.00%
will have a Pass Through Rate of 6.00% and a principal balance, following the
allocation of scheduled principal, prepayments of principal and Realized
Losses, equal to the product of: (i) 7.50% minus the Net Mortgage Rate in
respect of the related Mortgage Loan, divided by 1.50%, and (ii) the related
Mortgage Loan's principal balance. For purposes of the calculating the
Calculation Rate, each Class 1-A Interest relating to a Group 2 Mortgage Loan
will be treated as part of Collateral Allocation Group 2 and each Class 1-A
Interest relating to a Group 3 Mortgage Loan will be treated as part of
Collateral Allocation Group 3.
Each of the Class 1-B Interests relating to a Mortgage Loan in
Loan Group 1 having a Net Mortgage Rate that exceeds 6.00% will have a Pass
Through Rate of 7.50% and a principal balance, following the allocation of
scheduled principal, prepayments of principal and
3
Realized Losses, equal to the product of: (i) the Net Mortgage Rate in respect
of the related Mortgage Loan minus 6.00%, divided by 1.50%, and (ii) the
related Mortgage Loan's principal balance. For purposes of the calculating the
Calculation Rate, each Class 1-B Interest relating to a Group 2 Mortgage Loan
will be treated as part of Collateral Allocation Group 2 and each Class 1-B
Interest relating to a Group 4A Mortgage Loan will be treated as part of
Collateral Allocation Group 4B.
REMIC 1B also will issue the Class 1B-2-A-P Interest, Class
1B-3-A-P Interest, Class 1B-P-2 Interest and the Class R-1B Interest. The
Class 1B-2-A-P and 1B-3-A-P Interests will have principal balances, following
the allocation of scheduled principal, prepayments of principal and Realized
Losses, equal to the principal balances in respect of the Class 2-A-P and
3-A-P Certificates, respectively, and will not be entitled to receive
distributions of interest. The Class 1B-P-2 Interest will not be entitled to
any interest, but will be entitled to 100% of any prepayment premiums paid on
the Collateral Allocation Group 2, Collateral Allocation Group 3, Collateral
Allocation Group 4A and Collateral Allocation Group 4B Mortgage Loans. The
Class R-1B Interest is the residual interest and will not be entitled to any
distributions of interest or principal.
REMIC 2
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The REMIC 2 Interests, each of which (except for the Class R2 Interests)
is hereby designated as a REMIC regular interest for federal income tax
purposes, will have the principal balances, Pass-Through Rates and
Corresponding collateral allocation groups as set forth in the following
table:
Corresponding Corresponding
Initial Pass- Collateral Master
Principal Through Allocation REMIC
REMIC 2 Interests Balance Rate Group Class
----------------- ------- ----
2-1-A-1 (1) (1) N/A 1-A-1
2-1-A-2 (1) (1) N/A 1-A-2
2-1-A-3 (1) (1) N/A 1-A-3
2-1-A-4 (1) (1) N/A 1-A-4
2-1-A-5 (1) (1) N/A 1-A-5
2-1-A-6 (1) (1) N/A 1-A-6
2-1-M-1 (1) (1) N/A 1-M-1
2-1-M-2 (1) (1) N/A 1-M-2
2-1-M-3 (1) (1) N/A 1-M-3
2-1-M-4 (1) (1) N/A 1-M-4
2-1-M-5 (1) (1) N/A 1-M-5
2-1-M-6 (1) (1) N/A 1-M-6
2-1-B-1 (1) (1) N/A 1-B-1
2-1-B-2 (1) (1) N/A 1-B-2
2-1-B-3 (1) (1) N/A 1-B-3
2-OC (2) (2) N/A OC
2-A-2 (0.9% of the Subordinated Portion of N/A
Collateral Allocation Group 2) (3) 6.00% 2
4
2-B-2 (0.1% of the Subordinated Portion of N/A
Collateral Allocation Group 2) (3) 6.00% 2
N/A
2-C-2 (Excess of Collateral Allocation Group 2) (3) 6.00% 2
2-2-A-P (4) 0.00% 2 N/A
2-A-3 (0.9% of the Subordinated Portion of N/A
Collateral Allocation Group 3) (3) 6.00% 3
2-B-3 (0.1% of the Subordinated Portion of N/A
Collateral Allocation Group 3) (3) 6.00% 3
N/A
2-C-3 (Excess of Collateral Allocation Group 3) (3) 6.00% 3
2-3-A-P (4) 0.00% 3 N/A
2-A-4A (0.9% of the Subordinated Portion of N/A
Collateral Allocation Group 4A) (3) 7.50% 4A
2-B-4A (0.1% of the Subordinated Portion of N/A
Collateral Allocation Group 4A) (3) 7.50% 4A
N/A
2-C-4A (Excess of Collateral Allocation Group 4A) (3) 7.50% 4A
2-A-4B (0.9% of the Subordinated Portion of N/A
Collateral Allocation Group 4B) (3) 7.50% 4B
2-B-4B (0.1% of the Subordinated Portion of N/A
Collateral Allocation Group 4B) (3) 7.50% 4B
2-C-4B (Excess of Collateral Allocation Group 4B) (3) 7.50% 4B N/A
2-P-1 $100 (5) N/A N/A
2-P-2 $100 (5) N/A N/A
2-$100 $100 6.00% 2 A-R
R2 (6) (6) N/A N/A
---------------
(1) For each Distribution Date, each such Class will have the principal
balance and Pass Through Rate in respect of its Corresponding Master
REMIC Class.
(2) For each Interest Accrual Period the Class 2-OC Interests will accrue a
specified portion of the interest on the Group 1 Mortgage Loans equal
to the excess of the Net WAC Pass-Through Rate of the Group 1 Mortgage
Loans over the product of two and the weighted average interest rate of
the REMIC 1A Regular Interests having "(1)" designated in the column
entitled "Initial Principal Balance" with each such Class other than
the Class 1A-Accrual Interest subject to a cap equal to the
Pass-Through Rate of the corresponding Master REMIC class and the
1A-Accrual Interest subject to a cap of 0.00%.
(3) Each Class A Interest will have a principal balance initially equal to
0.9% of the Subordinated Portion of its corresponding Collateral
Allocation Group. Each Class B
5
Interest will have a principal balance initially equal to 0.1% of
the Subordinated Portion of its corresponding Collateral
Allocation Group. The initial principal balance of each Class C
Interest will equal the excess of the initial aggregate principal
balance of its corresponding Collateral Allocation Group over the
initial aggregate principal balances of the Class A and Class B
Interests (and of the Class 2-2-A-P, Class 2-3-A-P and Class
2-$100 Interests, in the case of the Class 2-C-2 and Class 2-C-3
Interests, respectively) corresponding to such Collateral
Allocation Group.
(4) For each Distribution Date, the principal balance of the Class 2-2-A-P
Interests and Class 2-3-A-P Interests will equal the principal balances
in respect of the Class 2-A-P and Class 3-A-P Certificates,
respectively.
(5) The Class 2-P-1 and Class 2-P-2 Interests will not bear interest. The
Class 2-P-1 will be entitled to all Prepayment Charges collected in
respect of the Group 1 Mortgage Loans. The Class 2-P-2 will be entitled
to all Prepayment Charges collected in respect of the Aggregate Loan
Group II Mortgage Loans.
(6) The Class R2 Interest is the sole class of residual interest in REMIC
2. It has no principal balance and pays no principal or interest.
On each Distribution Date, the Available Funds from Collateral
Allocation Groups 2, 3, 4A, and 4B shall be distributed with respect to the
REMIC 2 Interests in the following manner:
(1) Interest is to be distributed with respect to each REMIC 2 Interest
according to the formulas described above;
(2) Principal Amounts and Realized Losses will be allocated to make the Class
2-P-1, Class 2-P-2 and Class 2-$100 balance equal to the principal balances of
the Class P-1, Class P-2 and Class A-R Certificates, respectively, for such
Distribution Date.
(3) If Cross-Over Situation does not exist with respect to any Class of
Interests, then Principal Amounts and Realized Losses arising with respect to
each Collateral Allocation Group will be allocated: first to cause the
Collateral Allocation Group's corresponding Class A and Class B to equal,
respectively, 0.9% of the Subordinated Portion and 0.1% of the Subordinated
Portion; and second to the Collateral Allocation Group's corresponding Class C
Interest;
(4) If a Cross-Over Situation exists with respect to the Class A and Class B
Interests then:
(a) if the Calculation Rate in respect of the outstanding Class A and
Class B Interests is less than the Pass-Through Rate for the Aggregate
Group II Subordinate Certificates, Principal Relocation Payments will be
made proportionately to the outstanding Class A Interests prior to any
other distributions of principal from each such Collateral Allocation
Group; and
(b) if the Calculation Rate in respect of the outstanding Class A and
Class B Interests is greater than the Pass-Through Rate for the
Aggregate Group II Subordinate Certificates, Principal Relocation
Payments will be made proportionately to the outstanding Class B
6
Interests prior to any other distributions of principal from each such
Collateral Allocation Group.
In case of either (a) or (b), Principal Relocation Payments will be made so as
to cause the Calculation Rate in respect of the outstanding Class A and Class B
Interests to equal the Pass-Through Rate for the Aggregate Group II Subordinate
Certificates. With respect to each Collateral Allocation Group, if (and to the
extent that) the sum of (a) the principal payments comprising the Principal
Amount received during the Due Period and (b) the Realized Losses on the
Mortgage Loans in that Collateral Allocation Group, are insufficient to make the
necessary reductions of principal on the Class A and Class B Interests, then
interest will be added to the Collateral Allocation Group's other REMIC 2
Interests that are not receiving Principal Relocation Payments, in proportion to
their principal balances.
(c) The outstanding aggregate Class A and Class B Interests for all
Collateral Allocation Groups will not be reduced below 1% of the excess
of (i) the aggregate Stated Principal Balances of the Mortgage Loans as
of the end of any Due Period over (ii) the Certificate Balance of the
Senior Certificates (excluding the Class A-R Certificates) for all
Certificate Groups as of the related Distribution Date (after taking
into account distributions of principal on such Distribution Date).
If (and to the extent that) the limitation in paragraph (c) prevents the
distribution of principal to the Class A and Class B Interests of a Collateral
Allocation Group, and if the Collateral Allocation Group's Class C Interest has
already been reduced to zero, then the excess principal from that Collateral
Allocation Group will be paid to the Class C Interests of the other Collateral
Allocation Group, the aggregate Class A and Class B Interests of which are less
than 1% of the Subordinated Portion. If Class 2-C-2 or Class 2-C-3 Interests
receive such a payment, then the payment will be treated by REMIC 2 as a
Realized Loss. Conversely, if the Class 2-C-4A or Class 2-C-4B Interest receive
such a payment, then the payment will be treated by REMIC 2 as a reimbursement
for prior Realized Losses.
REMIC 3
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The REMIC 3 Interests, each of which (except for the Class R3 Interests)
is hereby designated as a REMIC regular interest for federal income tax
purposes, will have the principal balances, Pass-Through Rates and
Corresponding Master REMIC Certificates as set forth in the following
table:
=======================================================================================================
Pass-Through
Class Principal Rate Corresponding Master
Class Designation Balance (per annum) REMIC Class
-------------------------------------------------------------------------------------------------------
Class 3-1-A-1 (1) (2) Class 1-A-1
-------------------------------------------------------------------------------------------------------
Class 3-1-A-2 (1) (2) Class 1-A-2
-------------------------------------------------------------------------------------------------------
Class 3-1-A-3 (1) (2) Class 1-A-3
-------------------------------------------------------------------------------------------------------
Class 3-1-A-4 (1) (2) Class 1-A-4
-------------------------------------------------------------------------------------------------------
Class 3-1-A-5 (1) (2) Class 1-A-5
-------------------------------------------------------------------------------------------------------
Class 3-1-A-6 (1) (2) Class 1-A-6
-------------------------------------------------------------------------------------------------------
Class 3-1-M-1 (1) (2) Class 1-M-1
-------------------------------------------------------------------------------------------------------
7
Class 3-1-M-2 (1) (2) Class 1-M-2
-------------------------------------------------------------------------------------------------------
Class 3-1-M-3 (1) (2) Class 1-M-3
-------------------------------------------------------------------------------------------------------
Class 3-1-M-4 (1) (2) Class 1-M-4
-------------------------------------------------------------------------------------------------------
Class 3-1-M-5 (1) (2) Class 1-M-5
-------------------------------------------------------------------------------------------------------
Class 3-1-M-6 (1) (2) Class 1-M-6
-------------------------------------------------------------------------------------------------------
Class 3-1-B-1 (1) (2) Class 1-B-1
-------------------------------------------------------------------------------------------------------
Class 3-1-B-2 (1) (2) Class 1-B-2
-------------------------------------------------------------------------------------------------------
Class 3-1-B-3 (1) (2) Class 1-B-3
-------------------------------------------------------------------------------------------------------
Class 3-OC (1) (3) Class OC
-------------------------------------------------------------------------------------------------------
Class 3-2-A-1 (1) 6.00000% Class 2-A-1
-------------------------------------------------------------------------------------------------------
Class 3-2-A-2 (1) 6.00000% Class 2-A-2
-------------------------------------------------------------------------------------------------------
Class 3-2-A-3 (1) 6.00000% Class 2-A-3
-------------------------------------------------------------------------------------------------------
Class 3-2-A-4 (1) 6.00000% Class 2-A-4
-------------------------------------------------------------------------------------------------------
Class 3-2-A-P (1) 0.00000% Class 2-A-P
-------------------------------------------------------------------------------------------------------
Class 3-3-A-1 (1) 6.00000% Class 3-A-1
-------------------------------------------------------------------------------------------------------
Class 3-3-A-2 (1) 6.00000% Class 3-A-2
-------------------------------------------------------------------------------------------------------
Class 3-3-A-3 (1) 6.00000% Class 3-A-3
-------------------------------------------------------------------------------------------------------
Class 3-3-A-4 (1) 6.00000% Class 3-A-4
-------------------------------------------------------------------------------------------------------
Class 3-3-A-P (1) 0.00000% Class 3-A-P
-------------------------------------------------------------------------------------------------------
Class 3-4-A-1 (1) 7.50000% Class 4-A-1, 4-A-2
-------------------------------------------------------------------------------------------------------
Class 3-$100(12) (1) 6.00000% Class A-R
-------------------------------------------------------------------------------------------------------
Class 3-B-1 (1) (2) Class B-1
-------------------------------------------------------------------------------------------------------
Class 3-B-2 (1) (2) Class B-2
-------------------------------------------------------------------------------------------------------
Class 3-B-3 (1) (2) Class B-3
-------------------------------------------------------------------------------------------------------
Class 3-B-4 (1) (2) Class B-4
-------------------------------------------------------------------------------------------------------
Class 3-B-5 (1) (2) Class B-5
-------------------------------------------------------------------------------------------------------
Class 3-B-6 (1) (2) Class B-6
-------------------------------------------------------------------------------------------------------
Class 3-P-1 (1) (4) Class P-1
-------------------------------------------------------------------------------------------------------
Class 3-P-2 (1) (4) Class P-2
-------------------------------------------------------------------------------------------------------
R3 (5) (5) N/A
=======================================================================================================
------------------------------------------
(1) For each Distribution Date, the actual or notional principal balance,
as applicable, of the Corresponding Master REMIC Class.
(2) For each Distribution Date, the pass through rate of the Corresponding
Master REMIC Class.
(3) For each Distribution Date, the Class 3-OC Interests will be entitled
to all interest accruals and principal payments made in respect of the
Class 2-OC Interests.
(4) The Class 3-P-1 and Class 3-P-2 Interests will not bear interest. The
Class 3-P-1 will be entitled to all Prepayment Charges collected in
respect of the Group 1 Mortgage Loans. The Class 3-P-2 will be entitled
to all Prepayment Charges collected in respect of the Aggregate Loan
Group II Mortgage Loans.
8
(5) The Class R-3 Interest is the sole class of residual interest in REMIC
2. It has no principal balance and pays no principal
or interest.
The Master REMIC
The following table sets forth characteristics of the Master REMIC
Certificates, together with the minimum denominations and integral multiples
in excess thereof in which such Classes shall be issuable (except that one
Certificate of each Class of Certificates may be issued in a different amount
and, in addition, one Residual Certificate representing the Tax Matters Person
Certificate may be issued in a different amount):
=======================================================================================================================
Integral
Pass-Through Multiples
Initial Class Rate Minimum in Excess
Class Designation Principal Balance (per annum) Denomination Minimum
-----------------------------------------------------------------------------------------------------------------------
Class 1-A-1 $127,038,000.00 (1) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-A-2 $92,113,000.00 (2) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-A-3 $14,624,000.00 (3) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-A-4 $34,923,000.00 (4) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-A-5 $3,880,000.00 (5) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-A-6 $30,286,000.00 (6) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 2-A-1 $117,190,000.00 6.00000% $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 2-A-2 $17,796,000.00 6.00000% $1,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 2-A-3 $9,875,000.00 6.00000% $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 2-A-4 $7,625,000.00 6.00000% $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 2-A-P $1,354,872.00 (7) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 3-A-1 $89,081,000.00 6.00000% $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 3-A-2 $12,396,000.00 6.00000% $1,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 3-A-3 $7,429,000.00 6.00000% $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 3-A-4 $5,732,000.00 6.00000% $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 3-A-P $1,339,700.00 (7) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 4-A-1 $69,392,000.00 (8) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 4-A-2 Notional (9) (10) $100,000.00(11) $1,000.00(11)
---------------------------------------------------------------------------------------------------------------------
Class A-R (12) $100.00 6.00000% (13) (13)
---------------------------------------------------------------------------------------------------------------------
Class 1-M-1 $5,042,000.00 (14) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-M-2 $2,927,000.00 (15) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-M-3 $2,114,000.00 (16) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-M-4 $1,626,000.00 (17) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-M-5 $1,301,000.00 (18) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-M-6 $1,138,000.00 (19) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-B-1 $1,138,000.00 (20) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-B-2 $1,138,000.00 (21) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class 1-B-3 $1,626,000.00 (22) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class B-1 $6,427,000.00 (23) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class B-2 $4,106,000.00 (23) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class B-3 $2,321,000.00 (23) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
9
Class B-4 $2,143,000.00 (23) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class B-5 $1,606,000.00 (23) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class B-6 $1,250,686.13 (23) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------
Class P-1 $1,000.00 (24) $1,000.00 N/A
---------------------------------------------------------------------------------------------------------------------
Class P-2 $1,000.00 (24) $1,000.00 N/A
---------------------------------------------------------------------------------------------------------------------
Class OC (25) (25) (26) (26)
=====================================================================================================================
------------------------------------------
(1) The Pass-Through Rate for the Class 1-A-1 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to the least of (i) one-month LIBOR + 0.10000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. The Pass-Through Rate for the
Class 1-A-1 Certificates for the first Interest Accrual Period will be a
per annum rate of 5.50000%.
(2) The Pass-Through Rate for the Class 1-A-2 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to the lesser of (i) 6.35400% and (ii) the Net WAC Pass-Through
Rate. The Pass-Through Rate for the Class 1-A-2 Certificates for the
first Interest Accrual Period will be a per annum rate of 6.35400%.
(3) The Pass-Through Rate for the Class 1-A-3 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
lesser of (i) 6.42400% and (ii) the Net WAC Pass-Through Rate. Beginning
with the Interest Accrual Period related to the Distribution Date
immediately following the first related Optional Termination Date, the
Pass-Through Rate for the Class 1-A-3 Certificates will be a per annum
rate equal to the lesser of (i) 6.92400% and (ii) the Net WAC
Pass-Through Rate. The Pass-Through Rate for the Class 1-A-3
Certificates for the first Interest Accrual Period will be a per annum
rate of 6.42400%.
(4) The Pass-Through Rate for the Class 1-A-4 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
lesser of (i) 6.51300% and (ii) the Net WAC Pass-Through Rate. Beginning
with the Interest Accrual Period related to the Distribution Date
immediately following the first related Optional Termination Date, the
Pass-Through Rate for the Class 1-A-4 Certificates will be a per annum
rate equal to the lesser of (i) 7.01300% and (ii) the Net WAC
Pass-Through Rate. The Pass-Through Rate for the Class 1-A-4
Certificates for the first Interest Accrual Period will be a per annum
rate of 6.51300%.
(5) The Pass-Through Rate for the Class 1-A-5 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
lesser of (i) 6.63100% and (ii) the Net WAC Pass-Through Rate. Beginning
with the Interest Accrual Period related to the Distribution Date
immediately following the first related Optional Termination Date, the
Pass-Through Rate for the Class 1-A-5 Certificates will be a per annum
rate equal to the lesser of (i) 7.13100% and (ii) the Net WAC
Pass-Through Rate. The Pass-Through Rate for
10
the Class 1-A-5 Certificates for the first Interest Accrual Period will
be a per annum rate of 6.63100%.
(6) The Pass-Through Rate for the Class 1-A-6 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
lesser of (i) 6.23100% and (ii) the Net WAC Pass-Through Rate. Beginning
with the Interest Accrual Period related to the Distribution Date
immediately following the first related Optional Termination Date, the
Pass-Through Rate for the Class 1-A-6 Certificates will be a per annum
rate equal to the lesser of (i) 6.7310% and (ii) the Net WAC
Pass-Through Rate. The Pass-Through Rate for the Class 1-A-6c
Certificates for the first Interest Accrual Period will be a per annum
rate of 6.23100%.
(7) The Class 2-A-P and Class 3-A-P Certificates are principal only
certificates and are not entitled to receive any distributions of
interest.
(8) The Pass-Through Rate for the Class 4-A-1 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to the sum of one-month LIBOR plus 0.42000%, subject to a maximum
per annum rate of 7.50000% and a minimum rate of 0.42000%. The
Pass-Through Rate for the Class 4-A-1 Certificates for the first
Interest Accrual Period will be a per annum rate of 5.80500%.
(9) The Class 4-A-2 Certificates will be Notional Amount Certificates with
no Class Principal Balance and will bear interest on its Notional Amount
(initially, $69,392,000).
(10) The Pass-Through Rate for the Class 4-A-2 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to 7.08000% minus one-month LIBOR, subject to a maximum per annum
rate of 7.08000% and a minimum rate of 0.00000%. The Pass-Through Rate
for the Class 4-A-2 Certificates for the first Interest Accrual Period
will be a per annum rate of 1.69500%.
(11) Minimum denomination is based on the Notional Amount of such Class.
(12) The Class A-R Certificates represent the sole Class of residual interest
in each REMIC.
(13) The Class A-R Certificate shall be issued as two separate certificates,
one with an initial Certificate Balance of $99.99 and the Tax Matters
Person Certificate with an initial Certificate Balance of $0.01.
(14) The Pass-Through Rate for the Class 1-M-1 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 0.32000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.000%. Beginning with the Interest Accrual
Period related to the Distribution Date immediately following the first
related Optional Termination Date, the Pass-Through Rate for the Class
1-M-1 Certificates will be a per annum rate equal to the least of (i)
one-month LIBOR plus 0.48%, (ii) the Net WAC Pass-Through Rate and (iii)
11.000%. The Pass-Through Rate for the Class 1-A-1 Certificates for the
first Interest Accrual Period will be a per annum rate of 5.72000%.
11
(15) The Pass-Through Rate for the Class 1-M-2 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 0.34000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. Beginning with the Interest
Accrual Period related to the Distribution Date immediately following
the first related Optional Termination Date, the Pass-Through Rate for
the Class 1-M-2 Certificates will be a per annum rate equal to the least
of (i) one-month LIBOR plus 0.51000%, (ii) the Net WAC Pass-Through Rate
and (iii) 11.00000%. The Pass-Through Rate for the Class 1-A-1
Certificates for the first Interest Accrual Period will be a per annum
rate of 5.74000%.
(16) The Pass-Through Rate for the Class 1-M-3 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 0.36000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. Beginning with the Interest
Accrual Period related to the Distribution Date immediately following
the first related Optional Termination Date, the Pass-Through Rate for
the Class 1-M-3 Certificates will be a per annum rate equal to the least
of (i) one-month LIBOR plus 0.54000%, (ii) the Net WAC Pass-Through Rate
and (iii) 11.00000%. The Pass-Through Rate for the Class 1-A-1
Certificates for the first Interest Accrual Period will be a per annum
rate of 5.76000%.
(17) The Pass-Through Rate for the Class 1-M-4 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 0.42000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. Beginning with the Interest
Accrual Period related to the Distribution Date immediately following
the first related Optional Termination Date, the Pass-Through Rate for
the Class 1-M-4 Certificates will be a per annum rate equal to the least
of (i) one-month LIBOR plus 0.63000%, (ii) the Net WAC Pass-Through Rate
and (iii) 11.00000%. The Pass-Through Rate for the Class 1-A-1
Certificates for the first Interest Accrual Period will be a per annum
rate of 5.82000%.
(18) The Pass-Through Rate for the Class 1-M-5 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 0.44000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. Beginning with the Interest
Accrual Period related to the Distribution Date immediately following
the first related Optional Termination Date, the Pass-Through Rate for
the Class 1-M-5 Certificates will be a per annum rate equal to the least
of (i) one-month LIBOR plus 0.66000%, (ii) the Net WAC Pass-Through Rate
and (iii) 11.00000%. The Pass-Through Rate for the Class 1-A-1
Certificates for the first Interest Accrual Period will be a per annum
rate of 5.84000%.
(19) The Pass-Through Rate for the Class 1-M-6 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 0.50000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. Beginning with the Interest
Accrual Period related to the Distribution Date immediately following
the first related Optional Termination Date, the Pass-Through Rate for
the Class 1-M-6 Certificates will be a per annum rate equal to the least
of (i) one-month LIBOR plus 0.75000%, (ii)
12
the Net WAC Pass-Through Rate and (iii) 11.00000%. The Pass-Through Rate
for the Class 1-A-1 Certificates for the first Interest Accrual Period
will be a per annum rate of 5.90000%.
(20) The Pass-Through Rate for the Class 1-B-1 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 1.10%, (ii) the Net WAC Pass-Through
Rate and (iii) 11.000%. Beginning with the Interest Accrual Period
related to the Distribution Date immediately following the first related
Optional Termination Date, the Pass-Through Rate for the Class 1-B-1
Certificates will be a per annum rate equal to the least of (i)
one-month LIBOR plus 1.65%, (ii) the Net WAC Pass-Through Rate and (iii)
11.000%. The Pass-Through Rate for the Class 1-A-1 Certificates for the
first Interest Accrual Period will be a per annum rate of 6.50000%.
(21) The Pass-Through Rate for the Class 1-B-2 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 1.30000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. Beginning with the Interest
Accrual Period related to the Distribution Date immediately following
the first related Optional Termination Date, the Pass-Through Rate for
the Class 1-B-2 Certificates will be a per annum rate equal to the least
of (i) one-month LIBOR plus 1.95000%, (ii) the Net WAC Pass-Through Rate
and (iii) 11.00000%. The Pass-Through Rate for the Class 1-A-1
Certificates for the first Interest Accrual Period will be a per annum
rate of 6.70000%.
(22) The Pass-Through Rate for the Class 1-B-3 Certificates for the Interest
Accrual Period related to any Distribution Date on or prior to the first
related Optional Termination Date will be a per annum rate equal to the
least of (i) one-month LIBOR plus 1.30000%, (ii) the Net WAC
Pass-Through Rate and (iii) 11.00000%. Beginning with the Interest
Accrual Period related to the Distribution Date immediately following
the first related Optional Termination Date, the Pass-Through Rate for
the Class 1-B-3 Certificates will be a per annum rate equal to the least
of (i) one-month LIBOR plus 1.95000%, (ii) the Net WAC Pass-Through Rate
and (iii) 11.00000%. The Pass-Through Rate for the Class 1-A-1
Certificates for the first Interest Accrual Period will be a per annum
rate of 6.70000%.
(23) The Pass-Through Rate for the Class B-1, Class B-2, Class B-3, Class
B-4, Class B-5 and Class B-6 Certificates for any Distribution Date will
be a per annum rate equal to the sum of: (1) 6.00000% multiplied by the
excess of the aggregate Stated Principal Balance of the Collateral
Allocation Group 2 Mortgage Loans as of the Due Date in the month
preceding the month of that Distribution Date (after giving effect to
prepayments received in the Prepayment Period related to such prior Due
Date) over the Principal Balance of the Group 2 Senior P&I Portion
immediately prior to that Distribution Date,
13
(2) 6.00000% multiplied by the excess of the aggregate Stated Principal
Balance of the Collateral Allocation Group 3 Mortgage Loans as of the
due date in the month preceding the month of that Distribution Date
(after giving effect to prepayments received in the Prepayment Period
related to such prior Due Date) over the Principal Balance of Group 3
Senior P&I Portion immediately prior to that Distribution Date, (3)
7.50000% multiplied by the excess of the aggregate Stated Principal
Balance of the Collateral Allocation Group 4A Mortgage Loans as of the
Due Date in the month preceding the month of that Distribution Date
(after giving effect to prepayments received in the Prepayment Period
related to such prior Due Date) over the Principal Balance of the Group
0X Xxxxxx X&X Portion immediately prior to that Distribution Date, and
(4) 7.50000% multiplied by the excess of the aggregate Stated Principal
Balance of the Collateral Allocation Group 4B Mortgage Loans as of the
Due Date in the month preceding the month of that Distribution Date
(after giving effect to prepayments received in the Prepayment Period
related to such prior Due Date) over the Principal Balance of the Group
4B Senior P&I Portion immediately prior to that Distribution Date;
divided by the aggregate of the Class Principal Balances of the Class
B-1, Class B-2, Class B-3, Class B-4, Class B-5 and Class B-6
Certificates immediately prior to that Distribution Date. The
Pass-Through Rate for the Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates for the first Distribution Date
will be a per annum rate of 6.30688%.
(24) The Class P-1 and Class P-2 Certificates will not be entitled to any
interest, but will be entitled to 100% of any prepayment premiums paid
on the Group 1 Mortgage Loans and the Aggregate Group II Mortgage Loans,
respectively. For the federal income tax purposes, the Class P-1 and
Class P-2 Certificates will be entitled to 100% of the cash flow in
respect of the Class 2-P-1 Interest and Class 2-P-2 Interests,
respectively.
(25) For each Distribution Date, the Class OC Certificates will be entitled
to all interest accruals and principal payments made in respect of the
Class 3-OC Interests. The Pass-Through Rate of the Class OC Certificates
shall be a rate sufficient to entitle it to all interest accrued on the
Collateral Allocation Group 1 Mortgage Loans, less the interest accrued
on the other interests issued by the Master REMIC related to Collateral
Allocation Group 1. The Class OC Distributable Amount for any
Distribution Date is payable from current interest on the Collateral
Allocation Group 1 Mortgage Loans and any OC Release Amount for that
Distribution Date. The Class OC Certificates will represent beneficial
ownership of a regular interest issued by the Master REMIC, subject to
the obligation to make payments in respect of Basis Risk Carry Forward
Amounts to the Group 1 Certificates. For federal income tax purposes,
the Class OC Certificateholders' obligation to make payments of Basis
Risk Carry Forward Amounts to the Group 1 Certificates will be treated
as payments made pursuant to an interest rate cap contract written by
the Class OC Certificateholders in favor of Group 1 Certificates.
(26) The Class OC Certificates will be issued as a single Class of
Certificates.
The foregoing provisions in the Preliminary Statement are intended to
cause net interest and principal collections in respect of the Mortgage Loans
to be distributed from each of REMIC 1B and REMIC 1B to REMIC 2, from REMIC 2
to the Master REMIC and from the Master
14
REMIC to each Class of Certificates. The Preliminary Statement will be
interpreted and applied consistently with such intent.
For any purpose for which the Pass-Through Rate is calculated, the
interest rate on the Mortgage Loans shall be appropriately adjusted to account
for the difference between the monthly day count convention of the Mortgage
Loans and the monthly day count convention of the regular interests issued by
each of the REMICs. For purposes of calculating the Pass-Through Rates for
each of the interests issued by each REMIC other than the Master REMIC such
rates shall be adjusted to equal a monthly day count convention based on a 30
day month for each Due Period and a 360-day year so that the Mortgage Loans
and all regular interests will be using the same monthly day count convention.
The fiscal year of each REMIC will end on December 31.
15
Set forth below are designations of Classes or Components of Certificates and
other defined terms to the categories used herein:
Accretion Directed Certificates..... None.
Accretion Directed Components....... None.
Accrual Certificates................ None.
Accrual Components.................. None.
Aggregate Certificate Group......... Group 1 Certificates and the Aggregate
Group II Certificates.
Aggregate Group II Certificates..... The Aggregate Group II Senior Certificates
and the Aggregate Group II Subordinated
Certificates.
Aggregate Group II Senior The Group 2 Senior Certificates, the Group
Certificates........................ 3 Senior Certificates and the Group 4
Senior Certificates.
Aggregate Group II Subordinated Class B-1, Class B-2, Class B-3, Class
Certificates........................ B-4, Class B-5 and Class B-6
Certificates.
Book-Entry Certificates............. All Classes of Certificates other than the
Definitive Certificates.
Class 1-B Certificates.............. Class 1-B-1, Class 1-B-2 and Class 1-B-3
Certificates.
Class 1-M Certificates.............. Class 1-M-1, Class 1-M-2, Class 1-M-3,
Class 1-M-4, Class 1-M-5 and Class 1-M-6
Certificates.
Class 1-M Senior Certificates....... Class 1-M-1, Class 1-M-2 and Class 1-M-3
Certificates.
Class A-P Certificates.............. Class 2-A-P and Class 3-A-P Certificates.
Component Certificates.............. None.
Components.......................... For purposes of calculating distributions
of principal and/or interest, the
Component Certificates, if any, will be
comprised of multiple payment components
having the designations, Initial Component
Balances or Notional Amounts, as
applicable, and Pass-Through Rates set
forth below:
Initial Component
Destination Principal Balance Pass-Through Rate
----------- ----------------- -----------------
N/A N/A N/A
16
Definitive Certificates............. Private Certificates and the Residual
Certificates.
Delay Certificates.................. All interest-bearing Classes of
Certificates other than the Non-Delay
Certificates, if any.
ERISA-Restricted Certificates....... The Residual Certificates and Private
Certificates; and any Certificate of a
Class that ceases to satisfy the
applicable rating requirement under the
Underwriter's Exemption.
Floating Rate Certificates Group 1 LIBOR Certificates and Class 4-A-1
Certificates.
Group 1 Certificates................ Group 1 Senior Certificates and Group 1
Subordinated Certificates.
Group 1 LIBOR Certificates.......... Class 1-A-1 Certificates and the Group 1
Subordinated Certificates.
Group 1 Senior Certificates......... Class 1-A-1, Class 1-A-2, Class 1-A-3,
Class 1-A-4, Class 1-A-5 and Class 1-A-6
Certificates.
Group 1 Subordinated Certificates... Class 1-M-1, Class 1-M-2, Class 1-M-3,
Class 1-M-4, Class 1-M-5, Class 1-M-6,
Class 1-B-1, Class 1-B-2 and Class 1-B-3
Certificates.
Group 2 Senior Certificates......... Class 2-A-1, Class 2-A-2, Class 2-A-3,
Class 2-A-4, Class 2-A-P and Class A-R
Certificates.
Group 2 Certificates................ Group 2 Senior Certificates and the
portions of the Aggregate Group II
Subordinated Certificates related to
Collateral Allocation Group 2.
Group 3 Senior Certificates......... Class 3-A-1, Class 3-A-2, Class 3-A-3,
Class 3-A-4 and Class 3-A-P Certificates.
Group 3 Certificates................ Group 3 Senior Certificates and the
portions of the Aggregate Group II
Subordinated Certificates related to
Collateral Allocation Group 3.
Group 4 Senior Certificates......... Class 4-A-1 and Class 4-A-2 Certificates.
Group 4 LIBOR Certificates.......... Class 4-A-1 and Class 4-A-2 Certificates.
Group 4 Certificates................ Group 4 Senior Certificates and the
portions of the Aggregate Group II
Subordinated Certificates related to
Collateral Allocation Group 4.
Group 4A Certificates............... The Group 4A Senior P&I Portion and the
portions of the Aggregate Group II
Subordinated Certificates related to
Collateral Allocation Group 4A.
17
Group 4B Certificates............... The Group 4B Senior P&I Portion and the
portions of the Aggregate Group II
Subordinated Certificates related to
Collateral Allocation Group 4B.
Group 4 Senior Certificates......... The Group 4A Certificates and the Group 4B
Certificates.
Inverse Floating Rate Certificates.. Class 4-A-2 Certificates.
LIBOR Certificates.................. Floating Rate Certificates and Inverse
Floating Rate Certificates.
Non-Delay Certificates.............. The LIBOR Certificates.
Notional Amount Certificates........ Class 4-A-2 Certificates.
Notional Amount Components.......... None.
Offered Certificates All Classes of Certificates other than the
Private Certificates.
Planned Principal Classes........... None.
Principal Only Certificates......... None.
Private Certificates................ Class P-1, Class P-2, Class OC, Class B-4,
Class B-5 and Class B-6 Certificates.
Rating Agencies..................... S&P and Xxxxx'x.
Regular Certificates................ All Classes of Certificates, other than
the Residual Certificates.
Residual Certificates............... Class A-R Certificates.
Scheduled Principal Classes......... None.
Senior Certificates................. Group 1 Senior Certificates, Group 2
Senior Certificates, Group 3 Senior
Certificates or Group 4 Senior
Certificates, as applicable.
Senior Certificate Group............ Group 1 Senior Certificates, Group 2
Senior Certificates, Group 3 Senior
Certificates or Group 4 Senior
Certificates, as applicable.
Subordinated Certificates........... Group 1 Subordinated Certificates and the
Aggregate Group II Subordinated
Certificates.
Targeted Principal Classes.......... None.
Underwriter......................... Xxxxxx Xxxxxxx & Co. Incorporated.
With respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions herein
relating solely to such designations shall be of
18
no force or effect, and any calculations herein incorporating references to
such designations shall be interpreted without reference to such designations
and amounts. Defined terms and provisions herein relating to statistical
rating agencies not designated above as Rating Agencies shall be of no force
or effect.
ARTICLE I
DEFINITIONS
Section 1.01. Definitions.
The following words and phrases, unless the context otherwise requires,
shall have the following meanings:
A-P Formula Principal Amount: As to any Distribution Date and Collateral
Allocation Group in Aggregate Loan Group II, the sum of (i) the sum of the
applicable A-P Percentage of (a) the principal portion of each Scheduled
Payment (without giving effect, prior to the Bankruptcy Coverage Termination
Date, to any reductions thereof caused by any Debt Service Reductions or
Deficient Valuations) due on the Applicable Fraction of each Mortgage Loan in
the related Collateral Allocation Group on the related Due Date, (b) the
Stated Principal Balance of the Applicable Fraction of each Mortgage Loan in
the related Collateral Allocation Group that was repurchased by the Seller,
the Depositor, or the related Originator or purchased by the Master Servicer
pursuant to this Agreement as of such Distribution Date, (c) the Substitution
Adjustment Amount in connection with any the Applicable Fraction of Deleted
Mortgage Loan in the related Collateral Allocation Group received with respect
to such Distribution Date, (d) any Insurance Proceeds or Liquidation Proceeds
allocable to recoveries of principal of the Applicable Fraction of Mortgage
Loans in the related Collateral Allocation Group that are not yet Liquidated
Mortgage Loans received during the calendar month preceding the month of such
Distribution Date, (e) with respect to the Applicable Fraction of each
Mortgage Loan in the related Collateral Allocation Group that became a
Liquidated Mortgage Loan during the calendar month preceding the month of such
Distribution Date, the amount of Liquidation Proceeds allocable to principal
received with respect to such Mortgage Loan allocable to that Collateral
Allocation Group during the calendar month preceding the month of such
Distribution Date with respect to such Mortgage Loan and, if such Liquidated
Mortgage Loan is an Additional Collateral Mortgage Loan, the principal portion
of the proceeds of any Additional Collateral allocated to the Collateral
Allocation Group and (f) the Applicable Fraction of all Principal Prepayments
with respect to the Mortgage Loans in the related Collateral Allocation Group
received during the related Prepayment Period, and (ii) with respect to
Subsequent Recoveries attributable to the Applicable Fraction of a Discount
Mortgage Loan in the related Collateral Allocation Group which incurred (1) an
Excess Loss or (2) a Realized Loss after the related Senior Credit Support
Depletion Date, the A-P Percentage of the Applicable Fraction of any
Subsequent Recoveries on the Mortgage Loans related to such Collateral
Allocation Group received during the calendar month preceding the month of
such Distribution Date.
A-P Percentage: As to any Discount Mortgage Loan or Applicable Fraction
thereof in Collateral Allocation Group 2 or Collateral Allocation Group 3, a
fraction (expressed as a percentage) the numerator of which is the excess of
the Required Coupon for such Collateral
19
Allocation Group over the Net Mortgage Rate of such Discount Mortgage Loan and
the denominator of which is such Required Coupon. As to any Non-Discount
Mortgage Loan or Applicable Fraction thereof in Collateral Allocation Group 2
or Collateral Allocation Group 3 and as to any Mortgage Loan or Applicable
Fraction thereof in Combined Collateral Allocation Group 4, 0%.
Accountant: A Person engaged in the practice of accounting who (except
when this Agreement provides that an Accountant must be Independent) may be
employed by or affiliated with the Depositor or an Affiliate of the Depositor.
Accretion Directed Certificates: As specified in the Preliminary
Statement.
Accretion Direction Rule: Not applicable.
Accrual Amount: With respect to any Class of Accrual Certificates or any
Accrual Component and any Distribution Date, the amount allocable to interest
on such Class of Accrual Certificates or Accrual Component with respect to
such Distribution Date pursuant to Section 5.02(a)(1)(iii), 5.02(a)(2)(iii),
5.02(a)(3)(iii) or 5.02(a)(4)(iii), as applicable.
Accrual Certificates: As specified in the Preliminary Statement.
Accrual Components: As specified in the Preliminary Statement.
Accrual Termination Date: Not applicable.
Acknowledgements: The Assignment, Assumption and Recognition Agreements,
each dated as of July 1, 2006, assigning rights under the Purchase and
Servicing Agreements from the Seller to the Depositor and from the Depositor
to the Trustee, for the benefit of the Certificateholders.
Act: The Securities Act of 1933, as amended.
Additional Collateral: With respect to any Additional Collateral
Mortgage Loan, the marketable securities and other acceptable collateral
pledged as collateral pursuant to the related pledge agreements.
Additional Form 10-D Disclosure: As defined in Section 12.02 hereof.
Additional Form 10-K Disclosure: As defined in Section 12.04 hereof.
Additional Servicer: Each affiliate of each Servicer that services any
of the Mortgage Loans and each Person who is not an affiliate of the any
Servicer, who services 10% or more of the Mortgage Loans. For clarification
purposes, the Master Servicer and the Securities Administrator are Additional
Servicers.
Additional Collateral Mortgage Loan: Each Mortgage Loan identified as
such in the Mortgage Loan Schedule.
20
Adjustment Date: With respect to any Mortgage Loan with an Adjustable
Mortgage Rate, the date specified in each Mortgage Note as a date on which the
Mortgage Rate on the related Mortgage Loan will be adjusted.
Advance: With respect to a Mortgage Loan, the payments required to be
made by the Master Servicer or the applicable Servicer with respect to any
Distribution Date pursuant to this Agreement or the applicable Purchase and
Servicing Agreement, as applicable, the amount of any such payment being equal
to the aggregate of the payments of principal and interest (net of the
applicable Servicing Fee and net of any net income in the case of any REO
Property) on the Mortgage Loans that were due on the related Due Date and not
received as of the close of business on the related Determination Date, less
the aggregate amount of any such delinquent payments that the Master Servicer
or the applicable Servicer has determined would constitute Nonrecoverable
Advances if advanced.
Adverse REMIC Event: Either (i) loss of status as a REMIC, within the
meaning of Section 860D of the Code, for any group of assets identified as a
REMIC in the Preliminary Statement to this Agreement, or (ii) imposition of
any tax, including the tax imposed under Section 860F(a)(1) on prohibited
transactions, and the tax imposed under Section 860G(d) on certain
contributions to a REMIC, on any REMIC created hereunder to the extent such
tax would be payable from assets held as part of the Trust Fund.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect
to any specified Person means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Aggregate Certificate Group: As specified in the Preliminary Statement.
Aggregate Expense Rate: With respect to any Mortgage Loan, the
applicable Servicing Fee Rate and, with respect to any LPMI Mortgage Loan, the
interest premium charged by the mortgagee to obtain or maintain any Primary
Mortgage Insurance Policy.
Aggregate Group II Certificates: As specified in the Preliminary
Statement.
Aggregate II Prepayment Shift Percentage: With respect to the Aggregate
Group II Certificates and any Distribution Date occurring during the five
years beginning on the first Distribution Date will equal 0%. Thereafter, the
Aggregate II Prepayment Shift Percentage for any Distribution Date occurring
on or after the fifth anniversary of the first Distribution Date will be as
follows: for any Distribution Date in the first year thereafter, 30%; for any
Distribution Date in the second year thereafter, 40%; for any Distribution
Date in the third year thereafter, 60%; for any Distribution Date in the
fourth year thereafter, 80%; for any Distribution Date thereafter, 100%.
Aggregate II Shift Percentage: With respect to the Aggregate Group II
Certificates and any Distribution Date occurring during the five years
beginning on the first Distribution Date
21
will equal 0%. Thereafter, the Aggregate II Shift Percentage for any
Distribution Date occurring on or after the fifth anniversary of the first
Distribution Date will be 100%.
Aggregate Group II Senior Certificates: As specified in the Preliminary
Statement.
Aggregate Group II Subordinated Certificates: As specified in the
Preliminary Statement.
Aggregate Group II Subordinated Principal Distribution Amount: With
respect to any Distribution Date and Aggregate Group II Collateral Allocation
Group, an amount equal to the sum, not less than zero, of (i) the Subordinated
Percentage of the applicable Non-A-P Percentage for such Collateral Allocation
Group of all amounts described in subclauses (a) through (d) of clause (i) of
the definition of "Non-A-P Formula Principal Amount" for such Distribution
Date, (ii) with respect to the Applicable Fraction of each Mortgage Loan in
that Collateral Allocation Group that became a Liquidated Mortgage Loan during
the calendar month preceding the month of such Distribution Date, the
applicable Non-A-P Percentage of the amount of the Liquidation Proceeds
allocated to principal received with respect thereto remaining after
application thereof pursuant to clause (ii) of the definition of Senior
Principal Distribution Amount, up to the Subordinated Percentage for such
Collateral Allocation Group of the applicable Non-A-P Percentage of the Stated
Principal Balance of the Applicable Fraction such Mortgage Loan, (iii) the
Subordinated Prepayment Percentage of the applicable Non-A-P Percentage of all
amounts described in subclause (f) of clause (i) of the definition of "Non-A-P
Formula Principal Amount" for such Collateral Allocation Group and
Distribution Date, and (iv) the Subordinated Prepayment Percentage of any
Subsequent Recoveries described in clause (ii) of the definition of "Non-A-P
Formula Principal Amount" for such Collateral Allocation Group and
Distribution Date reduced by Class A-P Deferred Amounts; provided, however,
that on any Distribution Date after the third related Senior Termination Date,
the Subordinated Principal Distribution Amount will not be calculated by
Collateral Allocation Group but will equal the amount calculated pursuant to
the formula set forth above based on the applicable Subordinated Percentage or
Subordinated Prepayment Percentage, as applicable, for the Subordinated
Certificates for such Distribution Date with respect to all of the Aggregate
Group II Mortgage Loans as opposed to only the Applicable Fractions of the
Mortgage Loans in the related Collateral Allocation Group.
Aggregate Planned Balance: With respect to any group of Planned
Principal Classes or Components and any Distribution Date, the amount set
forth for such group for such Distribution Date in Schedule B hereto.
Aggregate Subordinated Percentage: As to any Distribution Date and the
Aggregate Group II Certificates, the fraction, expressed as a percentage, the
numerator of which is equal to the aggregate Class Principal Balance of the
Aggregate Group II Subordinated Certificates immediately prior to such
Distribution Date and the denominator of which is the aggregate Stated
Principal Balance of all the Aggregate Group II Mortgage Loans as of the Due
Date in the month preceding the month of such Distribution Date.
22
Aggregate Targeted Balance: With respect to any group of Targeted
Principal Classes or Components and any Distribution Date, the amount set
forth for such group for such Distribution Date in Schedule B hereto.
Aggregate Voting Interests: The aggregate of the Voting Interests of all
the Certificates under this Agreement.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements hereto.
Allocable Share: As to any Distribution Date and any Mortgage Loan in
Aggregate Group II Mortgage Loan (i) with respect to each Class of Class A-P
Certificates, zero, and (ii) with respect to each other Class of Aggregate
Group II Certificates the product of (a) the lesser of (I) the ratio that the
related Required Coupon bears to the Net Mortgage Rate of such Mortgage Loan
or the Applicable Fraction thereof and (II) one, multiplied by (b) the ratio
that the amount calculated with respect to such Distribution Date (A) with
respect to the Aggregate Group II Senior Certificates of the related Senior
Certificate Group, pursuant to clause (i) of the definition of Class Optimal
Interest Distribution Amount (without giving effect to any reduction of such
amount pursuant to Section 5.02 (d)) and (B) with respect to the Aggregate
Group II Subordinated Certificates, pursuant to the definition of Assumed
Interest Amount or after the third related Senior Termination Date, pursuant
to clause (i) of the definition of Class Optimal Interest Distribution Amount
(without giving effect to any reduction of such amount pursuant to Section
5.02(d)) bears to the amount calculated with respect to such Distribution Date
for each Class of Aggregate Group II Certificates pursuant to clause (i) of
the definition of Class Optimal Interest Distribution Amount (without giving
effect to any reduction of such amount pursuant to Section 5.02(d)) or the
definition of Assumed Interest Amount for such Collateral Allocation Group and
Class, as applicable and (iv) with respect to any other Class of Aggregate
Group II Certificates, the ratio that the amount calculated with respect to
such Distribution Date (A) with respect to the Aggregate Group II Senior
Certificates of the related Aggregate Group II Senior Certificate Group,
pursuant to clause (i) of the definition of Class Optimal Interest
Distribution Amount (without giving effect to any reduction of such amount
pursuant to Section 5.02 (d)) and (B) with respect to the Aggregate Group II
Subordinated Certificates, pursuant to the definition of Assumed Interest
Amount or after the third related Senior Termination Date, pursuant to clause
(i) of the definition of Class Optimal Interest Distribution Amount (without
giving effect to any reduction of such amount pursuant to Section 5.02(d))
bears to the amount calculated with respect to such Distribution Date for each
Class of Aggregate Group II Certificates pursuant to clause (i) of the
definition of Class Optimal Interest Distribution Amount (without giving
effect to any reduction of such amount pursuant to Section 5.02(d)) or the
definition of Assumed Interest Amount for such Collateral Allocation Group and
Class, as applicable.
American Home Mortgage Loan: Each Mortgage Loan originated by American
Home Mortgage Corporation and listed on the Mortgage Loan Schedule.
American Home Purchase Agreement: The Mortgage Loan Purchase Agreement
listed in Exhibit E hereto between the Seller and American Home Mortgage
Corporation.
23
Amount Available for Senior Principal: As to any Distribution Date and
(a) Collateral Allocation Group 2, Available Funds for such Distribution Date
and Collateral Allocation Group, reduced by the aggregate amount distributable
(or allocable to the Accrual Amount, if applicable) on such Distribution Date
in respect of interest on the related Senior Certificates pursuant to Section
5.02(a)(2)(ii), (b) Collateral Allocation Group 3, Available Funds for such
Distribution Date and Collateral Allocation Group, reduced by the aggregate
amount distributable (or allocable to the Accrual Amount, if applicable) on
such Distribution Date in respect of interest on the related Senior
Certificates pursuant to Section 5.02(a)(3)(ii) or (c) Combined Collateral
Allocation Group 4, Available Funds for such Distribution Date and Collateral
Allocation Group, reduced by the aggregate amount distributable (or allocable
to the Accrual Amount, if applicable) on such Distribution Date in respect of
interest on the related Senior Certificates pursuant to Section
5.02(a)(4)(ii).
Amount Held for Future Distribution: As to any Distribution Date and the
Mortgage Loans related to a Collateral Allocation Group, the aggregate amount
held in the Custodial Accounts at the close of business on the related
Determination Date on account of (i) Principal Prepayments received after the
related Prepayment Period and Liquidation Proceeds and Subsequent Recoveries
received in the month of such Distribution Date relating to such Collateral
Allocation Group and (ii) all Scheduled Payments due after the related Due
Date relating to such Collateral Allocation Group.
Applicable Credit Support Percentage: With respect to the Aggregate
Group II Certificates, as defined in Section 5.02(e) hereof.
Applicable Fraction: With respect to (a) any Mortgage Loan related to
Collateral Allocation Group 1, 100%, (b) any Mortgage Loan related to
Collateral Allocation Group 2, Collateral Allocation Group 3, Collateral
Allocation Group 4A and Collateral Allocation Group 4B, the percentage for
such Mortgage Loan and Collateral Allocation Group set forth on the Mortgage
Loan Schedule but generally calculated as follows:
24
The Applicable Fraction of each Mortgage Loan in Loan Group 2 that is
allocated to Collateral Allocation Group 2 and Collateral Allocation Group 4A
is as follows:
-------------------------------------------------------------------------------
Loan Group 2
Collateral
Net Mortgage Rate Collateral Allocation
of the Mortgage Loan Allocation Group 2 Group 4A
------------------------ ------------------------- -------------------------
less than or equal
to 6.00%................ 100.00% 0.00%
------------------------ ------------------------- -------------------------
Greater than 6.00% and 7.50% - Net 7.50% - Net
less than 7.50%......... Mortgage Rate 100.00% - Mortgage Rate
1.50% 1.50%
------------------------ ------------------------- -------------------------
7.50%
and above............... 0.00% 100.00%
------------------------ ------------------------- -------------------------
25
The Applicable Fraction of each Mortgage Loan in Loan Group 3 that is
allocated to Collateral Allocation Group 3 and Collateral Allocation Group 4B
is as follows:
----------------------------- -------------------------------------------------
Loan Group 3
Collateral
Net Mortgage Rate Collateral Allocation
of the Mortgage Loan Allocation Group 3 Group 4B
----------------------------- -------------------- ----------------------------
less than or equal
to 6.00%..................... 100.00% 0.00%
----------------------------- -------------------- ----------------------------
Greater than 6.00% and less 7.50% - Net 100.00% - 7.50% - Net
than 7.50%................... Mortgage Rate Mortgage Rate
1.50% 1.50%
----------------------------- -------------------- ----------------------------
7.50%
and above.................... 0.00% 100.00%
----------------------------- -------------------- ----------------------------
Applied Loss Amount: As to any Distribution Date, with respect to the
Group 1 Subordinated Certificates and the Class OC Certificates, the excess,
if any, of (i) the aggregate Class Principal Balances of the Group 1
Certificates and the Class OC Certificates, after giving effect to all
Realized Losses with respect to the Applicable Fractions of the Mortgage Loans
in Collateral Allocation Group 1 during the Due Period for such Distribution
Date and payments of principal on such Distribution Date over (ii) the
aggregate Stated Principal Balance of the Applicable Fractions of the
Collateral Allocation Group 1 Mortgage Loans for such Distribution Date.
Appraised Value: With respect to any Mortgage Loan, the Appraised Value
of the related Mortgaged Property shall be: (i) with respect to a Mortgage
Loan other than a Refinancing Mortgage Loan, the lesser of (a) the value of
the Mortgaged Property based upon the appraisal made at the time of the
origination of such Mortgage Loan and (b) the sales price of the Mortgaged
Property at the time of the origination of such Mortgage Loan; and (ii) with
respect to a Refinancing Mortgage Loan, the value of the Mortgaged Property
based upon the appraisal made at the time of the origination of such
Refinancing Mortgage Loan.
Assets: As such term is used with respect to any Auction of the Group 1
Assets, as defined in Section 7.01(b) hereof.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the
laws of the jurisdiction wherein the related Mortgaged Property is located to
reflect the sale of the Mortgage to the Trustee, which assignment, notice of
transfer or equivalent instrument may be in the form of one or more blanket
assignments covering the Mortgage Loans secured by Mortgaged Properties
located in
26
the same jurisdiction, if permitted by law; provided, however, that the
Trustee shall not be responsible for determining whether any such assignment
is in recordable form or sufficient under the laws of the applicable
jurisdiction to reflect the sale of the Mortgage to the Trustee.
Assignment of Proprietary Lease: With respect to a Cooperative Loan, an
assignment of the Proprietary Lease sufficient under the laws of the
jurisdiction wherein the related Cooperative Unit is located to reflect the
assignment of such Proprietary Lease; provided, however, that the Trustee
shall not be responsible for determining whether such assignment is sufficient
to reflect the assignment of the Proprietary Lease.
Assignment of Recognition Agreement: With respect to a Cooperative Loan,
an assignment of the Recognition Agreement sufficient under the laws of the
jurisdiction wherein the related Cooperative Unit is located to reflect the
assignment of such Recognition Agreement; provided, however, that the Trustee
shall not be responsible for determining whether such assignment is sufficient
to reflect the assignment of the Recognition Agreement.
Assumed Balance: With respect to any Distribution Date, Class of
Aggregate Group II Subordinated Certificates and Aggregate Group II Collateral
Allocation Group, each such Class' pro rata interest (based on their
respective Class Principal Balances) in such Collateral Allocation Group equal
to the product of the Subordinated Percentage for such Collateral Allocation
Group as of such Distribution Date and the aggregate of the applicable Non-A-P
Percentage of the Stated Principal Balance of each Mortgage Loan or Applicable
Fraction thereof in such Collateral Allocation Group as of the Due Date
occurring in the month preceding the month of such Distribution Date (after
giving effect to Principal Prepayments received in the related Prepayment
Period).
Assumed Interest Amount: With respect to any Distribution Date and Class
of Aggregate Group II Subordinated Certificates, one month's interest accrued
during the related Interest Accrual Period at the Pass-Through Rate for such
Class on the applicable Subordinated Portion immediately prior to that
Distribution Date.
Auction: As defined in Section 7.01(b) hereof.
Auction Administrator: The Securities Administrator, or any successor in
interest, or if any successor Auction Administrator shall be appointed as
herein provided, then such successor Auction Administrator.
Auction Date: As defined in Section 7.01(b) hereof.
Auction Excess Proceeds: With respect to an Auction Sale of the
Collateral Allocation Group 1 Mortgage Loans, the excess of the Mortgage Loan
Auction Price paid by the Auction Purchaser over the Minimum Bid Price.
Auction Purchaser: As defined in Section 7.01(b) hereof. For the
avoidance of doubt, the Auction Purchaser cannot be the Seller or an Affiliate
of the Seller.
Auction Sale: As defined in Section 7.01(b) hereof.
27
Authenticating Agent: Any authenticating agent appointed pursuant to
Section 6.10 until any successor authenticating agent for the Certificates is
named, and thereafter "Authenticating Agent" shall mean any such successor.
The initial Authenticating Agent shall be the Securities Administrator under
this Agreement.
Authorized Officer: Any Person who may execute an Officer's Certificate
on behalf of the Depositor.
Available Distribution Amount: For any Distribution Date and the Group 1
Certificates, the sum of the following amounts:
(1) the total amount of all cash received by or on behalf of each
Servicer with respect to the Collateral Allocation Group 1 Mortgage Loans
serviced by it or received by the Master Servicer by the related Servicer
Remittance Date and not previously distributed (including Liquidation
Proceeds, Subsequent Recoveries, condemnation proceeds and Insurance Proceeds
with respect to the Collateral Allocation Group 1 Mortgage Loans), except:
o all scheduled payments of principal and related interest collected
on the Collateral Allocation Group 1 Mortgage Loans but due on a
date after the related Due Date;
o all partial Principal Prepayments received with respect to the
Collateral Allocation Group 1 Mortgage Loans after the related
Prepayment Period, together with all related interest accrued on
such Mortgage Loans;
o all Prepayment Penalties received in connection with the
Collateral Allocation Group 1 Mortgage Loans;
o all Principal Prepayments in Full received with respect to the
Collateral Allocation Group 1 Mortgage Loans after the related
Prepayment Period, together with all related interest accrued on
such Mortgage Loans;
o Liquidation Proceeds, condemnation proceeds and Insurance Proceeds
received on such Collateral Allocation Group 1 Mortgage Loans
after the previous calendar month;
o all amounts reimbursable to a Servicer pursuant to the terms of
the related Purchase and Servicing Agreement or this Agreement, as
applicable, or to the Master Servicer, the Securities
Administrator, the Trustee and/or any Custodian pursuant to the
terms of this Agreement or the Custodial Agreements, in each case
with respect to the Collateral Allocation Group 1 Mortgage Loans
or otherwise allocable to the Group 1 Certificates;
o reinvestment income on the balance of funds, if any, in the
Custodial Accounts or Distribution Account; and
o any fees payable to the Servicers and the Master Servicer, in each
case with respect to the Collateral Allocation Group 1 Mortgage
Loans;
28
(2) all Advances on the Collateral Allocation Group 1 Mortgage
Loans made by each Servicer and/or the Master Servicer for that Distribution
Date;
(3) any amounts paid as Compensating Interest with respect to the
Collateral Allocation Group 1 Mortgage Loans by each Servicer and/or the
Master Servicer for that Distribution Date; and
(4) the total amount of any cash deposited in the Distribution
Account in connection with the repurchase of any Collateral Allocation Group 1
Mortgage Loans by the Seller or the related Originator.
Available Funds: As to any Distribution Date and the Mortgage Loans or
Applicable Fractions thereof in a Collateral Allocation Group in Aggregate
Loan Group II, the sum, for that Collateral Allocation Group, of (a) the
aggregate amount held in the Custodial Accounts at the close of business on
the related Determination Date, including any Subsequent Recoveries, in
respect of such Mortgage Loans in the related Loan Group in proportion to the
Applicable Fraction of those Mortgage Loans in that Collateral Allocation
Group net of (i) the Amount Held for Future Distribution, (ii) amounts
permitted to be withdrawn from the Custodial Accounts pursuant to Section
4.02(a) in respect of such Mortgage Loans or Applicable Fractions thereof and
(iii) amounts permitted to be withdrawn from the Distribution Account pursuant
to clauses (i)-(v) inclusive of Section 4.02(b), in each case in the related
Loan Group in proportion to the Applicable Fraction of those Mortgage Loans in
that Collateral Allocation Group, (b) the amount of all related Advances made
by the Servicers and the Master Servicer and all Compensating Interest
Payments or payments made in respect of Prepayment Interest Shortfalls paid by
the Servicers and the Master Servicer, in each case, in respect of such
Mortgage Loans in the related Loan Group in proportion to the Applicable
Fraction of those Mortgage Loans in that Collateral Allocation Group, (c) in
connection with Defective Mortgage Loans in the related Loan Group, as
applicable, the aggregate of the Purchase Prices and Substitution Adjustment
Amounts, in each case, in proportion to the Applicable Fraction of those
Mortgage Loans in that Collateral Allocation Group deposited on the related
Distribution Account Deposit Date minus (d) all related fees, charges and
other amounts payable or reimbursable to the Master Servicer, the Securities
Administrator, any Custodian or the Trustee under this Agreement or the
related Custodial Agreement or to the Servicers under the Purchase and
Servicing Agreements, or, if any amounts are not specifically related to the
Mortgage Loans or Applicable Fractions thereof in that Collateral Allocation
Group or the related Certificate Group, then the applicable Collateral
Allocation Group Percentage for such Collateral Allocation Group for such
Distribution Date of such amounts. The Holders of the Class P-2 Certificates
will be entitled to all Prepayment Penalties received on the Aggregate Group
II Mortgage Loans and such amounts will not be available for distribution to
the Holders of any other Class of Certificates.
Bankruptcy: As to any Person, the making of an assignment for the
benefit of creditors, the filing of a voluntary petition in bankruptcy,
adjudication as a bankrupt or insolvent, the entry of an order for relief in a
bankruptcy or insolvency proceeding, the seeking of reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief, or seeking, consenting to or acquiescing in the appointment of a
trustee, receiver or liquidator, dissolution, or termination, as the case may
be, of such Person pursuant to the provisions of either the Bankruptcy Code or
any other similar state laws.
29
Bankruptcy Code: The United States Bankruptcy Code of 1986, as amended.
Bankruptcy Coverage Termination Date: The point in time at which the
Bankruptcy Loss Coverage Amount is reduced to zero.
Bankruptcy Loss: With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction reported to the Master Servicer by the
related Servicer; provided, however, that a Bankruptcy Loss shall not be
deemed a Bankruptcy Loss hereunder so long as the related Servicer has
notified the Master Servicer in writing that the related 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 Mortgage Loan are being advanced on a current basis by the
Master Servicer or the related Servicer, in either case without giving effect
to any Debt Service Reduction or Deficient Valuation, as reported by the
related Servicer to the Master Servicer.
Bankruptcy Loss Coverage Amount: As of any date of determination, the
Bankruptcy Loss Coverage Amount shall equal the Initial Bankruptcy Coverage
Amount as reduced by (i) the aggregate amount of Bankruptcy Losses allocated
to the Aggregate Group II Certificates since the Cut-off Date and (ii) any
permissible reductions in the Bankruptcy Loss Coverage Amount as evidenced by
a letter of each Rating Agency to the Trustee and the Securities Administrator
to the effect that any such reduction will not result in a downgrading of the
then current ratings assigned to the Classes of Aggregate Group II
Certificates rated by it.
Basic Principal Distribution Amount: For any Distribution Date and the
Group 1 Certificates will equal the excess of the Group 1 Principal Remittance
Amount over the Excess Subordinated Amount.
Basis Risk Carry Forward Amount: With respect to any Class of Group 1
Certificates and any Distribution Date on which the Pass-Through Rate for that
Class of Certificates is limited to the Net WAC Pass-Through Rate, an amount
equal to the sum of (i) the excess of (x) the amount of interest such Class of
Certificates would have been entitled to receive on such Distribution Date if
the Net WAC Pass-Through Rate had not been applicable to such Class on such
Distribution Date over (y) the amount of interest accrued on such Distribution
Date at the Net WAC Pass-Through Rate and (ii) the related Basis Risk Carry
Forward Amount for the previous Distribution Date not previously distributed,
together with interest thereon at a rate equal to the related Pass-Through
Rate for such Class of Certificates for the most recently ended Interest
Accrual Period.
Book-Entry Certificates: Beneficial interests in Certificates designated
as "Book-Entry Certificates" in this Agreement, ownership and transfers of
which shall be evidenced or made through book entries by a Clearing Agency as
described in Section 3.09; provided, that after the occurrence of a Book-Entry
Termination whereupon book-entry registration and transfer are no longer
permitted and Definitive Certificates are to be issued to Certificate Owners,
such Book-Entry Certificates shall no longer be "Book-Entry Certificates." The
Classes of Certificates that constitute "Book-Entry Certificates" as of the
Closing Date are set forth in the Preliminary Statement.
30
Book-Entry Termination: The date on which the Clearing Agency is no
longer willing or able to properly discharge its responsibilities with respect
to the Book Entry Certificates, and the Depositor is unable to locate a
qualified successor.
Breached Mortgage Loan: A Mortgage Loan (a)(i) on which the first
payment was not made or (ii) that has been delinquent one or two times in the
six months following the Cut-off Date and (b) as to which the Seller obtained
a representation or warranty that no condition set forth in (a)(i) or, for the
same or other period time specified in such representation or warranty
(a)(ii), exists.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in New York, New York or, if other than New
York, the city in which the Corporate Trust Office of the Trustee is located,
or the States of Maryland or Minnesota, are authorized or obligated by law or
executive order to be closed.
Calculation Rate: For the Aggregate Group II Certificates and each
Distribution Date, in the case of the Class A and Class B Interests of REMIC
1B, the product of (i) 10 and (ii) the weighted average rate of the
outstanding Class A and Class B Interests, treating each Class A Interest as
capped at zero or reduced by a fixed percentage of 100% of the interest
accruing on such Class.
Certificate: Any one of the certificates signed by the Trustee, or the
Securities Administrator on the Trustee's behalf, and authenticated by the
Securities Administrator as Authenticating Agent in substantially the forms
attached hereto as Exhibit A.
Certificate Balance: With respect to any Certificate other than a Class
OC Certificate at any date, the maximum dollar amount of principal to which
the Holder thereof is then entitled hereunder, such amount being equal to the
principal balance or notional amount, as applicable, as of the Closing Date
(A) plus any Subsequent Recoveries added to the Certificate Balance of such
Certificate pursuant to Section 5.02, (B) minus the sum of (i) all
distributions of principal previously made with respect thereto, (ii) with
respect to the Group 1 Subordinated Certificates only, all Applied Loss
Amounts allocated thereto and all other reductions in Certificate Balance
previously allocated thereto pursuant to Section 5.04 and (iii) with respect
to the Aggregate Group II Certificates only, all Realized Losses allocated
thereto (including Excess Losses) and all other reductions in Certificate
Balance previously allocated thereto pursuant to Section 5.04 (C) in the case
of any Class of Accrual Certificates, increased by the Accrual Amount added to
the Class Principal Balance of such Class prior to such date. No individual
Class OC Certificate has a Certificate Balance.
Certificate Group: As specified in the Preliminary Statement.
Certificate Owner: With respect to a Book-Entry Certificate, the Person
who is the owner of such Book-Entry Certificate, as reflected on the books of
the Clearing Agency, or on the books of a Person maintaining an account with
such Clearing Agency (directly or as an indirect participant, in accordance
with the rules of such Clearing Agency).
31
Certificate Register and Certificate Registrar: The register maintained
and the registrar appointed pursuant to Section 3.02. The initial Certificate
Registrar is the Securities Administrator under this Agreement.
Certificateholder: The meaning provided in the definition of "Holder."
Certification Party: As defined in Section 12.05 hereof.
Certifying Person: As defined in Section 12.05 hereof.
Class: All Certificates bearing the same Class designation as set forth
in the Preliminary Statement.
Class 1-A Interest Distribution Amount: With respect to any Distribution
Date and any Class of Group 1 Senior Certificates, interest accrued during the
related Interest Accrual Period on the related Class Principal Balance of that
Class immediately prior to the Distribution Date at the Pass-Through Rate for
that Class reduced (to an amount not less than zero), in the case of such
Class, by the allocable share, if any, for that Class of Prepayment Interest
Shortfalls to the extent not covered by Compensating Interest paid by the
Master Servicer or the Servicers and Relief Act Interest Shortfalls, together
with the Interest Carry Forward Amount, if any, for such Distribution Date for
such Class of Group 1 Senior Certificates.
Class 1-A Principal Distribution Amount: With respect to any
Distribution Date and any Class of Group 1 Senior Certificates, (i) prior to
the Stepdown Date or on or after the Stepdown Date if a Trigger Event is in
effect, the Group 1 Principal Distribution Amount or (ii) on or after the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date,
the lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date; and
o the excess (if any) of (A) the aggregate Class Principal Balance
of the Class 1-A Certificates immediately prior to that
Distribution Date over (B) the lesser of (i) the aggregate Stated
Principal Balance of the Collateral Allocation Group 1 Mortgage
Loans as of the last day of the related Due Period multiplied by
86.20% and (ii) the amount, if any, by which (x) the aggregate
Stated Principal Balance of the Collateral Allocation Group 1
Mortgage Loans as of the last day of the related Due Period
exceeds (y) $1,138,588.
Class 1-B Certificates: As specified in the Preliminary Statement.
Class 1-B-1 Principal Distribution Amount: With respect to Class 1-B-1
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount,
the Class 1-M-1 Principal Distribution Amount, the Class 1-M-2 Principal
Distribution Amount, the Class 1-M-3 Principal Distribution Amount, the Class
1-M-4 Principal Distribution Amount, the Class 1-M-5 Principal Distribution
Amount and the Class 1-M-6 Principal Distribution Amount or (ii) on or after
the Stepdown Date if a Trigger Event is not in effect for that Distribution
Date, the lesser of:
32
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount, the Class 1-M-1 Principal Distribution
Amount, the Class 1-M-2 Principal Distribution Amount, the Class
1-M-3 Principal Distribution Amount, the Class 1-M-4 Principal
Distribution Amount, the Class 1-M-5 Principal Distribution Amount
and the Class 1-M-6 Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-B-1 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates and the Class 1-M Certificates (after
taking into account the payment of the Class 1-A, Class 1-M-1,
Class 1-M-2, Class 1-M-3, Class 1-M-4, Class 1-M-5 and Class 1-M-6
Principal Distribution Amounts for such Distribution Date) over
(B) the lesser of (i) the aggregate Stated Principal Balance of
the Collateral Allocation Group 1 Mortgage Loans as of the last
day of the related Due Period multiplied by 95.60% and (ii) the
amount, if any, by which (x) the aggregate Stated Principal
Balance of the Collateral Allocation Group 1 Mortgage Loans as of
the last day of the related Due Period exceeds (y) $1,138,588.
Class 1-B-2 Principal Distribution Amount: With respect to Class 1-B-2
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount,
the Class 1-M-1 Principal Distribution Amount, the Class 1-M-2 Principal
Distribution Amount, the Class 1-M-3 Principal Distribution Amount, the Class
1-M-4 Principal Distribution Amount, the Class 1-M-5 Principal Distribution
Amount, the Class 1-M-6 Principal Distribution Amount and the Class 1-B-1
Principal Distribution Amount or (ii) on or after the Stepdown Date if a
Trigger Event is not in effect for that Distribution Date, the lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount, the Class 1-M-1 Principal Distribution
Amount, the Class 1-M-2 Principal Distribution Amount, the Class
1-M-3 Principal Distribution Amount, the Class 1-M-4 Principal
Distribution Amount, the Class 1-M-5 Principal Distribution
Amount, the Class 1-M-6 Principal Distribution Amount and the
Class 1-B-1 Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-B-2 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates, the Class 1-M Certificates and the
Class 1-B-1 Certificates (after taking into account the payment of
the Class 1-A, Class 1-M-1, Class 1-M-2, Class 1-M-3, Class 1-M-4,
Class 1-M-5, Class 1-M-6 and Class 1-B-1 Principal Distribution
Amounts for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Collateral Allocation
Group 1 Mortgage Loans as of the last day of the related Due
Period multiplied by 96.30% and (ii) the amount, if any, by which
(x) the aggregate Stated Principal Balance of the
33
Collateral Allocation Group 1 Mortgage Loans as of the last day of
the related Due Period exceeds (y) $1,138,588.
Class 1-B-3 Principal Distribution Amount: With respect to Class 1-B-3
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount,
the Class 1-M-1 Principal Distribution Amount, the Class 1-M-2 Principal
Distribution Amount, the Class 1-M-3 Principal Distribution Amount, the Class
1-M-4 Principal Distribution Amount, the Class 1-M-5 Principal Distribution
Amount, the Class 1-M-6 Principal Distribution Amount, the Class 1-B-1
Principal Distribution Amount and the Class 1-B-2 Principal Distribution
Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
effect for that Distribution Date, the lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount, the Class 1-M-1 Principal Distribution
Amount, the Class 1-M-2 Principal Distribution Amount, the Class
1-M-3 Principal Distribution Amount, the Class 1-M-4 Principal
Distribution Amount, the Class 1-M-5 Principal Distribution
Amount, the Class 1-M-6 Principal Distribution Amount, the Class
1-B-1 Principal Distribution Amount and the Class 1-B-2 Principal
Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-B-3 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates, the Class 1-M Certificates and the
Class 1-B-1 and Class 1-B-2 Certificates (after taking into
account the payment of the Class 1-A, Class 1-M-1, Class 1-M-2,
Class 1-M-3, Class 1-M-4, Class 1-M-5, Class 1-M-6, Class 1-B-1
and Class 1-B-2 Principal Distribution Amounts for such
Distribution Date) over (B) the lesser of (i) the aggregate Stated
Principal Balance of the Collateral Allocation Group 1 Mortgage
Loans as of the last day of the related Due Period multiplied by
97.30% and (ii) the amount, if any, by which (x) the aggregate
Stated Principal Balance of the Collateral Allocation Group 1
Mortgage Loans as of the last day of the related Due Period
exceeds (y) $1,138,588.
Class 1-M Certificates: As specified in the Preliminary Statement.
Class 1-M Senior Certificates: As specified in the Preliminary
Statement.
Class 1-M-1 Principal Distribution Amount: With respect to Class 1-M-1
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount or
(ii) on or after the Stepdown Date if a Trigger Event is not in effect for
that Distribution Date, the lesser of:
34
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-M-1 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates (after taking into account the payment
of the Class 1-A Principal Distribution Amount for such
Distribution Date) over (B) the lesser of (i) the aggregate Stated
Principal Balance of the Collateral Allocation Group 1 Mortgage
Loans as of the last day of the related Due Period multiplied by
89.30% and (ii) the amount, if any, by which (x) the aggregate
Stated Principal Balance of the Collateral Allocation Group 1
Mortgage Loans as of the last day of the related Due Period
exceeds (y) $1,138,588.
Class 1-M-2 Principal Distribution Amount: With respect to Class 1-M-2
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount
and the Class 1-M-1 Principal Distribution Amount or (ii) on or after the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date,
the lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount and the Class 1-M-1 Principal Distribution
Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-M-2 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates and the Class 1-M-1 Certificates (after
taking into account the payment of the Class 1-A and Class 1-M-1
Principal Distribution Amounts for such Distribution Date) over
(B) the lesser of (i) the aggregate Stated Principal Balance of
the Collateral Allocation Group 1 Mortgage Loans as of the last
day of the related Due Period multiplied by 91.10% and (ii) the
amount, if any, by which (x) the aggregate Stated Principal
Balance of the Collateral Allocation Group 1 Mortgage Loans as of
the last day of the related Due Period exceeds (y) $1,138,588.
Class 1-M-3 Principal Distribution Amount: With respect to Class 1-M-3
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount,
the Class 1-M-1 Principal Distribution Amount and the Class 1-M-2 Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event
is not in effect for that Distribution Date, the lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount, the Class 1-M-1 Principal Distribution Amount
and the Class 1-M-2 Principal Distribution Amount; and
35
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-M-3 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates and the Class 1-M-1 and Class 1-M-2
Certificates (after taking into account the payment of the Class
1-A, Class 1-M-1 and Class 1-M-2 Principal Distribution Amounts
for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Collateral Allocation
Group 1 Mortgage Loans as of the last day of the related Due
Period multiplied by 92.40% and (ii) the amount, if any, by which
(x) the aggregate Stated Principal Balance of the Collateral
Allocation Group 1 Mortgage Loans as of the last day of the
related Due Period exceeds (y) $1,138,588.
Class 1-M-4 Principal Distribution Amount: With respect to Class 1-M-4
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount,
the Class 1-M-1 Principal Distribution Amount, the Class 1-M-2 Principal
Distribution Amount and the Class 1-M-3 Principal Distribution Amount or (ii)
on or after the Stepdown Date if a Trigger Event is not in effect for that
Distribution Date, the lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount, the Class 1-M-1 Principal Distribution
Amount, the Class 1-M-2 Principal Distribution Amount and the
Class 1-M-3 Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-M-4 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates and the Class 1-M Senior Certificates
(after taking into account the payment of the Class 1-A, Class
1-M-1, Class 1-M-2 and Class 1-M-3 Principal Distribution Amounts
for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Collateral Allocation
Group 1 Mortgage Loans as of the last day of the related Due
Period multiplied by 93.40% and (ii) the amount, if any, by which
(x) the aggregate Stated Principal Balance of the Collateral
Allocation Group 1 Mortgage Loans as of the last day of the
related Due Period exceeds (y) $1,138,588.
Class 1-M-5 Principal Distribution Amount: With respect to Class 1-M-5
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount,
the Class 1-M-1 Principal Distribution Amount, the Class 1-M-2 Principal
Distribution Amount, the Class 1-M-3 Principal Distribution Amount and the
Class 1-M-4 Principal Distribution Amount or (ii) on or after the Stepdown
Date if a Trigger Event is not in effect for that Distribution Date, the
lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount, the Class 1-M-1 Principal Distribution
Amount, the Class 1-M-2 Principal Distribution Amount, the
36
Class 1-M-3 Principal Distribution Amount and the Class 1-M-4
Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-M-5 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates, the Class 1- M Senior Certificates and
the Class 1-M-4 Certificates (after taking into account the
payment of the Class 1-A, Class 1-M-1, Class 1-M-2, Class 1-M-3
and Class 1-M-4 Principal Distribution Amounts for such
Distribution Date) over (B) the lesser of (i) the aggregate Stated
Principal Balance of the Collateral Allocation Group 1 Mortgage
Loans as of the last day of the related Due Period multiplied by
94.20% and (ii) the amount, if any, by which (x) the aggregate
Stated Principal Balance of the Collateral Allocation Group 1
Mortgage Loans as of the last day of the related Due Period
exceeds (y) $1,138,588.
Class 1-M-6 Principal Distribution Amount: With respect to Class 1-M-6
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Group 1 Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class 1-A Principal Distribution Amount,
the Class 1-M-1 Principal Distribution Amount, the Class 1-M-2 Principal
Distribution Amount, the Class 1-M-3 Principal Distribution Amount, the Class
1-M-4 Principal Distribution Amount and the Class 1-M-5 Principal Distribution
Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
effect for that Distribution Date, the lesser of:
o the Group 1 Principal Distribution Amount for that Distribution
Date remaining after distribution of the Class 1-A Principal
Distribution Amount, the Class 1-M-1 Principal Distribution
Amount, the Class 1-M-2 Principal Distribution Amount, the Class
1-M-3 Principal Distribution Amount, the Class 1-M-4 Principal
Distribution Amount and the Class 1-M-5 Principal Distribution
Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class 1-M-6 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class 1-A Certificates, the Class 1-M Senior Certificates and
the Class 1-M-4 and Class 1-M-5 Certificates (after taking into
account the payment of the Class 1-A, Class 1-M-1, Class 1-M-2,
Class 1-M-3, Class 1-M-4 and Class 1-M-5 Principal Distribution
Amounts for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Collateral Allocation
Group 1 Mortgage Loans as of the last day of the related Due
Period multiplied by 94.90% and (ii) the amount, if any, by which
(x) the aggregate Stated Principal Balance of the Collateral
Allocation Group 1 Mortgage Loans as of the last day of the
related Due Period exceeds (y) $1,138,588.
Class A-P Certificates: The Class 2-A-P and Class 3-A-P Certificates.
Class A-P Deferred Amount: As to any Distribution Date and Collateral
Allocation Group in Aggregate Loan Group II, the aggregate of the applicable
A-P Percentage of each Realized Loss, other than any Excess Loss, on a
Discount Mortgage Loan in that Collateral Allocation Group to be allocated to
the related Class A-P Component on such Distribution Date
37
on or prior to the related Senior Credit Support Depletion Date or previously
allocated to but not yet paid to the Holders of the Class A-P Certificates.
Class Interest Shortfall: As to any Distribution Date and Class of
Aggregate Group II Certificates, the amount by which the amount described in
clause (i) of the definition of Class Optimal Interest Distribution Amount for
such Class exceeds the amount of interest actually distributed on such Class
on such Distribution Date pursuant to such clause (i).
Class OC Certificates: As specified in the Preliminary Statement.
Class OC Distributable Amount: With respect to any Distribution Date and
the Class OC Certificates, the excess, if any, of (x) the sum of (i) the
amount of interest accrued during the related Accrual Period at the related
Pass-Through Rate on the Class Principal Balance for such Distribution Date
and not included in the Extra Principal Distribution Amount on that
Distribution Date and (ii) the Overcollateralization Release Amount, if any,
for such Distribution Date, over (y) the Overcollateralization Increase
Amount, if any, for such Distribution Date.
Class OC Interest: The Upper-Tier Regular Interest as specified and
described in the Preliminary Statement and the related footnote thereto.
Class Optimal Interest Distribution Amount: With respect to any
Distribution Date and interest bearing Class of Aggregate Group II
Certificates or, with respect to any interest bearing Component of Aggregate
Group II Certificates, the sum of (i) one month's interest accrued during the
related Interest Accrual Period at the Pass-Through Rate for such Class on the
related Class Principal Balance, Component Balance, Notional Amount or
Component Notional Amount, as applicable, immediately prior to such
Distribution Date, subject to reduction as provided in Section 5.02(d) and
(ii) any Class Unpaid Interest Amounts for such Class or Component.
Class P-1 Distribution Amount: For each Distribution Date and the Group
1 Mortgage Loans, an amount equal to the total of all Prepayment Penalties
received by the Securities Administrator from the Servicers on the Group 1
Mortgage Loans in the prior Due Period. The Class P-1 Distribution Amount is
not part of the Available Distribution Amount and is therefore not available
for distributions to the Classes of Group 1 Certificates.
Class P-2 Distribution Amount: For each Distribution Date and the
Aggregate Group II Mortgage Loans, an amount equal to the total of all
Prepayment Penalties received by the Securities Administrator from the
Servicers on the Aggregate Group II Mortgage Loans since the Due Date related
to the prior Distribution Date. The Class P-2 Distribution Amount is not part
of Available Funds and is therefore not available for distributions to the
Classes of Aggregate Group II Certificates.
Class Principal Balance: With respect to any Class of Certificates other
than the Class OC Certificates and as to any date of determination, the
aggregate of the Certificate Balances of all Certificates of such Class as of
such date. With respect to the Class OC Certificates and any Distribution
Date, the Overcollateralized Amount as of that Distribution Date.
38
Class Subordination Percentage: With respect to any Distribution Date
and each Class of Aggregate Group II Subordinated Certificates, the quotient
(expressed as a percentage) of (a) the Class Principal Balance of such Class
of Aggregate Group II Subordinated Certificates immediately prior to such
Distribution Date, divided by (b) the aggregate of the Class Principal
Balances of all Classes of Aggregate Group II Certificates (other than the
related Notional Amount Certificates) immediately prior to such Distribution
Date.
Class Unpaid Interest Amounts: As to any Distribution Date and Class of
Aggregate Group II Certificates that is a Class of interest bearing
Certificates, the amount by which the aggregate Class Interest Shortfalls for
such Class on prior Distribution Dates exceeds the amount distributed on such
Class on prior Distribution Dates pursuant to clause (ii) of the definition of
Class Optimal Interest Distribution Amount.
Clearing Agency: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended. As
of the Closing Date, the Clearing Agency shall be The Depository Trust
Company.
Clearing Agency Participant: A broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
Closing Date: July 31, 2006.
Code: The Internal Revenue Code of 1986, as amended, and as it may be
further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.
Collateral Allocation Group: Any of Collateral Allocation Group 1,
Collateral Allocation Group 2, Collateral Allocation Group 3, Collateral
Allocation Group 4A or Collateral Allocation Group 4B.
Collateral Allocation Group 1: The respective Applicable Fractions of
the Mortgage Loans in Loan Group 1 so identified on the Mortgage Loan
Schedule.
Collateral Allocation Group 1 Mortgage Loans: The Mortgage Loans or
Applicable Fractions thereof in Collateral Allocation Group 1.
Collateral Allocation Group 2: The respective Applicable Fractions of
the Mortgage Loans in Loan Group 2 so identified on the Mortgage Loan
Schedule.
Collateral Allocation Group 2 Mortgage Loans: The Mortgage Loans or
Applicable Fractions thereof in Collateral Allocation Group 2.
Collateral Allocation Group 3: The respective Applicable Fractions of
the Mortgage Loans in Loan Group 3 so identified on the Mortgage Loan
Schedule.
Collateral Allocation Group 3 Mortgage Loans: The Mortgage Loans or
Applicable Fractions thereof in Collateral Allocation Group 3.
39
Collateral Allocation Group 4A: The respective Applicable Fractions of
the Mortgage Loans in Loan Group 2 so identified on the Mortgage Loan
Schedule.
Collateral Allocation Group 4A Mortgage Loans: The Mortgage Loans or
Applicable Fractions thereof in Collateral Allocation Group 4A.
Collateral Allocation Group 4B: The respective Applicable Fractions of
the Mortgage Loans in Loan Group 3 so identified on the Mortgage Loan
Schedule.
Collateral Allocation Group 4B Mortgage Loans: The Mortgage Loans or
Applicable Fractions thereof in Collateral Allocation Group 4B.
Collateral Allocation Group Percentage: As to any Collateral Allocation
Group and any Distribution Date, the fraction, expressed as a percentage, the
numerator of which is the aggregate Stated Principal Balance of the Applicable
Fractions of all the Mortgage Loans in that Collateral Allocation Group as of
the related Due Date, and the denominator of which is the aggregate Stated
Principal Balance of all of the Mortgage Loans as of that Due Date.
Collateral Allocation Group Principal Balance: As to any Distribution
Date and Collateral Allocation Group, the sum of, with respect to each
Mortgage Loan related to that Collateral Allocation Group, the product of (x)
the Stated Principal Balance of that Mortgage Loan as of the Due Date in the
month preceding the month of the Distribution Date (after giving effect to
prepayments received in the Prepayment Period related to such prior Due Date)
and (y) the Applicable Fraction for that Mortgage Loan.
Collateralization Event: Not applicable.
Combined Collateral Allocation Group 4: The respective Applicable
Fractions of the Mortgage Loans in Collateral Allocation Group 4A and in
Collateral Allocation Group 4B so identified on the Mortgage Loan Schedule.
Combined Collateral Allocation Group 4 Mortgage Loans: The Mortgage
Loans or Applicable Fractions thereof in Collateral Allocation Group 4A and in
Collateral Allocation Group 4B.
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest Payment: As to any Distribution Date, an amount
equal to the lesser of (i) the Prepayment Interest Shortfall on the Mortgage
Loans serviced by such Servicer with respect to such Distribution Date and
(ii) the portion of the applicable Servicing Fee that the related Servicer is
required to remit to the Trust as compensation therefor in accordance with the
terms of the related Purchase and Servicing Agreement.
Component: As specified in the Preliminary Statement.
Component Balance: With respect to any Component and any Distribution
Date, the Initial Component Balance thereof on the Closing Date, (A) plus any
Subsequent Recoveries added to the Component Balance of such Component
pursuant to Section 5.02, (B) minus the
40
sum of all amounts applied in reduction of the principal balance of such
Component and Realized Losses allocated thereto on previous Distribution
Dates.
Component Certificates: As specified in the Preliminary Statement.
Component Notional Amount: Not applicable.
Consent: A document executed by the Cooperative Corporation (i)
consenting to the sale of the Cooperative Unit to the Mortgagor and (ii)
certifying that all maintenance charges relating to the Cooperative Unit have
been paid.
Controlling Person: With respect to any Person, any other Person who
"controls" such Person within the meaning of the Securities Act.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and improvements
constituting the Cooperative Property and which governs the Cooperative
Property, which Cooperative Corporation must qualify as a Cooperative Housing
Corporation under Section 216 of the Code.
Cooperative Loan: A Mortgage Loan secured by Cooperative Shares and a
Proprietary Lease, if any.
Cooperative Property: The real property and improvements owned by the
Cooperative Corporation, that includes the allocation of individual dwelling
units to the holders of the shares of the Cooperative Corporation.
Cooperative Shares: Shares issued by a Cooperative Corporation.
Cooperative Unit: With respect to any Cooperative Loan, a specific unit
in a Cooperative Property.
Corporate Trust Office: With respect to the Trustee, the designated
office of the Trustee in the State of Illinois at which at any particular time
its corporate trust business with respect to this Agreement is administered,
which office at the date of the execution of this Agreement is located at 000
Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, Attn: Global
Securities and Trust Services MSM 2006-11, and which is the address to which
notices to and correspondence with the Trustee should be directed, or at such
other address as the Trustee may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer and the Securities
Administrator or the principal corporate trust office of any successor
Trustee. With respect to the Certificate Registrar and presentment of
Certificates for registration of transfer, exchange or final payment, Xxxxx
Fargo Bank, National Association, Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: Corporate Trust, Xxxxxx Xxxxxxx
Mortgage Loan Trust 2006-11, and for all other purposes, X.X. Xxx 00,
Xxxxxxxx, Xxxxxxxx 00000 (or for overnight deliveries, 0000 Xxx Xxxxxxxxx
Xxxx, Xxxxxxxx, Xxxxxxxx 00000), Attention: Corporate Trust, Xxxxxx Xxxxxxx
Mortgage Loan Trust 2006-11.
Cross-Over Situation: For the Aggregate Group II Certificates and any
Distribution Date and for each Aggregate Group II Collateral Allocation Group
(after taking into account principal
41
distributions on such Distribution Date) with respect to the Class A and Class
B Interests, the Class A and Class B Interests corresponding to any Aggregate
Group II Collateral Allocation Group are in the aggregate less than 1% of the
Subordinated Portion of the Aggregate Group II Collateral Allocation Group to
which they correspond.
Custodial Account: Each custodial account (other than an Escrow Account)
established and maintained by a Servicer pursuant to a Purchase and Servicing
Agreement.
Custodial Agreement: The Custodial Agreements, listed in Exhibit F
hereof, as each such agreement may be amended or supplemented from time to
time as permitted hereunder.
Custodial Delivery Failure: With respect to any Custodian appointed
hereunder, as defined in Section 6.21 hereof.
Custodian: A Person who is at anytime appointed by the Depositor as a
custodian of the Mortgage Documents and the Trustee Mortgage Files. The
initial Custodians are Deutsche Bank Trust Company Americas, LaSalle Bank
National Association, X.X. Xxxxxx Trust Company, N.A. and Xxxxx Fargo Bank,
National Association. "Custodian" shall refer to each Custodian or all
Custodians, as the context requires.
Custodian Certification: As defined in Section 2.01.
Cut-off Date: July 1, 2006.
Cut-off Date Pool Principal Balance: $682,375,192.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the Bankruptcy Code
in the Scheduled Payment for such Mortgage Loan which became final and
non-appealable, except such a reduction resulting from a Deficient Valuation
or any reduction that results in a permanent forgiveness of principal.
Deceased Holder: Not Applicable.
Defaulted Swap Termination Payment: Not Applicable.
Defective Mortgage Loan: The meaning specified in Section 2.05(a).
Deficient Valuation: With respect to any Mortgage Loan, a valuation of
the related Mortgaged Property by a court of competent jurisdiction in an
amount less than the then outstanding indebtedness under the Mortgage Loan, or
any reduction in the amount of principal to be paid in connection with any
Scheduled Payment that results in a permanent forgiveness of principal, which
valuation or reduction results from an order of such court which is final and
non-appealable in a proceeding under the Bankruptcy Code.
Definitive Certificate: A Certificate of any Class issued in definitive,
fully registered, certificated form. As of the Closing Date the Classes of
Certificates being issued as "Definitive Certificates" are set forth in the
Preliminary Statement.
42
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased, or replaced
or to be replaced with a Replacement Mortgage Loan.
Delinquent: Any Mortgage Loan with respect to which the Scheduled
Payment due on a Due Date is not received.
Depositor: Xxxxxx Xxxxxxx Capital I Inc., a Delaware corporation having
its principal place of business in New York, or its successors in interest.
Depository: Cede & Co., or any other organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository shall initially be the registered Holder of
the Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code
of the State of New York.
Determination Date: With respect to each Servicer, the "Determination
Date" set forth in the related Purchase and Servicing Agreement.
Discount Mortgage Loan: Any Mortgage Loan or Applicable Fraction thereof
in Collateral Allocation Group 2 or Collateral Allocation Group 3, as
applicable, with a Net Mortgage Rate that is less than the Required Coupon for
that Collateral Allocation Group. For the avoidance of doubt, there are no
Discount Mortgage Loans in Combined Collateral Allocation Group 4.
Disqualified Organization: A "disqualified organization" as defined in
Section 860E(e)(5) of the Code.
Distribution Account: The separate Eligible Account created and
maintained by the Securities Administrator, on behalf of the Trustee, pursuant
to Section 4.01. Funds in the Distribution Account (exclusive of any earnings
on investments made with funds deposited in the Distribution Account) shall be
held in trust for the Trustee and the Certificateholders for the uses and
purposes set forth in this Agreement.
Distribution Account Deposit Date: With respect to each Servicer, not
later than 1:00 p.m., New York time, on 18th day of each calendar month after
the initial issuance of the Certificates or, if such 18th day is not a
Business Day, either the immediately preceding or immediately following
Business Day, as set forth in the related Acknowledgement, commencing in
August 2006.
Distribution Date: The 25th day of each month or, if such 25th day is
not a Business Day, the next succeeding Business Day, commencing in August
2006.
Due Date: With respect to any Distribution Date, the first day of the
month in which such Distribution Date occurs. With respect to any Mortgage
Loan, the date on which a Scheduled Payment is due under the related Mortgage
Note as indicated in the applicable Purchase and Servicing Agreement.
43
Due Period: As to any Distribution Date, the period beginning on the
second day of the month preceding the month of such Distribution Date, and
ending on the first day of the month of such Distribution Date.
XXXXX: The Commission's Electronic Data Gathering, Analysis and
Retrieval system.
Eligible Account: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the debt obligations of such holding company) have the
highest short-term ratings of each Rating Agency at the time any amounts are
held on deposit therein, or (ii) an account or accounts in a depository
institution or trust company in which such accounts are insured by the FDIC or
the SAIF (to the limits established by the FDIC or the SAIF) and the uninsured
deposits in which accounts are otherwise secured such that, as evidenced by an
Opinion of Counsel delivered to the Trustee and to each Rating Agency, the
Certificateholders have a claim with respect to the funds in such account or a
perfected first priority security interest against any collateral (which shall
be limited to Permitted Investments) securing such funds that is superior to
claims of any other depositors or creditors of the depository institution or
trust company in which such account is maintained, or (iii) a trust account or
accounts maintained with the trust department of a federal or state chartered
depository institution or trust company, acting in its fiduciary capacity or
(iv) any other account acceptable to each Rating Agency, as evidenced by a
signed writing delivered by each Rating Agency. Eligible Accounts may bear
interest, and may include, if otherwise qualified under this definition,
accounts maintained with the Trustee, the Paying Agent, the Securities
Administrator or the Master Servicer.
Eligible Institution: An institution having the highest short-term debt
rating, and one of the two highest long-term debt ratings of the Rating
Agencies or the approval of the Rating Agencies.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of an
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary Statement.
Escrow Account: With respect to each Mortgage Loan, as defined in
Article I of the related Purchase and Servicing Agreement.
Estoppel Letter: A document executed by the Cooperative Corporation
certifying, with respect to a Cooperative Unit, (i) the appurtenant
Proprietary Lease will be in full force and effect as of the date of issuance
thereof, (ii) the related stock certificate was registered in the Mortgagor's
name and the Cooperative Corporation has not been notified of any lien upon,
pledge of, levy of execution on or disposition of such stock certificate, and
(iii) the Mortgagor is not in default under the appurtenant Proprietary Lease
and all charges due the Cooperative Corporation have been paid.
44
Event of Default: Any one of the conditions or circumstances enumerated
in Section 6.14.
Excess Loss: With respect to the Aggregate Group II Mortgage Loans, the
amount of any (i) Fraud Loss on an Aggregate Group II Mortgage Loan realized
after the Fraud Loss Coverage Termination Date, (ii) Special Hazard Loss on an
Aggregate Group II Mortgage Loan realized after the Special Hazard Coverage
Termination Date or (iii) Bankruptcy Loss on an Aggregate Group II Mortgage
Loan realized after the Bankruptcy Coverage Termination Date.
Excess Subordinated Amount: For any Distribution Date and the Group 1
Certificates will equal the excess, if any, of the Overcollateralized Amount
on that Distribution Date over (ii) the Overcollateralization Target Amount
for such Distribution Date.
Extra Principal Distribution Amount: For the Group 1 Certificates and
any Distribution Date will be the lesser of the Net Monthly Excess Cashflow
for such Distribution Date and the Overcollateralization Increase Amount as of
that Distribution Date.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
Exchange Act Reports: Any reports on Form 10-D, Form 8-K and Form 10-K
required to be filed with respect to the Trust Fund under the Exchange Act.
Xxxxxx Xxx: The entity formerly known as the Federal National Mortgage
Association, a federally chartered and privately owned corporation organized
and existing under the Federal National Mortgage Association Charter Act, or
any successor thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Final Custodian Certification: As defined in Section 2.02 hereof.
Fiscal Agent: Not applicable.
Fitch: Fitch, Inc., or any successor thereto. If Fitch is designated as
a Rating Agency in the Preliminary Statement, for purposes of Section 11.07
the address for notices to Fitch shall be Fitch, Inc., Xxx Xxxxx Xxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage Surveillance Group,
or such other address as Fitch may hereafter furnish to the Depositor, the
Trustee and the Master Servicer.
Form 8-K Disclosure: As defined in Section 12.03 hereof.
Fraud Loan: With respect to the Aggregate Group II Mortgage Loans, a
Liquidated Mortgage Loan as to which a Fraud Loss has occurred, as reported by
the related Servicer to the Master Servicer.
45
Fraud Loss Coverage Amount: As of the Closing Date, $10,711,931, subject
to reduction from time to time, by the amount of Fraud Losses allocated to the
Aggregate Group II Certificates. The Fraud Loss Coverage Amount will be
reduced, from time to time, by the amount of Fraud Losses allocated to the
Aggregate Group II Certificates. In addition, the Fraud Loss Coverage Amount
for the Aggregate Group II Mortgage Loans will be reduced on the fifth
anniversary of the Cut-off Date, to zero and on the first, second, third and
fourth anniversaries of the Cut-off Date, to an amount equal to the lesser of
(x) 2%, in the case of the first anniversary, and 1%, in the case of the
second, third and fourth anniversaries, of the related Cut-off Date Pool
Principal Balance and (y) the excess of the Fraud Loss Coverage Amount as of
the preceding anniversary of the Cut-off Date over the cumulative amount of
Fraud Losses since the preceding anniversary. Commencing with the fifth
anniversary of the Cut-off Date, the Fraud Loss Coverage Amount will be zero.
Fraud Loss Coverage Termination Date: The point in time at which the
Fraud Loss Coverage Amount is reduced to zero.
Fraud Losses: Realized Losses on Aggregate Group II Mortgage Loans as to
which a loss is sustained by reason of a default arising from fraud,
dishonesty or misrepresentation in connection with the related Mortgage Loan,
including a loss by reason of the denial of coverage under any related Primary
Mortgage Insurance Policy because of such fraud, dishonesty or
misrepresentation.
Global Securities: The global certificates representing the Book-Entry
Certificates.
GMAC Serviced Mortgage Loan: Each Mortgage Loan serviced by GMAC
Mortgage Corporation and listed on the Mortgage Loan Schedule.
GMAC Servicing Agreement: The Servicing Agreement listed in Exhibit E
hereto between the Seller and GMAC Mortgage Corporation.
GreenPoint Purchase Agreement: The Mortgage Loan Purchase and Warranties
Agreement listed in Exhibit E hereto between the Seller and GreenPoint
Mortgage Funding, Inc. as seller and servicer.
GreenPoint Serviced Mortgage Loan: Each Mortgage Loan originated and
serviced by GreenPoint Mortgage Funding, Inc. and listed on the Mortgage Loan
Schedule.
Group 1 Certificates: As specified in the Preliminary Statement.
Group 1 Mortgage Loans: The Mortgage Loans in Loan Group 1.
Group 1 LIBOR Certificates: As specified in the Preliminary Statement.
Group 1 Excess Priority Amount: With respect to any Distribution Date on
and after the Distribution Date in July 2012, the amount equal to the lesser
of (x) the product of (i) the Group 1 Priority Percentage, (ii) the Group 1
Shift Percentage and (iii) the Senior Turbo Allocation Amount on that
Distribution Date and (y) the amount of Net Monthly Excess Cashflow remaining
after the application thereof pursuant to Section 5.02(a)(1)(C)(i) through
(xx) hereof.
46
Group 1 Principal Distribution Amount: With respect to the Group 1
Certificates and any Distribution Date, the sum of the Basic Principal
Distribution Amount and the Extra Principal Distribution Amount, in each case
for that Distribution Date.
Group 1 Principal Remittance Amount: For the Group 1 Certificates and
any Distribution Date, the sum of
(i) the principal portion of all Scheduled Payments on the Collateral
Allocation Group 1 Mortgage Loans due during the related Due Period, whether
or not received on or prior to the related Determination Date;
(ii) the principal portion of all proceeds received in respect of the
repurchase of a Collateral Allocation Group 1 Mortgage Loan (or, in the case
of a substitution, certain amounts representing a principal adjustment as
required by this Agreement) during the related Prepayment Period; and
(iii) the principal portion of all other unscheduled collections,
including Insurance Proceeds, condemnation proceeds, Liquidation Proceeds and
all partial Principal Prepayments and Principal Prepayments in full, received
during the related Prepayment Period, to the extent applied as recoveries of
principal on the Collateral Allocation Group 1 Mortgage Loans, provided, that
in no event will the Group 1 Principal Remittance Amount with respect to any
Distribution Date be (x) less than zero or (y) greater than the then
outstanding aggregate Class Principal Balance of the Group 1 Certificates.
Group 1 Priority Amount: With respect to any Distribution Date, the
amount equal to the product of (i) the Group 1 Priority Percentage, (ii) the
Group 1 Shift Percentage and (iii) the portion of the Group 1 Principal
Distribution Amount allocable to the Class 1-A Certificates for that
Distribution Date.
Group 1 Priority Percentage: With respect to any Distribution Date, the
fraction, expressed as a percentage, the numerator of which is the Class
Principal Balance of the Class 1-A-6 Certificates and the denominator of which
is the aggregate Class Principal Balance of the Class 1-A Certificates, in
each case prior to giving effect to any distributions of principal on the
Group 1 Certificates on that Distribution Date.
Group 1 Reserve Fund: A Reserve Fund established by the Securities
Administrator on behalf of the Trustee for the benefit of the Holders of the
Group 1 Certificates and the Class OC Certificates. The Group 1 Reserve Fund
is an "outside Reserve Fund" within the meaning of Treasury regulation Section
1.860G-2(h), which is not an asset of any REMIC, ownership of which is
evidenced by the Class OC Certificates, and which is established and
maintained pursuant to Section 5.10(d).
Group 1 Shift Percentage: With respect to each Distribution Date, the
percentage set forth below for that Distribution Date:
47
Distribution Date Percentage
August 2006 --July 2009........................... 0%
August 2009 --July 2011........................... 45%
August 2011 --July 2012........................... 80%
August 2012 --July 2013........................... 100%
August 2013 and thereafter........................ 300%
Group 1 Senior Certificates: As specified in the Preliminary Statement.
Group 1 Subordinated Certificates: As specified in the Preliminary
Statement.
Group 1 Subordinated Interest Distribution Amount: With respect to any
Class of Group 1 Subordinated Certificates and any Distribution Date, interest
accrued during the related Interest Accrual Period on the related Class
Principal Balance of that Class immediately prior to the Distribution Date at
the Pass-Through Rate for that Class reduced (to an amount not less than
zero), in the case of such Class, by the allocable share, if any, for that
Class of Prepayment Interest Shortfalls on the Collateral Allocation Group 1
Mortgage Loans to the extent not covered by (x) Compensating Interest paid by
the Master Servicer or the Servicers for the Collateral Allocation Group 1
Mortgage Loans and (y) Relief Act Interest Shortfalls on the Collateral
Allocation Group 1 Mortgage Loans.
Group 2 Certificates: As specified in the Preliminary Statement.
Group 2 Mortgage Loans: The Mortgage Loans in Loan Group 2.
Group 2 Priority Amount: With respect to any Distribution Date, the sum
of (i) the product of (A) the Senior Percentage for the Group 2 Certificates,
(B) the Scheduled Principal Distribution Amount for Collateral Allocation
Group 2, (C) the Aggregate II Shift Percentage and (D) the Group 2 Priority
Percentage and (ii) the product of (A) the Senior Prepayment Percentage for
the Group 2 Certificates, (B) the Unscheduled Principal Distribution Amount
for Collateral Allocation Group 2, (C) the Aggregate II Prepayment Shift
Percentage and (D) the Group 2 Priority Percentage.
Group 2 Priority Percentage: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate
Class Principal Balance of the Class 2-A-3 and Class 2-A-4 Certificates
immediately prior to such Distribution Date, and the denominator of which is
the aggregate Class Principal Balance of the Group 2 Senior Certificates
(other than the Class 2-A-P Certificates) immediately prior to such
Distribution Date.
Group 3 Certificates: As specified in the Preliminary Statement.
Group 3 Mortgage Loans: The Mortgage Loans in Loan Group 3.
Group 3 Priority Amount: With respect to any Distribution Date, the sum
of (i) the product of (A) the Senior Percentage for the Group 3 Certificates,
(B) the Scheduled Principal Distribution Amount for Collateral Allocation
Group 3, (C) the Aggregate II Shift Percentage and (D) the Group 3 Priority
Percentage and (ii) the product of (A) the Senior Prepayment
48
Percentage for the Group 3 Certificates, (B) the Unscheduled Principal
Distribution Amount for Collateral Allocation Group 3, (C) the Aggregate II
Prepayment Shift Percentage and (D) the Group 3 Priority Percentage.
Group 3 Priority Percentage: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate
Class Principal Balance of the Class 3-A-3 and Class 3-A-4 Certificates
immediately prior to such Distribution Date, and the denominator of which is
the aggregate Class Principal Balance of the Group 3 Senior Certificates
(other than the Class 3-A-P Certificates) immediately prior to such
Distribution Date.
Group 4 Certificates: As specified in the Preliminary Statement.
Group 4 LIBOR Certificates: As specified in the Preliminary Statement.
Holder: The registered owner of any Certificate as recorded on the books
of the Certificate Registrar except that, solely for the purposes of taking
any action or giving any consent pursuant to this Agreement, any Certificate
registered in the name of the Depositor, the Trustee, the Master Servicer, the
Securities Administrator and any Servicer, or any Affiliate thereof shall be
deemed not to be outstanding in determining whether the requisite percentage
necessary to effect any such consent has been obtained, except that, in
determining whether the Trustee or the Securities Administrator shall be
protected in relying upon any such consent, only Certificates that a
Responsible Officer of the Trustee or the Securities Administrator,
respectively, knows to be so owned shall be disregarded. The Trustee or the
Securities Administrator may request and conclusively rely on certifications
by the Depositor, the Master Servicer, the Securities Administrator or any
Servicer in determining whether any Certificates are registered to an
Affiliate of the Depositor, the Master Servicer, the Securities Administrator
or any Servicer.
HUD: The United States Department of Housing and Urban Development, or
any successor thereto.
Indemnifying Party: As specified in Section 12.08 hereof.
Independent: When used with respect to any Accountants, a Person who is
"independent" within the meaning of Rule 2-01(b) of the Securities and
Exchange Commission's Regulation S-X. When used with respect to any other
Person, a Person who (a) is in fact independent of another specified Person
and any Affiliate of such other Person, (b) does not have any material direct
financial interest in such other Person or any Affiliate of such other Person,
and (c) is not connected with such other Person or any Affiliate of such other
Person as an officer, employee, promoter, underwriter, trustee, partner,
director or Person performing similar functions.
Index: As to each Mortgage Loan, the index from time to time in effect
for adjustment of the Mortgage Rate as set forth as such on the related
Mortgage Note.
Initial Bankruptcy Coverage Amount: $150,000.
Initial Component Balance: As specified in the Preliminary Statement.
49
Initial Custodian Certification: As defined in Section 2.02.
Initial Optional Termination Date: With respect to the Group 1 Mortgage
Loans, the first Distribution Date following the date on which the aggregate
Stated Principal Balance of the Group 1 Mortgage Loans is equal to or less
than 10% of the aggregate Stated Principal Balance thereof as of the Cut-off
Date. With respect to the Aggregate Group II Mortgage Loans, the first
Distribution Date following the date on which the aggregate Stated Principal
Balance of the Aggregate Group II Mortgage Loans is equal to or less than 1%
of the aggregate Stated Principal Balance thereof as of the Cut-off Date
Insurance Policy: With respect to any Mortgage Loan, any insurance
policy, including all names and endorsements thereto in effect, including any
replacement policy or policies for any Insurance Policies.
Insurance Proceeds: Proceeds paid by any Insurance Policy (excluding
proceeds required to be applied to the restoration and repair of the related
Mortgaged Property or released to the Mortgagor), in each case other than any
amount included in such Insurance Proceeds in respect of Insured Expenses and
the proceeds from any Limited Purpose Surety Bond.
Insured Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to any Class of Group 1 LIBOR
Certificates and the August 2006 Distribution Date, the Interest Accrual
Period will be the 25-day period commencing on the Closing Date and ending on
the day immediately preceding that Distribution Date. The Interest Accrual
Period for any Distribution Date thereafter and any Class of Group 1 LIBOR
Certificates shall be the one-month period commencing on the Distribution Date
in the month prior to the month in which that Distribution Date occurs and
ending on the day immediately preceding that Distribution Date. For each other
Class of Group 1 Certificates and Distribution Date, the calendar month
immediately prior to the month in which that Distribution Date occurs. With
respect to each Class of Aggregate Group II Certificates other than the Group
4 LIBOR Certificates, its corresponding REMIC 2 REMIC Regular Interest and any
Distribution Date, the calendar month prior to the month of such Distribution
Date. With respect to any Class of Group 4 LIBOR Certificates, its
corresponding REMIC 2 REMIC Regular Interest and any Distribution Date, the
one month period commencing on the 25th day of the month preceding the month
in which such Distribution Date occurs and ending on the 24th day of the month
in which such Distribution Date occurs. With respect to each Class of Group 1
LIBOR Certificates, interest will be calculated on the basis of a 360-day year
and the actual number of days that elapsed in the related Interest Accrual
Period and for each other Class of Certificates, interest will be calculated
on the basis of a 360-day year consisting of twelve 30-day months.
Interest Carry Forward Amount: With respect to any Class of Group 1
Certificates and any Distribution Date, the amount, if any, by which the
Interest Distribution Amount for that Class of Certificates for the
immediately preceding Distribution Date exceeds the actual amount distributed
on such Class in respect of interest on the immediately preceding Distribution
Date, together with any Interest Carry Forward Amount with respect to such
Class remaining unpaid
50
from the previous Distribution Date, plus interest accrued thereon at the
related Pass-Through Rate for the most recently ended Interest Accrual Period.
Interest Determination Date: With respect to any Interest Accrual Period
for any Class of LIBOR Certificates, the second Business Day prior to the
first day of such Interest Accrual Period.
Interest Distribution Amount: With respect to the Group 1 Certificates
and any Distribution Date, the aggregate of the Class 1-A Interest
Distribution Amount and the Group 1 Subordinated Interest Distribution Amount
for that Distribution Date.
Interest Remittance Amount: For the Group 1 Certificates and any
Distribution Date, that portion of the Available Distribution Amount for such
Distribution Date that represents interest received or advanced on the
Collateral Allocation Group 1 Mortgage Loans.
Interest Transfer Amount: For any Distribution Date and for any
Undercollateralized Group of Aggregate Group II Senior Certificates, an amount
equal to one month's interest on the applicable Principal Transfer Amount at
the weighted average Pass-Through Rate of the applicable Undercollateralized
Group, plus any interest accrued on such Undercollateralized Group remaining
unpaid from prior Distribution Dates.
Investor Based Exemption: Any of Prohibited Transaction Class Exemption
("PTCE") 84-14 (for transactions by independent "qualified professional asset
managers"), PTCE 90-1 (for transactions by insurance company pooled separate
accounts), PTCE 91-38 (for transactions by bank collective investment funds),
PTCE 95-60 (for transactions by insurance company general accounts) or PTCE
96-23 (for transactions effected by "in house asset managers"), or any
comparable exemption available under Similar Law.
Last Scheduled Distribution Date: With respect to the Group 1
Certificates and the Aggregate Group II Certificates, the Distribution Date in
August 2036.
Latest Possible Maturity Date: The Distribution Date in August 2036.
LIBOR: The London interbank offered rate for one-month United States
dollar deposits calculated in the manner described in Section 5.09.
LIBOR Business Day: Any day on which banks in London, England and The
City of New York are open and conducting transactions in foreign currency and
exchange.
LIBOR Certificates: As specified in the Preliminary Statement.
Limited Purpose Surety Bond: Collectively, Ambac Assurance Corporation
Surety Bond No. AB0039BE and any other Limited Purpose Surety Bond securing an
Additional Collateral Mortgage Loan.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in
the calendar month preceding the month of such Distribution Date and as to
which the related Servicer has certified (in accordance
51
with its Purchase and Servicing Agreement) that it has received all amounts it
expects to receive in connection with the liquidation of such Mortgage Loan
including the final disposition of an REO Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds, received in
connection with the partial or complete liquidation of defaulted Mortgage
Loans, whether through trustee's sale, foreclosure sale or otherwise or
amounts received in connection with any condemnation or partial release of a
Mortgaged Property and any other proceeds received in connection with an REO
Property.
Living Holders: Not applicable.
Loan Group: Any of Loan Group 1, Loan Group 2 and Loan Group 3, as
applicable.
Loan Group 1: All Mortgage Loans identified as Group 1 Mortgage Loans on
the Mortgage Loan Schedule.
Loan Group 2: All Mortgage Loans identified as Group 2 Mortgage Loans on
the Mortgage Loan Schedule.
Loan Group 3: All Mortgage Loans identified as Group 3 Mortgage Loans on
the Mortgage Loan Schedule.
Loan Group Percentage: As to any Loan Group and any Distribution Date,
the fraction, expressed as a percentage, the numerator of which is the
aggregate Stated Principal Balance of all of the Mortgage Loans in that Loan
Group as of the related Due Date, and the denominator of which is the
aggregate Stated Principal Balance of all of the Mortgage Loans as of that Due
Date.
Loan Group Principal Balance: As to any Distribution Date and Loan
Group, the aggregate Stated Principal Balance of the Mortgage Loans in that
Loan Group outstanding on the Due Date in the month preceding the month of the
Distribution Date (after giving effect to prepayments received in the
Prepayment Period related to such prior Due Date).
Loan-To-Value Ratio: With respect to any Mortgage Loan and as to any
date of determination, the fraction (expressed as a percentage) the numerator
of which is the principal balance of the related Mortgage Loan at such date of
determination and the denominator of which is the Appraised Value of the
related Mortgaged Property.
LPMI Mortgage Loan: Certain Mortgage Loans as to which the lender
(rather than the borrower) acquires the Primary Mortgage Insurance Policy and
charges the related borrower an interest premium.
Master REMIC: As described in the Preliminary Statement.
Master Servicer: Xxxxx Fargo Bank, National Association, a national
banking association organized under the laws of the United States in its
capacity as Master Servicer and any Person succeeding as Master Servicer
hereunder or any successor in interest, or if any successor master servicer
shall be appointed as herein provided, then such successor master servicer.
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Master Servicer Compensation: With respect to any Master Servicer that
is a successor to Xxxxx Fargo Bank, National Association as Master Servicer,
the portion of the earnings on the funds on deposit in the Distribution
Account payable on each Distribution Date pursuant to Section 4.02(b)(ii)
hereof agreed to by and between such successor Master Servicer and the
successor securities administrator; provided, that the sum of such Master
Servicer Compensation and the Securities Administrator Compensation payable on
each Distribution Date shall not exceed the total earnings on funds in the
Distribution Account payable pursuant to Section 4.02(b)(ii) hereof earned
since the prior Distribution Date.
Memorandum: The private placement memorandum dated July 31, 2006,
relating to the Private Certificates.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any
successor to Mortgage Electronic Registration Systems, Inc.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on the
MERS(R) System.
MERS(R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The mortgage identification number for any MERS Mortgage Loan.
Minimum Auction Price: With respect to any Distribution Date on which an
Auction of the Group 1 Assets is being held, an amount equal to the sum of (a)
100% of the current aggregate Stated Principal Balance of the Collateral
Allocation Group 1 Mortgage Loans, plus accrued interest thereon, (b) the fair
market value of any related REO Property in the Trust Fund and all other
property related to Collateral Allocation Group 1 in the Trust Fund being
purchased, (c) any unreimbursed Servicing Advances related to the Collateral
Allocation Group 1 Mortgage Loans and (d) any expenses incurred by the Auction
Administrator in the Auction process.
MOM Loan: Any Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns.
Moody's: Xxxxx'x Investors Service, Inc., or any successor thereto. If
Xxxxx'x is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 11.07 the address for notices to Moody's shall be Xxxxx'x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Residential Pass-Through Monitoring, or such other address as
Moody's may hereafter furnish to the Depositor or the Master Servicer.
Mortgage: A mortgage, deed of trust or other instrument encumbering a
fee simple interest in real property securing a Mortgage Note, together with
improvements thereto.
Mortgage Documents: With respect to each Mortgage Loan, the mortgage
documents required to be delivered to the Custodian pursuant to each Custodial
Agreement.
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Mortgage Loan: A Mortgage and the related notes or other evidences of
indebtedness secured by each such Mortgage conveyed, transferred, sold,
assigned to or deposited with the Trustee pursuant to Section 2.01 (including
any REO Property), including without limitation, each Mortgage Loan listed on
the Mortgage Loan Schedule, as amended from time to time.
Mortgage Loan Auction Price: The price, calculated as set forth in
Section 7.01(b), to be paid in connection with the purchase of the Collateral
Allocation Group 1 Mortgage Loans by the Auction Purchaser.
Mortgage Loan Schedule: The schedule attached hereto as Schedule A,
which shall identify each Mortgage Loan, as such schedule may be amended by
the Depositor or a Servicer from time to time to reflect the addition of
Replacement Mortgage Loans to, or the deletion of Deleted Mortgage Loans from,
the Trust Fund. Such schedule shall, among other things (i) designate the
Servicer servicing such Mortgage Loan and the applicable Servicing Fee Rate;
(ii) identify the designated Loan Group in which such Mortgage Loan is
included, (iii) identify any LPMI Mortgage Loan and designate the rate at
which the premium for such insurance is calculated, (iv) separately identify
the Additional Collateral Mortgage Loans, (v) identify the Applicable Fraction
and related Collateral Allocation Group or Collateral Allocation Groups for
such Mortgage Loan.
Mortgage Note: The original executed note or other evidence of the
indebtedness of a Mortgagor secured by a Mortgage under a Mortgage Loan.
Mortgaged Property: The underlying property, including any Additional
Collateral, securing a Mortgage Loan which, with respect to a Cooperative
Loan, is the related Cooperative Shares and Proprietary Lease.
Mortgage Rate: As to any Mortgage Loan, the annual rate of interest
borne by the related Mortgage Notes.
MortgageIT Mortgage Loan: Each Mortgage Loan originated by MortgageIT,
Inc. and listed on the Mortgage Loan Schedule.
MortgageIT Purchase Agreement: The Mortgage Loan Purchase Agreement
listed in Exhibit E hereto between the Seller and MortgageIT, Inc.
Mortgagor: The obligor on a Mortgage Note.
MSCC Serviced Mortgage Loan: Each Mortgage Loan originated and serviced
by Xxxxxx Xxxxxxx Credit Corp. and listed on the Mortgage Loan Schedule.
MSCC Purchase Agreement: The Second Amended and Restated Master Mortgage
Loan Purchase Agreement listed in Exhibit E hereto between the Seller and
Xxxxxx Xxxxxxx Credit Corp. (as successor to Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit
Corporation).
MSCC Purchase and Servicing Agreement: Collectively, the MSCC Purchase
Agreement and the MSCC Servicing Agreement.
54
MSCC Servicing Agreement: The Amended and Restated Master Servicing
Agreement listed in Exhibit E hereto between the Seller and Xxxxxx Xxxxxxx
Credit Corp. (as successor to Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit Corporation).
MSMCI Mortgage Loan: A Mortgage Loan sold by the Seller to the Depositor
pursuant to the MSMCI Purchase Agreement.
MSMCI Purchase Agreement: The Mortgage Loan Purchase Agreement listed in
Exhibit E hereto between the Seller and the Depositor.
Net Liquidation Proceeds: With respect to any Liquidated Mortgage Loan
or any other disposition of related Mortgaged Property, the related
Liquidation Proceeds net of Advances, Servicer Advances, Servicing Fees and
any other accrued and unpaid servicing fees received and retained in
connection with the liquidation of such Mortgage Loan or Mortgaged Property.
Net Monthly Excess Cashflow: For the Group 1 Certificates and any
Distribution Date, the excess, if any, of (x) the Available Distribution
Amount for the Distribution Date over (y) the sum for the Distribution Date of
the aggregate of the Class 1-A Interest Distribution Amounts payable to the
holders of the Group 1 Senior Certificates, the Group 1 Subordinated Interest
Distribution Amounts payable to the holders of the Group 1 Subordinated
Certificates and the Group 1 Principal Distribution Amount.
Net Mortgage Rate: With respect to any Mortgage Loan and any
Distribution Date, the related Mortgage Rate as of the Due Date in the month
preceding the month of such Distribution Date reduced by the Aggregate Expense
Rate for such Mortgage Loan.
Net Prepayment Interest Shortfalls: As to any Distribution Date and
Collateral Allocation Group, the amount by which the aggregate of Prepayment
Interest Shortfalls for the Mortgage Loans in such Collateral Allocation Group
exceeds the Compensating Interest Payments for the Mortgage Loans or
Applicable Fractions thereof in such Collateral Allocation Group (and any
amounts paid by the Master Servicer in respect of such shortfalls pursuant to
Section 5.06) and that Distribution Date, in each case, based upon the
Applicable Fractions thereof that are part of such Collateral Allocation
Group.
Net Swap Payment: Not Applicable.
Net Swap Receipt: Not Applicable.
Net WAC Pass-Through Rate: For the Group 1 Certificates and any
Distribution Date, a per annum rate equal to the Weighted Average Net Mortgage
Rate of the Collateral Allocation Group 1 Mortgage Loans as of the first day
of the month preceding the month in which such Distribution Date occurs,
adjusted in the case of the Group 1 LIBOR Certificates only, to accrue on the
basis of a 360-day year and the actual number of days in the related Interest
Accrual Period, except that with respect to the August 2006 Distribution Date,
the number of days in the related Interest Accrual Period shall be 25.
Non-A-P Formula Principal Amount: As to any Distribution Date and
Collateral Allocation Group in Aggregate Loan Group II, the sum of (i) the sum
of (x) the applicable Non-
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A-P Percentage of (a) the principal portion of each Scheduled Payment (without
giving effect, prior to the Bankruptcy Coverage Termination Date, to any
reductions thereof caused by any Debt Service Reductions or Deficient
Valuations) due on the Applicable Fraction of each Mortgage Loan in the
related Collateral Allocation Group on the related Due Date, (b) the Stated
Principal Balance of the Applicable Fraction of each Mortgage Loan in the
related Collateral Allocation Group that was repurchased by the Depositor, the
Seller or an Originator or purchased by the Master Servicer pursuant to this
Agreement as of such Distribution Date, (c) the Substitution Adjustment Amount
in connection with any Deleted Mortgage Loan in such Collateral Allocation
Group received with respect to such Distribution Date, (d) any Insurance
Proceeds or Liquidation Proceeds allocable to recoveries of principal of the
Applicable Fraction of Mortgage Loans in the related Collateral Allocation
Group that are not yet Liquidated Mortgage Loans received during the calendar
month preceding the month of such Distribution Date, (e) with respect to the
Applicable Fraction of each Mortgage Loan in the related Collateral Allocation
Group that became a Liquidated Mortgage Loan during the calendar month
preceding the month of such Distribution Date, the amount of Liquidation
Proceeds allocable to principal received with respect to such Mortgage Loan
allocable to that Collateral Allocation Group during the calendar month
preceding the month of such Distribution Date with respect to such Mortgage
Loan and, if such Liquidated Mortgage Loan is an Additional Collateral
Mortgage Loan, the principal portion of the proceeds of any Additional
Collateral allocated to the Collateral Allocation Group, and (f) the
Applicable Fraction of all Principal Prepayments with respect to the Mortgage
Loans in the related Collateral Allocation Group received during the related
Prepayment Period, and (ii) (A) any Subsequent Recoveries for such Loan Group
received during the calendar month preceding the month of such Distribution
Date, or (B) with respect to Subsequent Recoveries attributable to the
Applicable Fraction of a Discount Mortgage Loan in the related Collateral
Allocation Group which incurred (1) an Excess Loss or (2) a Realized Loss
after the Senior Credit Support Depletion Date, the Non-A-P Percentage of the
Applicable Fraction of any Subsequent Recoveries on the Mortgage Loans related
to such Collateral Allocation Group received during the calendar month
preceding the month of such Distribution Date.
Non-A-P Percentage: As to the Applicable Fraction any Discount Mortgage
Loan in Collateral Allocation Group 2 or Collateral Allocation Group 3, a
fraction (expressed as a percentage) the numerator of which is the Net
Mortgage Rate of such Discount Mortgage Loan and the denominator of which is
the Required Coupon for such Collateral Allocation Group. As to any
Non-Discount Mortgage in Collateral Allocation Group 2 or Collateral
Allocation Group 3 and any Mortgage Loan or Applicable Fraction thereof in
Combined Collateral Allocation Group 4, 100%.
Non-A-P Pool Balance: With respect to Collateral Allocation Group 2 and
Collateral Allocation Group 3 and any Due Date is equal to the excess, if any,
of (x) the Applicable Fraction of the aggregate Stated Principal Balance of
all Aggregate Group II Mortgage Loans in the related Collateral Allocation
Group over (y) the sum of the product of the A-P Percentage of the Applicable
Fraction of the Stated Principal Balance of each Discount Mortgage Loan in
that Collateral Allocation Group. The Non-A-P Pool Balance for Combined
Collateral Allocation Group 4 or Collateral Allocation Group 3, and any Due
Date is equal to the Applicable Fraction of the aggregate Stated Principal
Balance of all of the Aggregate Group II Mortgage Loans in Combined Collateral
Allocation Group 4.
56
Non-Book-Entry Certificate: Any Certificate other than a Book-Entry
Certificate.
Non-Delay Certificates: As specified in the Preliminary Statement.
Non-Discount Mortgage Loan: Any Mortgage Loan in Collateral Allocation
Group 2 or Collateral Allocation Group 3 with an Net Mortgage Rate that is
greater than or equal to the Required Coupon for that Collateral Allocation
Group. For the avoidance of doubt, all of the Mortgage Loans in Combined
Collateral Allocation Group 4 are Non-Discount Mortgage Loans.
Non-permitted Foreign Holder: As defined in Section 3.03(f).
Non-U.S. Person: Any person other than a "United States person" within
the meaning of Section 7701(a)(30) of the Code.
Nonrecoverable Advance: Any portion of an Advance or Servicer Advance
previously made or proposed to be made by the Master Servicer and/or a
Servicer (as certified in an Officer's Certificate of such Servicer), which in
the good faith judgment of such party, shall not be ultimately recoverable by
such party from the related Mortgagor, related Liquidation Proceeds or
otherwise.
Notional Amount: With respect to any Distribution Date and the Class
4-A-2 Certificates, an amount equal to the Class Principal Balance of the
Class 4-A-1 Certificates immediately prior to that Distribution Date.
Notional Amount Certificates: As specified in the Preliminary Statement.
Offered Certificates: As specified in the Preliminary Statement.
Offering Document: The Prospectus or the Memorandum, as applicable.
Officer's Certificate: A certificate signed by two Authorized Officers
of the Depositor or the Chairman of the Board, any Vice Chairman, the
President, any Vice President or any Assistant Vice President of the Master
Servicer or the Securities Administrator or in the case of any other Person,
signed by an authorized officer of such Person, and in each case delivered to
the Trustee or the Securities Administrator, as applicable signed by an
authorized officer of that Person.
Officer's Certificate of a Servicer: A certificate (i) signed by the
Chairman of the Board, the Vice Chairman of the Board, the President, a
Managing Director, a Vice President (however denominated), an Assistant Vice
President, the Treasurer, the Secretary, or one of the Assistant Treasurers or
Assistant Secretaries of a Servicer, or (ii) if provided for herein, signed by
a Servicing Officer, as the case may be, and delivered to the Trustee, the
Securities Administrator or the Master Servicer, as required hereby.
Opinion of Counsel: A written opinion of counsel, reasonably acceptable
in form and substance to the Trustee, the Securities Administrator or the
Master Servicer, as required hereby, and who may be in-house or outside
counsel to the Depositor, the Master Servicer, the Securities Administrator or
the Trustee but which must be Independent outside counsel with respect to any
57
such opinion of counsel concerning the transfer of any Residual Certificate or
concerning certain matters with respect to ERISA, or the taxation, or the
federal income tax status, of each REMIC.
Original Applicable Credit Support Percentage: With respect to each of
the following Classes of Aggregate Group II Subordinated Certificates, the
corresponding percentage described below, as of the Closing Date:
The Aggregate Group II Subordinated Original Applicable
Certificates Credit Support Percentage
Class B-1...................................... 5.00%
Class B-2...................................... 3.20%
Class B-3...................................... 2.05%
Class B-4...................................... 1.40%
Class B-5...................................... 0.80%
Class B-6...................................... 0.35%
Original Subordinate Principal Balance: On or prior to the third related
Senior Termination Date, the Subordinated Percentage for an Aggregate Group II
Loan Group of the aggregate of the Stated Principal Balances of the Aggregate
Group II Mortgage Loans in such Loan Group, in each case as of the Cut-off
Date; or if such date is after the third related Senior Termination Date, the
aggregate of the Class Principal Balances of the Aggregate Group II
Subordinated Certificates as of the Closing Date.
Originator: Any one of American Home Mortgage Corporation, GreenPoint
Mortgage Funding, Inc., Xxxxxx Xxxxxxx Credit Corp., MortgageIT, Inc., Quicken
Loans, Inc., PHH Mortgage Corporation and Sovereign Bank as applicable.
Overcollateralization Increase Amount: With respect to the Group 1
Certificates and any Distribution Date will be the amount, if any, by which
the Overcollateralization Target Amount exceeds the Overcollateralized Amount
for such Distribution Date (calculated for this purpose only after assuming
that 100% of the Group 1 Principal Remittance Amount on such Distribution Date
has been distributed).
Overcollateralization Release Amount: For any Distribution Date, the
lesser of (1) the Principal Remittance Amount and (2) the excess of (a) the
Overcollateralized Amount over (b) the Overcollateralization Target Amount. In
addition, in connection with the final distribution on the Group 1
Certificates pursuant to Section 7.02 hereof, the Overcollateralization
Release Amount for the related Distribution Date shall also include the
excess, if any of, (a) the purchase price paid for the Collateral Allocation
Group 1 Mortgage Loans and any REO Properties related to the Collateral
Allocation Group 1 Mortgage Loans pursuant to Section 7.01 hereof, less any
costs incurred by the Trust Fund in connection with the liquidation thereof
pursuant to Section 7.02 hereof, over (b) the amount distributed on the Group
1 Certificates on that Distribution Date.
Overcollateralization Target Amount: With respect to the Group 1
Certificates and any Distribution Date (i) prior to the Stepdown Date, the
product of (x) 1.35% and (y) the aggregate Stated Principal Balance of the
Collateral Allocation Group 1 Mortgage Loans as of the Cut-off
58
Date, (ii) on and after the Stepdown Date, provided that a Trigger Event is
not in effect, the lesser of (a) the product of (x) 2.70% and (y) the
aggregate Stated Principal Balance of the Collateral Allocation Group 1
Mortgage Loans as of the related Due Date and (b) the product of (x) 1.35% and
(y) the aggregate Stated Principal Balance of the Collateral Allocation Group
1 Mortgage Loans as of the Cut-off Date and (iii) on and after the Stepdown
Date, if a Trigger Event is in effect, the Overcollateralization Target Amount
for the immediately preceding Distribution Date; provided, however, that on
each Distribution Date the Overcollateralization Target Amount shall not be
lower than $1,138,588.
Overcollateralized Amount: With respect to the Group 1 Certificates as
of the Closing Date will be an amount equal to $4,396,833. With respect to any
Distribution Date following the Closing Date, the Overcollateralized Amount is
the amount by which the aggregate Stated Principal Balance of the Collateral
Allocation Group 1 Mortgage Loans as of the last day of the related Due Period
exceeds the aggregate Class Principal Balances of the Group 1 Certificates
after taking into account all payments of principal on such Distribution Date.
Overcollateralized Group: With respect to any Distribution Date and
Aggregate Group II Senior Certificate Group, as defined in Section 5.08
hereof.
Pass-Through Rate: For any interest bearing Class of Certificates or
Component, the per annum rate set forth or calculated in the manner described
in the Preliminary Statement.
Paying Agent: Any paying agent appointed pursuant to Section 3.08. The
initial Paying Agent shall be the Securities Administrator under this
Agreement.
PCOAB: The Public Company Accounting Oversight Board.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the initial principal balance or notional
amount, as applicable, of such Certificate by the aggregate of the Class
Principal Balance or Notional Amount, as applicable, of all Certificates of
the same Class.
Permitted Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof,
provided that such obligations are backed by the full faith and credit
of the United States;
(ii) general obligations of or obligations guaranteed by any state
of the United States or the District of Columbia receiving the highest
long-term debt rating of each Rating Agency, or such lower rating as
shall not result in the downgrading or withdrawal of the ratings then
assigned to the Certificates by the Rating Agencies, as evidenced by a
signed writing delivered by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the highest commercial or finance company paper rating of each Rating
Agency rating such paper, or such lower rating as shall not result in
the downgrading or withdrawal of the ratings then
59
assigned to the Certificates by the Rating Agencies, as evidenced by a
signed writing delivered by each Rating Agency;
(iv) certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state thereof
and subject to supervision and examination by federal and/or state
banking authorities, provided that the commercial paper and/or long-term
unsecured debt obligations of such depository institution or trust
company (or in the case of the principal depository institution in a
holding company system, the commercial paper or long-term unsecured debt
obligations of such holding company, but only if Xxxxx'x is not the
applicable Rating Agency) are then rated one of the two highest
long-term and the highest short-term ratings of each Rating Agency for
such securities, or such lower ratings as shall not result in the
downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency;
(v) demand or time deposits or certificates of deposit issued by
any bank or trust company or savings institution to the extent that such
deposits are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation acceptable to the Rating Agencies
at the time of the issuance of such agreements, as evidenced by a signed
writing delivered by each Rating Agency;
(vii) repurchase obligations with respect to any security
described in clauses (i) and (ii) above, in either case entered into
with a depository institution or trust company (acting as principal)
described in clause (iv) above;
(viii) securities (other than stripped bonds, stripped coupons or
instruments sold at a purchase price in excess of 115% of the face
amount thereof) bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States or any
state thereof which, at the time of such investment, have one of the two
highest ratings of each Rating Agency (except if the Rating Agency is
Moody's, such rating shall be the highest commercial paper rating of
Moody's for any such series), or such lower rating as shall not result
in the downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency;
(ix) interests in any money market fund which at the date of
acquisition of the interests in such fund and throughout the time such
interests are held in such fund has the highest applicable rating by
each Rating Agency rating such fund or such lower rating as shall not
result in a change in the rating then assigned to the Certificates by
each Rating Agency, as evidenced by a signed writing delivered by each
Rating Agency, including funds for which the Trustee, the Master
Servicer, the Securities Administrator or any of its Affiliates is
investment manager or adviser;
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(x) short-term investment funds sponsored by any trust company or
national banking association incorporated under the laws of the United
States or any state thereof which on the date of acquisition has been
rated by each applicable Rating Agency in their respective highest
applicable rating category or such lower rating as shall not result in a
change in the rating then specified stated maturity and bearing interest
or sold at a discount acceptable to each Rating Agency as shall not
result in the downgrading or withdrawal of the ratings then assigned to
the Certificates by the Rating Agencies, as evidenced by a signed
writing delivered by each Rating Agency; and
(xi) such other investments having a specified stated maturity and
bearing interest or sold at a discount acceptable to the Rating Agencies
as shall not result in the downgrading or withdrawal of the ratings then
assigned to the Certificates by the Rating Agencies, as evidenced by a
signed writing delivered by each Rating Agency;
provided, that no such instrument shall be a Permitted Investment if (i) such
instrument evidences the right to receive interest only payments with respect
to the obligations underlying such instrument or (ii) such instrument would
require the Depositor to register as an investment company under the
Investment Company Act of 1940, as amended.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
PHH Purchase and Servicing Agreement: Collectively, the PHH Purchase
Agreement and the PHH Servicing Agreement.
PHH Purchase Agreement: The Mortgage Loan Purchase and Warranties
Agreement listed in Exhibit E hereto among the Seller, PHH Mortgage
Corporation (formerly known as Cendant Mortgage Corporation), as a seller and
servicer, and Xxxxxx'x Gate Residential Mortgage Trust, as a seller.
PHH Servicing Agreement: Second Amended and Restated Mortgage Loan Flow
Purchase, Sale & Servicing Agreement listed on Exhibit E hereto between the
Seller and PHH Mortgage Corporation (formerly known as Cendant Mortgage
Corporation) and Xxxxxx'x Gate Residential Mortgage Trust.
PHH Serviced Mortgage Loan: Each Mortgage Loan originated and serviced
by PHH Mortgage Corporation (formerly known as Cendant Mortgage Corporation)
and listed on the Mortgage Loan Schedule.
Plan: Any employee benefit plan or other plan or arrangement subject to
Section 406 of ERISA or Section 4975 of the Code, including individual
retirement accounts and annuities, Xxxxx plans and collective investment funds
and separate accounts in which such plans, accounts or arrangements are
invested.
Plan Asset Regulations: The Department of Labor regulations set forth in
29 C.F.R. ss.2510.3-101.
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Planned Balance: With respect to any group of Planned Principal Classes
or Components in the aggregate and any Distribution Date appearing in Schedule
B hereto, the Aggregate Planned Balance for such group and Distribution Date.
With respect to any other Planned Principal Class or Component and any
Distribution Date appearing in Schedule B hereto, the applicable amount
appearing opposite such Distribution Date for such Class or Component.
Planned Principal Classes: As specified in the Preliminary Statement.
Pool Percentage: With respect to either Loan Group 1 or the Aggregate
Group II Mortgage Loans in the aggregate and any Distribution Date, the
fraction, expressed as a percentage, the numerator of which is the aggregate
Stated Principal Balance of all of the Mortgage Loans in Loan Group 1 or the
Aggregate Group II Mortgage Loans in the aggregate, respectively, as of the
related Due Date, and the denominator of which is the aggregate Stated
Principal Balance of all of the Mortgage Loans in the Mortgage Pool as of that
Due Date.
Prepayment Interest Shortfall: With respect to each Mortgage Loan, the
amount of the shortfall in interest payable on such Mortgage Loan that occurs
as a result of the prepayment by the related Mortgagor of such Mortgage Loan
calculated in accordance with formula set forth in the related Purchase and
Servicing Agreement.
Prepayment Penalty: As to a Mortgage Loan, any penalty payable by a
Mortgagor in connection with certain partial prepayments and all prepayments
in full made within the related Prepayment Penalty Period, the Prepayment
Penalties with respect to each applicable Mortgage Loan so held by the Trust
Fund being identified in the Prepayment Penalty Schedule.
Prepayment Penalty Period: As to any Mortgage Loan, the period of time
during which a Prepayment Penalty may be imposed.
Prepayment Penalty Schedule: As of any date, the list of Prepayment
Penalties included in the Trust Fund on that date (including the Prepayment
Penalty summary attached thereto). The Prepayment Penalty Schedule shall set
forth the following information with respect to each Prepayment Penalty:
o the Mortgage Loan account number;
o a code indicating the type of Prepayment Penalty;
o the state of origination in which the related Mortgage Property is
located;
o the first date on which a monthly payment is or was due under the
related Mortgage Note;
o the term of the Prepayment Penalty;
o the original principal amount of the related Mortgage Loan; and
o the Cut-off Date Principal Balance of the related Mortgage Loan.
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The Prepayment Penalty Schedule shall be amended from time to time by
the Seller in accordance with this Agreement.
Prepayment Period: With respect to any Mortgage Loan and any
Distribution Date, the calendar month preceding that Distribution Date.
Prepayment Shift Percentage: Not applicable.
Primary Mortgage Insurance Policy: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect to any
Mortgage Loan.
Principal Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date and is not
accompanied by an amount representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Reductions: For each Collateral Allocation Group in Aggregate
Loan Group I, the sum of the Non-A-P Formula Principal Distribution Amount and
the Non-A-P Percentage of any Realized Losses allocated to such Collateral
Allocation Group.
Principal Relocation Payment: A payment from any Collateral Allocation
Group in Aggregate Loan Group II to a Subsidiary REMIC Regular Interest other
than a Regular Interest corresponding to that Collateral Allocation Group as
provided in the Preliminary Statement. Principal Relocation Payments shall be
made of principal allocations comprising the Non-A-P Formula Principal
Distribution Amount from a Collateral Allocation Group and shall include a
proportionate allocation of Realized Losses from the Mortgage Loans or
Applicable Fractions thereof related to such Collateral Allocation Group.
Principal Transfer Amount: For any Distribution Date and for any
Undercollateralized Group related to Aggregate Loan Group II, the excess, if
any, of the aggregate Class Principal Balance of such Undercollateralized
Group immediately prior to such Distribution Date, over the aggregate Stated
Principal Balance of the related Collateral Allocation Group immediately prior
to such Distribution Date.
Priority Amount: Not applicable.
Priority Percentage: Not applicable.
Private Certificate: As specified in the Preliminary Statement.
Pro Rata Share: As to any Distribution Date, the Aggregate Group II
Subordinated Principal Distribution Amount and any Class of Aggregate Group II
Subordinated Certificates, the portion of the Aggregate Group II Subordinated
Principal Distribution Amount allocable to such Class, equal to the product of
the Aggregate Group II Subordinated Principal Distribution Amount on such
Distribution Date and a fraction, the numerator of which is the related Class
63
Principal Balance thereof and the denominator of which is the aggregate of the
Class Principal Balances of the Aggregate Group II Subordinated Certificates.
Pro Rata Subordinated Percentage: As to any Distribution Date and
Aggregate Group II Loan Group, 100% minus the related Senior Percentage for
such Distribution Date.
Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Proprietary Lease: With respect to any Cooperative Property, a lease or
occupancy agreement between a Cooperative Corporation and a holder of related
Cooperative Shares.
Prospectus: The prospectus supplement dated July 26, 2006, together with
the accompanying prospectus dated March 14, 2006, relating to the
Certificates.
Purchase and Servicing Agreements: Collectively, the mortgage loan
purchase and servicing agreements, each as amended by the related
Acknowledgement, listed in Exhibit E hereto, as each such agreement may be
amended or supplemented from time to time as permitted hereunder.
Purchase Date: As defined in Section 7.01(c).
Purchase Price: With respect to any Mortgage Loan required or permitted
to be purchased by the Seller or Depositor pursuant to this Agreement, or by
the related Originator or Servicer pursuant to the related Purchase and
Servicing Agreement, an amount equal to the sum of (i) 100% of the unpaid
principal balance of the Mortgage Loan on the date of such purchase and (ii)
accrued interest thereon at the applicable Net Mortgage Rate from the date
through which interest was last paid by the Mortgagor to the Due Date in the
month in which the Purchase Price is to be distributed to Certificateholders,
or such other amount as may be specified in the related Purchase and Servicing
Agreement and (iii) costs and damages incurred by the Trust Fund in connection
with a repurchase pursuant to Section 2.05 hereof that arises out of a
violation of any predatory or abusive lending law with respect to the related
Mortgage Loan.
Quicken Mortgage Loan: Each Mortgage Loan originated by Quicken Loans,
Inc. and listed on the Mortgage Loan Schedule.
Quicken Purchase Agreement: The Mortgage Loan Purchase Agreement listed
in Exhibit E hereto between the Seller and Quicken Loans, Inc.
Rating Agency: Each of the Rating Agencies specified in the Preliminary
Statement. If any such organization or a successor is no longer in existence,
"Rating Agency" shall be such nationally recognized statistical rating
organization, or other comparable Person, as is designated by the Depositor,
notice of which designation shall be given to the Trustee. References herein
to a given rating category of a Rating Agency shall mean such rating category
without giving effect to any modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Stated Principal Balance of the related
Mortgage Loan) as of the date of
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such liquidation, equal to (i) the Stated Principal Balance of the Liquidated
Mortgage Loan as of the date of such liquidation, plus (ii) interest at the
Net Mortgage Rate from the Due Date as to which interest was last paid or
advanced (and not reimbursed) to Certificateholders up to the Due Date in the
month in which Liquidation Proceeds are required to be distributed on the
Stated Principal Balance of such Liquidated Mortgage Loan from time to time,
minus (iii) the Liquidation Proceeds, if any, received during the month in
which such liquidation occurred, to the extent applied as recoveries of
interest at the Net Mortgage Rate and to principal of the Liquidated Mortgage
Loan. With respect to each Mortgage Loan which has become the subject of a
Deficient Valuation, if the principal amount due under the related Mortgage
Note has been reduced, 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 and any Distribution Date, the amount, if any, by
which the principal portion of the related Scheduled Payment has been reduced.
To the extent the Master Servicer or a Servicer receives Subsequent
Recoveries with respect to any Mortgage Loan, the amount of the Realized Loss
with respect to that Mortgage Loan will be reduced by such Subsequent
Recoveries.
Recognition Agreement: An agreement among a Cooperative Corporation, a
lender and a Mortgagor with respect to a Cooperative Loan whereby such parties
(i) acknowledge that such lender may make, or intends to make, such
Cooperative Loan, and (ii) make certain agreements with respect to such
Cooperative Loan.
Record Date: As to any Distribution Date (i) with respect to the
Non-Delay Certificates, the last Business Day preceding such Distribution Date
(or the Closing Date, in the case of the first Distribution Date) unless such
Certificates shall no longer be Book-Entry Certificates, in which case the
Record Date shall be the last Business Day of the month preceding the month of
such Distribution Date and (ii) in the case of the Delay Certificates
(including the Non-Delay Certificates that are subsequently reissued as
Definitive Certificates), the last Business Day of the month preceding the
month of each Distribution Date.
Redemption Price: With respect to any Class of Aggregate Group II
Certificates to be redeemed, an amount equal to 100% of the related Class
Principal Balance of the Certificates to be so redeemed, together with
interest on such amount at the applicable Pass-Through Rate through the
related Accrual Period (as increased by any Class Unpaid Interest Amounts),
and including, in the case of the Redemption Price payable in connection with
the redemption and retirement of all of the Aggregate Group II Certificates,
the payment of all amounts (including, without limitation, all previously
unreimbursed Advances and Servicer Advances and accrued and unpaid Servicing
Fees ) payable or reimbursable to the Trustee, the Securities Administrator,
the Master Servicer and the Servicers pursuant to this Agreement and the
Purchase and Servicing Agreements, or to the Custodian under the Custodial
Agreements (to the extent such amounts are not paid to the Custodian by the
Seller) related to the Aggregate Group II Mortgage Loans. With respect to the
Group 1 Certificates, in the aggregate, and any Distribution Date, the sum of
(a) 100% of the aggregate Stated Principal Balance of the Collateral
Allocation Group 1 Mortgage Loans as of the related Due Date (after giving
effect to Principal Prepayments received in the related Prepayment Period),
(b) the fair market value of any related REO Property and (c) all
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amounts (including, without limitation, all previously unreimbursed Advances
and Servicer Advances and accrued and unpaid Servicing Fees ) payable or
reimbursable to the Trustee, the Securities Administrator, the Master Servicer,
the Servicers or the Custodian pursuant to this Agreement, the Purchase and
Servicing Agreements, or the Custodial Agreements (to the extent such amounts
are not paid to the Custodian by the Seller) related to the Collateral
Allocation Group 1 Mortgage Loans.
Refinancing Mortgage Loan: Any Mortgage Loan originated in connection
with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from time to
time, and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005))
or by the staff of the Commission, or as may be provided by the Commission or
its staff from time to time.
Relevant Servicing Criteria: The Servicing Criteria applicable to the
various parties, as set forth on Exhibit O attached hereto. For clarification
purposes, multiple parties can have responsibility for the same Relevant
Servicing Criteria. With respect to a Servicing Function Participant engaged
by the Master Servicer, the Securities Administrator, any Servicer or any
Custodian, the term "Relevant Servicing Criteria" may refer to a portion of
the Relevant Servicing Criteria applicable to such parties.
Relief Act: The Servicemembers' Civil Relief Act (formerly known as the
Soldiers' and Sailors' Civil Relief Act of 1940), as amended, and any similar
state laws.
Relief Act Reduction: A reduction in the amount of the monthly interest
payment on a Mortgage Loan pursuant to the Servicemembers' Civil Relief Act.
Relief Act Shortfalls: With respect to any Distribution Date and any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Relief Act, the amount, if any, by which (i) interest
collectible on such Mortgage Loan for the most recently ended calendar month
is less than (ii) interest accrued thereon for such month pursuant to the
Mortgage Note.
REMIC: Each pool of assets in the Trust Fund designated as a REMIC as
described in the Preliminary Statement.
REMIC Provisions: The provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of the Code, and related provisions, and regulations, including
proposed regulations and rulings, and administrative pronouncements
promulgated thereunder, as the foregoing may be in effect from time to time.
REMIC 1A: As specified in the Preliminary Statement.
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REMIC 1A Interest: As specified in the Preliminary Statement.
REMIC 1A Regular Interest: As specified in the Preliminary Statement.
REMIC 1B: As specified in the Preliminary Statement.
REMIC 1B Interest: As specified in the Preliminary Statement.
REMIC 1B Regular Interest: As specified in the Preliminary Statement.
REMIC 2: As specified in the Preliminary Statement.
REMIC 2 Interest: As specified in the Preliminary Statement.
REMIC 2 Regular Interest: As specified in the Preliminary Statement.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan or otherwise treated as having been acquired pursuant to the
REMIC Provisions.
Replacement Mortgage Loan: A mortgage loan substituted by an Originator
or the Seller for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in a Request for Release, substantially in the form
attached to the related Custodial Agreement, (i) have a Stated Principal
Balance, after deduction of all Scheduled Payments due in the month of
substitution, not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan, (ii) if such Mortgage Loan is a fixed-rate Mortgage Loan, have
a Mortgage Rate not less than (and not more than two percentage points greater
than) the mortgage rate of the Deleted Mortgage Loan, (iii) if such Mortgage
Loan is an adjustable-rate Mortgage Loan, have a Mortgage Rate not less than
(and not more than two percentage points greater than) the mortgage rate of
the Deleted Mortgage Loan, (iv) have a Loan-to-Value Ratio equal to or less
than that of the Deleted Mortgage Loan, (v) have a remaining term to maturity
not greater than (and not more than one year less than) that of the Deleted
Mortgage Loan, (vi) is otherwise acceptable to the Seller, (vii) if such
Mortgage Loan is an adjustable-rate Mortgage Loan, have the same adjustment
date as that of the Deleted Mortgage Loan, (viii) if such Mortgage Loan is an
adjustable-rate Mortgage Loan, have a minimum Mortgage Rate not less than that
of the Deleted Mortgage Loan, (ix) if such Mortgage Loan is an adjustable-rate
Mortgage Loan, have the same Index as that of the Deleted Mortgage Loan, (x)
comply with all of the representations and warranties set forth in the related
underlying servicing agreement, as modified by any related assignment thereof,
and (xi) shall be accompanied by an Opinion of Counsel that such Replacement
Mortgage Loan would not adversely affect the REMIC status of any REMIC created
hereunder or would not otherwise be prohibited by this Pooling and Servicing
Agreement.
Replacement Swap Counterparty Payment: Not Applicable.
Reportable Event: As defined in Section 12.03 hereof.
Reporting Party: The Depositor, any Originator, the Master Servicer, any
Custodian, any Servicer, any originator identified in the Prospectus
Supplement, any credit enhancement
67
provider described herein and any other material transaction party as may be
mutually agreed between the Depositor and the Master Servicer from time to
time for the purpose of complying with the requirements of the Commission.
Reporting Subcontractor: With respect to the Master Servicer, the
Securities Administrator or any Custodian, any Subcontractor determined by
such Person pursuant to Section 12.08(b) to be "participating in the servicing
function" within the meaning of Item 1122 of Regulation AB. References to a
Reporting Subcontractor shall refer only to the Subcontractor of such Person
and shall not refer to Subcontractors generally.
Repurchase Price: With respect to any Mortgage Loan purchased from the
Trust pursuant to Section 2.07 hereof, 100% of the unpaid principal balance of
such Mortgage Loan, plus all related accrued and unpaid interest, and the
amount of any unreimbursed Servicing Advances made by the Servicers or the
Master Servicer related to the Mortgage Loan.
Request for Release: The Request for Release submitted by the applicable
Servicer to the Trustee or the applicable Custodian, as applicable,
substantially in the form of Exhibit M or the equivalent form under the
applicable Custodial Agreement.
Required Coupon: With respect to the Collateral Allocation Group 1
Mortgage Loans, the Collateral Allocation Group 2 Mortgage Loans and the
Collateral Allocation Group 3 Mortgage Loans, 6.00% per annum, and, with
respect to the Combined Collateral Allocation Group 4 Mortgage Loans, 7.50%
per annum.
Required Distributions: Not applicable.
Reserve Fund Deposit: With respect to the Group 1 Reserve Fund, $1,000.
Reserve Fund: The Group 1 Reserve Fund.
Residual Certificate: The Class A-R Certificates.
Responsible Officer: With respect to the Trustee, any officer in the
corporate trust department or similar group of the Trustee with direct
responsibility for the administration of this Agreement and also, with respect
to a particular corporate trust matter, any other officer to whom such matter
is referred because of his or her knowledge of and familiarity with the
particular subject. With respect to the Master Servicer, any officer in its
master servicing operations with direct responsibility for the Administration
of this Agreement. With respect to the Securities Administrator, any officer
in the corporate trust department or similar group of the Securities
Administrator with direct responsibility for the administration of this
Agreement and also, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of his or her knowledge
of and familiarity with the particular subject.
Restricted Classes: As defined in Section 5.02(e).
Restricted Global Security: As defined in Section 3.01(c).
Rule 144A: Rule 144A under the Securities Act.
SAIF: The Saving's Association Insurance Fund, or any successor thereto.
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Xxxxxxxx-Xxxxx Act: The Xxxxxxxx-Xxxxx Act of 2002 and the rules and
regulations of the Commission promulgated thereunder (including any
interpretations thereof by the Commission's staff).
Xxxxxxxx-Xxxxx Certification: A written certification covering the
activities of all Servicing Function Participants and signed by a senior
officer of the Master Servicer in charge of the master servicing function that
complies with (i) the Xxxxxxxx-Xxxxx Act of 2002, as amended from time to
time, and (ii) Exchange Act Rules 13a-14(d) and 15d-14(d), as in effect from
time to time.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc. If
S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 11.07 the address for notices to S&P shall be Standard &
Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Master Servicer.
Scheduled Balances: Not applicable.
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified in the related Purchase and Servicing
Agreement, shall give effect to any related Debt Service Reduction and any
Deficient Valuation that affects the amount of the monthly payment due on such
Mortgage Loan.
Scheduled Principal Classes: As specified in the Preliminary Statement.
Scheduled Principal Distribution Amount: As to any Distribution Date and
a Collateral Allocation Group in Aggregate Loan Group II, an amount equal to
the Non-A-P Percentage of all amounts described in subclauses (a) through (d)
of clause (i) of the definition of "Non-A-P Formula Principal Amount" for such
Distribution Date and such Collateral Allocation Group; provided, however,
that if a Bankruptcy Loss that is an Excess Loss is sustained with respect to
a Mortgage Loan in the related Loan Group that is not a Liquidated Mortgage
Loan, the Scheduled Principal Distribution Amount for such Collateral
Allocation Group will be reduced on the related Distribution Date by the
applicable Non-A-P Percentage of the principal portion of such Bankruptcy Loss
based on the Applicable Fraction of such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations thereunder.
Securities Administrator: Xxxxx Fargo Bank, National Association, not in
its individual capacity but solely as Securities Administrator, or any
successor in interest, or if any successor Securities Administrator shall be
appointed as herein provided, then such successor Securities Administrator.
Securities Administrator Compensation: With respect to any Securities
Administrator that is a successor to Xxxxx Fargo Bank, National Association as
Securities Administrator, the portion of the earnings on the funds on deposit
in the Distribution Account payable on each Distribution Date pursuant to
Section 4.02(b)(ii) hereof agreed to by and between such Securities
69
Administrator and the successor master servicer; provided, that (x) such
Securities Administrator Compensation payable on each Distribution Date shall
equal at least one day's earnings accrued since the prior Distribution Date
and (y) the sum of such Securities Administrator Compensation and the Master
Servicer Compensation payable on each Distribution Date shall not exceed the
total earnings on the funds on deposit in the Distribution Account payable on
each Distribution Date pursuant to Section 4.02(b)(ii) hereof earned since the
prior Distribution Date.
Seller: Xxxxxx Xxxxxxx Mortgage Capital Inc., a New York corporation.
Senior Certificate Group: As specified in the Preliminary Statement.
Senior Certificates: As specified in the Preliminary Statement.
Senior Credit Support Depletion Date: With respect to the Aggregate
Group II Senior Certificates, the date on which the Class Principal Balance of
each Class of Aggregate Group II Subordinated Certificates has been reduced to
zero.
Senior Defaulted Swap Termination Payment: Not Applicable.
Senior Enhancement Percentage: For any Distribution Date and the Group 1
Senior Certificates, the percentage obtained by dividing (x) the sum of (i)
the aggregate Class Principal Balance of the Group 1 Subordinated Certificates
and (ii) the Overcollateralized Amount by (y) the aggregate Stated Principal
Balance of the Collateral Allocation Group 1 Mortgage Loans as of the end of
the related Due Period, calculated after taking into account distributions of
principal on the Collateral Allocation Group 1 Mortgage Loans and distribution
of the Group 1 Principal Distribution Amount to the holders of the Group 1
Certificates then entitled to distributions of principal on such Distribution
Date.
Senior P&I Portion: With respect to the Aggregate Group II Mortgage
Loans, a portion related to each Collateral Allocation Group, each of which
will have the principal balances and pass-through rates set forth below as of
the closing date:
Initial Principal Pass-Through Related Collateral Related Senior
Balance Rate Allocation Group Certificate Group
------------------- ----------------- ----------------------- ---------------------
Group 2 Senior P&I Portion.... $152,486,100 6.00% Collateral Allocation Senior Certificate
Group 2 Group 2
Group 3 Senior P&I Portion.... $114,638,000 6.00% Collateral Allocation Senior Certificate
Group 3 Group 3
Group 4A Senior P&I Portion... $44,166,000 7.50% Collateral Allocation Senior Certificate
Group 4A Group 4
Group 4B Senior P&I Portion... $25,226,000 7.50% Collateral Allocation Senior Certificate
Group 4B Group 4
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Senior Percentage: With respect to any Senior Certificate Group in
Aggregate Group II and Distribution Date on or prior to the third related
Senior Termination Date will be equal to the Senior Percentage of the related
Senior P&I Portion or Portions for that Distribution Date. With respect to any
Senior P&I Portion in Aggregate Group II and Distribution Date on or prior to
the third related Senior Termination Date is the percentage equivalent of a
fraction the numerator of which is the principal balance of such Senior P&I
Portion immediately prior to such Distribution Date and the denominator of
which is the aggregate of the applicable Non-A-P Percentage of the Stated
Principal Balance of each Mortgage Loan or the Applicable Fraction thereof in
the related Collateral Allocation Group as of the Due Date occurring in the
month prior to the month of such Distribution Date (after giving effect to
prepayments received in the Prepayment Period related to such prior Due Date);
provided, however, that on any Distribution Date after the third related
Senior Termination Date, the Senior Percentage for the Senior Certificates of
the remaining Senior Certificate Group in Aggregate Certificate Group II is
the percentage equivalent of a fraction, the numerator of which is the
aggregate of the Class Principal Balances of each such Class of Aggregate
Group II Senior Certificates (other than the related Class of Class A-P
Certificates and Notional Amount Certificates relating to the Aggregate Group
II Certificates) of such remaining Senior Certificate Group immediately prior
to such Distribution Date and the denominator is the aggregate of the Class
Principal Balances of all Classes of Aggregate Group II Certificates (other
than the related Class of Class A-P Certificates and related Classes of
Notional Amount Certificates), immediately prior to such Distribution Date.
Senior Prepayment Percentage: As to an Aggregate Group II Senior
Certificate Group and any Distribution Date during the five years beginning on
the first Distribution Date, 100%. The Senior Prepayment Percentage for any
Distribution Date occurring on or after the fifth anniversary of the first
Distribution Date will, except as provided herein, be as follows: for any
Distribution Date in the first year thereafter, the related Senior Percentage
plus 70% of the related Subordinated Percentage for such Distribution Date;
for any Distribution Date in the second year thereafter, the related Senior
Percentage plus 60% of the related Subordinated Percentage for such
Distribution Date; for any Distribution Date in the third year thereafter, the
related Senior Percentage plus 40% of the related Subordinated Percentage for
such Distribution Date; for any Distribution Date in the fourth year
thereafter, the related Senior Percentage plus 20% of the related Subordinated
Percentage for such Distribution Date; and for any Distribution Date
thereafter, the related Senior Percentage for such Distribution Date (unless
on any Distribution Date the Senior Percentage exceeds the initial Senior
Percentage of such Senior Certificate Group, in which case the Senior
Prepayment Percentage for such Distribution Date will once again equal 100%).
Notwithstanding the foregoing, no decrease in any Senior Prepayment Percentage
will occur unless both of the Senior Step Down Conditions are satisfied with
respect to all Aggregate Group II Collateral Allocation Groups.
Senior Principal Distribution Amount: As to any Distribution Date and
Aggregate Group II Senior P&I Portion, the sum of (i) the sum, not less than
zero, of the related Senior Percentage of the applicable Non-A-P Percentage of
all amounts described in subclauses (a) through (d) of clause (i) of the
definition of Non-A-P Formula Principal Amount with respect to the related
Collateral Allocation Group for such Distribution Date, (ii) with respect to
any Mortgage Loan in the related Loan Group that became a Liquidated Mortgage
Loan during the calendar month preceding the month of such Distribution Date,
the lesser of (x) the related Senior Percentage of the applicable Non-A-P
Percentage of the Stated Principal Balance of the Applicable Fraction of
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such Mortgage Loan and (y) either (A) the related Senior Prepayment Percentage
of the applicable Non-A-P Percentage of the amount of the Liquidation Proceeds
allocable to principal received on the Applicable Fraction of the Mortgage
Loan, or (B) if an Excess Loss was sustained with respect to such Liquidated
Mortgage Loan during such prior calendar month, the related Senior Percentage,
of the applicable Non-A-P Percentage of the amount of the Liquidation Proceeds
allocable to principal received with respect to the Applicable Fraction of
such Mortgage Loan, and (iii) the sum of (x) the related Senior Prepayment
Percentage of the applicable Non-A-P Percentage of the amounts described in
subclause (f) of clause (i) of the definition of Non-A-P Formula Principal
Amount with respect to the related Collateral Allocation Group for such
Distribution Date plus (y) the related Senior Prepayment Percentage of any
Subsequent Recoveries described in clause (ii) of the definition of Non-A-P
Formula Principal Amount for such Distribution Date; provided, however, that
if a Bankruptcy Loss that is an Excess Loss is sustained on a Mortgage Loan or
the Applicable Fraction thereof in the related Collateral Allocation Group
that is not a Liquidated Mortgage Loan, the Senior Principal Distribution
Amount will be reduced on the related Distribution Date by the related Senior
Percentage of the applicable Non-A-P Percentage of the principal portion of
such Bankruptcy Loss; provided further, however, on any Distribution Date
after the third related Senior Termination Date, the Senior Principal
Distribution Amount for the remaining Senior P&I Portion will be calculated
pursuant to the above formula based on all the Mortgage Loans in Aggregate
Loan Group II, as opposed to the Mortgage Loans or Applicable Fractions
thereof in the related Collateral Allocation Group and, if such Distribution
Date is after the third related Senior Termination Date, shall be reduced by
the amount of the principal distribution made pursuant to (a) if the Group 2
Senior Certificates are reduced to zero on such date, Section
5.02(a)(2)(iv)(y), (b) if the Group 3 Senior Certificates are reduced to zero
on such date, Section 5.02(a)(3)(iv)(y) or (c) if the Group 4 Senior
Certificates are reduced to zero on such date, Section 5.02(a)(4)(iv)(y).
Senior Step Down Conditions: With respect to all Aggregate Group II
Mortgage Loans and any Distribution Date: (i) the outstanding principal
balance of all Mortgage Loans delinquent 60 days or more on such Distribution
Date (including any Mortgage Loans in foreclosure, REO Property and Mortgage
Loans the mortgagors of which are in bankruptcy) (averaged over the preceding
six month period), as a percentage of (a) if such date is on or prior to the
third related Senior Termination Date, the Subordinated Percentage for such
Collateral Allocation Group of the aggregate of the applicable Non-A-P
Percentage of the aggregate Stated Principal Balance of the Aggregate Group II
Mortgage Loans or Applicable Fractions thereof in that Collateral Allocation
Group, or (b) if such date is after the third related Senior Termination Date,
the aggregate Class Principal Balance of the Aggregate Group II Subordinated
Certificates, does not equal or exceed 50%, and (ii) cumulative Realized
Losses on the Aggregate Group II Mortgage Loans in each Loan Group as of such
Distribution Date do not exceed: (a) for the Distribution Date on the fifth
anniversary of the first Distribution Date, 30% of the Original Subordinate
Principal Balance, (b) for the Distribution Date on the sixth anniversary of
the first Distribution Date, 35% of the Original Subordinate Principal
Balance, (c) for the Distribution Date on the seventh anniversary of the first
Distribution Date, 40% of the Original Subordinate Principal Balance, (d) for
the Distribution Date on the eighth anniversary of the first Distribution
Date, 45% of the Original Subordinate Principal Balance, and (e) for the
Distribution Date on the ninth anniversary of the first Distribution Date, 50%
of the Original Subordinate Principal Balance.
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Senior Termination Date: With respect to each Senior Certificate Group
(other than any related Class of Class A-P Certificates) related to a
Collateral Allocation Group in Aggregate Loan Group II, the Distribution Date
on which the principal balance of the related Senior P&I Portion is reduced to
zero.
Senior Turbo Allocation Amount: For the Group 1 Senior Certificates and
any Distribution Date on and after the Distribution Date in July 2012, the sum
of the Turbo Allocation Amounts for the Group 1 Senior Certificates for that
Distribution Date.
Sequential Trigger Event: With respect to any Distribution Date
occurring before August 2008, the circumstances in which the aggregate amount
of Realized Losses on Collateral Allocation Group 1 incurred since the Cut-off
Date through the last day of the related Prepayment Period divided by the
aggregate Stated Principal Balance of the Applicable Fractions of the Mortgage
Loans in Collateral Allocation Group 1 as of the Cut-off Date exceeds 0.25%.
With respect to any Distribution Date occurring in or after August 2008, a
Trigger Event.
Servicer: Each Servicer under a Purchase and Servicing Agreement, and
its respective successors and assigns. As of the Closing Date, the Servicers
of the Mortgage Loans shall be GMAC Mortgage Corporation, GreenPoint Mortgage
Funding, Inc., Xxxxxx Xxxxxxx Credit Corp., Cendant Mortgage Corporation and
Xxxxx Fargo National Association.
Servicer Advance: A "Servicer Advance" or "Servicing Advance" as defined
in the applicable Purchase and Servicing Agreement.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB, as the same may be amended from time to time.
Servicing Fee: As to any Distribution Date and each Mortgage Loan, an
amount equal to the product of (a) one-twelfth of the related Servicing Fee
Rate and (b) the Stated Principal Balance of such Mortgage Loan as of the
first day of the related Due Period.
Servicing Fee Rate: With respect to each Mortgage Loan and any
Distribution Date, the per annum rate specified in the related Purchase and
Servicing Agreement.
Servicing Function Participant: Any Sub-Servicer, Subcontractor or any
other Person, other than each Servicer, the Master Servicer, the Trustee, the
Securities Administrator and any Custodian, that is performing activities
addressed by the Servicing Criteria.
Servicing Officer: Any officer of the related Servicer involved in, or
responsible for, the administration and servicing of the related Mortgage
Loans whose name and facsimile signature appear on a list of servicing
officers furnished to the Master Servicer by the related Servicer on the
Closing Date pursuant to the related Purchase and Servicing Agreement, as such
list may from time to time be amended.
Shift Percentage: Not applicable.
Similar Law: As defined in Section 3.03(d) hereof.
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Sovereign Bank Mortgage Loan: Each Mortgage Loan originated by Sovereign
Bank and listed on the Mortgage Loan Schedule.
Sovereign Bank Purchase Agreement: The Mortgage Loan Purchase Agreement
listed in Exhibit E hereto between the Seller and Sovereign Bank.
Special Hazard Coverage Termination Date: The point in time at which the
related Special Hazard Loss Coverage Amount is reduced to zero.
Special Hazard Loss: With respect to the Aggregate Group II Mortgage
Loans, any Realized Loss suffered by a Mortgaged Property on account of direct
physical loss, as reported by the related Servicer to the Master Servicer, but
not including (i) any loss of a type covered by a hazard insurance policy or a
flood insurance policy required to be maintained with respect to such
Mortgaged Property to the extent of the amount of such loss covered thereby,
or (ii) any loss caused by or resulting from:
(a) normal wear and tear;
(b) fraud, conversion or other dishonest act on the part of the
Trustee, the Master Servicer or any of their agents or employees
(without regard to any portion of the loss not covered by any errors and
omissions policy);
(c) errors in design, faulty workmanship or faulty materials,
unless the collapse of the property or a part thereof ensues and then
only for the ensuing loss;
(d) nuclear or chemical reaction or nuclear radiation or
radioactive or chemical 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;"
(e) hostile or warlike action in time of peace and war, including
action in hindering, combating 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;
(f) any weapon of war employing nuclear fission, fusion or other
radioactive force, whether in time of peace or war; or
(g) insurrection, rebellion, revolution, civil war, usurped power
or action taken by governmental authority in hindering, combating 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.
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Special Hazard Loss Coverage Amount: With respect to the Aggregate Group
II Certificates and the first Distribution Date, $3,978,531. With respect to
any Distribution Date after the first Distribution Date, the related Special
Hazard Loss Coverage Amount as of the Closing Date less the amount, if any, of
Special Hazard Losses allocated to the Certificates since the Closing Date.
All principal balances for the purpose of this definition will be calculated
as of the first day of the calendar month preceding the month of such
Distribution Date after giving effect to Scheduled Payments on the Aggregate
Group II Mortgage Loans then due, whether or not paid.
Special Hazard Mortgage Loan: With respect to the Aggregate Group II
Mortgage Loans, a Liquidated Mortgage Loan as to which a Special Hazard Loss
has occurred.
Startup Day: The day designated as such pursuant to Section 10.01(b)
hereof.
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as
specified in the amortization schedule at the time relating thereto (before
any adjustment to such amortization schedule by reason of any moratorium or
similar waiver or grace period) after giving effect to any previous partial
Principal Prepayments and Liquidation Proceeds allocable to principal (other
than with respect to any Liquidated Mortgage Loan) and to the payment of
principal due on such Due Date and irrespective of any delinquency in payment
by the related Mortgagor.
Stepdown Date: With respect to the Group 1 Certificates will be the
later to occur of:
(1) the earlier to occur of
(x) the Distribution Date in August 2009, and
(y) the Distribution Date on which the aggregate Class Principal
Balance of the Class 1-A Certificates is reduced to zero; and
(2) the first Distribution Date on which the Senior Credit Enhancement
Percentage (calculated for this purpose only after taking into account
distributions of principal on the Collateral Allocation Group 1 Mortgage
Loans, but prior to any distribution of the Group 1 Principal Distribution
Amount to the holders of the Group 1 Certificates on the Distribution Date) is
greater than or equal to 13.80%.
Subcontractor: Any vendor, subcontractor or other Person that is not
responsible for the overall servicing (as "servicing" is commonly understood
by participants in the mortgage-backed securities market) of Mortgage Loans
but performs one or more discrete functions identified in Item 1122(d) of
Regulation AB with respect to Mortgage Loans under the direction or authority
of any Servicer (including a Sub-Servicer of any Servicer), the Securities
Administrator, the Master Servicer, the Trustee or any Custodian, as the case
may be.
Subordinated Certificates: As specified in the Preliminary Statement.
Subordinated Percentage: As to any Distribution Date on or prior to the
third related Senior Termination Date and the Aggregate Group II Subordinated
Certificates relating to a
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Collateral Allocation Group, 100% minus the Senior Percentage for the Senior
P&I Portion relating to that Collateral Allocation Group on such Distribution
Date. As to any Distribution Date after the third related Senior Termination
Date, 100% minus the Senior Percentage for such Distribution Date.
Subordinated Portion: For any Distribution Date and Aggregate Group II Loan
Group, an amount equal to the aggregate Stated Principal Balance of the
Aggregate Group II Mortgage Loans in the related Loan Group as of the end of
the Prepayment Period related to the immediately preceding Distribution Date,
minus the aggregate Class Principal Balance of the related Aggregate Group II
Senior Certificates immediately prior to such Distribution Date.
Subordinated Prepayment Percentage: As to any Distribution Date and
Aggregate Group II Loan Group, 100% minus the related Senior Prepayment
Percentage for such Distribution Date.
Subsequent Recoveries: As to any Distribution Date, with respect to a
Liquidated Mortgage Loan that resulted in a Realized Loss in a prior calendar
month, amounts received by the Securities Administrator from the related
Servicer (net of any related expenses permitted to be reimbursed pursuant to
Section 4.02) specifically related to such Liquidated Mortgage Loan.
Sub-Servicer: Any Person that (i) is considered to be a Servicing
Function Participant, (ii) services Mortgage Loans on behalf of any Servicer,
and (iii) is responsible for the performance (whether directly or through
sub-servicers or Subcontractors) of Servicing functions required to be
performed under this Agreement, any related Servicing Agreement or any
sub-servicing agreement that are identified in Item 1122(d) of Regulation AB.
Substitution Adjustment Amount: As defined in the second paragraph of
Section 2.05(b).
Substitution Event: Not Applicable.
Swap Account: Not Applicable.
Swap Agreement: Not Applicable.
Swap Counterparty: Not Applicable.
Swap Payment Allocation: Not Applicable.
Swap Payment Rate: Not Applicable.
Swap Termination Date: Not Applicable.
Swap Termination Payment: Not Applicable.
Targeted Balance: With respect to any group of Targeted Principal
Classes or Components in the aggregate and any Distribution Date appearing in
Schedule B hereto, the Aggregate Targeted Balance for such group and
Distribution Date. With respect to any other Targeted Principal Class or
Component and any Distribution Date appearing in Schedule B
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hereto, the applicable amount appearing opposite such Distribution Date for
such Class or Component.
Tax Matters Person: The person designated as "tax matters person" in the
manner provided under Treasury regulation ss. 1.860F-4(d) and temporary
Treasury regulation ss.301.6231(a)(7)1T. Initially, the Tax Matters Person
shall be the Securities Administrator.
Tax Matters Person Certificate: The Class A-R Certificate with a
Denomination of $0.01.
Three Month Rolling Average: With respect to the Collateral Allocation
Group 1 Mortgage Loans and the end of the Due Period related to any
Distribution Date, will equal the rolling 3 month average percentage of the
aggregate Stated Principal Balance of the Collateral Allocation Group 1
Mortgage Loans that are 60 or more days Delinquent (including Mortgage Loans
in foreclosure, REO Property or discharged in bankruptcy).
Trigger Event: With respect to any Distribution Date and the Group 1
Certificates, a Trigger Event is in effect if (x) the Three Month Rolling
Average with respect to the Collateral Allocation Group 1 Mortgage Loans
exceeds 50.00% of the Senior Enhancement Percentage for the prior Distribution
Date, or (y) the aggregate amount of Realized Losses on the Collateral
Allocation Group 1 Mortgage Loans incurred since the Cut-off Date through the
last day of the related Due Period divided by the aggregate outstanding
principal balance of the Collateral Allocation Group 1 Mortgage Loans as of
the Cut-off exceeds the applicable percentages set forth below with respect to
such Distribution Date:
Distribution Date Percentage
August 2008 --July 2009....... 0.25% for the first month, plus an additional
1/12th of 0.35% for each month thereafter
August 2009 -- July 2010...... 0.60% for the first month, plus an additional
1/12th of 0.45% for each month thereafter
August 2010 -- July 2011...... 1.05% for the first month, plus an additional
1/12th of 0.45% for each month thereafter
August 2011 -- July 2012...... 1.50% for the first month, plus an additional
1/12th of 0.30% for each month thereafter
August 2012 and thereafter.... 1.80%
Trust: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-11.
Trust Fund: The corpus of the trust created pursuant to this Agreement
consisting of (i) the Mortgage Loans and all interest and principal received
on or with respect thereto after the Cut-off Date (other than Scheduled
Payments due on or prior to the Cut-off Date) to the extent not applied in
computing the Cut-off Date Principal Balance thereof; (ii) all cash,
instruments or property held or required to be held in the Custodial Accounts
and the Distribution Account and all amounts deposited therein pursuant to the
applicable provisions of this Agreement; (iii) property that secured a
Mortgage Loan and has been acquired by foreclosure, deed-in-lieu of
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foreclosure or otherwise; (iv) the Depositor's rights assigned to the Trustee
under the Purchase and Servicing Agreements, as modified by the
Acknowledgements and under the Custodial Agreements; (v) all insurance
policies related to the Mortgage Loans and any insurance proceeds; (vi) the
pledge, control and guaranty agreements and the Limited Purpose Surety Bond
relating to the Additional Collateral Mortgage Loans; (vii) the amounts on
deposit in the Group 1 Reserve Fund and (viii) all proceeds of the conversion,
voluntary or involuntary, of any of the foregoing.
Trustee: LaSalle Bank National Association, a national banking
association, organized under the laws of the United States and any Person
succeeding the Trustee hereunder, or if any successor trustee or any
co-trustee shall be appointed as herein provided, then such successor trustee
and such co-trustee, as the case may be.
Trustee Mortgage Files: With respect to each Mortgage Loan, the Mortgage
Documents to be retained in the custody and possession of the Trustee or
Custodian on behalf of the Trustee identified in Section 2.01(a) hereof.
Turbo Allocation Amount: For any Class of Group 1 Certificates and any
Distribution Date on and after the Distribution Date in July 2012 is that
Class's pro rata share of the Net Monthly Excess Cashflow remaining after the
application thereof pursuant to Section 5.02(a)(1)(C)(i) through (xx) hereof.
UCC: The Uniform Commercial Code as enacted in the relevant
jurisdiction.
Undercollateralization Distribution: With respect to any Distribution
Date and Aggregate Group II Senior Certificate Group, as defined in Section
5.08 hereof.
Undercollateralized Group: With respect to any Distribution Date and
Aggregate Group II Senior Certificate Group, as defined in Section 5.08
hereof.
Underwriter's Exemption: Prohibited Transaction Exemption 2002-41, 67
Fed. Reg. 54487 (2002), as amended (or any successor thereto), or any
substantially similar administrative exemption granted by the U.S. Department
of Labor.
Underwriter: As specified in the Preliminary Statement.
Underwriting Agreement: The Underwriting Agreement, dated July 26, 2006,
among the Seller, the Depositor and the Underwriter.
Uniform Commercial Code: The Uniform Commercial Code as in effect in any
applicable jurisdiction from time to time.
Unpaid Interest Shortfall Amount: For any Class of Group 1 Certificates,
the sum of Relief Act Interest Shortfalls and net prepayment interest
shortfalls on the Collateral Allocation Group 1 Mortgage Loans allocated to
such Class of Certificates on that Distribution Date and such amounts from any
prior Distribution Date remaining unpaid.
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Unpaid Realized Loss Amount: For any Class of Group 1 Certificates, the
portion of any Realized Losses previously allocated to that Class remaining
unpaid from prior Distribution Dates.
Unscheduled Principal Distribution Amount: As to any Distribution Date
and a Collateral Allocation Group in Aggregate Loan Group II, an amount equal
to the sum of (1) with respect to each Mortgage Loan in the related Loan Group
that became a Liquidated Mortgage Loan during the calendar month preceding the
month of such Distribution Date, the Non-A-P Percentage of the Liquidation
Proceeds allocable to principal received with respect to such Mortgage Loan
based on the Applicable Fraction thereof, (2) the applicable Non-A-P
Percentage of the amount described in subclause (f) of clause (i) of the
definition of Non-A-P Formula Principal Amount for such Collateral Allocation
Group and Distribution Date and (3) the amount described in clause (ii) of the
definition of Non-A-P Formula Principal Amount for such Collateral Allocation
Group and that Distribution Date.
Voting Interests: The portion of the voting rights of all the
Certificates that is allocated to any Certificate for purposes of the voting
provisions of this Agreement. At all times during the term of this Agreement,
1.00% of all Voting Interests shall be allocated to the Class OC Certificates,
each Class of Notional Amount Certificates and the Class A-R Certificates.
Voting Interests shall be allocated among all other Classes of Certificates
pro rata based on Class Principal Balances for each Class then outstanding.
Voting Interests shall be allocated among the Certificates within each such
Class in proportion to their Certificate Balances or Percentage Interests.
Weighted Average Net Mortgage Rate: As to any Distribution Date and
Collateral Allocation Group, the average of the Net Mortgage Rate of the
Applicable Fraction of each Mortgage Loan in that Collateral Allocation Group,
weighted on the basis of the Applicable Fraction of its Stated Principal
Balance as of the end of the Prepayment Period related to the immediately
preceding Distribution Date.
Xxxxx Fargo Serviced Mortgage Loan: Each Mortgage Loan serviced by Xxxxx
Fargo Bank, National Association and listed on the Mortgage Loan Schedule.
Xxxxx Fargo Servicing Agreement: The Servicing Agreement listed in
Exhibit E hereto between the Seller and Xxxxx Fargo Bank, National
Association.
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ARTICLE II
DECLARATION OF TRUST;
ISSUANCE OF CERTIFICATES
Section 2.01. Creation and Declaration of Trust Fund; Conveyance of
Mortgage Loans.
(a) Concurrently with the execution and delivery of this Agreement, the
Depositor does hereby transfer, assign, set over, deposit with and otherwise
convey to the Trustee, without recourse, subject to Sections 2.02 and 2.05, in
trust, all the right, title and interest of the Depositor in and to the Trust
Fund. Such conveyance includes, without limitation, (i) the Mortgage Loans,
including the right to all payments of principal and interest received on or
with respect to the Mortgage Loans on and after the Cut-off Date (other than
Scheduled Payments due on or before such date), and all such payments due
after such date but received prior to such date and intended by the related
Mortgagors to be applied after such date; (ii) all of the Depositor's right,
title and interest in and to all amounts from time to time credited to and the
proceeds of the Distribution Account, any Custodial Accounts or any Escrow
Account established with respect to the Mortgage Loans; (iii) all of the
rights and obligations of the Depositor as assignee of the Seller with respect
to the Seller's rights and obligations under the Purchase and Servicing
Agreements pursuant to the Acknowledgements; (iv) all of the Depositor's
right, title or interest in REO Property and the proceeds thereof; (v) all of
the Depositor's rights under any Insurance Policies related to the Mortgage
Loans; (vi) $2,000 (which amount has been delivered by the Depositor to the
Securities Administrator to be held in the Distribution Account until
distributed to the Holders of the Class P-1 and Class P-2 Certificates
pursuant to Section 5.02(a)); and (vii) if applicable, the Depositor's
security interest in any collateral pledged to secure the Mortgage Loans,
including the Mortgaged Properties and any Additional Collateral relating to
the Additional Collateral Mortgage Loans, including, but not limited to, the
pledge, control and guaranty agreements and the Limited Purpose Surety Bond,
to have and to hold, in trust; and the Trustee declares that, subject to the
review provided for in Section 2.02, it has received and shall hold the Trust
Fund, as trustee, in trust, for the benefit and use of the Holders of the
Certificates and for the purposes and subject to the terms and conditions set
forth in this Agreement, and, concurrently with such receipt, has caused to be
executed, authenticated and delivered to or upon the order of the Depositor,
in exchange for the Trust Fund, Certificates in the authorized denominations
evidencing the entire ownership of the Trust Fund.
The foregoing sale, transfer, assignment, set-over, deposit and
conveyance does not and is not intended to result in the creation or
assumption by the Trustee of any obligation of the Depositor, the Seller or
any other Person in connection with the Mortgage Loans or any other agreement
or instrument relating thereto except as specifically set forth therein.
In connection with such transfer and assignment of the Mortgage Loans,
the Depositor shall cause to be delivered and the Custodian acting on the
Trustee's behalf will continue to hold the documents or instruments listed
below with respect to each Mortgage Loan (each, a "Trustee Mortgage File") so
transferred and assigned:
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(i) with respect to each Mortgage Loan, the original Mortgage Note
endorsed without recourse in proper form to the order of "LaSalle Bank
National Association, as Trustee of Xxxxxx Xxxxxxx Mortgage Loan Trust
2006-11, Mortgage Pass-Through Certificates, without recourse", or in blank
(in each case, with all necessary intervening endorsements, as applicable);
(ii) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the original Mortgage with evidence of
recording thereon, or if the original Mortgage has not yet been returned from
the recording office, a copy of such Mortgage certified by the applicable
Originator, title company, escrow agent or closing attorney to be a true copy
of the original of the Mortgage which has been sent for recording in the
appropriate jurisdiction in which the Mortgaged Property is located, and in
the case of the each MERS Mortgage Loan, the original Mortgage, noting the
presence of the MIN of the Mortgage Loans and either language indicating that
the Mortgage Loan is a MOM Loan if the Mortgage Loan is a MOM Loan or if the
Mortgage Loan was not a MOM Loan at origination, the original Mortgage and the
assignment thereof to MERS, with evidence of recording indicated thereon;
(iii) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the Assignment of Mortgage in form and
substance acceptable for recording in the relevant jurisdiction, such
assignment being either (A) in blank, without recourse, or (B) endorsed to
"LaSalle Bank National Association, as Trustee of Xxxxxx Xxxxxxx Mortgage Loan
Trust 2006-11, Mortgage Pass-Through Certificates, without recourse";
(iv) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the originals of all intervening assignments
of the Mortgage, if any, with evidence of recording thereon, or if the
original intervening assignment has not yet been returned from the recording
office, a copy of such assignment certified by the applicable Originator,
title company, escrow agent or closing attorney to be a true copy of the
original of the assignment which has been sent for recording in the
appropriate jurisdiction in which the Mortgaged Property is located;
(v) with respect to each Mortgage Loan (other than a Cooperative Loan),
the originals of all assumption, modification, consolidation or extension
agreements, if any, with evidence of recording thereon;
(vi) if any, with respect to each Mortgage Loan (other than a
Cooperative Loan), the original policy of title insurance (or a true copy
thereof) with respect to any such Mortgage Loan, or, if such policy has not
yet been delivered by the insurer, the title commitment or title binder to
issue same;
(vii) if any, with respect to each Mortgage Loan (other than a
Cooperative Loan), the original power of attorney and guaranty agreement with
respect to such Mortgage Loan;
(viii) [reserved];
(ix) with respect to each Mortgage Loan which constitutes a Cooperative
Loan:
(a) the original of any security agreement or similar document
executed in connection with the Cooperative Loan;
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(b) the original Recognition Agreement and the original
Assignment of Recognition Agreement;
(c) UCC-1 financing statements with recording information
thereon from the appropriate governmental recording offices
if necessary to perfect the security interest of the
Cooperative Loan under the Uniform Commercial Code in the
jurisdiction in which the Cooperative Property is located,
accompanied by UCC-3 financing statements executed in blank
for recordation of the change in the secured party
thereunder;
(d) an Estoppel Letter and/or Consent;
(e) a search for (i) federal tax liens, mechanics' liens, lis
pendens, judgments of record or otherwise against (x) the
Cooperative Corporation and (y) the seller of the
Cooperative Unit, (ii) filings of financing statements and
(iii) the deed of the cooperative project into the
Cooperative Corporation;
(f) the guaranty of the Mortgage Note and Cooperative Loan, if
any;
(g) the original Proprietary Lease and the Assignment of
Proprietary Lease executed by the Mortgagor in blank or if
the Proprietary Lease has been assigned by the Mortgagor to
the Seller, then the Seller must execute an assignment of
the Assignment of Proprietary Lease in blank; and
(h) if any, the original or certified copy of the certificates
evidencing ownership of the Cooperative Shares issued by the
Cooperative Corporation and related assignment of such
certificates or an assignment of such Cooperative Shares, in
blank, executed by the Mortgagor with such signature
guaranteed;
(x) [reserved]; and
(xi) any other document or instruments required to be delivered under
the related Custodial Agreement.
In addition, in connection with the assignment of any MERS Mortgage
Loan, it is understood that the related Originator will cause the MERS(R)
System to indicate that such Mortgage Loans have been assigned by the related
Originator to the Trustee in accordance with this Agreement for the benefit of
the Certificateholders by including (or deleting, in the case of Mortgage
Loans which are repurchased in accordance with this Agreement) in such
computer files the information required by the MERS(R) System to identify the
series of Certificates issued in connection with such Mortgage Loans. It is
further understood that the related Originator will not, and the Master
Servicer hereby agrees that it will not, alter the information referenced in
this paragraph with respect to any Mortgage Loan during the term of this
Agreement unless and until such Mortgage Loan is repurchased in accordance
with the terms of this Agreement.
On or prior to the Closing Date, the Depositor shall cause to be
delivered to the Master Servicer, the Trustee and the Custodian an electronic
copy of the Mortgage Loan Schedule in a form acceptable to the Master Servicer,
the Depositor, the Trustee and the Custodian.
(b) As soon as is practicable after the Closing Date, the Depositor
shall cause the Servicer of any Additional Collateral Mortgage Loan to deliver
to the applicable Custodian the
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Assignment and Notice of Transfer with respect to each Additional Collateral
Mortgage Loan as well as the assignments of any rights with respect to each
Additional Collateral Mortgage Loan under any Limited Purpose Surety Bond.
(c) In instances where a title insurance policy is required to be
delivered to the applicable Custodian on behalf of the Trustee and is not so
delivered, the Depositor will provide a copy of such title insurance policy to
the applicable Custodian on behalf of the Trustee, as promptly as practicable
after the execution and delivery hereof, but in any case within 180 days of
the Closing Date.
(d) For Mortgage Loans (if any) that have been prepaid in full after the
Cut-off Date and prior to the Closing Date, the Depositor, in lieu of
delivering the above documents, herewith delivers such amount to the
Securities Administrator, and delivers to the Securities Administrator, the
Trustee, and the applicable Custodian, an Officer's Certificate which shall
include a statement to the effect that all amounts received in connection with
such prepayment that are required to be deposited in the Distribution Account
pursuant to Section 4.01 have been so deposited. All original documents that
are not delivered to the applicable Custodian on behalf of the Trustee shall
be held by the Master Servicer or the related Servicer in trust for the
benefit of the Trustee and the Certificateholders.
(e) Neither the Depositor nor the Trust will acquire or hold any
Mortgage Loan that would violate the representations made by the Seller set
forth in clauses (iv) through (vi) of Section 2.05(b) hereof.
Section 2.02. Acceptance of Trust Fund by Trustee; Review of
Documentation for Trust Fund.
(a) The Trustee, by execution and delivery hereof, acknowledges receipt
by it of notice from each of the Custodians that each holds the documents
identified in the Initial Custodial Certification in the form annexed hereto
as Exhibit L-1 (the "Initial Custodial Certification") pertaining to the
Mortgage Loans listed on the Mortgage Loan Schedule.
(b) Nothing in this Agreement shall be construed to constitute an
assumption by the Trust Fund, the Trustee, any Custodian or the
Certificateholders of any unsatisfied duty, claim or other liability on any
Mortgage Loan or to any Mortgagor.
(c) Each of the parties hereto acknowledges that (i) the Custodian has
delivered to the Depositor, the Master Servicer and the Trustee, the Initial
Custodial Certification, in the form annexed hereto as Exhibit L-1, stating
that it has performed the applicable review of the Mortgage Loans as required
herein and in the Custodial Agreements on the Closing Date and (ii)
thereafter, if applicable, the Custodian shall perform the applicable review
of the Mortgage Loans and deliver the further certifications (including but
not limited to the Final Custodial Certification) as provided herein and in
the applicable Custodial Agreements.
With respect to the MSMCI Mortgage Loans only, not later than 180 days
after the Closing Date, the Trustee shall enforce the related Custodian's
obligation, to the extent required by the related Custodial Agreement, to
deliver to the Depositor, the Master Servicer and the Trustee a Final
Custodial Certification in the form annexed hereto as Exhibit L-2 (the "Final
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Custodial Certification"), with any applicable exceptions noted thereon. To
the extent that a Custodian must deliver a Final Certification under the
related Custodial Agreement, the Trustee shall enforce that Custodian's
obligation to make available, upon request of any Certificateholder, a copy of
any exceptions noted on the related Initial Custodial Certification or the
related Final Custodial Certification.
(d) Upon execution of this Agreement, the Depositor hereby delivers to
the Trustee (with a copy to the Master Servicer) and the Trustee acknowledges
receipt of the Acknowledgements, together with the related Purchase and
Servicing Agreements.
(e) Neither the Trustee nor the Custodian shall make any representation
as to: (i) the validity, legality, sufficiency, enforceability or genuineness
of any of the documents contained in the Trustee Mortgage File of any of the
Mortgage Loans identified on the Mortgage Loan Schedule, or (ii) the
collectability, insurability, perfection, priority, effectiveness or
suitability of any such Mortgage Loan. Except as specifically required
hereunder, neither the Trustee nor the Custodian shall be responsible to verify
the validity, sufficiency or genuiness of any document in the Trustee Mortgage
File.
Section 2.03. Representations and Warranties of the Depositor.
(a) The Depositor hereby represents and warrants to the Trustee, for the
benefit of the Certificateholders, and to the Master Servicer and the
Securities Administrator as of the Closing Date or such other date as is
specified, that:
(i) the Depositor is a corporation duly organized, validly
existing and in good standing under the laws governing its creation and
existence and has full corporate power and authority to own its
property, to carry on its business as presently conducted, to enter into
and perform its obligations under this Agreement, and to create the
trust pursuant hereto;
(ii) the execution and delivery by the Depositor of this Agreement
have been duly authorized by all necessary corporate action on the part
of the Depositor; neither the execution and delivery of this Agreement,
nor the consummation of the transactions herein contemplated, nor
compliance with the provisions hereof, will conflict with or result in a
breach of, or constitute a default under, any of the provisions of any
law, governmental rule, regulation, judgment, decree or order binding on
the Depositor or its properties or the certificate of incorporation or
bylaws of the Depositor;
(iii) the execution, delivery and performance by the Depositor of
this Agreement and the consummation of the transactions contemplated
hereby do not require the consent or approval of, the giving of notice
to, the registration with, or the taking of any other action in respect
of, any state, federal or other governmental authority or agency, except
such as has been obtained, given, effected or taken prior to the date
hereof;
(iv) this Agreement has been duly executed and delivered by the
Depositor and, assuming due authorization, execution and delivery by the
Trustee, the Master Servicer and the Securities Administrator,
constitutes a valid and binding obligation of the Depositor enforceable
against it in accordance with its terms except as such enforceability
may be subject to (A) applicable bankruptcy and insolvency laws and
other similar laws affecting the enforcement of the rights of creditors
generally and (B) general principles of equity regardless of whether
such enforcement is considered in a proceeding in equity or at law;
(v) there are no actions, suits or proceedings pending or, to the
knowledge of the Depositor, threatened or likely to be asserted against
or affecting the Depositor,
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before or by any court, administrative agency, arbitrator or
governmental body (A) with respect to any of the transactions
contemplated by this Agreement or (B) with respect to any other matter
which in the judgment of the Depositor will be determined adversely to
the Depositor and will if determined adversely to the Depositor
materially and adversely affect it or its business, assets, operations
or condition, financial or otherwise, or adversely affect its ability to
perform its obligations under this Agreement;
(vi) immediately prior to the transfer and assignment of the
Mortgage Loans to the Trustee, the Depositor was the sole owner of
record and holder of each Mortgage Loan, and the Depositor had good and
marketable title thereto, and had full right to transfer and sell each
Mortgage Loan to the Trustee free and clear, subject only to (1) liens
of current real property taxes and assessments not yet due and payable
and, if the related Mortgaged Property is a condominium unit, any lien
for common charges permitted by statute, (2) covenants, conditions and
restrictions, rights of way, easements and other matters of public
record as of the date of recording of such Mortgage acceptable to
mortgage lending institutions in the area in which the related Mortgaged
Property is located and specifically referred to in the lender's title
insurance policy or attorney's opinion of title and abstract of title
delivered to the originator of such Mortgage Loan, and (3) such other
matters to which like properties are commonly subject which do not,
individually or in the aggregate, materially interfere with the benefits
of the security intended to be provided by the Mortgage, of any
encumbrance, equity, participation interest, lien, pledge, charge, claim
or security interest, and had full right and authority, subject to no
interest or participation of, or agreement with, any other party, to
sell and assign each Mortgage Loan pursuant to this Agreement;
(vii) This Agreement creates a valid and continuing security
interest (as defined in the applicable Uniform Commercial Code (the
"UCC"), in the Mortgage Loans in favor of the Trustee, which security
interest is prior to all other liens, and is enforceable as such against
creditors of and purchasers from the Depositor;
(viii) The Mortgage Loans constitute "instruments" within the
meaning of the applicable UCC;
(ix) Other than the security interest granted to the Trustee
pursuant to this Agreement, the Depositor has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Mortgage Loans. The Depositor has not authorized the filing of and is
not aware of any financing statement against the Depositor that includes
a description of the collateral covering the Mortgage Loans other than a
financing statement relating to the security interest granted to the
Trustee hereunder or that has been terminated. The Depositor is not
aware of any judgment or tax lien filings against the Depositor;
(x) None of the Mortgage Loans have any marks or notations
indicating that such Mortgage Loans have been pledged, assigned or
otherwise conveyed to any Person other than the Trustee; and
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(xi) The Depositor has received all consents and approvals
required by the terms of the Mortgage Loans to convey the Mortgage Loans
hereunder to the Trustee.
The foregoing representations made in this Section 2.03 shall survive
the termination of this Agreement and shall not be waived by any party hereto.
Section 2.04. Representations and Warranties of the Depositor and the
Seller as to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with respect
to the Mortgage Loans or each Mortgage Loan, as the case may be, as of the
date hereof or such other date set forth herein that as of the Closing Date:
(a) Immediately prior to the transfer and assignment contemplated
herein, the Depositor was the sole owner and holder of the Mortgage Loans. The
Mortgage Loans were not assigned or pledged by the Depositor and the Depositor
had good and marketable title thereto, and the Depositor had full right to
transfer and sell the Mortgage Loans to the Trustee, for the benefit of the
Certificateholders, free and clear of any encumbrance, participation interest,
lien, equity, pledge, claim or security interest and had full right and
authority subject to no interest or participation in, or agreement with any
other party to sell or otherwise transfer the Mortgage Loans.
(b) As of the Closing Date, the Depositor has transferred all right,
title and interest in the Mortgage Loans to the Trustee on behalf of the
Trust.
(c) As of the Closing Date, the Depositor has not transferred the
Mortgage Loans to the Trustee on behalf of the Trust with any intent to
hinder, delay or defraud an of its creditors.
It is understood and agreed that the representations and warranties set
forth in this Section 2.04 shall survive delivery of the respective Mortgage
Files to the Trustee or the Custodian and shall inure to the benefit of the
Trustee, notwithstanding any restrictive or qualified endorsement or
assignment.
Section 2.05. Representations and Warranties of the Seller; Discovery of
Breach; Repurchase or Substitution of Mortgage Loans.
(a) With respect to the MSMCI Mortgage Loans the Seller hereby makes the
representations and warranties contained in Section 3.01 of the MSMCI Purchase
Agreement to and for the benefit of the Depositor, the Trustee and the Trust
Fund.
The Seller hereby represents and warrants that no Mortgage Loan contains
a provision whereby the related mortgagor is permitted to convert the Mortgage
Rate from an adjustable rate to a fixed rate.
With respect to the Sovereign Mortgage Loans the Seller hereby makes the
representations and warranties contained in Sections 9.01 and 9.02 of the
Sovereign Purchase Agreement (other than the representation contained in
Section 9.02(b) of the Sovereign Purchase
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Agreement) to and for the benefit of the Depositor, the Trustee and the Trust
Fund. With respect to the Sovereign Mortgage Loans the Seller hereby
represents and warrants to and for the benefit of the Depositor, the Trustee
and the Trust Fund that all payments due on or prior to the Cut-off Date for
each Sovereign Mortgage Loan have been made as of the Closing Date, such
Sovereign Mortgage Loan is not delinquent thirty (30) days or more in payment
and has not been dishonored; there are no material defaults under the terms of
such Sovereign Mortgage Loan; the Seller has not advanced funds, or induced,
solicited or knowingly received any advance of funds from a party other than
the owner of the Mortgaged Property subject to the Mortgage, directly or
indirectly, for the payment of any amount required by any Sovereign Mortgage
Loan; as to each Sovereign Mortgage Loan, there has been no more than one
thirty (30) day delinquency during the immediately preceding thirty-day
period. The Seller agrees to comply with the provisions of this Section 2.05
in respect of a breach of any of such representations and warranties.
With respect to the Quicken Mortgage Loans the Seller hereby makes the
representations and warranties contained in Section 9.02 of the Quicken
Purchase Agreement (other than the representation contained in Section 9.02(b)
of the Quicken Purchase Agreement) to and for the benefit of the Depositor,
the Trustee and the Trust Fund. With respect to the Quicken Mortgage Loans the
Seller hereby represents and warrants to and for the benefit of the Depositor,
the Trustee and the Trust Fund that all payments due on or prior to the
Cut-off Date for each Quicken Mortgage Loan have been made as of the Closing
Date, such Quicken Mortgage Loan is not delinquent thirty (30) days or more in
payment and has not been dishonored; there are no material defaults under the
terms of such Quicken Mortgage Loan; the Seller has not advanced funds, or
induced, solicited or knowingly received any advance of funds from a party
other than the owner of the Mortgaged Property subject to the Mortgage,
directly or indirectly, for the payment of any amount required by any Quicken
Mortgage Loan; as to each Quicken Mortgage Loan, there has been no more than
one thirty (30) day delinquency during the immediately preceding thirty-day
period. The Seller agrees to comply with the provisions of this Section 2.05
in respect of a breach of any of such representations and warranties.
The Seller hereby represents and warrants to the Trustee with respect to
the Mortgage Loans as of the date hereof or such other date set forth herein
that as of the Closing Date:
(i) Each Mortgage Loan at origination complied in all material
respects with applicable predatory and abusive lending laws and
consummation of the transactions contemplated by this Agreement will not
involve the violation of any such laws.
(ii) All of the Mortgage Loans were originated in compliance with
all applicable laws, including, but not limited to, all applicable
anti-predatory and abusive lending laws.
(iii) None of the Mortgage Loans is covered by the Home Ownership
and Equity Protection Act of 1994 ("HOEPA").
(iv) None of the Mortgage Loans is a "high cost" loan as defined
by applicable predatory and abusive lending laws.
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(v) No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable, and with respect to the foregoing, the terms "High Cost
Loan" and "Covered Loan" have the meaning assigned to them in the then
current version of Standard & Poor's LEVELS(R), which is now Version 5.7
Glossary Revised, Appendix E which is attached hereto as Exhibit Q (the
"Glossary") where (x) a "High Cost Loan" is each loan identified in the
column "Category under applicable anti-predatory lending law" of the
table entitled "Standard & Poor's High Cost Loan Categorization" in the
Glossary as each such loan is defined in the applicable anti-predatory
lending law of the State or jurisdiction specified in such table and (y)
a "Covered Loan" is each loan identified in the column "Category under
applicable anti-predatory lending law" of the table entitled "Standard &
Poor's High Covered Loan Categorization" in the Glossary as each such
loan is defined in the applicable anti-predatory lending law of the
State or jurisdiction specified in such table.
(vi) No Mortgage Loan originated on or after October 1, 2002
through March 6, 2003 is governed by the Georgia Fair Lending Act.
Upon discovery by the Depositor, the Seller or the related Originator or
receipt of written notice of any materially defective document in, or,
following the date of delivery to the Trustee of the Custodian's
certifications as required under the related Custodial Agreements, that a
document is missing from, a Trustee Mortgage File, or discovery by the
Trustee, the Depositor, the Seller or the related Originator of the breach by
such Originator or Seller of any representation or warranty under the related
Purchase and Servicing Agreement, as modified by the Acknowledgement, in the
case of the Originator, or under this Agreement, in the case of the Seller, in
respect of any Mortgage Loan which materially adversely affects the value of
that Mortgage Loan or the interest therein of the Certificateholders (a
"Defective Mortgage Loan") (each of the Depositor, the Seller and the related
Originator hereby agreeing to give written notice thereof to the Trustee and
the other of such parties), the Trustee, or its designee, shall promptly
notify the Depositor and the Seller or the related Originator, as applicable,
in writing of such nonconforming or missing document or breach and request
that the Seller or related Originator deliver such missing document or cure or
cause the cure of such defect or breach within a period of time specified in
the related Purchase and Servicing Agreement, and if the Seller or related
Originator, as applicable, does not deliver such missing document or cure such
defect or breach in all material respects during such period, the Trustee,
shall enforce the obligations of the related Originator under the related
Purchase and Servicing Agreement, as modified by the Acknowledgement, or the
Seller under this Agreement, as applicable, and cause the related Originator
or the Seller, as the case may be, to repurchase that Mortgage Loan from the
Trust Fund at the Purchase Price on or prior to the Determination Date
following the expiration of such specified period (subject to Section 2.05(c)
below); provided, however, that, in connection with any such breach that could
not reasonably have been cured within such specified period (unless permitted
a greater period of time to cure under the related Purchase and Servicing
Agreement), subject to Section 2.05(c) below, if the related Originator or the
Seller, as applicable, shall have commenced to cure such breach within such
specified period, the related Originator or the Seller shall be permitted to
proceed thereafter diligently and expeditiously to cure the same within such
additional time as is reasonably necessary to cure such breach. To the extent
that the amount by which the Purchase Price (as defined in this Agreement)
exceeds the repurchase price payable by the related Originator under the
related Purchase and Servicing
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Agreement, including any costs and damages that are incurred by the Trust Fund
as a result of any violation of any applicable federal, state, or local
predatory or abusive lending law arising from or in connection with the
origination of any Mortgage Loan repurchased by the related Originator or the
Seller, the payment of such excess shall be borne by the Seller. The Purchase
Price for the repurchased Mortgage Loan shall be deposited in the related
Distribution Account, and the Trustee, or its designee, upon receipt of
written certification from the Securities Administrator of such deposit, shall
release or cause the Custodian to release to the related Originator or the
Seller, as applicable, the related Trustee Mortgage File and shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranties, as either party shall furnish to it
and as shall be necessary to vest in such party any Mortgage Loan released
pursuant hereto and the Trustee, or its designee, shall have no further
responsibility with regard to such Trustee Mortgage File (it being understood
that the Trustee shall have no responsibility for determining the sufficiency
of such assignment for its intended purpose). If pursuant to the foregoing
provisions the related Originator or the Seller repurchases a Mortgage Loan
that is a MERS Mortgage Loan, the related Servicer shall cause MERS to
designate on the MERS(R) System the related Originator or the Seller, as
applicable, as the beneficial holder of such Mortgage Loan.
In lieu of repurchasing any such Mortgage Loan as provided above, either
party may cause such Mortgage Loan to be removed from the Trust Fund (in which
case it shall become a Deleted Mortgage Loan) and substitute one or more
Replacement Mortgage Loans in the manner and subject to the limitations set
forth in Section 2.05(b) below. It is understood and agreed that the
obligations of the Originators and the Seller to cure or to repurchase (or to
substitute for) any related Mortgage Loan as to which a document is missing, a
material defect in a constituent document exists or as to which such a breach
has occurred and is continuing shall constitute the sole remedy against the
such party respecting such omission, defect or breach available to the Trustee
on behalf of the Certificateholders.
(b) Any substitution of Replacement Mortgage Loans for Deleted Mortgage
Loans made pursuant to Section 2.05(a) above must be effected prior to the
last Business Day that is within two years after the Closing Date. As to any
Deleted Mortgage Loan for which the related Originator or the Seller
substitutes a Replacement Mortgage Loan or Loans, such substitution shall be
effected by delivering to the Custodian, on behalf of the Trustee, for such
Replacement Mortgage Loan or Loans, the Mortgage Note, the Mortgage, any
related assignment thereof and the Acknowledgement to the Trustee, and such
other documents and agreements, with all necessary endorsements thereon,
together with an Officers' Certificate stating that each such Replacement
Mortgage Loan satisfies the definition thereof and specifying the Substitution
Adjustment Amount (as described below), if any, in connection with such
substitution. Monthly Payments due with respect to Replacement Mortgage Loans
in the month of substitution shall not be included as part of the Trust Fund
and shall be retained by the related Originator or the Seller, as applicable.
For the month of substitution, distributions to the Certificateholders shall
reflect the collections and recoveries in respect of such Deleted Mortgage in
the Due Period preceding the month of substitution and the related Originator
or the Seller, as applicable, shall thereafter be entitled to retain all
amounts subsequently received in respect of such Deleted Mortgage Loan. Upon
such substitution, such Replacement Mortgage Loan shall constitute part of the
Trust Fund and shall be subject in all respects to the terms of this Agreement
and the related Purchase and Servicing Agreement, as modified by the related
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Acknowledgement, including all representations and warranties thereof included
in such Purchase and Servicing Agreement, as modified by the Acknowledgement,
in each case as of the date of substitution.
For any month in which an Originator or the Seller substitutes one or
more Replacement Mortgage Loans for one or more Deleted Mortgage Loans, the
related Servicer shall determine the excess (each, a "Substitution Adjustment
Amount"), if any, by which the aggregate Purchase Price of all such Deleted
Mortgage Loans exceeds the aggregate Stated Principal Balance of the
Replacement Mortgage Loans replacing such Deleted Mortgage Loans, together with
one month's interest on such excess amount at the applicable Net Mortgage Rate.
On the date of such substitution, the related Originator or Seller, as
applicable, shall deliver or cause to be delivered to the related Servicer for
deposit in the related Custodial Account an amount equal to the related
Substitution Adjustment Amount, if any, and the Custodian, on behalf of the
Trustee, upon receipt of the related Replacement Mortgage Loan or Loans and
Request for Release and certification by such Servicer of such deposit, shall
release to the related Originator or the Seller, as applicable, the related
Trustee Mortgage File or Files and the Trustee or the Custodian, as applicable,
shall execute and deliver such instruments of transfer or assignment, in each
case without recourse, as the related Originator or Seller shall deliver to it
and as shall be necessary to vest therein any Deleted Mortgage Loan released
pursuant hereto.
In addition, the related Originator or the Seller, as applicable, shall
obtain at its own expense and deliver to the Trustee and the Securities
Administrator an Opinion of Counsel to the effect that such substitution
(either specifically or as a class of transactions) shall not cause an Adverse
REMIC Event. If such Opinion of Counsel cannot be delivered, then such
substitution may only be effected at such time as the required Opinion of
Counsel can be given.
(c) Upon discovery by the related Originator, the Seller, the Master
Servicer, the Depositor or the Trustee that any Mortgage Loan does not
constitute a "qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code, the party discovering such fact shall within two Business Days give
written notice thereof to the other parties. In connection therewith, the
applicable party shall repurchase or, subject to the limitations set forth in
Section 2.05(b), substitute one or more Replacement Mortgage Loans for the
affected Mortgage Loan within 90 days of the earlier of discovery or receipt
of such notice with respect to such affected Mortgage Loan. Any such
repurchase or substitution shall be made in the same manner as set forth in
Section 2.05(a) above and/or in accordance with this Section 2.05(c). The
Trustee shall re-convey to the related Originator or the Seller, as
applicable, the Mortgage Loan to be released pursuant hereto in the same
manner, and on the same terms and conditions, as it would a Mortgage Loan
repurchased for breach of a representation or warranty.
Section 2.06. Grant Clause.
(a) It is intended that the conveyance of the Depositor's right, title
and interest in and to property constituting the Trust Fund pursuant to this
Agreement shall constitute, and shall be construed as, a sale of such property
and not a grant of a security interest to secure a loan. However, if such
conveyance is deemed to be in respect of a loan, it is intended that: (1) the
rights and obligations of the parties shall be established pursuant to the
terms of this Agreement; (2) the Depositor hereby grants to the Trustee for
the benefit of the Holders of the Certificates a first priority security
interest in all of the Depositor's right, title and interest in, to and under,
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whether now owned or hereafter acquired, the Trust Fund and all proceeds of
any and all property constituting the Trust Fund to secure payment of the
Certificates; and (3) this Agreement shall constitute a security agreement
under applicable law. If such conveyance is deemed to be in respect of a loan
and the trust created by this Agreement terminates prior to the satisfaction
of the claims of any Person holding any Certificate, the security interest
created hereby shall continue in full force and effect and the Trustee shall
be deemed to be the collateral agent for the benefit of such Person, and all
proceeds shall be distributed as herein provided.
(b) The Depositor shall, to the extent consistent with this Agreement,
take such reasonable actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the Mortgage Loans and
the other property described above, such security interest would be deemed to
be a perfected security interest of first priority under applicable law and
will be maintained as such throughout the term of this Agreement. The
Depositor will, at its own expense, make all initial filings on or about the
Closing Date and shall forward a copy of such filing or filings to the
Trustee. Without limiting the generality of the foregoing, the Depositor shall
prepare and forward for filing, or shall cause to be forwarded for filing, at
the expense of the Depositor, all filings necessary to maintain the
effectiveness of any original filings necessary under the relevant UCC to
perfect the Trustee's security interest in or lien on the Mortgage Loans,
including without limitation (x) continuation statements, and (y) such other
statements as may be occasioned by (1) any change of name of an Originator,
the Depositor or the Trustee, (2) any change of location of the place of
business or the chief executive office of the Seller or the Depositor, (3) any
transfer of any interest of an Originator or the Depositor in any Mortgage
Loan or (4) any change under the relevant UCC or other applicable laws.
Neither the Originators nor the Depositor shall organize under the law of any
jurisdiction other than the State under which each is organized as of the
Closing Date (whether changing its jurisdiction of organization or organizing
under an additional jurisdiction) without giving 30 days prior written notice
of such action to its immediate and intermediate transferee, including the
Trustee. Before effecting such change, any Originator or the Depositor
proposing to change its jurisdiction of organization shall prepare and file in
the appropriate filing office any financing statements or other statements
necessary to continue the perfection of the interests of its immediate and
intermediate transferees, including the Trustee, in the Mortgage Loans. In
connection with the transactions contemplated by this Agreement, each of the
Originators and the Depositor authorizes its immediate or intermediate
transferee (but not the Trustee) to file in any filing office any initial
financing statements, any amendments to financing statements, any continuation
statements, or any other statements or filings described in this paragraph
(b).
Section 2.07. Depositor's Option to Purchase Breached Mortgage Loans.
(a) Subject to the terms specified in this Agreement, the Depositor has
the option, but is not obligated, to purchase from the Trust Fund any Breached
Mortgage Loan at the Repurchase Price; provided that the entity from which the
Seller purchased the Mortgage Loan has both (a) agreed to purchase the
Mortgage Loan from the Depositor and (b) has represented to the Seller that it
has the ability to purchase such Mortgage Loan from the Depositor, as soon as
is practicable thereafter at the Repurchase Price.
Section 2.08. Release of Mortgage Documents for Servicing
(a) From time to time and as appropriate for the foreclosure or servicing
of any of the Mortgage Loans, the Custodian shall, upon receipt in writing,
facsimile or electronic transmission from the Master Servicer or a Servicer of
a Request for Release release to the Master Servicer or such Servicer the
Mortgage Documents set forth in such Request for Release. All Mortgage
Documents released by the Custodian to the Master Servicer or a Servicer
pursuant to this Section 2.08 shall be held by the Master Servicer or such
Servicer in trust for the benefit of the Trust pursuant to the applicable
Purchase and Servicing Agreement. Upon the repurchase of any Mortgage Loan or
upon the payment in full of any Mortgage Loan, and upon receipt by the
Custodian of (i) the Request for Release (which Request for Release shall
include a statement to the effect that all amounts payable to the Trust in
connection with a repurchase have been deposited in the related Custodial
Account or the Collection Account or (ii) direction of the Depositor or the
Trustee, as applicable, the Custodian shall promptly release the related
Mortgage Documents in accordance with such Request for Release or direction.
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ARTICLE III
THE CERTIFICATES
Section 3.01. The Certificates.
(a) The Certificates shall be issuable in registered form only and shall
be securities governed by Article 8 of the New York Uniform Commercial Code.
The Book-Entry Certificates will be evidenced by one or more certificates,
beneficial ownership of which will be held in the dollar denominations in
Certificate Balance, or Notional Amount, as applicable, or in the Percentage
Interests, specified herein. Each Class of Certificates will be issued in the
minimum denominations and integral multiples thereof of the initial
Certificate Balance (or Notional Amount) specified in the Preliminary
Statement hereto.
(b) The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer of the Trustee or of the
Securities Administrator on the Trustee's behalf. Each Certificate shall, on
original issue, be authenticated by the Authenticating Agent upon the order of
the Depositor upon receipt by the Trustee of the Trustee Mortgage Files
described in Section 2.01. 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 an authorized officer of the Authenticating
Agent, by manual signature, and such certification upon any Certificate shall
be conclusive evidence, and the only evidence, that such Certificate has been
duly authenticated and delivered hereunder. All Certificates shall be dated
the date of their authentication. At any time and from time to time after the
execution and delivery of this Agreement, the Depositor may deliver
Certificates executed by or on behalf of the Trustee to the Authenticating
Agent for authentication and the Authenticating Agent shall authenticate and
deliver such Certificates as in this Agreement provided and not otherwise.
(c) The Class OC, X-0, X-0, X-0, Class P-1, Class P-2 and Class A-R
Certificates offered and sold in reliance on the exemption from registration
under Rule 144A under the Act shall be issued initially in definitive, fully
registered form without interest coupons with the applicable legends set forth
in Exhibit A added to the forms of such Certificates (each, a "Restricted
Global Security").
Section 3.02. Registration.
The Securities Administrator is hereby appointed, and the Securities
Administrator hereby accepts its appointment as, initial Certificate Registrar
in respect of the Certificates and shall maintain books for the registration
and for the transfer of Certificates (the "Certificate Register"). The Trustee
may appoint a bank or trust company to act as successor Certificate Registrar.
A registration book shall be maintained for the Certificates collectively. The
Certificate Registrar may resign or be discharged or removed and a new
successor may be appointed in accordance with the procedures and requirements
set forth in Sections 6.06 and 6.07 hereof with respect to the resignation,
discharge or removal of the Securities Administrator and the appointment of a
successor Securities Administrator. The Certificate Registrar may appoint, by
a written instrument delivered to the Holders and the Master Servicer, any
bank or trust
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company to act as co-registrar under such conditions as the Certificate
Registrar may prescribe; provided, however, that the Certificate Registrar
shall not be relieved of any of its duties or responsibilities hereunder by
reason of such appointment.
Section 3.03. Transfer and Exchange of Certificates.
(a) A Certificate (other than Book-Entry Certificates which shall be
subject to Section 3.09 hereof) may be transferred by the Holder thereof only
upon presentation and surrender of such Certificate at the office of the
Certificate Registrar duly endorsed or accompanied by an assignment duly
executed by such Holder or his duly authorized attorney in such form as shall
be satisfactory to the Certificate Registrar. Upon the transfer of any
Certificate in accordance with the preceding sentence, the Securities
Administrator on behalf of the Trustee shall execute, and the Authenticating
Agent shall authenticate and deliver to the transferee, one or more new
Certificates of the same Class and evidencing, in the aggregate, the same
aggregate Certificate Balance (or Notional Amount) as the Certificate being
transferred. No service charge shall be made to a Certificateholder for any
registration of transfer of Certificates, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any registration of transfer of
Certificates.
(b) A Certificate may be exchanged by the Holder thereof for any number
of new Certificates of the same Class, in authorized denominations,
representing in the aggregate the same Certificate Balance (or Notional
Amount) as the Certificate surrendered, upon surrender of the Certificate to
be exchanged at the office of the Certificate Registrar duly endorsed or
accompanied by a written instrument of transfer duly executed by such Holder
or his duly authorized attorney in such form as is satisfactory to the
Certificate Registrar. Certificates delivered upon any such exchange will
evidence the same obligations, and will be entitled to the same rights and
privileges, as the Certificates surrendered. No service charge shall be made
to a Certificateholder for any exchange of Certificates, but the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any exchange of
Certificates. Whenever any Certificates are so surrendered for exchange, the
Securities Administrator on behalf of the Trustee shall execute, and the
Authenticating Agent shall authenticate, date and deliver the Certificates
which the Certificateholder making the exchange is entitled to receive.
(c) By acceptance of a Restricted Certificate, whether upon original
issuance or subsequent transfer, each Holder of such a Certificate
acknowledges the restrictions on the transfer of such Certificate set forth
thereon and agrees that it will transfer such a Certificate only as provided
herein.
The following restrictions shall apply with respect to the transfer and
registration of transfer of a Restricted Certificate to a transferee that
takes delivery in the form of a Definitive Certificate:
(i) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is (x) to the Depositor
or an affiliate (as defined in Rule 405 under the 0000 Xxx) of the
Depositor or (y) being made to a "qualified
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institutional buyer" (a "QIB") as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Act") by a transferor that has
provided the Certificate Registrar with a certificate in the form of
Exhibit H hereto; and
(ii) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is being made to an
"accredited investor" under Rule 501(a)(1), (2), (3) or (7) under the
Act, or to any Person all of the equity owners in which are such
accredited investors, by a transferor who furnishes to the Certificate
Registrar a letter of the transferee substantially in the form of
Exhibit I hereto.
(d) No transfer of an ERISA-Restricted Certificate in the form of a
Definitive Certificate shall be made to any Person or shall be effective
unless the Certificate Registrar, on behalf of the Trustee, has received (A) a
certificate substantially in the form of Exhibit J hereto (or Exhibit B, in
the case of a Residual Certificate) from such transferee or (B) an Opinion of
Counsel satisfactory to the Certificate Registrar and the Securities
Administrator to the effect that the purchase and holding of such a
Certificate will not constitute or result in any nonexempt prohibited
transactions under Title I of ERISA or Section 4975 of the Code or a plan
subject to any Federal, state or local law ("Similar Law") materially similar
to the foregoing provisions of ERISA or the Code and will not subject the
Certificate Registrar, the Trustee, the Master Servicer, the Depositor or the
Securities Administrator to any obligation in addition to those undertaken in
the Agreement; provided, however, that the Certificate Registrar will not
require such certificate or opinion in the event that, as a result of a change
of law or otherwise, counsel satisfactory to the Certificate Registrar has
rendered an opinion to the effect that the purchase and holding of an
ERISA-Restricted Certificate by a Plan or a Person that is purchasing or
holding such a Certificate with the assets of a Plan will not constitute or
result in a prohibited transaction under Title I of ERISA or Section 4975 of
the Code and will not subject the Certificate Registrar, the Trustee, the
Master Servicer, the Depositor or the Securities Administrator to any
obligation in addition to those undertaken in this Agreement. Each Transferee
of an ERISA-Restricted Certificate that is a Book-Entry Certificate shall be
deemed to have made the appropriate representation set forth in paragraph 2
and the representation set forth in paragraph 3 of Exhibit J. The preparation
and delivery of the certificate and opinions referred to above shall not be an
expense of the Trust Fund, the Certificate Registrar, the Trustee, the Master
Servicer, the Depositor or the Securities Administrator.
Notwithstanding the foregoing, no opinion or certificate shall be
required for the initial issuance of the ERISA-Restricted Certificates to the
Underwriter. The Certificate Registrar shall have no obligation to monitor
transfers of Book-Entry Certificates that are ERISA-Restricted Certificates
and shall have no liability for transfers of such Certificates in violation of
the transfer restrictions. The Certificate Registrar shall be under no
liability to any Person for any registration of transfer of any
ERISA-Restricted Certificate that is in fact not permitted by this Section
3.03(d) and neither the Securities Administrator nor the Paying Agent shall
have any liability for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder under
the provisions of this Agreement so long as the transfer was registered by the
Certificate Registrar in accordance with the foregoing requirements. The
Securities Administrator, on behalf of the Trustee, shall be entitled, but not
obligated, to recover from any Holder of any ERISA-Restricted Certificate
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that was in fact a Plan or a Person acting on behalf of a Plan any payments
made on such ERISA-Restricted Certificate at and after such time. Any such
payments so recovered by the Securities Administrator, on behalf of the
Trustee, shall be paid and delivered by the Securities Administrator, on
behalf of the Trustee, to the last preceding Holder of such Certificate that
is not such a Plan or Person acting on behalf of a Plan.
(e) As a condition of the registration of transfer or exchange of any
Certificate, the Certificate Registrar may require the certified taxpayer
identification number of the owner of the Certificate and the payment of a sum
sufficient to cover any tax or other governmental charge imposed in connection
therewith; provided, however, that the Certificate Registrar shall have no
obligation to require such payment or to determine whether or not any such tax
or charge may be applicable. No service charge shall be made to the
Certificateholder for any registration, transfer or exchange of a Certificate.
(f) Notwithstanding anything to the contrary contained herein, no
Residual Certificate may be owned, pledged or transferred, directly or
indirectly, by or to (i) a Disqualified Organization or (ii) an individual,
corporation or partnership or other person unless such person (A) is not a
Non-U.S. Person or (B) is a Non-U.S. Person that holds a Residual Certificate
in connection with the conduct of a trade or business within the United States
and has furnished the transferor and the Certificate Registrar with an
effective Internal Revenue Service Form W-8ECI or successor form at the time
and in the manner required by the Code (any such person who is not covered by
clause (A) or (B) above is referred to herein as a "Non-permitted Foreign
Holder").
Prior to and as a condition of the registration of any transfer, sale or
other disposition of a Residual Certificate, the proposed transferee shall
deliver to the Certificate Registrar an affidavit in substantially the form
attached hereto as Exhibit B representing and warranting, among other things,
that such transferee is neither a Disqualified Organization, an agent or
nominee acting on behalf of a Disqualified Organization, nor a Non-permitted
Foreign Holder (any such transferee, a "Permitted Transferee"), and the
proposed transferor shall deliver to the Trustee and the Certificate Registrar
an affidavit in substantially the form attached hereto as Exhibit C. In
addition, the Trustee or the Certificate Registrar may (but shall have no
obligation to) require, prior to and as a condition of any such transfer, the
delivery by the proposed transferee of an Opinion of Counsel, addressed to the
Trustee and the Certificate Registrar, that such proposed transferee or, if
the proposed transferee is an agent or nominee, the proposed beneficial owner,
is not a Disqualified Organization, agent or nominee thereof, or a
Non-permitted Foreign Holder. Notwithstanding the registration in the
Certificate Register of any transfer, sale, or other disposition of a Residual
Certificate to a Disqualified Organization, an agent or nominee thereof, or
Non-permitted Foreign Holder, such registration shall be deemed to be of no
legal force or effect whatsoever and such Disqualified Organization, agent or
nominee thereof, or Non-permitted Foreign Holder shall not be deemed to be a
Certificateholder for any purpose hereunder, including, but not limited to,
the receipt of distributions on such Residual Certificate. The Depositor and
the Certificate Registrar shall be under no liability to any Person for any
registration or transfer of a Residual Certificate to a Disqualified
Organization, agent or nominee thereof or Non-permitted Foreign Holder or for
the Paying Agent making any payments due on such Residual Certificate to the
Holder thereof or for taking any other action with respect to such Holder
under the provisions of the Agreement, so long as the transfer was effected in
accordance with this Section 3.03(f), unless the Certificate Registrar shall
have actual knowledge at the time
95
of such transfer or the time of such payment or other action that the
transferee is a Disqualified Organization, or an agent or nominee thereof, or
Non-permitted Foreign Holder. The Certificate Registrar shall be entitled to
recover from any Holder of a Residual Certificate that was a Disqualified
Organization, agent or nominee thereof, or Non-permitted Foreign Holder at the
time it became a Holder or any subsequent time it became a Disqualified
Organization, agent or nominee thereof, or Non-permitted Foreign Holder, all
payments made on such Residual Certificate at and after either such times (and
all costs and expenses, including but not limited to attorneys' fees, incurred
in connection therewith). Any payment (not including any such costs and
expenses) so recovered by the Certificate Registrar shall be paid and
delivered to the last preceding Holder of such Residual Certificate.
If any purported transferee shall become a registered Holder of a
Residual Certificate in violation of the provisions of this Section 3.03(f),
then upon receipt of written notice to the Trustee or the Certificate
Registrar that the registration of transfer of such Residual Certificate was
not in fact permitted by this Section 3.03(f), the last preceding Permitted
Transferee shall be restored to all rights as Holder thereof retroactive to
the date of such registration of transfer of such Residual Certificate. The
Depositor, the Certificate Registrar and the Trustee shall be under no
liability to any Person for any registration of transfer of a Residual
Certificate that is in fact not permitted by this Section 3.03(f), or for the
Paying Agent making any payment due on such Certificate to the registered
Holder thereof or for taking any other action with respect to such Holder
under the provisions of this Agreement so long as the transfer was registered
upon receipt of the affidavit described in the preceding paragraph of this
Section 3.03(f).
(g) Each Holder or Certificate Owner of a Restricted Certificate,
ERISA-Restricted Certificate or Residual Certificate, or an interest therein,
by such Holder's or Owner's acceptance thereof, shall be deemed for all
purposes to have consented to the provisions of this section.
Section 3.04. Cancellation of Certificates.
Any Certificate surrendered for registration of transfer or exchange
shall be cancelled and retained in accordance with normal retention policies
with respect to cancelled certificates maintained by the Certificate
Registrar.
Section 3.05. Replacement of Certificates.
If (i) any Certificate is mutilated and is surrendered to the Trustee or
the Certificate Registrar or (ii) the Certificate Registrar receives evidence
to its satisfaction of the destruction, loss or theft of any Certificate, and
there is delivered to the Trustee and the Certificate Registrar such security
or indemnity as may be required by them to save each of them harmless, then,
in the absence of notice to the Depositor, the Trustee or the Certificate
Registrar that such destroyed, lost or stolen Certificate has been acquired by
a protected purchaser, the Securities Administrator on behalf of the Trustee
shall execute and the Authenticating Agent shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and Certificate Balance. Upon the
issuance of any new Certificate under this Section 3.05, the Trustee, the
Depositor or the Certificate Registrar may require the payment of a sum
sufficient to cover any tax or other governmental
96
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee, the Depositor or the
Certificate Registrar) connected therewith. Any replacement Certificate issued
pursuant to this Section 3.05 shall constitute complete and indefeasible
evidence of ownership in the applicable Trust Fund, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.
If after the delivery of such new Certificate, a protected purchaser of
the original Certificate in lieu of which such new Certificate was issued
presents for payment such original Certificate, the Depositor, the Certificate
Registrar and the Trustee or any agent shall be entitled to recover such new
Certificate from the Person to whom it was delivered or any Person taking
therefrom, except a protected purchaser, and shall be entitled to recover upon
the security or indemnity provided therefor to the extent of any loss, damage,
cost or expenses incurred by the Depositor, the Certificate Registrar, the
Trustee or any agent in connection therewith.
Section 3.06. Persons Deemed Owners.
Subject to the provisions of Section 3.09 with respect to Book-Entry
Certificates, the Depositor, the Master Servicer, the Securities
Administrator, the Trustee, the Certificate Registrar, the Paying Agent and
any agent of any of them shall treat the Person in whose name any Certificate
is registered upon the books of the Certificate Registrar as the owner of such
Certificate for the purpose of receiving distributions pursuant to Sections
5.01 and 5.02 and for all other purposes whatsoever, and neither the
Depositor, the Master Servicer, the Securities Administrator, the Trustee, the
Certificate Registrar, the Paying Agent nor any agent of any of them shall be
affected by notice to the contrary.
Section 3.07. Temporary Certificates.
(a) Pending the preparation of definitive Certificates, upon the order
of the Depositor, the Securities Administrator on behalf of the Trustee shall
execute and the Authenticating Agent shall authenticate and deliver temporary
Certificates that are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Certificates in lieu of which they are issued and with such
variations as the authorized officers executing such Certificates may
determine, as evidenced by their execution of such Certificates.
(b) If temporary Certificates are issued, the Depositor will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office or agency of the Certificate Registrar without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Securities Administrator on behalf of the Trustee
shall execute and the Authenticating Agent shall authenticate and deliver in
exchange therefor a like aggregate Certificate Balance of definitive
Certificates of the same Class in the authorized denominations. Until so
exchanged, the temporary Certificates shall in all respects be entitled to the
same benefits under this Agreement as definitive Certificates of the same
Class.
Section 3.08. Appointment of Paying Agent.
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The Securities Administrator is hereby appointed as the initial Paying
Agent. The Trustee may appoint a successor Paying Agent (which may be the
Trustee) for the purpose of making distributions to the Certificateholders
hereunder. The Trustee shall cause any Paying Agent, other than the Securities
Administrator, to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee that such Paying Agent will
hold all sums held by it for the payment to the Certificateholders in an
Eligible Account (which shall be the Distribution Account) in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be
paid to the Certificateholders. All funds remitted by the Securities
Administrator to any such Paying Agent for the purpose of making distributions
shall be paid to the Certificateholders on each Distribution Date and any
amounts not so paid shall be returned on such Distribution Date to the
Securities Administrator. If the Paying Agent is not the Trustee or the
Securities Administrator, the Securities Administrator shall cause to be
remitted to the Paying Agent on or before the Business Day prior to each
Distribution Date, by wire transfer in immediately available funds, the funds
to be distributed on such Distribution Date. Any Paying Agent shall be either
a bank or trust company or otherwise authorized under law to exercise
corporate trust powers.
Section 3.09. Book-Entry Certificates.
(a) Each Class of Book-Entry Certificates, upon original issuance, shall
be issued in the form of one or more typewritten Certificates representing the
Book-Entry Certificates. The Book-Entry Certificates shall initially be
registered on the Certificate Register in the name of the nominee of the
Clearing Agency, and no Certificate Owner will receive a definitive
certificate representing such Certificate Owner's interest in the Book-Entry
Certificates, except as provided in Section 3.09(c). Unless Definitive
Certificates have been issued to Certificate Owners of Book-Entry Certificates
pursuant to Section 3.09(c):
(i) the provisions of this Section 3.09 shall be in full force and
effect;
(ii) the Certificate Registrar, the Paying Agent and the Trustee
shall deal with the Clearing Agency for all purposes (including the
making of distributions on the Book-Entry Certificates) as the
authorized representatives of the Certificate Owners and the Clearing
Agency and shall be responsible for crediting the amount of such
distributions to the accounts of such Persons entitled thereto, in
accordance with the Clearing Agency's normal procedures;
(iii) to the extent that the provisions of this Section 3.09
conflict with any other provisions of this Agreement, the provisions of
this Section 3.09 shall control; and
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and the Clearing Agency Participants and
shall be limited to those established by law and agreements between such
Certificate Owners and the Clearing Agency and/or the Clearing Agency
Participants. Unless and until Definitive Certificates are issued
pursuant to Section 3.09(c), the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit distributions of principal of and interest on the
Book-Entry Certificates to such Clearing Agency Participants.
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(b) Whenever notice or other communication to the Certificateholders is
required under this Agreement, unless and until Definitive Certificates shall
have been issued to Certificate Owners pursuant to Section 3.09(c), the
Securities Administrator shall give all such notices and communications
specified herein to be given to Holders of the Book-Entry Certificates to the
Clearing Agency.
(c) If (i) (A) the Clearing Agency or the Depositor advises the
Certificate Registrar in writing that the Clearing Agency is no longer willing
or able to discharge properly its responsibilities with respect to the
Book-Entry Certificates, and (B) the Depositor is unable to locate a qualified
successor satisfactory to the Depositor and the Certificate Registrar or (ii)
after the occurrence of an Event of Default, Certificate Owners representing
beneficial interests aggregating not less than 50% of the Class Principal
Balance of a Class of Book-Entry Certificates advise the Paying Agent and the
Clearing Agency through the Clearing Agency Participants in writing that the
continuation of a book-entry system through the Clearing Agency is no longer
in the best interests of the Certificate Owners of a Class of Book-Entry
Certificates, the Certificate Registrar shall notify the Clearing Agency to
effect notification to all Certificate Owners, through the Clearing Agency, of
the occurrence of any such event and of the availability of Definitive
Certificates to Certificate Owners requesting the same. Upon surrender to the
Certificate Registrar of the Book-Entry Certificates by the Clearing Agency,
accompanied by registration instructions from the Clearing Agency for
registration, the Certificate Registrar shall issue the Definitive
Certificates. Neither the Depositor, the Certificate Registrar nor the Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates all references herein to
obligations imposed upon or to be performed by the Clearing Agency shall be
deemed to be imposed upon and performed by the Certificate Registrar, to the
extent applicable, with respect to such Definitive Certificates and the
Certificate Registrar shall recognize the holders of the Definitive
Certificates as Certificateholders hereunder. Notwithstanding the foregoing,
the Certificate Registrar, upon the instruction of the Depositor, shall have
the right to issue Definitive Certificates on the Closing Date in connection
with credit enhancement programs.
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01. Custodial Accounts; Distribution Account.
(a) On or prior to the Closing Date, the Master Servicer shall have
caused each Servicer to establish and maintain one or more Custodial Accounts,
as provided in the related Purchase and Servicing Agreement, into which all
Scheduled Payments and unscheduled payments with respect to the related
Mortgage Loans, net of any deductions or reimbursements permitted under the
related Purchase and Servicing Agreement, shall be deposited. On each
Distribution Account Deposit Date, the Servicers shall remit to the Securities
Administrator for deposit into the Distribution Account, all amounts so
required to be deposited into such account in accordance with the terms of the
related Purchase and Servicing Agreements.
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(b) The Securities Administrator, as Paying Agent for the Trust, shall
establish and maintain an Eligible Account entitled "Distribution Account of
LaSalle Bank National Association, as Trustee for the benefit of Xxxxxx
Xxxxxxx Mortgage Loan Trust 2006-11, Holders of Mortgage Pass-Through
Certificates." The Securities Administrator shall, promptly upon receipt from
the Servicers on each related Distribution Account Deposit Date, deposit into
the Distribution Account and retain on deposit until the related Distribution
Date the following amounts:
(i) the aggregate of collections with respect to the Mortgage
Loans remitted by the Servicers from the related Custodial Accounts in
accordance with the Purchase and Servicing Agreements;
(ii) any amounts required to be deposited by the Master Servicer
with respect to the Mortgage Loans for the related Due Period pursuant
to this Agreement, including the amount of any Advances or Compensating
Interest Payments with respect to the Mortgage Loans not paid by the
Servicers; and
(iii) any other amounts so required to be deposited in the
Distribution Account in the related Due Period pursuant to this
Agreement.
(c) In the event the Master Servicer or a Servicer has remitted in error
to the Distribution Account any amount not required to be remitted in
accordance with the definition of Available Funds, it may at any time direct
the Securities Administrator to withdraw such amount from the Distribution
Account for repayment to the Master Servicer or Servicer, as applicable, by
delivery of an Officer's Certificate to the Securities Administrator and the
Trustee which describes the amount deposited in error.
(d) On each Distribution Date and Initial Optional Termination Date, the
Securities Administrator, as Paying Agent, shall withdraw from funds available
in the Distribution Account and distribute the Available Funds to the
Certificateholders and any other parties entitled thereto in the amounts and
priorities set forth in Section 5.02. The Securities Administrator may from
time to time withdraw from the Distribution Account and pay the Master
Servicer, the Trustee, the Custodians, the Securities Administrator or any
Servicer any amounts permitted to be paid or reimbursed to such Person from
funds in the Distribution Account pursuant to this Agreement, any Purchase and
Servicing Agreement or any Custodial Agreements.
(e) Funds in the Distribution Account may be invested in Permitted
Investments selected by and at the written direction of the Securities
Administrator, which shall mature not later than one Business Day prior to the
Distribution Date (except that if such Permitted Investment is an obligation
of the Securities Administrator or any of its Affiliates, or is managed or
advised by the Securities Administrator or any Affiliate, then such Permitted
Investment shall mature not later than such applicable Distribution Date) and
any such Permitted Investment shall not be sold or disposed of prior to its
maturity. All such Permitted Investments shall be made in the name of the
Trustee (in its capacity as such) or its nominee. All income and gain realized
from any Permitted Investment of amounts on deposit in the Distribution
Account shall be for the benefit of the Securities Administrator, as
additional compensation for its duties hereunder,
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and shall be subject to its withdrawal or order from time to time, and shall
not be part of the Trust Fund; provided, however, that if Xxxxx Fargo Bank,
National Association is no longer the Master Servicer and the Securities
Administrator, any such income and gain shall be used to pay the successor
Master Servicer and the successor Securities Administrator, the Master
Servicer Compensation and the Securities Administrator Compensation,
respectively. The amount of any losses incurred in respect of any such
investments shall be deposited in such Distribution Account by the Securities
Administrator out of its own funds, without any right of reimbursement
therefor, immediately as realized.
Section 4.02. Permitted Withdrawals from the Custodial Accounts and the
Distribution Account.
(a) Each Servicer may from time to time make withdrawals from its
Custodial Account for the following purposes:
(i) to reimburse itself for unreimbursed Advances made by it, such
right of reimbursement pursuant to this subclause (i) being limited to
amounts received on the Mortgage Loan(s) in respect of which any such
Advance was made;
(ii) to reimburse itself for any Nonrecoverable Advance previously
made by it;
(iii) to reimburse itself for unreimbursed Servicer Advances, each
Servicer's right to reimbursement pursuant to this clause (a) with
respect to any Mortgage Loan being limited to amounts received on such
Mortgage Loan(s) which represent late recoveries of the payments for
which such advances were made pursuant to the related Purchase and
Servicing Agreement;
(iv) to reimburse itself for expenses incurred by it and
reimbursable pursuant to the related Purchase and Servicing Agreement;
and
(v) to withdraw any amount deposited in the Custodial Account and
not required to be deposited therein.
To the extent required by the related Purchase and Servicing Agreement
each Servicer shall keep and maintain separate accounting, on a Mortgage Loan
by Mortgage Loan basis, for the purpose of justifying any withdrawal from its
Custodial Account pursuant to such subclauses (i), (ii), (iii), (iv) and (v).
Prior to making any withdrawal from its Custodial Account pursuant to
subclause (ii), the related Servicer shall deliver to the Master Servicer an
Officer's Certificate of a Servicing Officer indicating the amount of any
previous Advance determined by the Servicer to be a Nonrecoverable Advance and
identifying the related Mortgage Loans(s), and their respective portions of
such Nonrecoverable Advance.
(b) The Securities Administrator shall withdraw funds from the
Distribution Account for distributions to Certificateholders in the manner
specified in this Agreement (and to withhold from the amounts so withdrawn,
the amount of any taxes that it is authorized to withhold pursuant to Section
10.01). In addition, the Securities Administrator may from time to time make
withdrawals from the Distribution Account for the following purposes:
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(i) to pay all costs and expenses described in clause (d) of the
definition of "Available Funds" and in the sixth bullet of clause (e) of
the definition of "Available Distribution Amount";
(ii) (x) for so long as Xxxxx Fargo Bank, National Association is
the Master Servicer and the Securities Administrator, to pay to the
Master Servicer the investment earnings on the Distribution Account as
its compensation for the related Distribution Date and (y) thereafter,
concurrently, to the Master Servicer and the Securities Administrator,
the Master Servicer Compensation and the Securities Administrator
Compensation, respectively;
(iii) to withdraw and return to the Master Servicer any amount
deposited in the Distribution Account and not required to be deposited
therein; and
(iv) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 7.01 hereof.
(v) [Reserved].
Section 4.03. [Reserved].
Section 4.04. [Reserved].
Section 4.05. Reports to Trustee and Certificateholders.
On each Distribution Date, the Securities Administrator shall have
prepared and shall make available to the Trustee, the Depositor, the Rating
Agencies and each Certificateholder a written report setting forth the
following information (on the basis of Mortgage Loan level information
obtained from the Master Servicer and the Servicers):
(a) the amount of the distributions, separately identified, with respect
to each Class of Certificates;
(b) the amount of the distributions set forth in the clause (a)
allocable to principal, separately identifying the aggregate amount of any
Principal Prepayments, liquidation proceeds or other unscheduled recoveries of
principal included in that amount;
(c) the amount of the distributions set forth in the clause (a)
allocable to interest and how it was calculated;
(d) the amount of any unpaid Class Interest Shortfall remaining unpaid,
and the related accrued interest thereon, with respect to each Class of
Certificates;
(e) the Class Principal Balance or Notional Amount of each Class of
Certificates after giving effect to the distribution of principal on that
Distribution Date;
(f) if the distribution to the holders of such Class of Certificates is
less than the full amount that would be distributable to such holders if there
were sufficient funds available
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therefor, the amount of the shortfall and the allocation of the Class Interest
Shortfall as between principal and interest, to the extent not otherwise
reported;
(g) the aggregate Stated Principal Balance of the Mortgage Loans in each
Loan Group and in the Trust Fund and the Collateral Allocation Group Principal
Balance at the end of the related Prepayment Period, and the applicable
Weighted Average Net Mortgage Rate of each Loan Group and the Mortgage Pool
and the Applicable Fraction of each Mortgage Loan in each Collateral
Allocation Group at the beginning of the related Due Period and the weighted
average remaining term to maturity of each Loan Group, the Mortgage Pool and
each Collateral Allocation Group;
(h) the Senior Percentage and the Subordinated Percentage for each
Collateral Allocation Group and for the Aggregate Loan Group II and Collateral
Allocation Group 1 for the following Distribution Date;
(i) the Senior Prepayment Percentage and Subordinate Prepayment
Percentage for each Collateral Allocation Group in Aggregate Loan Group II for
the following Distribution Date;
(j) in the aggregate and with respect to each Loan Group and each
Collateral Allocation Group, the amount of the Servicing Fee paid to or
retained by the Master Servicer and by each Servicer, respectively, and in the
aggregate with respect to each Loan Group;
(k) in the aggregate and with respect to each Loan Group and Collateral
Allocation Group, the amount of Monthly Advances for the related Due Period;
(l) in the aggregate and with respect to each Loan Group and Collateral
Allocation Group (based upon the Applicable Fractions of the Mortgage Loans),
determined by use of the MBA Method, the number and Stated Principal Balance
of the Mortgage Loans that were (A) Delinquent (exclusive of Mortgage Loans in
foreclosure) (1) 30 to 59 days, (2) 60 to 89 days and (3) 90 or more days, (B)
in foreclosure and Delinquent (1) 30 to 59 days, (2) 60 to 89 days and (3) 90
or more days and (C) in bankruptcy as of the close of business on the last day
of the calendar month preceding that Distribution Date;
(m) in the aggregate and with respect to each Loan Group and Collateral
Allocation Group (based upon the Applicable Fractions of the Mortgage Loans),
the total number, principal balance and market value (if available) of any REO
Properties as of the close of business on the last day of the preceding Due
Period;
(n) in the aggregate and with respect to each Loan Group and Collateral
Allocation Group (based upon the Applicable Fractions of the Mortgage Loans),
the amount of Realized Losses incurred during the preceding calendar month;
(o) in the aggregate and with respect to each Loan Group and Collateral
Allocation Group (based upon the Applicable Fractions of the Mortgage Loans),
the cumulative amount of Realized Losses incurred since the Closing Date;
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(p) the Realized Losses, if any, allocated to each Class of Certificates
on that Distribution Date;
(q) the Class Principal Balance or Notional Amount of each Class of
Certificates after giving effect to the distribution of principal on the
Distribution Date;
(r) with respect to the Aggregate Group II Certificates, the Special
Hazard Loss Coverage Amount, the Fraud Loss Coverage Amount and the Bankruptcy
Loss Coverage Amount, in each case as of the related Determination Date;
(s) the Pass-Through Rate for each Class of Certificates for that
Distribution Date;
(t) with respect to the Aggregate Group II Certificates, the amount of
any Transfer Payment Received paid to an Undercollateralized Group or Transfer
Payment Made by an Overcollateralized Group pursuant to Section 5.08 hereof;
(u) [Reserved];
(v) the total amount of Prepayment Penalties collected and due to the
Trust Fund, as reported by the Servicers;
(w) the applicable Record Date(s) for such Distribution Date;
(x) with respect to the Group 1 Certificates, the amount thereof
allocable to interest, any Unpaid Interest Amount included in such
distribution and any remaining Unpaid Interest Amount after giving effect to
such distribution, any Basis Risk Carry Forward Amount for such Distribution
Date not otherwise distributable to the Class OC Certificates;
(y) with respect to the Group 1 Certificates, if the distribution to the
Holders of such Class of Certificates is less than the full amount that would
be distributable to such Holders if there were sufficient funds available
therefor, the amount of the shortfall and the allocation thereof as between
principal and interest, including any Basis Risk Carry Forward Amount not
covered by amounts otherwise distributable to the Class OC Certificates;
(z) with respect to the Group 1 Certificates, whether a Trigger Event
has occurred and is continuing (including the calculation demonstrating the
existence of the Trigger Event and the aggregate outstanding balance of all
60+ Day Delinquent Mortgage Loans);
(aa) with respect to the Group 1 Certificates, the amount of any Net
Monthly Excess Cash Flow on such Distribution Date and the allocation thereof
to the Certificateholders with respect to Unpaid Interest Amounts, Unpaid
Realized Loss Amounts, or Basis Risk Carry Forward Amounts;
(bb) with respect to the Group 1 Certificates, the amount distributed on
the Class OC Certificates;
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(cc) with respect to the Group 1 Certificates, the Overcollateralized
Amount and the Overcollateralization Target Amount; and
(dd) with respect to the Group 1 Certificates, the amount of any
Subsequent Recoveries for such Distribution Date.
The Securities Administrator shall make such reports available each
month via its website at xxxx://xxx.xxxxxxx.xxx. Assistance in using the
website may be obtained by calling the Securities Administrator's customer
service desk at (000) 000-0000. Certificateholders and other parties that are
unable to use the website are entitled to have a paper copy mailed to them via
first class mail by contacting the Securities Administrator and indicating
such. In preparing or furnishing the foregoing reports, the Securities
Administrator shall be entitled to rely conclusively on the accuracy of the
information or data regarding the Mortgage Loans and the related REO
Properties that has been provided to the Securities Administrator by the
Master Servicer and the Servicers, and neither the Trustee nor the Securities
Administrator shall be obligated to verify, recompute, reconcile or
recalculate any such information or data.
Upon the reasonable advance written request of any Certificateholder
that is a savings and loan, bank or insurance company, which request, if
received by the Trustee or any agent thereof, shall be promptly forwarded to
the Securities Administrator, the Securities Administrator shall provide, or
cause to be provided, (or, to the extent that such information or
documentation is not required to be provided by a Servicer under the
applicable Purchase and Servicing Agreement, shall use reasonable efforts to
obtain such information and documentation from such Servicer, and provide) to
such Certificateholders such reports and access to information and
documentation regarding the Mortgage Loans as such Certificateholders may
reasonably deem necessary to comply with applicable regulations of the Office
of Thrift Supervision or its successor or other regulatory authorities with
respect to an investment in the Certificates; provided, however, that the
Securities Administrator shall be entitled to be reimbursed by such
Certificateholders for the Securities Administrator's actual expenses incurred
in providing such reports and access.
ARTICLE V
DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
Section 5.01. Distributions Generally.
(a) Subject to Section 7.01 respecting the final distribution on the
Certificates, on each Distribution Date the Securities Administrator or the
Paying Agent shall make all distributions in accordance with this Article V.
Such distributions shall be made by check mailed to each Certificateholder's
address as it appears on the Certificate Register of the Certificate Registrar
or, upon written request made to the Securities Administrator at least five
Business Days prior to the related Record Date by any Certificateholder owning
an aggregate initial Certificate Balance of at least $1,000,000, or in the
case of a Class of Notional Amount Certificates or Residual Certificate, a
Percentage Interest of not less than 100%, by wire transfer in immediately
available funds to an account specified in the request and at the expense of
such Certificateholder; provided, however, that the final distribution in
respect of any Certificate shall
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be made only upon presentation and surrender of such Certificate at the
Certificate Registrar's Corporate Trust Office; provided, further, that the
foregoing provisions shall not apply to any Class of Certificates as long as
such Certificate remains a Book-Entry Certificate in which case all payments
made shall be made through the Clearing Agency and its Clearing Agency
Participants. Notwithstanding the reduction of the Class Principal Balance of
any Class of Certificates to zero, such Class will be outstanding hereunder
(solely for the purpose of receiving distributions and not for any other
purpose) until the termination of the respective obligations and
responsibilities of the Depositor, the Master Servicer, the Securities
Administrator and the Trustee hereunder in accordance with Article VII. Wire
transfers will be made at the expense of the Holder requesting such wire
transfer by deducting a wire transfer fee from the related distribution.
Notwithstanding such final payment of principal of any of the Certificates,
each Residual Certificate will remain outstanding until the termination of
each REMIC and the payment in full of all other amounts due with respect to
the Residual Certificates and at such time such final payment in retirement of
any Residual Certificate will be made only upon presentation and surrender of
such Certificate at the Certificate Registrar's Corporate Trust Office. If any
payment required to be made on the Certificates is to be made on a day that is
not a Business Day, then such payment will be made on the next succeeding
Business Day.
(b) All distributions or allocations made with respect to the
Certificateholders within each Class on each Distribution Date shall be
allocated among the outstanding Certificates in such Class equally in
proportion to their respective initial Class Principal Balances or initial
Class Notional Amounts (or Percentage Interests).
Section 5.02. Priorities of Distribution.
(a) (1) On each Distribution Date, the Securities Administrator shall
withdraw from the Distribution Account the Available Distribution Amount (to
the extent that such amount is then on deposit in the Distribution Account)
and shall distribute such amount to the Group 1 Certificates in the following
order of priority:
(A) With respect to the portion of Available Distribution Amount for
such Distribution Date consisting of the Interest Remittance Amount for
such Distribution Date, on each Distribution Date, the Securities
Administration shall withdraw the Interest Remittance Amount from the
Available Distribution Amount on deposit in the Distribution Account for
that Distribution Date, and distribute such funds to the specified Class
of Group 1 Certificates that have outstanding Class Principal Balances,
sequentially, in the following order of priority:
(i) concurrently, to the Class 1-A-1, Class 1-A-2, Class 1-A-3,
Class 1-A-4, Class 1-A-5 and Class 1-A-6 Certificates their
respective Class 1-A Interest Distribution Amounts for such
Distribution Date, pro rata, based on their respective Class
1-A Interest Distribution Amounts for such Distribution
Date;
(ii) sequentially, to the Class 1-M-1, Class 1-M-2, Class 1-M-3,
Class 1-M-4, Class 1-M-5, Class 1-M-6, Class 1-B-1, Class
1-B-2 and Class 1-B-3 Certificates, in that order, their
respective Group 1 Subordinated Interest
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Distribution Amounts, in each case, to the extent of the
Interest Remittance Amount remaining after distributions of
interest to the Classes of Group 1 Certificates with a
higher payment priority; and
(iii) any remaining Interest Remittance Amount on any Distribution
Date will be distributed pursuant to Section 5.02(a)(1)(C)
hereof.
(B) (1) On each Distribution Date (a) prior to the Stepdown Date or (b)
on which a Trigger Event is in effect, the Holders of each Class of
Group 1 Certificates shall be entitled to receive payments and
distributions in respect of principal from the Group 1 Principal
Distribution Amount, respectively, in the following order of priority:
(i) to the holders of the Group 1 Senior Certificates pursuant
to Section 5.03 hereof, until their respective Class
Principal Balances are reduced to zero;
(ii) sequentially, to the holders of the Class 1-M-1, Class
1-M-2, Class 1-M-3, Class 1-M-4, Class 1-M-5, Class 1-M-6,
Class 1-B-1, Class 1-B-2 and Class 1-B-3 Certificates, in
that order, until their respective Class Principal Balances
are reduced to zero; and
(iii) any remaining Group 1 Principal Distribution Amount on any
Distribution Date will be will be distributed pursuant to
Section 5.02(a)(1)(C) hereof; or
(2) On each Distribution Date (a) on or after the Stepdown Date
and (b) on which a Trigger Event is not in effect, the Holders of each
Class of Group 1 Certificates shall be entitled to receive payments and
distributions in respect of principal from the Group 1 Principal
Distribution Amount, respectively, in the following order of priority:
(i) to the holders of the Group 1 Senior Certificates pursuant
to Section 5.03 hereof, until their respective Class
Principal Balances are reduced to zero;
(ii) to the Class 1-M-1 Certificates, the Class 1-M-1 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(iii) to the Class 1-M-2 Certificates, the Class 1-M-2 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(iv) to the Class 1-M-3 Certificates, the Class 1-M-3 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(v) to the Class 1-M-4 Certificates, the Class 1-M-4 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(vi) to the Class 1-M-5 Certificates, the Class 1-M-5 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
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(vii) to the Class 1-M-6 Certificates, the Class 1-M-6 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(viii) to the Class 1-B-1 Certificates, the Class 1-B-1 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero; and
(ix) to the Class 1-B-2 Certificates, the Class 1-B-2 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero; and
(x) to the Class 1-B-3 Certificates, the Class 1-B-3 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero; and
(xi) any remaining Group 1 Principal Distribution Amount on any
Distribution Date will be will be distributed pursuant to
Section 5.02(a)(1)(C) hereof.
(C) On each Distribution Date the remaining Net Monthly Excess Cashflow,
after giving effect to the distribution of the Extra Principal Distribution
Amount for that Distribution Date, shall be distributed to the Group 1
Certificates in the following order of priority, in each case to the extent of
the amounts remaining:
(i) to the Class 1-M-1 Certificates, the related Interest Carry
Forward Amount;
(ii) to the Class 1-M-1 Certificates, the related Unpaid Realized
Loss Amount;
(iii) to the Class 1-M-2 Certificates, the related Interest Carry
Forward Amount;
(iv) to the Class 1-M-2 Certificates, the related Unpaid Realized
Loss Amount;
(v) to the Class 1-M-3 Certificates, the related Interest Carry
Forward Amount;
(vi) to the Class 1-M-3 Certificates, the related Unpaid Realized
Loss Amount;
(vii) to the Class 1-M-4 Certificates, the related Interest Carry
Forward Amount;
(viii) to the Class 1-M-4 Certificates, the related Unpaid
Realized Loss Amount;
(ix) to the Class 1-M-5 Certificates, the related Interest Carry
Forward Amount;
(x) to the Class 1-M-5 Certificates, the related Unpaid Realized
Loss Amount;
(xi) to the Class 1-M-6 Certificates, the related Interest Carry
Forward Amount;
(xii) to the Class 1-M-6 Certificates, the related Unpaid Realized
Loss Amount;
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(xiii) to the Class 1-B-1 Certificates, the related Interest Carry
Forward Amount;
(xiv) to the Class 1-B-1 Certificates, the related Unpaid Realized
Loss Amount;
(xv) to the Class 1-B-2 Certificates, the related Interest Carry
Forward Amount;
(xvi) to the Class 1-B-2 Certificates, the related Unpaid Realized
Loss Amount;
(xvii) to the Class 1-B-3 Certificates, the related Interest Carry
Forward Amount;
(xviii) to the Class 1-B-3 Certificates, the related Unpaid
Realized Loss Amount;
(xix) to the Group 1 Reserve Fund, the amount of any Basis Risk
Carry Forward Amount for such Distribution Date and from the Group 1
Reserve Fund sequentially, first (i) concurrently, to the Class 1-A
Certificates, first pro rata, based on their respective Class Principal
Balances to the extent needed to pay any Basis Risk Carry Forward Amount
Carryover for each such Class and then, pro rata, based on any Basis
Risk Carry Forward Amount Carryover for each such Class, in an amount up
to the amount of any Basis Risk Carry Forward Amount remaining unpaid
for such Classes of Certificates and then (ii) sequentially, to the
Class 1-M-1, Class 1-M-2, Class 1-M-3, Class 1-M-4, Class 1-M-5, Class
1-M-6, Class 1-B-1, Class 1-B-2 and Class 1-B-3 Certificates, in that
order, in an amount up to the amount of any Basis Risk Carry Forward
Amount for such Classes of Certificates;
(xx) sequentially, first (i) concurrently, to the Class 1-A
Certificates, first pro rata, based on their respective Class Principal
Balances to the extent needed to pay any Unpaid Interest Shortfall
Amount for each such Class and then, pro rata, based on any Unpaid
Interest Shortfall Amount for each such Class, in an amount up to the
amount of any Unpaid Interest Shortfall Amount remaining unpaid for such
Classes of Certificates and then (ii) sequentially, to the Class 1-M-1,
Class 1-M-2, Class 1-M-3, Class 1-M-4, Class 1-M-5, Class 1-M-6, Class
1-B-1, Class 1-B-2 and Class 1-B-3 Certificates, in that order, in an
amount up to the amount of any Unpaid Interest Shortfall Amount for such
Classes of Certificates;
(xxi) commencing with the Distribution Date in July 2012, to the
holders of the Classes of Group 1 Certificates then outstanding
sequentially, in the following order of priority;
(1) the greater of (x) the Senior Turbo Allocation Amount
for that Distribution Date and (y) the Group 1 Excess Priority Amount
for that Distribution Date, to the Group 1 Senior Certificates,
sequentially, in the following order of priority:
(a) to the holders of the Class 1-A-6 Certificates,
the Group 1 Excess Priority Amount, until its Class Principal Balance is
reduced to zero;
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(b) sequentially, to the Class 1-A-1, Class 1-A-2 and
Class 1-A-3 Certificates, in that order, until their respective Class
Principal Balances are reduced to zero;
(c) concurrently, to the Class 1-A-4 and Class 1-A-5
Certificates, pro rata, until their respective Class Principal Balances
are reduced to zero; provided, however that if a Sequential Trigger
Event is in effect, the principal distributions to the Class 1-A-4 and
Class 1-A-5 Certificates will be allocated sequentially, to the Class
1-A-4 and Class 1-A-5 Certificates, in that order, until their
respective Class Principal Balances are reduced to zero; and
(d) to the Class 1-A-6 Certificates, without regard to
the Group 1 Excess Priority Amount, until its Class Principal Balance is
reduced to zero; and
(2) concurrently, to the holders of the Class 1-M-1, Class
1-M-2, Class 1-M-3, Class 1-M-4, Class 1-M-5, Class 1-M-6, Class 1-B-1,
Class 1-B-2 and Class 1-B-3 Certificates, pro rata, until their
respective Class Principal Balances are reduced to zero;
(xxii) to the Class OC Certificates, the Class OC Distributable
Amount; and
(xxiii) to the holders of the Class A-R Certificates, any
remaining amounts; provided that if such Distribution Date is the
Distribution Date immediately following the expiration of the latest
prepayment charge term or any Distribution Date thereafter, then any
such remaining amounts, together with the Class P-1 Distribution Amount,
will be distributed first, to the holders of the Class P-1 Certificates,
until the Class Principal Balance thereof has been reduced to zero; and
second, to the holders of the Class A-R Certificates.
For the avoidance of doubt, Section 5.02(a)(1)(C) is intended to cause the
Class OC Certificates to receive from amounts remaining after the application
of all other clauses of Section 5.02(a)(1)(C) preceding it, an amount up to
the sum of the Class OC Distributable Amount for that Distribution Date and
any Class OC Distributable Amounts remaining unpaid from prior Distribution
Dates and the Securities Administrator shall construe Section 5.02(a)(1)(C) as
necessary so as to accomplish such result.
(D) On each Distribution Date, the Class P-1 Distribution Amount
received during the related Prepayment Period will be distributed to the
holders of the Class P-1 Certificates. On the Distribution Date in January 1,
2012, the $1,000 held in trust for the Class P-1 Certificates will be
distributed to the holders of the Class P-1 Certificates.
(2) With respect to Available Funds for Collateral Allocation
Group 2, on each Distribution Date, the Securities Administrator shall
withdraw the Available Funds from the funds available therefor in the
Distribution Account and apply such funds to distributions on the specified
Classes of Group 2 Senior Certificates and the Group 2 Senior P& I Portion in
the following order and priority and, in each case, to the extent of Available
Funds remaining:
(i) [Reserved];
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(ii) concurrently, to each interest-bearing Class of Group 2
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall being
allocated among such Classes in proportion to the amount of the Class
Optimal Interest Distribution Amount that would have been distributed in
the absence of such shortfall; provided that prior to an Accrual
Termination Date, the related Accrual Amount shall be distributed as
provided in Section 5.02(a)(2)(iii);
(iii) [Reserved];
(iv) to the Group 2 Senior P&I Portion and each Class of Group 2
Senior Certificates, concurrently as follows:
(x) to the Class 2-A-P Certificates, an amount allocable to
the related A-P Formula Principal Amount, up to the outstanding
Class Principal Balance thereof; and
(y) on each Distribution Date prior to the Senior Credit
Support Depletion Date the related Non-A-P Formula Principal
Amount up to the amount of the Senior Principal Distribution
Amount for Collateral Allocation Group 2 for such Distribution
Date, will be distributed to the Group 2 Senior P&I Portion, until
its principal balance is reduced to zero. Amounts received by the
Group 2 Senior P&I Portion on each Distribution Date shall be
distributed, sequentially, to the following Classes of Group 2
Certificates in the following order of priority:
1. to the Class A-R Certificates until its Class Principal
Balance is reduced to zero; and
2. concurrently, to the Class 2-A-3 and Class 2-A-4
Certificates, pro rata, the Group 2 Priority Amount, until their
respective Class Principal Balances are reduced to zero;
3. sequentially, to the Class 2-A-1 and Class 2-A-2
Certificates, in that order, until their respective Class
Principal Balances are reduced to zero; and
4. concurrently, to the Class 2-A-3 and Class 2-A-4
Certificates, pro rata, without regard to the Group 2 Priority
Amount, until their respective Class Principal Balances are
reduced to zero; and
(v) to the Class 2-A-P Certificates, in an amount up to the
related Class A-P Deferred Amount, from amounts otherwise distributable
(without regard to this Section 5.02(a)(2)(v)) sequentially, to the
Class B-6, Class B-5, Class B-4, Class B-3, Class B-2, and Class B-1
Certificates, in that order, pursuant to Section 5.02(a)(6) hereof.
(3) With respect to Available Funds for Collateral Allocation
Group 3, on each Distribution Date, the Securities Administrator shall
withdraw the Available Funds from the funds available therefor in the
Distribution Account and apply such funds to distributions on the
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specified Classes of Group 3 Senior Certificates and the Group 3 Senior P& I
Portion in the following order and priority and, in each case, to the extent
of Available Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 3
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall being
allocated among such Classes in proportion to the amount of the Class
Optimal Interest Distribution Amount that would have been distributed in
the absence of such shortfall; provided that prior to an Accrual
Termination Date, the related Accrual Amount shall be distributed as
provided in Section 5.02(a)(3)(iii);
(iii) [Reserved]; and
(iv) to the Group 3 Senior P&I Portion and each Class of Group 3
Senior Certificates, concurrently as follows:
(x) to the Class 3-A-P Certificates, an amount allocable to
the related A-P Formula Principal Amount, up to the outstanding
Class Principal Balance thereof; and
(y) on each Distribution Date prior to the Senior Credit
Support Depletion Date the related Non-A-P Formula Principal
Amount up to the amount of the Senior Principal Distribution
Amount for Collateral Allocation Group 3 for such Distribution
Date, will be distributed to the Group 3 Senior P&I Portion, until
its principal balance is reduced to zero. Amounts received by the
Group 3 Senior P&I Portion on each Distribution Date shall be
distributed, sequentially, to the following Classes of Group 3
Certificates in the following order of priority:
1. concurrently, to the Class 3-A-3 and Class 3-A-4
Certificates, pro rata, the Group 3 Priority Amount, until their
respective Class Principal Balances are reduced to zero;
2. sequentially, to the Class 3-A-1 and Class 3-A-2
Certificates, in that order, until their respective Class
Principal Balances are reduced to zero; and
3. concurrently, to the Class 3-A-3 and Class 3-A-4, pro
rata, without regard to the Group 3 Priority Amount, until their
respective Class Principal Balances are reduced to zero; and
(v) to the Class 3-A-P Certificates, in an amount up to the
related Class A-P Deferred Amount, from amounts otherwise distributable
(without regard to this Section 5.02(a)(3)(v)) sequentially, to the
Class B-6, Class B-5, Class B-4, Class B-3, Class B-2, and Class B-1
Certificates, in that order, pursuant to Section 5.02(a)(6) hereof.
(4) With respect to Available Funds for Collateral Allocation
Group 4A and Available Funds for Collateral Allocation Group 4B, on each
Distribution Date, the Securities
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Administrator shall withdraw the Available Funds from the funds available
therefor in the Distribution Account and apply such funds to distributions on
the specified Classes of Group 4 Senior Certificates, the Group 4A Senior P& I
Portion and the Group 4B Senior P& I Portion in the following order and
priority and, in each case, to the extent of Available Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 4
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall being
allocated among such Classes in proportion to the amount of the Class
Optimal Interest Distribution Amount that would have been distributed in
the absence of such shortfall; provided that prior to an Accrual
Termination Date, the related Accrual Amount shall be distributed as
provided in Section 5.02(a)(4)(iii);
(iii) [Reserved]; and
(iv) to the Group 0X Xxxxxx X&X Portion, to the Group 4B Senior
P&I Portion, and each Class of Group 4 Senior Certificates, concurrently
as follows:
(x) [Reserved]; and
(y) first, concurrently, (i) on each Distribution Date prior
to the Senior Credit Support Depletion Date the related Non-A-P
Formula Principal Amount up to the amount of the Senior Principal
Distribution Amount for Collateral Allocation Group 4A for such
Distribution Date, will be distributed to the Group 0X Xxxxxx X&X
Portion, until its principal balance is reduced to zero and (ii)
on each Distribution Date prior to the Senior Credit Support
Depletion Date the related Non-A-P Formula Principal Amount up to
the amount of the Senior Principal Distribution Amount for
Collateral Allocation Group 4B for such Distribution Date, will be
distributed to the Group 4B Senior P&I Portion, until its
principal balance is reduced to zero; and second, amounts received
by the Group 0X Xxxxxx X&X Portion and the Group 4B Senior P&I
Portion on each Distribution Date shall both be distributed, to
the Class 4-A-1 Certificates, until its Class Principal Balance is
reduced to zero; and
(v) [Reserved].
(5) On each Distribution Date, after making the distributions
described in Section 5.02(a)(2), Section 5.02(a)(3) and Section 5.02(a)(4)
above, Available Funds from each Collateral Allocation Group in Aggregate Loan
Group II after making the distributions described in Section 5.02(a)(2),
Section 5.02(a)(3) and Section 5.02(a)(4) will be distributed to the Aggregate
Group II Senior Certificates to the extent provided in Section 5.08 hereof.
(6) On each Distribution Date, Available Funds from all of the
Aggregate Group II Loan Groups remaining after making the distributions
described in Section 5.02(a)(2), Section 5.02(a)(3), Section 5.02(a)(4) and
Section 5.02(a)(5) above, will be distributed to the Aggregate Group II
Subordinated Certificates, the Class P-2 Certificates and the Class A-R
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Certificates in the following order and priority and, in each case, to the
extent of such funds remaining:
(A) to the Class B-1 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount
for such Class for such Distribution Date;
(B) to the Class B-1 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(C) to the Class B-2 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount
for such Class for such Distribution Date;
(D) to the Class B-2 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(E) to the Class B-3 Certificates, an amount allocable to
interest equal to the amount of the Class Optimal Interest
Distribution Amount for such Class for such Distribution Date;
(F) to the Class B-3 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(G) to the Class B-4 Certificates, an amount allocable to
interest equal to the amount of the Class Optimal Interest
Distribution Amount for such Class for such Distribution Date;
(H) to the Class B-4 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(I) to the Class B-5 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount
for such Class for such Distribution Date;
(J) to the Class B-5 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(K) to the Class B-6 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount
for such Class for such Distribution Date; and
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(L) to the Class B-6 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(M) [Reserved]; and
(N) to the Class A-R Certificates, any remaining funds in
the Trust Fund; provided, that such amounts shall not include the
$1,000 held in trust for the Class P-1 or Class P-2 Certificates.
On each Distribution Date, all amounts representing Prepayment Penalties
on the Aggregate Group II Mortgage Loans received by the Securities
Administrator with respect to the related Prepayment Period will be
distributed to the holders of the Class P-2 Certificates. On the Distribution
Date in January 1, 2012, the $1,000 held in trust for the Class P-2
Certificates will be distributed to the holders of the Class P-2 Certificates.
On any Distribution Date, amounts distributed in respect of Class A-P
Deferred Amounts will not reduce the Class Principal Balance of the related
Class of Class A-P Certificates.
On any Distribution Date, to the extent the Amount Available for Senior
Principal related to a Collateral Allocation Group is insufficient to make the
full distribution required to be made pursuant to subclause (iv)(x) above for
such Collateral Allocation Group, (A) the amount distributable on the related
Class of Class A-P Certificates in respect of principal pursuant to such
subclause (iv)(x) shall be equal to the product of (1) the Amount Available
for Senior Principal for that Collateral Allocation Group and Distribution
Date and (2) a fraction, the numerator of which is the A-P Formula Principal
Amount for that Collateral Allocation Group and Distribution Date and the
denominator of which is the sum of the A-P Formula Principal Amount and the
Senior Principal Distribution Amount for that Collateral Allocation Group and
Distribution Date and (B) the amount distributable on the Senior Certificates,
other than the related Class of Class A-P Certificates, in respect of
principal pursuant to clause (iv)(y) shall be equal to the product of (1) the
Amount Available for Senior Principal for that Collateral Allocation Group and
Distribution Date and (2) a fraction, the numerator of which is the Senior
Principal Distribution Amount for that Collateral Allocation Group and
Distribution Date and the denominator of which is the sum of the Senior
Principal Distribution Amount and the A-P Formula Principal Amount for that
Collateral Allocation Group and Distribution Date.
(b) On each Distribution Date with respect to each Class or Component of
Accrual Certificates, the Accrual Amount for such Class or Component for such
Distribution Date shall not (except as provided in the second to last sentence
in this paragraph) be distributed as interest with respect to such Class or
Component of Accrual Certificates, but shall instead be added to the related
Class Principal Balance of such Class on the related Distribution Date. With
respect to any Distribution Date on which principal payments on any Class or
Component of Accrual Certificates are distributed pursuant to Section
5.02(a)(2)(iv)(y), Section 5.02(a)(3)(iv)(y) or Section 5.02(a)(4)(iv)(y), as
applicable, the related Accrual Amount shall be deemed to have been added on
such Distribution Date to the related Class Principal Balance or Component
Balance (and included in the amount distributable on the related Class or
Classes or Component of Accretion Directed Certificates pursuant to Section
5.02(a)(2)(iii), Section
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5.02(a)(3)(iii) or Section 5.02(a)(4)(iii), as applicable, for such
Distribution Date) and the related distribution thereon shall be deemed to
have been applied concurrently towards the reduction of all or a portion of
the amount so added and, to the extent of any excess, towards the reduction of
the Class Principal Balance or Component Balance of such Class or Component of
Accrual Certificates immediately prior to such Distribution Date.
(c) On each Distribution Date on or after the Senior Credit Support
Depletion Date for the Aggregate Group II Certificates, notwithstanding the
allocations and priorities set forth in Section 5.02(a)(2)(iv)(y) and Section
5.02(a)(3)(iv)(y), the portion of Available Funds available to be distributed
as principal of the Group 2 Senior Certificates (other than the Class 2-A-P
Certificates) and the Group 3 Senior Certificates (other than the Class 3-A-P
Certificates), respectively, shall be distributed concurrently, as principal,
on such Classes, pro rata, on the basis of their respective Class Principal
Balances, until the Class Principal Balances thereof are reduced to zero.
(d) On each Distribution Date, the amount referred to in clause (i) of
the definition of Class Optimal Interest Distribution Amount for each Class of
Aggregate Group II Certificates for such Distribution Date shall be reduced
for each Class of Aggregate Group II Senior Certificates of a Senior
Certificate Group and each Class of Aggregate Group II Subordinated
Certificates by (i) the related Class' pro rata share of Net Prepayment
Interest Shortfalls for such Aggregate Group II Collateral Allocation Group
based (x) with respect to a Class of Aggregate Group II Senior Certificates,
on the related Class Optimal Interest Distribution Amount and (y) with respect
to a Class of Aggregate Group II Subordinated Certificates on or prior to the
third related Senior Termination Date on the Assumed Interest Amount and on or
after such Senior Termination Date, the related Class' Class Optimal Interest
Distribution Amount for such Distribution Date, without taking into account
such Net Prepayment Interest Shortfalls and (ii) the related Class' Allocable
Share of (A) after the Special Hazard Coverage Termination Date, with respect
to the Applicable Fraction of each Mortgage Loan in the related Aggregate
Group II Collateral Allocation Group (or, after the Senior Credit Support
Depletion Date, any Aggregate Group II Mortgage Loan) that became a Special
Hazard Mortgage Loan during the calendar month preceding the month of such
Distribution Date, the excess of one month's interest at the related Net
Mortgage Rate on the Applicable Fraction of the Stated Principal Balance of
such Mortgage Loan as of the first day of the related Due Period in such month
over the amount of Liquidation Proceeds applied as interest on such Mortgage
Loan with respect to such month, (B) after the Bankruptcy Coverage Termination
Date, with respect to each Aggregate Group II Mortgage Loan that became
subject to a Bankruptcy Loss during the calendar month preceding the month of
such Distribution Date, the interest portion of the related Debt Service
Reduction or Deficient Valuation allocable to the Applicable Fraction of such
Mortgage Loan, (C) each Relief Act Reduction for the Aggregate Group II
Mortgage Loans in the related Collateral Allocation Group (or, after the
Senior Credit Support Depletion Date, any Mortgage Loan) incurred during the
calendar month preceding the month of such Distribution Date and (D) after the
Fraud Loss Coverage Termination Date, with respect to the Applicable Fraction
of each Mortgage Loan in the related Aggregate Group II Collateral Allocation
Group (or, after the Senior Credit Support Depletion Date, any Aggregate Group
II Mortgage Loan) that became a Fraud Loan during the calendar month preceding
the month of such Distribution Date, the excess of one month's interest at the
related Net Mortgage Rate on the Applicable Fraction of the Stated Principal
Balance of such Mortgage Loan as of the first day of the related Due Period
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in such month over the amount of Liquidation Proceeds applied as interest on
such Mortgage Loan with respect to such month.
(e) Notwithstanding the priority and allocation contained in Section
5.02(a)(6), if, on any Distribution Date, with respect to any Class of
Aggregate Group II Subordinated Certificates (other than the Class of
Aggregate Group II Subordinated Certificates then outstanding with the highest
priority of distribution), the sum of the related Class Subordination
Percentages of such Class and of all Classes of Aggregate Group II
Subordinated Certificates which have a higher numerical Class designation than
such Class (the "Applicable Credit Support Percentage") is less than the
Original Applicable Credit Support Percentage for such Class, no distribution
of Principal Prepayments will be made to any such Classes (the "Restricted
Classes") and the amount of such Principal Prepayments otherwise distributable
to the Restricted Classes shall be distributed to the outstanding Classes of
Aggregate Group II Subordinated Certificates having lower numerical Class
designations than such Class, pro rata, based on their respective Class
Principal Balances immediately prior to such Distribution Date and shall be
distributed in the sequential order provided in Section 5.02(a)(6).
Notwithstanding anything in this Agreement to the contrary, the Class of
Subordinated Certificates then outstanding with the highest distribution
priority shall not be a Restricted Class.
(f) If the amount of a Realized Loss on an Aggregate Group II Mortgage
Loan has been reduced by application of Subsequent Recoveries with respect to
a Liquidated Mortgage Loan in Aggregate Loan Group II, the Applicable Fraction
of the amount of such Subsequent Recoveries will be applied sequentially, in
the order of payment priority, to increase the Class Principal Balance of each
Class of Aggregate Group II Certificates to which Realized Losses have been
allocated, but in each case by not more than the amount of Realized Losses
previously allocated to that Class of Aggregate Group II Certificates pursuant
to Section 5.04. Holders of such Certificates will not be entitled to any
payment in respect of the Class Optimal Interest Distribution Amount on the
amount of such increases for any Interest Accrual Period preceding the
Distribution Date on which such increase occurs. Any such increases shall be
applied pro rata to the Certificate Balance of each Certificate of such Class.
Section 5.03. Allocation of Principal Payments to Class 1-A
Certificates.
Any principal distributions allocated to the Class 1-A Certificates are
required to be allocated sequentially, in the following order of priority:
1. to the Class 1-A-6 Certificates, the Group 1 Priority Amount,
until its Class Principal Balance is reduced to zero;
2. sequentially, to the Class 1-A-1, Class 1-A-2 and Class 1-A-3
Certificates, in that order, until their respective Class Principal Balances
are reduced to zero; and
3. concurrently, to the Class 1-A-4 and Class 1-A-5 Certificates,
pro rata, until their respective Class Principal Balances are reduced to zero;
provided, however that if a Sequential Trigger Event is in effect, the
principal distributions to the Class 1-A-4 and Class 1-A-5 Certificates will
be allocated sequentially, to the Class 1-A-4 and Class 1-A-5 Certificates, in
that order, until their respective Class Principal Balances are reduced to
zero; and
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4. to the Class 1-A-6 Certificates, without regard to the Group 1
Priority Amount, until its Class Principal Balance is reduced to zero.
Notwithstanding the allocation of principal to the Class 1-A
Certificates described above, from and after the Distribution Date on which
the aggregate Class Principal Balances of the Group 1 Subordinated
Certificates and the Class Principal Balance of the Class OC Certificates have
been reduced to zero, any principal distributions allocated to the Class 1-A
Certificates are required to be allocated pro rata among Class 1-A-1, Class
1-A-2, Class 1-A-3, Class 1-A-4, Class 1-A-5 and Class 1-A-6 Certificates,
until their respective Class Principal Balances have been reduced to zero,
with the exception that if a Sequential Trigger Event is in effect, principal
distributions allocable to the Class 1-A-4 and Class 1-A-5 Certificates will
be allocated sequentially, to the Class 1-A and Class 1-A-5 Certificates, in
that order, until their respective Class Principal Balances are reduced to
zero.
Section 5.04. Allocation of Losses.
(a) On or prior to each Distribution Date, the Securities Administrator
shall aggregate the information provided by each Servicer with respect to the
total amount of Realized Losses, including Excess Losses experienced on the
Mortgage Loans in the related Aggregate Loan Group, for the related
Distribution Date, separately identifying the Realized Losses on the Mortgage
Loans in each Loan Group.
(b) Realized Losses and Applied Loss Amounts with respect to the
Mortgage Loans on any Distribution Date shall be allocated as follows:
(i) any Applied Loss Amounts on the Collateral Allocation Group 1
Mortgage Loans shall be allocated first to the Class OC Certificates,
until its Class Principal Balance is reduced to zero, and second, to the
Group 1 Subordinated Certificates in reverse order of their respective
priorities of payment (beginning with the Class of Class 1-B
Certificates then outstanding with the highest numerical Class
designation or, if no Classes of Class 1-B Certificates are outstanding,
then beginning with the Class of Class 1-M Certificates then outstanding
with the highest numerical Class designation) until the respective Class
Principal Balance of each such Class is reduced to zero; and
(ii) Realized Losses with respect to the Aggregate Group II
Mortgage Loans on any Distribution Date shall be allocated as follows:
(A) the applicable A-P Percentage of any Realized Loss,
including any Excess Loss, on an Aggregate Group II Mortgage Loan, based
upon the related Applicable Fraction, in a Collateral Allocation Group
shall be allocated to the related Class of Class A-P Certificates, until
the Class Principal Balance thereof is reduced to zero; and
(B) the applicable Non-A-P Percentage of any Realized Loss
on the Aggregate Group II Mortgage Loans, based upon the related
Applicable Fraction, shall be allocated first to the Aggregate Group II
Subordinated Certificates in reverse order of their respective numerical
Class designations (beginning with the Class of Aggregate
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Group II Subordinated Certificates then outstanding with the highest
numerical Class designation) until the respective Class Principal
Balance of each such Class is reduced to zero, and second to the
Aggregate Group II Senior Certificates in the related Collateral
Allocation Group (other than any Class of Class A-P Certificates or
Notional Amount Certificates, as applicable), pro rata on the basis of,
in the case of the Senior P&I Portions their respective principal
balances and in the case of the Classes of Certificates in the related
Senior Certificate Group, their respective Class Principal Balances, in
each case immediately prior to the related Distribution Date until the
respective Class Principal Balance of each such Class is reduced to
zero, except that the applicable Non-A-P Percentage of any Realized Loss
on the Collateral Allocation Group 2 Mortgage Loans that would otherwise
be allocated to the Class 2-A-1, Class 2-A-2 or Class 2-A-3 Certificates
will instead be allocated to the Class 2-A-4 Certificates, until its
Class Principal Balance is reduced to zero, and the applicable Non-A-P
Percentage of any Realized Losses on the Collateral Allocation Group 3
Mortgage Loans that would otherwise be allocated to the Class 3-A-1,
Class 3-A-2 or Class 3-A-3 Certificates will instead be allocated to the
Class 3-A-4 Certificates, until its Class Principal Balance is reduced
to zero.
(C) the applicable Non-A-P Percentage of any Excess Losses
on the Aggregate Group II Mortgage Loans, based upon the related
Applicable Fraction, in a Collateral Allocation Group shall be allocated
will be allocated pro rata among the Classes of Aggregate Group II
Senior Certificates of the related Senior Certificate Group (other than
any related Classes of Notional Amount Certificates and any related
Class of Class A-P Certificates) and the Aggregate Group II Subordinated
Certificates as follows: (i) in the case of the Senior P&I Portions,
their respective principal balances, in the case of the Group 2
Certificates and the Group 3 Certificates, the Senior Percentage of the
Non-A-P Percentage of such Excess Loss will be allocated among the
Classes of the Group 2 Certificates and the Group 3 Certificates (other
than any related Classes of Notional Amount Certificates and any related
Class of Class A-P Certificates) in the related certificate group pro
rata based on their Class Principal Balances immediately prior to such
Distribution Date and in the case of the Group 4 Certificates, the
Senior Percentage of the Non-A-P Percentage of an Excess Loss in
Collateral Allocation Group 4A or Collateral Allocation Group 4B will be
allocated among the Classes of the Group 4 Certificates (other than any
related Classes of Notional Amount Certificates) pro rata based on their
Class Principal Balances immediately prior to such Distribution Date,
and in the case of the Aggregate Group II Subordinated Certificates,
each Class' share of the Assumed Balance for the related Collateral
Allocation Group, in each case immediately prior to the related
Distribution Date and, with respect to each Class of Aggregate Group II
Subordinated Certificates, the applicable Assumed Balance for each such
Class relating to the Collateral Allocation Group in which such Realized
Loss occurs; provided, however, on any Distribution Date after the third
related Senior Termination Date for an Aggregate Group II Senior
Certificate Group, such Excess Losses on the Aggregate Group II Mortgage
Loans in the related Collateral Allocation Group will be allocated to
the Aggregate Group II Subordinated Certificates on the basis of their
respective Class Principal Balances; and provided further that after the
related Senior Credit Support Depletion Date, such Excess Losses shall
be allocated pro rata to all Classes and Components of Aggregate Group
II Senior Certificates (other than any Class A-P
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Certificates or Notional Amount Certificates, as applicable) regardless
of Senior Certificate Group on the basis of their respective initial
Class Principal Balances or Component Balances, as applicable, or in the
case of any or in the case of any Class of Accrual Certificates or
Accrual Component, on the basis of the lesser of their respective Class
Principal Balance and their respective initial Class Principal Balance
or their respective Component Balance or their respective initial
Component Balance, as the case may be, in each case immediately prior to
the related Distribution Date.
(c) (i) The Class Principal Balance of the Aggregate Group II
Subordinated Certificates then outstanding with the highest numerical Class
designation shall be reduced on each Distribution Date by the amount, if any,
by which the aggregate of the Class Principal Balances of all outstanding
Classes of Aggregate Group II Certificates (after giving effect to the
distribution of principal and the allocation of Realized Losses on the
Mortgage Loans on such Distribution Date) exceeds the sum of the Pool Stated
Principal Balance of the Aggregate Group II Mortgage Loans for the following
Distribution Date.
(ii) The Class Principal Balance of the Class of Group 1
Subordinated Certificates then outstanding with the highest numerical Class
designation shall be reduced on each Distribution Date by the amount, if any,
by which the aggregate of the Class Principal Balances of all outstanding
Classes of Group 1 Certificates (after giving effect to the distribution of
principal and the allocation of Applied Loss Amounts on the Group 1 Mortgage
Loans on such Distribution Date) exceeds the aggregate Stated Principal
Balance of the Group 1 Mortgage Loans for the following Distribution Date. For
the avoidance of doubt, no reductions will be made in the Class Principal
Balance of the Class 1-A Certificates in respect of Realized Losses on the
Group 1 Mortgage Loans.
(d) Any Realized Loss allocated to a Aggregate Group II Certificates or
any Applied Loss Amounts allocated to the Aggregate Group II Certificates or
any reduction in the Class Principal Balance of a Class of Certificates
pursuant to Section 5.04(b) above shall be allocated among the Certificates of
such Class in proportion to their respective Certificate Balances.
(e) Any allocation of Realized Losses to a Certificate or to any
Component or any reduction in the Certificate Balance of a Certificate,
pursuant to Section 5.04(b) above shall be accomplished by reducing the
Certificate Balance or Component Balance thereof, as applicable, immediately
following the distributions made on the related Distribution Date in
accordance with the definition of "Certificate Balance" or "Component
Balance," as the case may be. All Realized Losses, Applied Loss Amounts or
Excess Losses allocated to a Class of Component Certificates will be
allocated, pro rata, to the related Components.
(f) For the avoidance of doubt, no Realized Losses on the Mortgage Loans
shall be allocated to the Class P-1 or Class P-2 Certificates.
Section 5.05. Advances by the Master Servicer.
If any Servicer fails to remit any Advance required to be made under the
applicable Purchase and Servicing Agreement, the Master Servicer shall itself
make, or shall cause the successor Servicer to make, such Advance. If the
Master Servicer determines that an Advance is
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required, it shall on the Business Day preceding the related Distribution Date
immediately following such Determination Date remit to the Securities
Administrator from its own funds (or funds advanced by the applicable
Servicer) for deposit in the Distribution Account immediately available funds
in an amount equal to such Advance. The Master Servicer and each Servicer
shall be entitled to be reimbursed for all Advances made by it.
Notwithstanding anything to the contrary herein, in the event the Master
Servicer determines in its reasonable judgment that an Advance is
non-recoverable, the Master Servicer shall be under no obligation to make such
Advance. If the Master Servicer determines that an Advance is non-recoverable,
it shall, on or prior to the related Distribution Date, deliver an Officer's
Certificate to the Trustee and the Securities Administrator to such effect.
Section 5.06. Compensating Interest Payments.
The amount of compensation payable to the Securities Administrator in
respect of the Mortgage Loans and any Distribution Date shall be reduced (but
not below zero) by the amount of any aggregate Compensating Interest Payment
from the Servicers for such Distribution Date, but only to the extent that
Prepayment Interest Shortfalls relating to such Distribution Date are required
to be paid by the Servicers pursuant to the Purchase and Servicing Agreements,
as amended by the Acknowledgements, but are not actually paid by the Servicer.
Such amount shall not be treated as an Advance and shall not be reimbursable.
Section 5.07. [Reserved].
Section 5.08. Cross-Collateralization; Adjustments to Available Funds.
(a) With respect to the Aggregate Group II Certificates, On each
Distribution Date after the first related Senior Termination Date but prior to
the earlier of the Senior Credit Support Depletion Date and the third related
Senior Termination Date, the Securities Administrator shall distribute the
principal portion of Available Funds on the Applicable Fractions of the
Mortgage Loans in the Collateral Allocation Group relating to the Aggregate
Group II Senior Certificates that will have been paid in full to the holders
of the Senior Certificates of the other Certificate Groups in Aggregate
Certificate Group II.
(b) If on any Distribution Date the aggregate Principal Balance of any
Senior P&I Portion relating to a Senior Certificate Group in Aggregate Group
II after giving effect to distributions to be made on that Distribution Date,
is greater than the Non-A-P Pool Balance for that Collateral Allocation Group
in Aggregate Group II (any such group, an "Undercollateralized Group"), all
amounts otherwise distributable as principal to the Aggregate Group II
Subordinated Certificates (or, following the Senior Credit Support Depletion
Date, the amounts described in the following sentence) will be distributed as
principal to the Senior P&I Portion of that Undercollateralized Group in
Aggregate Group II until the aggregate Principal Balance of the Senior P&I
Portion of the Undercollateralized Group in Aggregate Group II equals the
Non-A-P Pool Balance for that Collateral Allocation Group (such distribution,
an "Undercollateralization Distribution"). If a Senior Certificate Group in
Aggregate Group II (other than any related Class of Class A-P Certificates)
constitutes an Undercollateralized Group on any Distribution Date following
the Senior Credit Support Depletion Date, Undercollateralization Distributions
will be made from the excess of the Available Funds from Aggregate Group II
for the other Collateral
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Allocation Groups in Aggregate Group II remaining after all required amounts
for that Distribution Date have been distributed to those Senior Certificate
Groups in Aggregate Group II (other than any related Class of Class A-P
Certificates). If more than one Undercollateralized Group on any Distribution
Date is entitled to an Undercollateralization Distribution, such
Undercollateralization Distribution will be allocated among the
Undercollateralized Groups, pro rata, based upon the amount by which the
aggregate Principal Balance of any Senior P&I Portion relating to a Senior
Certificate Group in Aggregate Group II exceeds the sum of the Non-A-P
Balances for the related Undercollateralized Group. If more than one Senior
Certificate Group in Aggregate Group II on any Distribution Date is required
to make an Undercollateralization Distribution to an Undercollateralized
Group, the payment of such Undercollateralization Distributions will be
allocated among such Senior Certificate Groups in Aggregate Group II (other
than any related Class of Class A-P Certificates), pro rata, based upon the
aggregate excess of the Available Funds for the Senior Certificate Groups
other than the Undercollateralized Group remaining after all required amounts
for that Distribution Date have been distributed to those Senior Certificates
in Aggregate Group II.
On each Distribution Date after the first Senior Termination Date but
prior to the earlier of the Senior Credit Support Depletion Date and the third
related Senior Termination Date, the Non-A-P Formula Principal Amount for the
Collateral Allocation Group relating to the Senior Certificate Group that has
been paid in full, will be distributed to the other Senior Certificate Groups
(other than any related Class of Class A-P Certificates or Component thereof),
so that each remaining Senior Certificate Group receives its pro rata portion
thereof. If principal from one Collateral Allocation Group is distributed to
the Senior Certificate Groups (other than any related Class of Class A-P
Certificates or Component thereof) that are not related to that Collateral
Allocation Group according to this paragraph, the Subordinated Certificates
will not receive that principal as a distribution.
Section 5.09. Determination of Pass-Through Rates for LIBOR
Certificates.
(a) On each Interest Determination Date after the initial Interest
Determination Date and for so long as any LIBOR Certificates are outstanding,
the Securities Administrator will determine LIBOR on the basis of the British
Bankers' Association ("BBA") "Interest Settlement Rate" for one-month deposits
in U.S. dollars as found on Telerate page 3750 as of 11:00 a.m. London time on
each LIBOR Determination Date. "Telerate Page 3750" means the display page
currently so designated on the Moneyline Telerate Service (formerly the Dow
Xxxxx Markets) (or such other page as may replace that page on that service
for the purpose of displaying comparable rates or prices).
(b) If on any Interest Determination Date, LIBOR cannot be determined as
provided in paragraph (a) of this Section 5.09, the Securities Administrator
shall either (i) request each Reference Bank to inform the Securities
Administrator of the quotation offered by its principal London office for
making one-month United States dollar deposits in leading banks in the London
interbank market, as of 11:00 a.m. (London time) on such Interest
Determination Date or (ii) in lieu of making any such request, rely on such
Reference Bank quotations that appear at such time on the Reuters Screen LIBO
Page (as defined in the International Swap Dealers Association Inc. Code of
Standard Wording, Assumptions and Provisions for Swaps,
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1986 Edition), to the extent available. LIBOR for the next Interest Accrual
Period will be established by the Securities Administrator on each interest
Determination Date as follows:
(i) If on any Interest Determination Date two or more Reference
Banks provide such offered quotations, LIBOR for the next applicable
Interest Accrual Period shall be the arithmetic mean of such offered
quotations (rounding such arithmetic mean upwards if necessary to the
nearest whole multiple of 1/32%).
(ii) If on any Interest Determination Date only one or none of the
Reference Banks provides such offered quotations, LIBOR for the next
Interest Accrual Period shall be whichever is the higher of (i) LIBOR as
determined on the previous Interest Determination Date or (ii) the
Reserve Interest Rate. The "Reserve Interest Rate" shall be the rate per
annum which the Securities Administrator determines to be either (i) the
arithmetic mean (rounded upwards if necessary to the nearest whole
multiple of 1/32%) of the one-month United States dollar lending rates
that New York City banks selected by the Securities Administrator are
quoting, on the relevant Interest Determination Date, to the principal
London offices of at least two of the Reference Banks to which such
quotations are, in the opinion of the Securities Administrator, being so
made, or (ii) in the event that the Securities Administrator can
determine no such arithmetic mean, the lowest one-month United States
dollar lending rate which New York City banks selected by the Securities
Administrator are quoting on such Interest Determination Date to leading
European banks.
(iii) If on any Interest Determination Date the Securities
Administrator is required but is unable to determine the Reserve
Interest Rate in the manner provided in paragraph (b) above, LIBOR for
the related Classes of Certificates shall be LIBOR as determined on the
preceding applicable Interest Determination Date or (B) in the case of
the first Interest Determination Date, one-month LIBOR for the Group 1
LIBOR Certificates shall be 5.400%, and one-month LIBOR for the Group 4
LIBOR Certificates shall be 5.385%.
Until all of the LIBOR Certificates are paid in full, the Securities
Administrator will at all times retain at least four Reference Banks for the
purpose of determining LIBOR with respect to each Interest Determination Date.
The Securities Administrator initially shall designate the Reference Banks.
Each "Reference Bank" shall be a leading bank engaged in transactions in
Eurodollar deposits in the international Eurocurrency market, shall not
control, be controlled by, or be under common control with, the Securities
Administrator and shall have an established place of business in London. If
any such Reference Bank should be unwilling or unable to act as such or if the
Master Servicer should terminate its appointment as Reference Bank, the
Securities Administrator shall promptly appoint or cause to be appointed
another Reference Bank. The Securities Administrator shall have no liability
or responsibility to any Person for (i) the selection of any Reference Bank
for purposes of determining LIBOR or (ii) any inability to retain at least
four Reference Banks which is caused by circumstances beyond its reasonable
control.
(c) The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Securities Administrator on
each Interest
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Determination Date so long as the LIBOR Certificates are
outstanding on the basis of LIBOR and the respective formulae appearing in
footnotes corresponding to the LIBOR Certificates in the table relating to the
Certificates in the Preliminary Statement.
(d) In determining LIBOR, any Pass-Through Rate for the LIBOR
Certificates, any Interest Settlement Rate, or any Reserve Interest Rate, the
Securities Administrator may conclusively rely and shall be protected in
relying upon the offered quotations (whether written, oral or on the Dow Xxxxx
Markets) from the BBA designated banks, the Reference Banks or the New York
City banks as to LIBOR, the Interest Settlement Rate or the Reserve Interest
Rate, as appropriate, in effect from time to time. The Securities
Administrator shall not have any liability or responsibility to any Person for
(i) the selection of New York City banks for purposes of determining any
Reserve Interest Rate or (ii) its inability, following a good-faith reasonable
effort, to obtain such quotations from, the BBA designated banks, the
Reference Banks or the New York City banks or to determine such arithmetic
mean, all as provided for in this Section 5.09.
(e) The establishment of LIBOR and each Pass-Through Rate for the LIBOR
Certificates by the Securities Administrator shall (in the absence of manifest
error) be final, conclusive and binding upon each Holder of a Certificate and
the Securities Administrator.
Section 5.10 The Reserve Fund.
On the Closing Date, the Securities Administrator shall establish and
maintain in its name, in trust for the benefit of the Group 1 Certificates,
the Group 1 Reserve Fund and shall deposit $1,000 therein upon receipt of such
amount from or on behalf of the Underwriter. On each Distribution Date, the
Securities Administrator shall transfer from the Distribution Account to the
Group 1 Reserve Fund the amounts specified pursuant to Section
5.02(a)(1)(C)(viii). Any such amounts transferred shall be treated for federal
tax purposes as amounts distributed to the Holders of the Class OC
Certificates. On each Distribution Date, to the extent required, the
Securities Administrator shall withdraw amounts in the Group 1 Reserve Fund to
make distributions to the Classes of Group 1 Certificates in accordance with
the priorities set forth in Section 5.02(a)(1)(C) (viii). On the Distribution
Date on which the termination of the Group 1 Certificates occurs pursuant to
Section 7.02, after making all distributions required in connection with the
Group 1 Certificates, the Securities Administrator shall withdraw from the
Group 1 Reserve Fund (to the extent of funds available on deposit therein) any
remaining amounts and distribute them to the Holders of the Class OC
Certificates.
The Group 1 Reserve Fund shall be an Eligible Account, and funds on
deposit therein shall be held separate and apart from, and shall not be
commingled with, any other moneys, including without limitation, other moneys
held by the Securities Administrator on behalf of the Trustee pursuant to this
Agreement. Amounts held in the Group 1 Reserve Fund from time to time shall
continue to constitute assets of the Trust Fund, but not of any REMIC created
under this Agreement, until released from the Group 1 Reserve Fund pursuant to
this Section 5.10. The Group 1 Reserve Fund constitutes an "outside Reserve
Fund" within the meaning of Treasury Regulation ss. 1.860G-2(h) and is not an
asset of any REMIC. The Holders of the Class OC Certificates shall be the
owner of the Group 1 Reserve Fund. The Securities Administrator shall keep
records that accurately reflect the funds on deposit in the Group 1 Reserve
Fund. Funds in
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the Group 1 Reserve Fund may be invested in Permitted Investments at the
written direction of the Majority of the Holders of the Class OC Certificates,
which Permitted Investments shall mature not later than the Business Day
immediately preceding the first Distribution Date that follows the date of
such investment (except that if such Permitted Investment is an obligation of
the institution that maintains the Group 1 Reserve Fund, then such Permitted
Investment shall mature not later than such Distribution Date) and shall not
be sold or disposed of prior to maturity; provided, however, that if the
Securities Administrator does not receive written investment directions, the
funds in the Group 1 Reserve Fund shall be invested in the Xxxxx Fargo Prime
Investment Money Market Fund. All such Permitted Investments shall be made in
the name of the Trustee, for the benefit of the Holders of the Class OC
Certificates. All losses incurred in the Group 1 Reserve Fund in respect of
any such investments shall be charged against amounts on deposit in the Group
1 Reserve Fund (or such investments immediately as realized). The Securities
Administrator shall not be liable for the amount of any loss incurred in
respect of any investment or lack of investment of funds in the Group 1
Reserve Fund. The Class OC Certificates shall evidence ownership of the Group
1 Reserve Fund for federal tax purposes.
To the extent that a Class of Group 1 Certificates receives interest in
excess of the Net WAC Pass-Through Rate, such interest shall be deemed to have
been paid to the Group 1 Reserve Fund and then paid by the Group 1 Reserve
Fund to those Certificateholders. For purposes of the Code, amounts deemed
deposited in the Group 1 Reserve Fund shall be deemed to have first been
distributed to the Class OC Certificates.
ARTICLE VI
CONCERNING THE TRUSTEE AND
THE SECURITIES ADMINISTRATOR; EVENTS OF DEFAULT
Section 6.01. Duties of Trustee and the Securities Administrator.
(a) The Trustee, except during the continuance of an Event of Default,
and the Securities Administrator undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. Any permissive
right of the Trustee or the Securities Administrator provided for in this
Agreement shall not be construed as a duty of the Trustee or the Securities
Administrator. If an Event of Default has occurred and has not otherwise been
cured or waived, the Trustee or the Securities Administrator 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 Person would exercise
or use under the circumstances in the conduct of such Person's own affairs,
unless the Trustee is acting as master servicer, in which case it shall use
the same degree of care and skill (in its capacity as successor Master
Servicer) as a master servicer hereunder.
(b) Each of the Trustee and the Securities Administrator, upon receipt
of all resolutions, certificates, statements, opinions, reports, documents,
orders or other instruments furnished to the Trustee or the Securities
Administrator which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they are
in the form required by this Agreement; provided, however, that neither the
Trustee nor the Securities Administrator shall be responsible for the accuracy
or content of any such
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resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Master Servicer or any Servicer to the Trustee or
the Securities Administrator pursuant to this Agreement, and shall not be
required to recalculate or verify any numerical information furnished to the
Trustee or the Securities Administrator pursuant to this Agreement. Subject to
the immediately preceding sentence, if any such resolution, certificate,
statement, opinion, report, document, order or other instrument is found not
to conform to the form required by this Agreement in a material manner the
Securities Administrator shall take such action as it deems appropriate to
cause the instrument to be corrected, and if the instrument is not corrected
to the Securities Administrator 's satisfaction, the Securities Administrator
will provide notice thereof to the Certificateholders and will, at the expense
of the Trust Fund, which expense shall be reasonable given the scope and
nature of the required action, take such further action as directed by the
Certificateholders.
(c) Neither the Trustee nor the Securities Administrator shall have any
liability arising out of or in connection with this Agreement, except for its
respective negligence or willful misconduct. Notwithstanding anything in this
Agreement to the contrary, neither the Trustee nor the Securities
Administrator shall be liable for special, indirect or consequential losses or
damages of any kind whatsoever (including, but not limited to, lost profits).
No provision of this Agreement shall be construed to relieve the Trustee or
the Securities Administrator from liability for its own negligent action, its
own negligent failure to act or its own willful misconduct; provided, however,
that:
(i) 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 as provided in
Section 6.18 hereof;
(ii) For all purposes under this Agreement, the Trustee shall not
be deemed to have notice of any Event of Default unless a Responsible
Officer of the Trustee has actual knowledge thereof or unless written
notice of any event which is in fact such a default is received by the
Trustee at the Corporate Trust Office of the Trustee, and such notice
references the Holders of the Certificates and this Agreement;
(iii) For all purposes under this Agreement, the Securities
Administrator shall not be deemed to have notice of any Event of Default
(other than resulting from a failure by the Master Servicer (i) to remit
funds (or to make Advances) or (ii) to furnish information to the
Securities Administrator when required to do so) unless a Responsible
Officer of the Securities Administrator has actual knowledge thereof or
unless written notice of any event which is in fact such a default is
received by the Securities Administrator at the address provided in
Section 11.07, and such notice references the Holders of the
Certificates and this Agreement;
(iv) No provision of this Agreement shall require the Trustee or
the Securities Administrator to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if
it shall have reasonable grounds for believing that repayment of such
funds or indemnity reasonably satisfactory to it against such risk or
liability is not reasonably assured to it; and none of the provisions
contained in this Agreement shall in any event
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require the Trustee or the Securities Administrator to perform, or be
responsible for the manner of performance of, any of the obligations of
the Master Servicer under this Agreement;
(v) Neither the Trustee nor the Securities Administrator shall be
responsible for any act or omission of each other or the Master
Servicer, the Depositor, the Seller, any Servicer or any Custodian.
(d) The Trustee shall have no duty hereunder with respect to any
complaint, claim, demand, notice or other document it may receive or which may
be alleged to have been delivered to or served upon it by the parties as a
consequence of the assignment of any Mortgage Loan hereunder; provided,
however, that the Trustee shall promptly remit to the Master Servicer, upon
receipt any such complaint, claim, demand, notice or other document (i) which
is delivered to the Corporate Trust Office of the Trustee, (ii) of which a
Responsible Officer has actual knowledge, and (iii) which contains information
sufficient to permit the Trustee to make a determination that the real
property to which such document relates is a Mortgaged Property related to a
Mortgage Loan.
(e) Neither the Trustee nor the Securities Administrator shall be
personally liable with respect to any action taken, suffered or omitted to be
taken by it in good faith in accordance with the direction of the
Certificateholders of any Class holding Certificates which evidence, as to
such Class, Percentage Interests aggregating not less than 25% as to the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or the Securities Administrator or exercising any trust or power
conferred upon the Trustee or the Securities Administrator, as applicable,
under this Agreement or the Acknowledgements.
(f) Neither the Trustee nor the Securities Administrator shall be
required to perform services under this Agreement, or to expend or risk its
own funds or otherwise incur financial liability for the performance of any of
its duties hereunder or the exercise of any of its rights or powers if there
is reasonable ground for believing that the timely payment of its fees and
expenses or the repayment of such funds or indemnity reasonably satisfactory
to it against such risk or liability is not reasonably assured to it, and none
of the provisions contained in this Agreement shall in any event require the
Trustee or the Securities Administrator, as applicable, to perform, or be
responsible for the manner of performance of, any of the obligations of the
Master Servicer or any Servicer under this Agreement or any Purchase and
Servicing Agreement except during such time, if any, as the Trustee shall be
the successor to, and be vested with the rights, duties, powers and privileges
of, the Master Servicer in accordance with the terms of this Agreement.
(g) The Trustee shall not be held liable by reason of any insufficiency
in the Distribution Account resulting from any investment loss on any
Permitted Investment included therein (except to the extent that the Trustee
is the obligor and has defaulted thereon).
(h) Neither the Trustee nor, except as otherwise provided herein, the
Securities Administrator shall have any duty (A) to see to any recording,
filing, or depositing of this Agreement or any agreement referred to herein or
any financing statement or continuation statement evidencing a security
interest, or to see to the maintenance of any such recording or
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filing or depositing or to any rerecording, refiling or redepositing of any
thereof, (B) to see to any insurance, (C) to see to the payment or discharge
of any tax, assessment, or other governmental charge or any lien or
encumbrance of any kind owing with respect to, assessed or levied against, any
part of the Trust Fund other than from funds available in the Distribution
Account, or (D) to confirm or verify the contents of any reports or
certificates of the Master Servicer or any Servicer delivered to the Trustee
or the Securities Administrator pursuant to this Agreement believed by the
Trustee or the Securities Administrator, as applicable, to be genuine and to
have been signed or presented by the proper party or parties.
(i) Neither the Securities Administrator nor the Trustee shall be liable
in its individual capacity for an error of judgment made in good faith by a
Responsible Officer or other officers of the Trustee or the Securities
Administrator, as applicable, unless it shall be proved that the Trustee or
the Securities Administrator, as applicable, was negligent in ascertaining the
pertinent facts.
(j) Notwithstanding anything in this Agreement to the contrary, neither
the Securities Administrator nor the Trustee shall be liable for special,
indirect or consequential losses or damages of any kind whatsoever (including,
but not limited to, lost profits), even if the Trustee or the Securities
Administrator, as applicable, has been advised of the likelihood of such loss
or damage and regardless of the form of action.
(k) Neither the Securities Administrator nor the Trustee shall be
responsible for the acts or omissions of the other, it being understood that
this Agreement shall not be construed to render them agents of one another, or
of any Servicer.
Section 6.02. Certain Matters Affecting the Trustee and the Securities
Administrator.
Except as otherwise provided in Section 6.01:
(i) Each of the Trustee and the Securities Administrator may
request, and may rely and shall be protected in acting or refraining
from acting upon any resolution, Officer's Certificate, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond or other paper
or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) Each of the Trustee and the Securities Administrator may
consult with counsel and any advice of its counsel or Opinion of Counsel
shall be full and complete authorization and protection in respect of
any action taken or suffered or omitted by it hereunder in good faith
and in accordance with such advice or Opinion of Counsel;
(iii) Neither the Trustee nor the Securities Administrator shall
be personally liable for any action taken, suffered or omitted by it in
good faith and reasonably believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
(iv) Unless an Event of Default shall have occurred and be
continuing, neither the Trustee nor the Securities Administrator shall
be bound to make any investigation
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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 the Holders of at least a majority in Class Principal
Balance (or Percentage Interest) of each Class of Certificates;
provided, however, that, if the payment within a reasonable time to the
Trustee or the Securities Administrator, as applicable, 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 or the Securities
Administrator, as applicable, not reasonably assured to the Trustee or
the Securities Administrator by the security afforded to it by the terms
of this Agreement, the Trustee or the Securities Administrator, as
applicable, may require indemnity reasonably satisfactory to it against
such expense or liability or payment of such estimated expenses from the
Certificateholders as a condition to proceeding. The reasonable expense
thereof shall be paid by the party requesting such investigation and if
not reimbursed by the requesting party shall be reimbursed to the
Trustee or the Securities Administrator, as applicable, by the Trust
Fund;
(v) Each of the Trustee and the Securities Administrator may
execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents, custodians or
attorneys, which agents, custodians or attorneys shall have any and all
of the rights, powers, duties and obligations of the Trustee and the
Securities Administrator conferred on them by such appointment, provided
that each of the Trustee and the Securities Administrator shall continue
to be responsible for its duties and obligations hereunder to the extent
provided herein, and provided further that neither the Trustee nor the
Securities Administrator shall be responsible for any misconduct or
negligence on the part of any such agent or attorney appointed with due
care by the Trustee or the Securities Administrator, as applicable;
(vi) Neither the Trustee nor the Securities Administrator shall be
under any obligation to exercise any of the trusts or powers vested in
it by this Agreement or the Acknowledgements or to institute, conduct or
defend any litigation hereunder or in relation hereto, in each case 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 or the Securities
Administrator, as applicable, security or indemnity reasonably
satisfactory to it against the costs, expenses and liabilities which may
be incurred therein or thereby;
(vii) The right of the Trustee and the Securities Administrator to
perform any discretionary act enumerated in this Agreement shall not be
construed as a duty, and neither the Trustee nor the Securities
Administrator shall be answerable for other than its negligence or
willful misconduct in the performance of such act; and
(viii) Neither the Trustee nor the Securities Administrator shall
be required to give any bond or surety in respect of the execution of
the Trust Fund created hereby or the powers granted hereunder.
Section 6.03. Trustee and Securities Administrator Not Liable for
Certificates.
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The Trustee and the Securities Administrator make no representations as
to the validity or sufficiency of this Agreement, any Purchase and Servicing
Agreement or Acknowledgement or of the Certificates (other than, in the case
of the Securities Administrator, the certificate of authentication on the
Certificates) or of any Mortgage Loan, or related document save that the
Trustee and the Securities Administrator represent that, assuming due
execution and delivery by the other parties hereto, this Agreement has been
duly authorized, executed and delivered by it and constitutes its valid and
binding obligation, enforceable against it in accordance with its terms except
that such enforceability may be subject to (A) applicable bankruptcy and
insolvency laws and other similar laws affecting the enforcement of the rights
of creditors generally, and (B) general principles of equity regardless of
whether such enforcement is considered in a proceeding in equity or at law.
The Trustee and the Securities Administrator shall not be accountable for the
use or application by the Depositor of funds paid to the Depositor in
consideration of the assignment of the Mortgage Loans to the Trust Fund by the
Depositor or for the use or application of any funds deposited into the
Distribution Account or any other fund or account maintained with respect to
the Certificates. The Trustee and the Securities Administrator shall not be
responsible for the legality or validity of this Agreement or any other
document or agreement described in this Section 6.03 or the validity,
priority, perfection or sufficiency of the security for the Certificates
issued or intended to be issued hereunder. Neither the Trustee nor, except as
otherwise provided herein, the Securities Administrator shall have any
responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection
of any security interest or lien granted to it hereunder or to record this
Agreement.
Section 6.04. Trustee and the Securities Administrator May Own
Certificates.
The Trustee and the Securities Administrator and any Affiliate or agent
of either of them in its individual or any other capacity may become the owner
or pledgee of Certificates and may transact banking and trust business with
the other parties hereto and their Affiliates with the same rights it would
have if it were not Trustee, Securities Administrator or such agent.
Section 6.05. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be (i) an institution whose
accounts are insured by the FDIC, (ii) a corporation or national banking
association, organized and doing business under the laws of any State or the
United States of America, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by federal or state
authority and (iii) not an Affiliate of the Master Servicer or any Servicer.
If such corporation or national banking association 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 or national
banking association 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 provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.06.
Section 6.06. Resignation and Removal of Trustee and the Securities
Administrator.
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(a) The Trustee may at any time resign and be discharged from the trust
hereby created by giving written notice thereof to the Securities
Administrator, the Depositor and the Master Servicer. Upon receiving such
notice of resignation, the Depositor will promptly appoint a successor
trustee, by written instrument, one copy of which instrument shall be
delivered to the resigning Trustee, one copy to the successor trustee, one
copy to the Securities Administrator and one copy to the Master Servicer. If
no successor trustee shall have been so appointed and shall have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee.
At least 15 calendar days prior to the effective date of such
resignation, the Trustee shall provide (x) written notice to the Depositor and
the Master Servicer of any successor pursuant to this Section (other than a
successor appointed by the Depositor in accordance with the preceding
paragraph) and (y) in writing and in form and substance reasonably
satisfactory to the Depositor, all information reasonably requested by the
Depositor in order to comply with its reporting obligation under Item 6.02 of
Form 8-K with respect to the resignation of the Trustee.
(b) If at any time (i) the Trustee shall cease to be eligible in
accordance with the provisions of Section 6.05 and shall fail to resign after
written request therefor by the Depositor, (ii) the Trustee shall become
incapable of acting, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of either of their
property or affairs for the purpose of rehabilitation, conservation or
liquidation, (iii) (A) a tax is imposed or threatened with respect to the
Trust Fund by any state in which the Trustee or the Trust Fund held by the
Trustee is located due to the location of the Trustee, (B) the imposition of
such tax would be avoided by the appointment of a different trustee and (C)
the Trustee fails to indemnify the Trust Fund against such tax (iv) the
continued use of the Trustee would result in a downgrading of the rating by
any Rating Agency of any Class of Certificates with a rating, or (v) the
Trustee fails to comply with its obligations under the penultimate paragraph
of Section 6.14(a), in the preceding paragraph or Article XII and such failure
is not remedied within the lesser of 10 calendar days or such period in which
the applicable Exchange Act Report can be filed timely (without taking into
account any extensions), then, in the case of clauses (i) through (iv), the
Depositor shall remove the Trustee and the Depositor shall appoint a successor
trustee, acceptable to the Master Servicer by written instrument, one copy of
which instrument shall be delivered to the Trustee so removed, one copy to the
successor trustee, one copy to the Securities Administrator and one copy to
the Master Servicer.
(c) The Holders of more than 50% of the Class Principal Balance (or
Percentage Interest) of each Class of Certificates may at any time upon 30
days' written notice to the Trustee and to the Depositor remove the Trustee by
such written instrument, signed by such Holders or their attorney-in-fact duly
authorized, one copy of which instrument shall be delivered to the Depositor,
one copy to the Trustee, one copy to the Securities Administrator and one copy
to the Master Servicer; the Depositor shall thereupon appoint a successor
trustee in accordance with this Section.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance
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of appointment by the successor trustee, as provided in Section 6.07. If no
successor trustee shall have been so appointed and shall have accepted
appointment within 30 days after such notice of dismissal, the Trustee who
received such notice of dismissal may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(e) The Securities Administrator shall not resign except in accordance
with the provisions of Sections 9.06 and 9.07 hereof, to the same extent that
the Master Servicer is entitled to resign or assign or delegate, as
applicable, its duties hereunder.
(f) If at any time the Securities Administrator shall cease to be
eligible in accordance with the provisions of Section 9.10 hereof and shall
fail to resign after written request thereto by the Depositor, or if at any
time the Securities Administrator shall become incapable of acting, or shall
be adjudged as bankrupt or insolvent, or a receiver of the Securities
Administrator or of its property shall be appointed, or any public officer
shall take charge or control of the Securities Administrator or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, or a tax is imposed with respect to the Trust Fund by any state
in which the Securities Administrator or the Trust Fund is located and the
imposition of such tax would be avoided by the appointment of a different
Securities Administrator, then the Depositor or the Trustee may remove the
Securities Administrator and appoint a successor securities administrator by
written instrument, in triplicate, one copy of which instrument shall be
delivered to the Securities Administrator so removed, one copy of which shall
be delivered to the Master Servicer and one copy to the successor securities
administrator.
(g) If no successor securities administrator shall have been appointed
and shall have accepted appointment within 60 days after Xxxxx Fargo Bank,
N.A., as Securities Administrator, ceases to be the securities administrator
pursuant to this Section 6.06, then the Trustee (as successor Securities
Administrator) shall perform the duties of the Securities Administrator
pursuant to this Agreement. The Trustee shall notify the Rating Agencies of
any change of the Securities Administrator. In such event, the Trustee shall
assume all of the rights and obligations of the Securities Administrator
hereunder arising thereafter except that the Trustee shall not be (i) liable
for losses of the predecessor Securities Administrator or any acts or
omissions of the predecessor Securities Administrator hereunder, (ii) deemed
to have made any representations and warranties of the Securities
Administrator made herein and (iii) subject to the same resignation
limitations as set forth in Section 9.06 hereof; provided, however, that the
Trustee (as successor securities administrator) shall not resign until a
successor securities administrator has accepted appointment pursuant to
Section 6.07 hereof. The Trustee shall not be accountable, shall have no
liability and makes no representation as to any acts or omissions hereunder of
the Securities Administrator until such time as the Trustee may be required to
act as successor Securities Administrator pursuant to this Section 6.06 and
thereupon only for the acts or omissions of the Trustee as successor
Securities Administrator. If the Trustee is unwilling, or unable, to act as
successor Securities Administrator, then, in such event, the Trustee may
appoint, or petition a court of competent jurisdiction to appoint a successor
Securities Administrator meeting the criteria set forth in Section 9.10
hereof. Such successor Securities Administrator shall be entitled to the
Securities Administrator Compensation.
(h) The Trustee as successor securities administrator shall be entitled
to be reimbursed for all reasonable costs and expenses associated with the
transfer of the duties of the
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Securities Administrator by the predecessor Securities Administrator,
including, without limitation, any costs or expenses associated with the
complete transfer of all securities administrator data and the completion,
correction or manipulation of such securities administrator data as may be
required by the Trustee as successor securities administrator to correct any
errors or insufficiencies in such securities administrator data or otherwise
to enable the Trustee or successor securities administrator to perform the
duties of the Securities Administrator properly and effectively; provided,
however, that the predecessor Securities Administrator shall not be obligated
to make any such reimbursements if such Securities Administrator was
terminated or removed without cause or if such termination or removal was a
result of the imposition of any tax on the Trust Estate by any state in which
the Securities Administrator or the Trust Fund is located. If such costs are
not paid by the predecessor Securities Administrator, the Trustee shall pay
such costs from the Trust Fund.
(i) The Trustee, as successor Securities Administrator, as compensation
for its activities hereunder as successor Securities Administrator, shall be
entitled to retain or withdraw from the Distribution Account an amount equal
to the Securities Administrator Compensation.
(j) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Securities Administrator and appoint a
successor securities administrator 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 by the successor
Securities Administrator to the Trustee, one complete set to the Securities
Administrator so removed and one complete set to the successor so appointed.
Notice of any removal of the Securities Administrator shall be given to each
Rating Agency by the successor securities administrator.
(k) Any resignation or removal of the Securities Administrator and
appointment of a successor securities administrator pursuant to any of the
provisions of this Section 6.06 or Section 9.06 shall become effective upon
acceptance by the successor securities administrator of appointment as
provided in Section 6.07 hereof.
(l) If the Securities Administrator and the Master Servicer are the same
Person, any removal of the Master Servicer pursuant to an Event of Default
shall also result in the removal of the Securities Administrator and require
the appointment of a successor pursuant to this Section and Section 6.07.
(m) The Securities Administrator shall cooperate with the Trustee and
any successor securities administrator in effecting the termination of the
Securities Administrator's responsibilities and rights hereunder, providing to
the Trustee and successor securities administrator all documents and records
in electronic or other form reasonably requested by it to enable it to assume
the Securities Administrator's functions hereunder and for the transfer to the
Trustee or successor Securities Administrator of all amounts in the
Distribution Account or any other account or fund maintained by the Securities
Administrator with respect to the Trust Fund. Neither the Trustee nor the
Master Servicer, as applicable, nor any other successor, as applicable, shall
be deemed to be in default hereunder by reason of any failure to make, or any
delay in making, any distribution hereunder or any portion thereof caused by
(i) the failure of the predecessor Securities Administrator to deliver, or any
delay in delivering, cash, documents or
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records to it, (ii) the failure of the predecessor Securities Administrator to
cooperate as required by this Agreement, (iii) the failure of the predecessor
Securities Administrator to deliver the related Mortgage Loan data as required
by this Agreement or (iv) restrictions imposed by any regulatory authority
having jurisdiction over the predecessor Securities Administrator. No
successor securities administrator shall be deemed to be in default hereunder
by reason of any failure to make, or any delay in making, any distribution
hereunder or any portion thereof caused by (i) the failure of the Master
Servicer to deliver, or any delay in delivering cash, documents or records to
it related to such distribution, or (ii) the failure of Trustee or the Master
Servicer to cooperate as required by this Agreement.
Section 6.07. Successor Trustee and Successor Securities Administrator.
(a) Any successor trustee or successor securities administrator
appointed as provided in Section 6.06 shall execute, acknowledge and deliver
to the Depositor and to its predecessor trustee or predecessor securities
administrator, as applicable, an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
or predecessor securities administrator, as applicable, shall become effective
and such successor trustee or successor securities administrator, as
applicable, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as trustee or securities
administrator, as applicable, herein. The predecessor trustee or predecessor
securities administrator, as applicable, shall deliver to the successor
trustee or successor securities administrator, as applicable, all Trustee
Mortgage Files and documents and statements related to each Trustee Mortgage
File held by it hereunder, and shall duly assign, transfer, deliver and pay
over to the successor trustee the entire Trust Fund, together with all
necessary instruments of transfer and assignment or other documents properly
executed necessary to effect such transfer and such of the records or copies
thereof maintained by the predecessor trustee in the administration hereof as
may be requested by the successor trustee and shall thereupon be discharged
from all duties and responsibilities under this Agreement. In addition, the
Depositor and the predecessor trustee or predecessor securities administrator,
as applicable, shall execute and deliver such other instruments and do such
other things as may reasonably be required to more fully and certainly vest
and confirm in the successor trustee or successor securities administrator, as
applicable, all such rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in this
Section unless at the time of such appointment such successor trustee shall be
eligible under the provisions of Section 6.05 and has provided to the
Depositor in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement Trustee.
(c) Upon acceptance of appointment by a successor trustee or successor
securities administrator, as applicable, as provided in this Section, the
Master Servicer shall mail notice of the succession of such trustee or
securities administrator, as applicable, hereunder to all Holders of
Certificates at their addresses as shown in the Certificate Register and to
any Rating Agency. The costs of such mailing shall be borne by the Master
Servicer.
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(d) Any successor securities administrator shall also either serve as
auction administrator pursuant to Section 7.01(b) hereof or select an
investment bank to act as auction administrator at the expense of the Trust
Fund.
(e) [Reserved].
Section 6.08. Merger or Consolidation of Trustee or the Securities
Administrator.
Any Person into which the Trustee or Securities Administrator may be
merged or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Trustee or Securities
Administrator shall be a party, or any Persons succeeding to the business of
the Trustee or Securities Administrator, shall be the successor to the Trustee
or Securities Administrator hereunder, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding, provided that, in the case of the
Trustee, such Person shall be eligible under the provisions of Section 6.05.
At least 15 calendar days prior to the effective date of any succession
by merger or consolidation of the Trustee or the Securities Administrator, the
Trustee or the Securities Administrator, as applicable, shall provide (x)
written notice to the Depositor of any successor pursuant to this Section and
(y) in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement Trustee or Securities Administrator, as applicable.
Section 6.09. Appointment of Co-Trustee, Separate Trustee or Custodian.
(a) Notwithstanding any other provisions hereof, at any time, the
Trustee, the Depositor or the Certificateholders evidencing more than 50% of
the Class Principal Balance (or Percentage Interest) of every Class of
Certificates shall have the power from time to time to appoint one or more
Persons, approved by the Trustee, to act either as co-trustees jointly with
the Trustee, or as separate trustees, or as custodians, for the purpose of
holding title to, foreclosing or otherwise taking action with respect to any
Mortgage Loan outside the state where the Trustee has its principal place of
business where such separate trustee or co-trustee is necessary or advisable
(or the Trustee has been advised by the Master Servicer that such separate
trustee or co-trustee is necessary or advisable) under the laws of any state
in which a property securing a Mortgage Loan is located or for the purpose of
otherwise conforming to any legal requirement, restriction or condition in any
state in which a property securing a Mortgage Loan is located or in any state
in which any portion of the Trust Fund is located. The separate Trustees,
co-trustees, or custodians so appointed shall be trustees or custodians for
the benefit of all the Certificateholders and shall have such powers, rights
and remedies as shall be specified in the instrument of appointment; provided,
however, that no such appointment shall, or shall be deemed to, constitute the
appointee an agent of the Trustee. The obligation of the Master Servicer to
make Advances pursuant to Section 5.05 hereof shall not be affected or
assigned by the appointment of a co-trustee.
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(b) Every separate trustee, co-trustee, and custodian shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all powers, duties, obligations and rights conferred upon the
Trustee in respect of the receipt, custody and payment of moneys shall
be exercised solely by the Trustee;
(ii) all other 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,
co-trustee, or custodian jointly, except to the extent that under any
law of any jurisdiction in which any particular act or acts are to be
performed the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and
obligations, including the holding of title to the Trust Fund or any
portion thereof in any such jurisdiction, shall be exercised and
performed by such separate trustee, co-trustee, or custodian;
(iii) no trustee or custodian hereunder shall be personally liable
by reason of any act or omission of any other trustee or custodian
hereunder; and
(iv) the Trustee may at any time, by an instrument in writing
executed by it, with the concurrence of the Depositor, accept the
resignation of or remove any separate trustee, co-trustee or custodian,
so appointed by it or them, if such resignation or removal does not
violate the other terms of this Agreement.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee, co-trustee or custodian shall refer to this
Agreement and the conditions of this Article VI. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Trustee or separately, as may be provided therein, subject to
all the provisions of this Agreement, specifically including every provision
of this Agreement relating to the conduct of, affecting the liability of, or
affording protection to, the Trustee. Every such instrument shall be filed
with the Trustee and a copy given to the Master Servicer.
(d) Any separate trustee, co-trustee or custodian 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, co-trustee or custodian 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.
(e) No separate trustee, co-trustee or custodian hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
6.05 hereunder and no notice to the Certificateholders of the appointment
shall be required under Section 6.07 hereof.
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(f) The Securities Administrator on behalf of the Trustee agrees to
instruct the co-trustees, if any, to the extent necessary to fulfill the
Trustee's obligations hereunder.
(g) The Trust shall pay the reasonable compensation of the co-trustees
(which compensation shall not reduce any compensation payable to the Trustee
under such Section).
Section 6.10. Authenticating Agents.
(a) The Trustee may appoint one or more Authenticating Agents which
shall be authorized to act on behalf of the Trustee in authenticating
Certificates. The Securities Administrator is hereby appointed as initial
Authenticating Agent, and the Securities Administrator accepts such
appointment. Wherever reference is made in this Agreement to the
authentication of Certificates by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication on
behalf of the Trustee by an Authenticating Agent and a certificate of
authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent must be a corporation organized and doing business
under the laws of the United States of America or of any state, having a
combined capital and surplus of at least $15,000,000, authorized under such
laws to do a trust business and subject to supervision or examination by
federal or state authorities.
(b) Any Person into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from
any merger, conversion or consolidation to which any Authenticating Agent
shall be a party, or any Person succeeding to the corporate agency business of
any Authenticating Agent, shall continue to be the Authenticating Agent
without the execution or filing of any paper or any further act on the part of
the Trustee or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at least
30 days' advance written notice of resignation to the Trustee and the
Depositor. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and the Depositor. Upon receiving a notice of resignation
or upon such a termination, or in case at any time any Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section
6.10, the Trustee may appoint a successor authenticating agent, shall give
written notice of such appointment to the Depositor and shall mail notice of
such appointment to all Holders of Certificates. Any successor authenticating
agent upon acceptance of its appointment hereunder shall become vested with
all the rights, powers, duties and responsibilities of its predecessor
hereunder, with like effect as if originally named as Authenticating Agent. No
successor authenticating agent shall be appointed unless eligible under the
provisions of this Section 6.10. No Authenticating Agent shall have
responsibility or liability for any action taken by it as such at the
direction of the Trustee.
Section 6.11. Indemnification of the Trustee and the Securities
Administrator.
The Trustee (in its individual capacity and in its representative
capacity as Trustee hereunder) and the Securities Administrator and their
respective directors, officers, employees and agents shall be entitled to
indemnification from the Trust Fund for any loss, liability or expense
(including the reasonable compensation and the expenses and disbursements of
its
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agents or counsel), incurred without negligence or willful misconduct on their
part, arising out of, or in connection with, the acceptance or administration
of the trusts created hereunder or under the Purchase and Servicing
Agreements, the Acknowledgements, the Custodial Agreements, or in connection
with the performance of their duties hereunder or thereunder including the
costs and expenses of defending themselves against any claim in connection
with the exercise or performance of any of their powers or duties hereunder or
thereunder, provided that:
(i) with respect to any such claim, the Trustee or the Securities
Administrator, as applicable, shall have given the Depositor written
notice thereof promptly after the Trustee, the Securities Administrator,
as applicable, shall have knowledge thereof;
(ii) while maintaining control over its own defense, the Trustee
or the Securities Administrator, as applicable, shall cooperate and
consult fully with the Depositor in preparing such defense; and
(iii) notwithstanding anything to the contrary in this Section
6.11, the Trust Fund shall not be liable for settlement of any such
claim by the Trustee or the Securities Administrator, as applicable,
entered into without the prior consent of the Depositor, which consent
shall not be unreasonably withheld.
The provisions of this Section 6.11 shall survive any termination of
this Agreement and the resignation or removal of the Trustee or the Securities
Administrator or Custodian, as applicable, and shall be construed to include,
but not be limited to any loss, liability or expense under any environmental
law.
Section 6.12. Fees and Expenses of the Master Servicer, Securities
Administrator, the Trustee and the Custodians.
(a) For so long as Xxxxx Fargo Bank, National Association is the Master
Servicer and the Securities Administrator, the Securities Administrator shall
be entitled to be paid by the Master Servicer reasonable compensation for the
Securities Administrator's services hereunder in an amount to be agreed upon
between the Master Servicer and the Securities Administrator. Should Xxxxx
Fargo Bank, National Association no longer be both the Master Servicer and the
Securities Administrator, the Securities Administrator shall be entitled to
receive the Securities Administrator Compensation payable pursuant to Section
4.02(b)(ii) hereof. The Securities Administrator shall be entitled to all
disbursements and advancements incurred or made by the Securities
Administrator in accordance with this Agreement (including fees and expenses
of its counsel and all persons not regularly in its employment), except any
such expenses arising from its negligence, bad faith or willful misconduct.
(b) As compensation for its services hereunder, the Trustee and each
Custodian shall each be entitled to receive a fee (which, in the case of the
Trustee, shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) which shall be paid by the
Master Servicer pursuant to a separate agreement between the Trustee, the
Custodians and the Master Servicer. Any expenses incurred by the Trustee or
the Custodians shall be reimbursed in accordance with Section 6.11.
Notwithstanding any provision in any
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Custodial Agreement to the contrary, the parties hereto acknowledge and agree
that (i) the Master Servicer shall only be obligated to pay to each Custodian
the fee agreed to by such Custodian and the Master Servicer in the separate
fee agreement referred to above, and (ii) except as may be expressly set forth
therein with respect to the Master Servicer, in no event shall the Master
Servicer have any responsibility or liability for the payment of any other
fees or any expenses or other amounts, if any, that may be payable to a
Custodian under the related Custodial Agreement, all of which shall be payable
in accordance with the terms and conditions of such Custodial Agreement.
Section 6.13. Collection of Monies.
Except as otherwise expressly provided in this Agreement, the Securities
Administrator on behalf of the Trustee may demand payment or delivery of, and
shall receive and collect, all money and other property payable to or
receivable by the Securities Administrator on behalf of the Trustee pursuant
to this Agreement. The Securities Administrator on behalf of the Trustee shall
hold all such money and property received by it as part of the Trust Fund and
shall distribute it as provided in this Agreement. Section 6.14. Events of
Default; Trustee To Act; Appointment of Successor.
(a) The occurrence of any one or more of the following events shall
constitute an "Event of Default" with respect to the Master Servicer:
(i) Any failure by the Master Servicer to furnish the Securities
Administrator the Mortgage Loan data on the Mortgage Loans sufficient to
prepare the reports described in Section 4.05 which continues unremedied
for a period of one Business Day after the date upon which written
notice of such failure shall have been given to the Master Servicer by
the Trustee or the Securities Administrator or to the Master Servicer,
the Securities Administrator and the Trustee by the Holders of not less
than 25% of the Class Principal Balance of each Class of Certificates
affected thereby; 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 (other than those referred to in (vii) and (ix) below) on the
part of the Master Servicer contained in this Agreement (including any
obligation to enforce any Purchase and Servicing Agreement) or any
representation or warranty of the Master Servicer shall prove to be
untrue in any material respect, which failure or breach continues
unremedied for a period of 60 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 Trustee or the Securities
Administrator, or to the Master Servicer, the Securities Administrator
and the Trustee by the Holders of more than 50% of the Aggregate Voting
Interests of the Certificates; provided that the sixty-day cure period
shall not apply so long as the Depositor is required to file Exchange
Act Reports with respect to the Trust Fund, the failure to comply with
the requirements set forth in Section 9.11, Section 9.05 and Section
9.06 (with respect to notice and information to be provided to the
Depositor) or Article XII, for which the grace period shall not exceed
the lesser of 10 calendar days or such period
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in which the applicable Exchange Act Report can be filed timely (without
taking into account any extensions); or
(iii) A decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered
against the Master Servicer, and such decree or order shall have
remained in force undischarged or unstayed for a period of 60 days or
any Rating Agency reduces or withdraws or threatens to reduce or
withdraw the rating of the Certificates because of the financial
condition or loan servicing capability of such Master Servicer; 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, voluntary liquidation 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 any applicable insolvency or reorganization statute, make
an assignment for the benefit of its creditors or voluntarily suspend
payment of its obligations; or
(vi) The Master Servicer shall be dissolved, or shall dispose of
all or substantially all of its assets, or consolidate with or merge
into another entity or shall permit another entity to consolidate or
merge into it, such that the resulting entity does not meet the criteria
for a successor servicer as specified in Section 9.05 hereof; or
(vii) If a representation or warranty set forth in Section 9.03
hereof shall prove to be incorrect as of the time made in any respect
that materially and adversely affects the interests of the
Certificateholders, and the circumstance or condition in respect of
which such representation or warranty was incorrect shall not have been
eliminated or cured within 90 days after the date on which written
notice of such incorrect representation or warranty shall have been
given to the Master Servicer by the Trustee or the Securities
Administrator, or to the Master Servicer, the Securities Administrator
and the Trustee by the Holders of more than 50% of the Aggregate Voting
Interests of the Certificates; or
(viii) A sale or pledge of any of the rights of the Master
Servicer hereunder or an assignment of this Agreement by the Master
Servicer or a delegation of the rights or duties of the Master Servicer
hereunder shall have occurred in any manner not otherwise permitted
hereunder and without the prior written consent of the Trustee and
Certificateholders holding more than 50% of the Aggregate Voting
Interests of the Certificates; or
(ix) After receipt of notice from the Trustee or the Securities
Administrator, any failure of the Master Servicer to make any Advances
required to be made by it hereunder; or
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(x) (a) Any failure by the Master Servicer to deposit in the
Distribution Account or remit to the Securities Administrator any
payment required to be made by the Master Servicer under the terms of
this Agreement (other than an Advance required pursuant to Section 5.05
hereof), which failure shall continue unremedied for three Business Days
after the date upon which written notice of such failure shall have been
given to the Master Servicer by the Securities Administrator, Trustee or
the Depositor or to the Master Servicer and the Trustee by the Holders
of Certificates having not less than 25% of the Voting Rights evidenced
by the Certificates or (b) any failure by the Master Servicer to deposit
in the Distribution Account or remit to the Securities Administrator any
Advance required to be made by the Master Servicer under Section 5.05
hereof, which failure shall continue unremedied for one Business Day
after the date upon which written notice of such failure shall have been
given to the Master Servicer by the Securities Administrator, Trustee or
the Depositor or to the Master Servicer and the Trustee by the Holders
of Certificates having not less than 25% of the Voting Rights evidenced
by the Certificates; or
(xi) If the Master Servicer and the Securities Administrator are
the same Person, any removal of the Securities Administrator pursuant to
Section 6.06.
If an Event of Default described in clauses (i) through (ix) or (xi) of
this Section shall occur with respect to the Master Servicer, then, in each
and every case, subject to applicable law, so long as any such Event of
Default shall not have been remedied within any period of time prescribed by
this Section, the Trustee, by notice in writing to the Master Servicer may,
and, if so directed by (a) Certificateholders evidencing more than 50% of the
Class Principal Balance of each Class of Certificates or (b) the Depositor, in
the case of a failure related to a filing obligation triggered by a Reportable
Event; the Trustee shall by notice in writing to the Master Servicer (with a
copy to each Rating Agency and the Depositor), terminate all of the respective
rights and obligations of the Master Servicer hereunder and in and to the
Mortgage Loans and the proceeds thereof. Subject to Section 6.01(c)(ii), if an
Event of Default described in clause (x) of this Section shall occur with
respect to the Master Servicer, then, in each and every case, subject to
applicable law, so long as any such Event of Default shall not have been
remedied within any period of time prescribed by this Section, the Trustee
shall by notice in writing to the Master Servicer terminate all of the
respective rights and obligations of the Master Servicer hereunder and in and
to the Mortgage Loans and the proceeds thereof. On or after the receipt by the
Master Servicer of such written notice, all authority and power of the Master
Servicer, and with respect to the Master Servicer only in its capacity as
Master Servicer under this Agreement, whether with respect to the Mortgage
Loans or otherwise, shall pass to and be vested in the Trustee; and the
Trustee is hereby authorized and empowered to execute and deliver, on behalf
of the defaulting 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 affected Mortgage Loans and related documents or otherwise. The defaulting
Master Servicer agrees to cooperate with the Trustee and the Securities
Administrator in effecting the termination of the defaulting Master Servicer's
responsibilities and rights hereunder as Master Servicer which includes,
without limitation, notifying the Servicers of the assignment of the master
servicing function and providing the Trustee or its
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designee all documents and records in electronic or other form reasonably
requested by it to enable the Trustee or its designee to assume the defaulting
Master Servicer's functions hereunder and the transfer to the Trustee for
administration by it of all amounts which shall at the time be or should have
been deposited by the defaulting Master Servicer in the Distribution Account,
any related Custodial Account and any other account or fund maintained with
respect to the Certificates or thereafter received with respect to the
affected Mortgage Loans. The Master Servicer being terminated shall bear all
costs of the transfer of the master servicing to the successor master
servicer, including but not limited to those of the Trustee or Securities
Administrator reasonably allocable to specific employees and overhead, legal
fees and expenses, accounting and financial consulting fees and expenses, and
costs of amending the Agreement, if necessary. If such costs are not paid by
the terminated Master Servicer, the Trustee shall pay such costs from the
Trust Fund.
Notwithstanding the termination of its activities as Master Servicer,
any terminated Master Servicer shall continue to be entitled to reimbursement
under this Agreement to the extent such reimbursement relates to the period
prior to such Master Servicer's termination.
The Securities Administrator and the Master Servicer shall promptly
notify the Responsible Officers of the Trustee and the Depositor of the
occurrence and continuance of an Event of Default. If any Event of Default
shall occur, the Trustee, upon a Responsible Officer of the Trustee becoming
aware of the occurrence thereof, shall promptly notify each Rating Agency of
the nature and extent of such Event of Default. The Securities Administrator
shall immediately give written notice to the Master Servicer upon the failure
of the Master Servicer to make Advances as required under this Agreement with
a copy to the Trustee.
Upon the occurrence of an Event of Default, the Trustee shall provide
the Depositor in writing and in form and substance reasonably satisfactory to
the Depositor, all information reasonably requested by the Depositor in order
to comply with its reporting obligation under Item 6.02 of Form 8-K with
respect to a successor master servicer in the event the Trustee should succeed
to the duties of the Master Servicer as set forth herein.
In order to comply with applicable Form 8-K reporting requirements under
Regulation AB, at least 15 calendar days prior to the effective date of such
appointment, (x) the Trustee shall provide written notice to the Depositor of
such successor pursuant to this Section 6.14 and (y) such successor Master
Servicer shall provide to the Depositor in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K with respect to a replacement master servicer.
(b) On and after the time the Master Servicer receives a notice of
termination from the Trustee or the Securities Administrator, as applicable,
pursuant to Section 6.14(a) or the Trustee or the Securities Administrator, as
applicable, receives the resignation of the Master Servicer evidenced by an
Opinion of Counsel pursuant to Section 9.06, the Trustee, unless another
master servicer shall have been appointed, shall be the successor in all
respects to the Master Servicer, in its capacity as such under this Agreement
and the transactions set forth or provided for herein and shall have all the
rights and powers and be subject to all the responsibilities, duties and
liabilities relating thereto and arising thereafter placed on the Master
Servicer, hereunder, including the obligation to make Advances; provided,
however, that any failure to perform such duties or responsibilities caused by
the failure of the Master Servicer to
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provide information required by this Agreement shall not be considered a
default by the Trustee or the Securities Administrator, as applicable,
hereunder. In addition, neither the Trustee nor the Securities Administrator,
as applicable, shall have any responsibility for any act or omission of the
Master Servicer prior to the issuance of any notice of termination. The
Trustee shall have no liability relating to the representations and warranties
of the Master Servicer set forth in Section 9.03. In the capacity as such
successor, the Trustee shall have the same limitations on liability herein
granted to the Master Servicer. As compensation for being the successor master
servicer, the Trustee shall be entitled to receive all compensation payable to
the Master Servicer under this Agreement. Any successor to the Master Servicer
hereunder also may assume the obligations of the Securities Administrator
hereunder as successor in such capacity shall be entitled to the compensation
payable to the Securities Administrator pursuant to Section 4.02 hereof from
and after the date of such assumption.
(c) Notwithstanding the above, the Trustee may, if it shall be unwilling
to continue to so act, or shall, if it is unable to so act, petition a court
of competent jurisdiction to appoint, or appoint on its own behalf any
established housing and home finance institution servicer, master servicer,
servicing or mortgage servicing institution having a net worth of not less
than $15,000,000 and meeting such other standards for a successor master
servicer, as are set forth in this Agreement, as the successor to such Master
Servicer in the assumption of all of the respective responsibilities, duties
or liabilities of a master servicer, like the Master Servicer. Any entity
designated by the Trustee, may be an Affiliate of the Trustee; provided,
however, that, unless such Affiliate meets the net worth requirements and
other standards set forth herein for a successor master servicer, the Trustee,
in its individual capacity shall agree, at the time of such designation, to be
and remain liable to the Trust Fund for such Affiliate's actions and omissions
in performing its duties hereunder. In connection with such appointment and
assumption, the Trustee may make such arrangements for the compensation of
such successor out of payments on the Mortgage Loans as it and such successor
shall agree; provided, however, that no such compensation shall be in excess
of that permitted to the Master Servicer hereunder. The Trustee and such
successor shall take such actions, consistent with this Agreement, as shall be
necessary to effectuate any such succession and may make other arrangements
with respect to the master servicing to be conducted hereunder which are not
inconsistent herewith. The Master Servicer shall cooperate with the Trustee
and any successor master servicer in effecting the termination of the Master
Servicer's responsibilities and rights hereunder including, without
limitation, notifying the Servicers of the assignment of the master servicing
functions and providing the Trustee and successor master servicer all
documents and records in electronic or other form reasonably requested by it
to enable it to assume the Master Servicer's functions hereunder and the
transfer to the Trustee or such successor all amounts which shall at the time
be or should have been deposited by the Master Servicer in the Distribution
Account, any Custodial Account, or any other account or fund maintained with
respect to the Certificates or thereafter be received with respect to the
Mortgage Loans. Neither the Trustee nor the Securities Administrator, as
applicable, nor any other successor, as applicable, shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making,
any distribution hereunder or any portion thereof caused by (i) the failure of
the Master Servicer to deliver, or any delay in delivering, cash, documents or
records to it, (ii) the failure of the Master Servicer to cooperate as
required by this Agreement, (iii) the failure of the Master Servicer to
deliver the related Mortgage Loan data as required by this Agreement or (iv)
restrictions imposed by any regulatory authority having jurisdiction over the
Master Servicer. No successor master servicer shall be deemed to be
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in default hereunder by reason of any failure to make, or any delay in making,
any distribution hereunder or any portion thereof caused by (i) the failure of
the Securities Administrator to deliver, or any delay in delivering cash,
documents or records to it related to such distribution, or (ii) the failure
of Trustee or the Securities Administrator to cooperate as required by this
Agreement.
Section 6.15. Additional Remedies of Trustee Upon Event of Default.
During the continuance of any Event of Default, so long as such Event of
Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 6.14, shall have the right, in its own name and as
trustee of the Trust Fund, to take all actions now or hereafter existing at
law, in equity or by statute to enforce its rights and remedies and to protect
the interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filings of proofs of claim and debt in connection
therewith). Except as otherwise expressly provided in this Agreement, no
remedy provided for by this Agreement shall be exclusive of any other remedy,
and each and every remedy shall be cumulative and in addition to any other
remedy, and no delay or omission to exercise any right or remedy shall impair
any such right or remedy or shall be deemed to be a waiver of any Event of
Default.
Section 6.16. Waiver of Defaults.
More than 50% of the Aggregate Voting Interests of the
Certificateholders may waive any default or Event of Default by the Master
Servicer in the performance of its obligations hereunder, except that a
default in the making of any required deposit to the Distribution Account that
would result in a failure of the Securities Administrator or the Paying Agent
to make any required payment of principal of or interest on the Certificates
may only be waived with the consent of 100% of the affected
Certificateholders. Upon any such waiver of a past default, such default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon except to the extent expressly so waived.
Section 6.17. Notification to Holders.
Upon termination of the Master Servicer or appointment of a successor to
the Master Servicer, in each case as provided herein, the Trustee shall
promptly mail notice thereof by first class mail to the Securities
Administrator and the Certificateholders at their respective addresses
appearing on the Certificate Register. The Trustee shall also, within 45 days
after the occurrence of any Event of Default known to the Trustee, give
written notice thereof to the Securities Administrator and the
Certificateholders, unless such Event of Default shall have been cured or
waived prior to the issuance of such notice and within such 45-day period.
Section 6.18. Directions by Certificateholders and Duties of Trustee
During Event of Default.
Subject to the provisions of Section 8.01 hereof, during the continuance
of any Event of Default, Holders of Certificates evidencing not less than 25%
of the Class Principal Balance (or
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Percentage Interest) of each Class of Certificates affected thereby may direct
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; provided, however, that the Trustee shall be
under no obligation to pursue any such remedy, or to exercise any of the
trusts or powers vested in it by this Agreement (including, without
limitation, (i) the conducting or defending of any administrative action or
litigation hereunder or in relation hereto and (ii) the terminating of the
Master Servicer or any successor master servicer from its rights and duties as
master servicer hereunder) at the request, order or direction of any of the
Certificateholders, unless such Certificateholders shall have offered to the
Trustee security or indemnity reasonably satisfactory to it against the cost,
expenses and liabilities which may be incurred therein or thereby; and,
provided further, that, subject to the provisions of Section 8.01, the Trustee
shall have the right to decline to follow any such direction if the Trustee,
in accordance with an Opinion of Counsel, determines that the action or
proceeding so directed may not lawfully be taken or if the Trustee in good
faith determines that the action or proceeding so directed would involve it in
personal liability for which it is not indemnified to its satisfaction.
Section 6.19. Action Upon Certain Failures of the Master Servicer and
Upon Event of Default.
In the event that a Responsible Officer of the Trustee shall have actual
knowledge or written notice of any action or inaction of the Master Servicer
that would become an Event of Default upon the Master Servicer's failure to
remedy the same after notice, the Trustee shall give notice thereof to the
Master Servicer.
Section 6.20. Preparation of Tax Returns and Other Reports.
(a) The Securities Administrator shall prepare or cause to be prepared
on behalf of the Trust Fund, based upon information calculated in accordance
with this Agreement pursuant to instructions given by the Depositor, and the
Securities Administrator shall file federal tax returns, all in accordance
with Article X hereof. If the Securities Administrator is notified in writing
that a state tax return or other return is required, then, at the sole expense
of the Trust Fund, the Securities Administrator shall prepare and file such
state income tax returns and such other returns as may be required by
applicable law relating to the Trust Fund, and, if required by state law,
shall file any other documents to the extent required by applicable state tax
law (to the extent such documents are in the Securities Administrator's
possession). The Securities Administrator shall forward copies to the
Depositor of all such returns and Form 1099 supplemental tax information and
such other information within the control of the Securities Administrator as
the Depositor may reasonably request in writing, and shall forward to each
Certificateholder such forms and furnish such information within the control
of the Securities Administrator as are required by the Code and the REMIC
Provisions to be furnished to them, and will prepare and forward to
Certificateholders Form 1099 (supplemental tax information) (or otherwise
furnish information within the control of the Securities Administrator) to the
extent required by applicable law. The Master Servicer will indemnify the
Securities Administrator and the Trustee for any liability of or assessment
against the Securities Administrator or the Trustee, as applicable, resulting
from any error in any of such tax or information returns directly resulting
from errors in the information provided by such Master Servicer except to the
extent that such information was provided in reasonable reliance upon
information from any Servicer.
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(b) The Securities Administrator shall prepare and file with the
Internal Revenue Service ("IRS"), on behalf of the Trust Fund and each REMIC
created hereunder, an application for an employer identification number on IRS
Form SS-4 or by any other acceptable method. The Securities Administrator
shall also file a Form 8811 as required. The Securities Administrator, upon
receipt from the IRS of the Notice of Taxpayer Identification Number Assigned,
shall upon request promptly forward a copy of such notice to the Trustee and
the Depositor. The Securities Administrator shall furnish any other
information that is required by the Code and regulations thereunder to be made
available to the Certificateholders. The Master Servicer agrees that it shall
cause each Servicer to, provide the Securities Administrator with such
information related to the Mortgage Loans in the possession of such Servicer,
as may reasonably be required for the Securities Administrator to prepare such
reports.
Section 6.21. Certain Matters Regarding any Custodian Appointed Hereunder
(a) The Custodian shall maintain continuous custody of all items
constituting the Trustee Mortgage Files in secure facilities in accordance with
customary standards for such custody and shall reflect in its records the
interest of the Trustee for the benefit of the Certificateholders therein. Each
Mortgage Note (and Assignment of Mortgage) shall be maintained in fire
resistant facilities.
(b) With respect to the documents constituting each Trustee Mortgage File
relating to a Mortgage Loan listed on the Mortgage Loan Schedule, the Custodian
shall (i) act exclusively as the custodian for the Trustee, (ii) hold all
documents constituting such Trustee Mortgage File received by it for the
exclusive use and benefit of the Trust, and (iii) make disposition thereof only
in accordance with the terms of this Agreement.
(c) In the event that (i) the Trustee, a Servicer, the Securities
Administrator, the Master Servicer or the Custodian shall be served by a third
party with any type of levy, attachment, writ or court order with respect to
any Trustee Mortgage File or any document included within a Trustee Mortgage
File or (ii) a third party shall institute any court proceeding by which any
Trustee Mortgage File or a document included within a Trustee Mortgage File
shall be required to be delivered otherwise than in accordance with the
provisions of this Agreement, the party receiving such service shall promptly
deliver or cause to be delivered to the other parties to this Agreement copies
of all court papers, orders, documents and other materials concerning such
proceedings. The Custodian shall, to the extent permitted by law, continue to
hold and maintain all the Trustee Mortgage Files that are the subject of such
proceedings pending a final, nonappealable order of a court of competent
jurisdiction permitting or directing disposition thereof. Upon final
determination of such court, the Custodian shall dispose of such Trustee
Mortgage File or any document included within such Trustee Mortgage File as
directed by the Trustee which shall give a direction consistent with such
determination. Expenses and fees (including reasonable attorney's fees) of the
Custodian incurred as a result of such proceedings shall be borne by the Trust
Fund.
(d) The Custodian shall provide access to the Mortgage Loan Documents in
its possession regarding the related Mortgage Loans and REO Property and the
servicing thereof to the Trustee, the Master Servicer, the Securities
Administrator, the related Servicer, the Certificateholders, the FDIC, and the
supervisory agents and examiners of the FDIC, such access being afforded only
upon reasonable prior written request and during normal business hours at the
office of the Custodian. The Custodian shall allow representatives of the above
entities to photocopy any of the records and documentation and shall provide
equipment for that purpose at the expense of the person requesting such access.
(e) The Custodian shall have no duties or responsibilities except those
that are specifically set forth herein, or as subsequently agreed in writing by
the parties hereto, and no implied covenants or obligations shall be read into
this Agreement against the Custodian.
(f) The Custodian shall have no responsibility nor duty with respect to
any Trustee Mortgage Files while not in its possession.
(g) The Custodian shall be under no obligation to make any investigation
into the facts or matters stated in any resolution, exhibit, request,
representation, opinion, certificate, statement, acknowledgement, consent,
order or document in the Trustee Mortgage File.
(h) If the Trustee and a Custodian are the same Person, any removal or
resignation of that Person in either capacity shall also result in the removal
of the Person in its other capacity.
(i) In the event that the Custodian fails to produce a Mortgage Note,
Assignment of Mortgage or any other document related to a Mortgage Loan that
was in its possession pursuant to Section 2.01 within five (5) Business Days
after required or requested by the Depositor, the Trustee, the Master Servicer
or the related Servicer, and provided, that (i) Custodian previously delivered
to the Trustee an Initial Certification or a Final Certification with respect
to such document; (ii) such document is not outstanding pursuant to a Request
for Release; and (iii) such document was held by the Custodian on behalf of the
Trustee (a "Custodial Delivery Failure"), then the Custodian shall (a) with
respect to any missing Mortgage Note, promptly deliver to the Depositor, the
Trustee, the Master Servicer or the Servicer upon request, a Lost Note
Affidavit in the form of Exhibit R annexed hereto and (b) with respect to any
missing document related to such Mortgage Loan including but not limited to, a
missing Mortgage Note, indemnify the Depositor, Trustee, the Master Servicer or
the Servicer in accordance with the succeeding paragraph of this Section
6.21(i).
The Custodian appointed hereunder agrees to indemnify and hold the
Depositor, the Trustee, the Master Servicer and the Servicer and their
respective employees, officers, directors and agents harmless against any and
all direct liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements, including reasonable
attorney's fees, that may be imposed on, incurred by, or asserted against it or
them in any way relating to or arising out of such Custodial Delivery Failure.
The foregoing indemnification shall survive any termination or assignment of
this Agreement or the removal or resignation of the Custodian hereunder.
For the avoidance of doubt, if the entity serving as Trustee is also
serving as a Custodian, such entity in its capacity as Custodian shall have the
same rights, protections and indemnities as are afforded to the Trustee
hereunder provided that such Custodian shall not be indemnified by the Trust
Fund for any liability, obligation, loss, damage, penalty, action, judgment,
suit, cost, expense or disbursement imposed on, incurred by or asserted against
the Custodian because of the breach by the Custodian of its obligations
hereunder, which breach was caused by negligence, lack of good faith or willful
misconduct on the part of the Custodian or any of its directors, officers,
agents or employees.
ARTICLE VII
PURCHASE OF MORTGAGE LOANS AND
TERMINATION OF THE TRUST FUND
Section 7.01. Purchase of Mortgage Loans; Termination of Trust Fund Upon
Purchase or Liquidation of All Mortgage Loans.
(a) The respective obligations and responsibilities of the Trustee, the
Securities Administrator and the Master Servicer created hereby (other than
the obligation of the Securities Administrator to make payments to the
Certificateholders as set forth in Section 7.02), shall terminate on the
earliest of (i) the final payment or other liquidation of the last Mortgage
Loan remaining in the Trust Fund and the disposition of all REO Property, (ii)
the sale or auction of the property held by the Trust Fund in accordance with
both (x) Section 7.01(b) or 7.01(c) and (iii) the Latest Possible Maturity
Date; provided, however, that in no event shall the Trust Fund created hereby
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United
States to the Court of St. James's, living on the date hereof. Any termination
of the Trust Fund shall be carried out in such a manner so that the
termination of each REMIC included therein shall qualify as a "qualified
liquidation" under the REMIC Provisions.
(b) On the Initial Optional Termination date related to the Collateral
Allocation Group 1 Mortgage Loans, the Auction Administrator shall solicit
bids for the Group 1 Assets from at least three institutions that are regular
purchasers and/or sellers in the secondary market of residential whole
mortgage loans similar to the Mortgage Loans. If the Auction Administrator
receives at least three bids for the Group 1 Assets, and one of such bids is
equal to or greater than the Minimum Auction Price, the Auction Administrator
shall sell (such sale, an "Auction") the related Group 1 Assets to the highest
bidder (the "Auction Purchaser") at the price offered by the Auction Purchaser
(the "Mortgage Loan Auction Price"). If the Auction Administrator receives
less than three bids, or does not receive any bid that is at least equal to
the Minimum Auction Price, the Auction Administrator shall, on each six-month
anniversary of the Initial Optional Termination Date for the Collateral
Allocation Group 1 Mortgage Loans, repeat these auction procedures until the
Auction Administrator receives a bid that is at least equal to the Minimum
Auction Price, at which time the Auction Administrator shall sell the Group 1
Assets to the Auction Purchaser at that Mortgage Loan Auction Price; provided,
however, that the Auction
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Administrator shall not be required to repeat these auction procedures on any
Distribution Date for any six-month anniversary of the Initial Optional
Termination Date unless the Auction Administrator reasonably believes that
there is a reasonable likelihood of receiving a bid of at least the Minimum
Auction Price. The Auction Administrator shall give notice to the Rating
Agencies and each Servicer that is servicing any of the Collateral Allocation
Group 1 Mortgage Loans of the sale of the related Group 1 Assets pursuant to
this Section 7.01(b) (an "Auction Sale") and of the Auction Date.
(c) In the event that the Master Servicer chooses to exercise its
optional termination rights it shall do so in accordance with the following:
(i) Optional Termination Related to the Collateral Allocation
Group 1 Mortgage Loans. On any Distribution Date occurring after the
Initial Optional Termination Date related to the Collateral Allocation
Group 1 Mortgage Loans, the Master Servicer has the option to cause the
Trust Fund to adopt a plan of complete liquidation of the Collateral
Allocation Group 1 Mortgage Loans pursuant to Sections 7.02 and 7.03
hereof to sell all of the property related thereto. If the Master
Servicer elects to exercise such option, it shall no later than 30 days
prior to the Distribution Date selected for purchase of the Collateral
Allocation Group 1 Mortgage Loans and all other assets of the Trust Fund
related to the Group 1 Certificates (with respect to the Group 1
Certificates, the "Purchase Date") deliver written notice to the Trustee
and the Securities Administrator and either (a) deposit in the
Distribution Account the related Redemption Price or (b) state in such
notice that the Redemption Price shall be deposited in the Distribution
Account not later than 10:00 a.m., New York City time, on the applicable
Purchase Date. Upon exercise of such option, the Group 1 Assets shall be
sold to the Master Servicer at a price equal to the related Redemption
Price.
(ii) Optional Termination Related to the Aggregate Group II
Mortgage Loans. On any Distribution Date occurring on or after the
Initial Optional Termination Date related to the Aggregate Group II
Mortgage Loans, the Master Servicer has the option to cause the Trust to
adopt a plan of complete liquidation of the Aggregate Group II Mortgage
Loans pursuant to Sections 7.02 and 7.03 hereof to sell all of the
property related thereto. If the Master Servicer elects to exercise such
option, it shall no later than 30 days prior to the Distribution Date
selected for purchase of the Aggregate Group II Mortgage Loans and all
other assets of the Trust related to the Aggregate Group II Certificates
(with respect to the Aggregate Group II Certificates, the "Purchase
Date") deliver written notice to the Trustee and the Securities
Administrator and either (a) deposit in the Distribution Account the
related aggregate Redemption Price or (b) state in such notice that the
Redemption Price shall be deposited in the Distribution Account not
later than 10:00 a.m., New York City time, on the applicable Purchase
Date. Upon exercise of such option, the property of the Trust related to
the Aggregate Group II Certificates shall be sold to the Master Servicer
at a price equal to the aggregate Redemption Price for the Aggregate
Group II Certificates.
(d) The Depositor, the Master Servicer, each Servicer, the Securities
Administrator, the Trustee and the Custodian shall be reimbursed from the
Redemption Price for
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any Advances, Servicer Advances, accrued and unpaid Servicing Fees or other
amounts with respect to the Mortgage Loans and any related assets being
purchased pursuant to Section 7.01(b) or (c) above that are reimbursable to
such parties (and such other amounts which, if not related to the Mortgage
Loans and other assets of the Trust Fund not being purchased, that are then
due and owing to any such Person) under this Agreement and the related
Purchase and Servicing Agreement or the related Custodial Agreement.
Section 7.02. Procedure Upon Redemption of Trust Fund.
(a) Notice of any termination pursuant to the provisions of Section
7.01, specifying the Distribution Date upon which the final distribution shall
be made or the purchase of the Trust's assets related to the Group 1
Certificates or the Aggregate Group II Certificates, as applicable, will
occur, shall be given promptly by the Securities Administrator by first class
mail to the related Certificateholders mailed in the case of a redemption of
the related Certificates, no later than (i) the first day of the month in
which the Distribution Date selected for redemption of such Certificates shall
occur or (ii) upon (x) the sale of all of the property of the Trust Fund by
the Securities Administrator or in the case of a sale of assets of the Trust
Fund, or (y) upon the final payment or other liquidation of the last Mortgage
Loan or REO Property in the Trust Fund. Such notice shall specify (A) the
Initial Optional Termination Date, Distribution Date upon which final
distribution on the Certificates of all amounts required to be distributed to
Certificateholders pursuant to Section 5.02 will be made upon presentation and
surrender of the Certificates at the Certificate Registrar's Corporate Trust
Office, and (B) that the Record Date otherwise applicable to such Distribution
Date is not applicable, distribution being made only upon presentation and
surrender of the Certificates at the office or agency of the Securities
Administrator therein specified. The Securities Administrator shall give such
notice to the Trustee, the Master Servicer and the Certificate Registrar at
the time such notice is given to Holders of the Certificates. Upon any such
termination, the duties of the Certificate Registrar with respect to the
affected Certificates shall terminate and, in the event that such termination
is the second termination pursuant to Section 7.01, the Securities
Administrator shall terminate the Distribution Account and any other account
or fund maintained with respect to the Certificates, subject to the Securities
Administrator's obligation hereunder to hold all amounts payable to
Certificateholders in trust without interest pending such payment.
(b) In the event that all of the Holders do not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Securities Administrator shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice any Certificates shall not
have been surrendered for cancellation, the Securities Administrator may take
appropriate steps to contact the remaining Certificateholders concerning
surrender of such Certificates, and the cost thereof shall be paid out of the
amounts distributable to such Holders. If within two years after the second
notice any Certificates shall not have been surrendered for cancellation, the
Securities Administrator shall deliver any remaining funds being held by it to
the Holder of the Class A-R Certificates and the Holder of the Class A-R
Certificates shall, subject to applicable state law relating to escheatment,
hold all amounts distributable to such Holders for the benefit of such
Holders. No interest shall accrue on any amount held by the Securities
Administrator and not distributed to a Certificateholder due to such
Certificateholder's failure to surrender its
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Certificate(s) for payment of the final distribution thereon in accordance
with this Section. The foregoing provisions are intended to distribute to each
Class of Certificates any accrued and unpaid interest and/or principal to
which they are entitled based on their Pass-Through Rates and Class
Certificate Balances or Notional Amounts set forth in the Preliminary
Statement upon liquidation of the Trust Fund.
(c) Any reasonable expenses incurred by the Securities Administrator in
connection with any purchase or termination or liquidation of the portion of
the Trust Fund related to the Group 1 Certificates or the Aggregate Group II
Certificates, as applicable, shall be reimbursed from proceeds received from
the liquidation of the Trust Fund.
(d) Any purchase of the Group 1 Assets by the related Auction Purchaser
shall be made on an Auction Date by receipt of the Auction Administrator of
the related Mortgage Loan Auction Price from the Auction Purchaser, and
deposit of the such Mortgage Loan Auction Price into the Distribution Account
by the Auction Administrator before the Distribution Date on which such
purchase is effected. Upon deposit of such purchase price into the
Distribution Account, the Trustee and the Securities Administrator, shall,
upon request and at the expense of the Auction Purchaser, execute and deliver
all such instruments of transfer or assignment, in each case without recourse,
as shall be reasonably requested by the Auction Purchaser to vest title in the
Auction Purchaser in the Group 1 Assets so purchased and shall transfer or
deliver to the Auction Purchaser the purchased Group 1 Assets.
Section 7.03. Additional Trust Fund Termination Requirements.
(a) On the termination of the Trust Fund under Section 7.01 (a), upon an
Auction Sale pursuant to Section 7.01(b) or upon the exercise of the right to
purchase all of the Collateral Allocation Group 1 Mortgage Loans or the
Aggregate Group II Mortgage Loans, as applicable, pursuant to Section 7.01(c),
the Securities Administrator, on behalf of the Trustee, shall comply with
requirements of this Section 7.03 with respect to each Lower Tier REMIC
relating to the assets to be sold (the "Affected REMIC") and with respect to
the Certificates corresponding to the Affected REMIC (the "Corresponding
Certificates"), unless the party having the right to purchase the assets of
the Affected REMIC (the "Purchaser") delivers to the Trustee and the
Securities Administrator, an Opinion of Counsel (at the Master Servicer's
expense), addressed to the Trustee and the Securities Administrator to the
effect that the failure of the Trustee and the Securities Administrator to
comply with the requirements of this Section 7.03 will not result in an
Adverse REMIC Event:
(i) Within 89 days prior to the time of making the final payment
on the Corresponding Certificates, (and upon notification by (1) the
Auction Administrator in the case of a purchase under Section 7.01(b) or
(2) the Master Servicer in the case of a purchase under Section
7.01(c)(i) or Section 7.01(c)(ii), as applicable) the Securities
Administrator on behalf of the Trustee shall adopt on behalf of the
Affected REMIC, a plan of complete liquidation, meeting the requirements
of a qualified liquidation under the REMIC Provisions;
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(ii) Any sale of the assets of the Affected REMIC shall be for
cash and shall occur at or after the time the plan of complete
liquidation is adopted and prior to the time the final payments on the
Corresponding Certificates are made;
(iii) On the date specified for final payment of the Corresponding
Certificates, the Securities Administrator shall make final
distributions of principal and interest on the Corresponding
Certificates in accordance with Section 5.02 and, after payment of, or
provision for any outstanding expenses, distribute or credit, or cause
to be distributed or credited, to the Holders of the Residual
Certificates all cash on hand after such final payment (other than cash
retained to meet claims), and the portion of the Trust Fund (and the
Affected REMIC) shall terminate at that time; and
(iv) In no event may the final payment on the Corresponding
Certificates or the final distribution or credit to the Holders of the
Residual Certificates be made after the 89th day from the date on which
the plan of complete liquidation is adopted.
(b) By its acceptance of a Residual Certificate, each Holder thereof
hereby agrees to accept the plan of complete liquidation adopted by the
Securities Administrator on behalf of the Trustee under this Section and to
take such other action in connection therewith as may be reasonably requested
by the Trustee, the Securities Administrator or any Servicer.
ARTICLE VIII
RIGHTS OF CERTIFICATEHOLDERS
Section 8.01. Limitation on Rights of Holders.
(a) The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or this Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or
take any action or proceeding in any court for a partition or winding up of
this Trust Fund, nor otherwise affect the rights, obligations and liabilities
of the parties hereto or any of them. Except as otherwise expressly provided
herein, no Certificateholder, solely by virtue of its status as a
Certificateholder, shall have any right to vote or in any manner otherwise
control the Master Servicer or the operation and management of the Trust Fund,
or the obligations of the parties hereto, nor shall anything herein set forth,
or contained in the terms of the Certificates, be construed so as to
constitute the Certificateholders from time to time as partners or members of
an association, nor shall any Certificateholder be under any liability to any
third person by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
(b) No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of an Event
of Default and of the continuance thereof, as hereinbefore provided, and
unless also the Holders of Certificates evidencing not less than 25% of the
Class Principal Amount or Class Notional Amount (or Percentage Interest) of
Certificates of each Class affected thereby shall have made
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written request upon the Trustee to institute such action, suit or proceeding
in its own name as Trustee hereunder and shall have offered to the Trustee
such reasonable indemnity as it may require against the cost, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for sixty 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 and no
direction inconsistent with such written request has been given such Trustee
during such sixty-day period by such Certificateholders; it being understood
and intended, and being expressly covenanted by each Certificateholder with
every other Certificateholder, the Securities Administrator and the Trustee,
that no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing 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 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 8.02. Access to List of Holders.
(a) If the Trustee is not acting as Certificate Registrar, the
Certificate Registrar will furnish or cause to be furnished to the Trustee,
within fifteen days after receipt by the Certificate Registrar of a request by
the Trustee in writing, a list, in such form as the Trustee may reasonably
require, of the names and addresses of the Certificateholders of each Class as
of the most recent Record Date.
(b) If three or more Holders or Certificate Owners (hereinafter referred
to as "Applicants") apply in writing to the Certificate Registrar, and such
application states that the Applicants desire to communicate with other
Holders with respect to their rights under this Agreement or under the
Certificates and is accompanied by a copy of the communication which such
Applicants propose to transmit, then the Certificate Registrar shall, within
five Business Days after the receipt of such application, afford such
Applicants reasonable access during the normal business hours of the
Certificate Registrar to the most recent list of Certificateholders held by
the Certificate Registrar or shall, as an alternative, send, at the
Applicants' expense, the written communication proffered by the Applicants to
all Certificateholders at their addresses as they appear in the Certificate
Register.
(c) Every Holder or Certificate Owner, if the Holder is a Clearing
Agency, by receiving and holding a Certificate, agrees with the Depositor, the
Master Servicer, the Securities Administrator, the Certificate Registrar and
the Trustee that none of the Depositor, the Master Servicer, the Securities
Administrator, the Certificate Registrar nor the Trustee shall be held
accountable by reason of the disclosure of any such information as to the
names and addresses of the Certificateholders hereunder, regardless of the
source from which such information was derived.
Section 8.03. Acts of Holders of Certificates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders or Certificate Owners, if the
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Holder is a Clearing Agency, may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and the Securities Administrator and,
where expressly required herein, to the Master Servicer. Such instrument or
instruments (as the action embodies therein and evidenced thereby) are herein
sometimes referred to as an "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agents shall be sufficient for any purpose of this
Agreement and conclusive in favor of the Trustee, the Securities Administrator
and the Master Servicer, if made in the manner provided in this Section. Each
of the Trustee, the Securities Administrator and the Master Servicer shall
promptly notify the others of receipt of any such instrument by it, and shall
promptly forward a copy of such instrument to the others.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer
authorized by law to take acknowledgments or deeds, certifying that the
individual signing such instrument or writing acknowledged to him the
execution thereof. Whenever such execution is by an officer of a corporation
or a member of a partnership on behalf of such corporation or partnership,
such certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
writing, or the authority of the individual executing the same, may also be
proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Certificates (whether or not such Certificates
shall be overdue and notwithstanding any notation of ownership or other
writing thereon made by anyone other than the Trustee) shall be proved by the
Certificate Register, and none of the Trustee, the Securities Administrator,
the Master Servicer or the Depositor shall be affected by any notice to the
contrary.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Certificate shall bind every
future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by
the Trustee or the Master Servicer in reliance thereon, whether or not
notation of such action is made upon such Certificate.
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
BY THE MASTER SERVICER
Section 9.01. Duties of the Master Servicer; Enforcement of Servicers'
and Master Servicer's Obligations.
(a) The Master Servicer, on behalf of the Trustee, the Depositor and the
Certificateholders shall monitor the performance of the Servicers under the
Purchase and
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Servicing Agreements, and shall use its reasonable good faith efforts to cause
the Servicers duly and punctually to perform all of their respective duties
and obligations thereunder. Upon the occurrence of a default of which a
Responsible Officer of the Master Servicer has actual knowledge under a
Purchase and Servicing Agreement, the Master Servicer shall promptly notify
the Trustee thereof, and shall specify in such notice the action, if any, the
Master Servicer is taking in respect of such default. So long as any such
default shall be continuing, the Master Servicer may, and shall if it
determines such action to be in the best interests of Certificateholders, (i)
terminate all of the rights and powers of such Servicer pursuant to the
applicable provisions of the related Purchase and Servicing Agreement; (ii)
exercise any rights it may have to enforce the related Purchase and Servicing
Agreement against such Servicer; and/or (iii) waive any such default under the
related Purchase and Servicing Agreement or take any other action with respect
to such default as is permitted thereunder. Notwithstanding anything to the
contrary in this Agreement, with respect to any Additional Collateral Mortgage
Loan, the Master Servicer will have no duty or obligation to supervise,
monitor or oversee the activities of the related Servicer under any Purchase
and Servicing Agreement with respect to any Additional Collateral or under any
agreement relating to the pledge of, or the perfection of a pledge or security
interest in, any Additional Collateral except upon the occurrence of the
following events (i) in the case of a final liquidation of any Mortgaged
Property secured by Additional Collateral, the Master Servicer shall enforce
the obligation of the Servicer under the related Servicing Agreement to
liquidate such Additional Collateral as required by such Servicing Agreement,
and (ii) if the Master Servicer assumes the obligations of such Servicer as
successor Servicer under the related Servicing Agreement pursuant to this
Section 9.01, as successor Servicer, it shall be bound to service and
administer the Additional Collateral in accordance with the provisions of such
Servicing Agreement.
(b) Upon any termination by the Master Servicer of a Servicer's rights
and powers pursuant to its Purchase and Servicing Agreement, the rights and
powers of such Servicer with respect to the related Mortgage Loans shall vest
in the Master Servicer and the Master Servicer shall be the successor in all
respects to such Servicer in its capacity as Servicer with respect to such
Mortgage Loans under the related Purchase and Servicing Agreement, unless or
until the Master Servicer shall have appointed (and the Trustee shall have
acknowledged), with the consent of the Rating Agencies and in accordance with
the applicable provisions of the related Purchase and Servicing Agreement, a
new Xxxxxx Xxx- or FHLMC-approved Person to serve as successor to the
Servicer; provided, however, that it is understood and agreed by the parties
hereto that there will be a period of transition (not to exceed 90 days)
before the actual servicing functions can be fully transferred to a successor
servicer (including the Master Servicer). With such letter from the Rating
Agencies, the Master Servicer may elect to continue to serve as successor
servicer under the Purchase and Servicing Agreement. Upon appointment of a
successor servicer, as authorized under this Section 9.01(b), unless the
successor servicer shall have assumed the obligations of the terminated
Servicer under such Purchase and Servicing Agreement, the Master Servicer and
such successor servicer shall enter into a servicing agreement in a form
substantially similar to the affected Purchase and Servicing Agreement, and
the Trustee shall acknowledge such servicing agreement. In connection with any
such appointment, the Master Servicer may make such arrangements for the
compensation of such successor servicer as it and such successor servicer
shall agree, but in no event shall such compensation of any successor servicer
(including the Master Servicer) be in excess of that payable to the Servicer
under the affected Purchase and Servicing Agreement.
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The Master Servicer shall pay the costs of such enforcement (including
the termination of a Servicer, the appointment of a successor servicer or the
transfer and assumption of the servicing by the Master Servicer) at its own
expense and shall be reimbursed therefor initially (i) by the terminated
Servicer, (ii) 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, (iii) from a specific recovery of costs, expenses
or attorney's fees against the party against whom such enforcement is
directed, or (iv) to the extent that such amounts described in (i)-(iii) above
are insufficient to reimburse the Master Servicer for such costs of
enforcement, from the Trust Fund, as provided in Section 9.04.
If the Master Servicer assumes the servicing with respect to any of the
Mortgage Loans, it will not assume liability for the representations and
warranties of any Servicer it replaces or for the errors or omissions of such
Servicer.
If the Seller is the owner of the servicing rights and the Seller
chooses to terminate that Servicer with or without cause and sell those
servicing rights to a successor servicer, then the Depositor shall (i) cause
the Seller to give reasonable prior written notice to the Master Servicer, and
(ii) obtain a letter from the Rating Agencies indicating that the appointment
of the proposed successor servicer will not result in a downgrade or
withdrawal of the rating of any of the Certificates, and a New Xxxxxx Mae- or
FHLMC-approved Person reasonably acceptable to the Master Servicer shall be
chosen by the Seller and appointed as successor servicer with the
acknowledgment of the Master Servicer and the Trustee; provided, however, that
the Seller shall not be required to get a no-downgrade letter from the Rating
Agencies if: (i) the Rating Agencies received prior written notice of the
transfer of the servicing rights and the name of the successor Servicer, (ii)
such successor Servicer has a servicing rating in the highest category of
Fitch or Xxxxx'x to the extent that Fitch or Xxxxx'x, respectively, is a
Rating Agency, and such successor Servicer has a servicer evaluation ranking
in one of the two highest categories of S&P to the extent that S&P is a Rating
Agency, and (iii) such successor Servicer shall service the related Mortgage
Loans under either the Purchase and Servicing Agreement together with the
related Assignment Agreement under which such Mortgage Loans are currently
being serviced or under another Servicing Agreement together with a related
Assignment Agreement that have already been reviewed and approved by the
Rating Agencies. The Depositor shall cause the costs of such transfer
including any costs of such transfer (including any costs of the Master
Servicer) to be borne by the Seller.
At least 15 calendar days prior to the effective date of such
termination, (x) the Depositor shall provide written notice to the Master
Servicer and all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement servicer.
(c) Upon any termination of a Servicer's rights and powers pursuant to
its Purchase and Servicing Agreement, the Master Servicer shall promptly
notify the Trustee and the Rating Agencies, specifying in such notice that the
Master Servicer or any successor servicer, as the case may be, has succeeded
such Servicer under the related Purchase and Servicing Agreement or under any
other servicing agreement reasonably satisfactory to the Master Servicer and
the Rating Agencies, which notice shall also specify the name and address of
any such successor servicer.
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(d) The Depositor shall not consent to the assignment by any Servicer of
such Servicer's rights and obligations under the related Purchase and
Servicing Agreement without the prior written consent of the Master Servicer,
which consent shall not be unreasonably withheld.
(e) The Trustee shall execute and deliver, at the written request of the
Master Servicer or any Servicer, and furnish to the Master Servicer and any
Servicer, at the expense of the requesting party, a power of attorney in the
standard form provided by the Trustee to take title to the Mortgaged
Properties after foreclosure in the name of and on behalf of the Trustee in
its capacity as Trustee hereunder and for the purposes described herein to the
extent necessary or desirable to enable the Master Servicer or any Servicer to
perform its respective duties. The Trustee shall not be liable for the actions
of the Master Servicer or any Servicer under such powers of attorney.
Section 9.02. Assumption of Master Servicing by Trustee.
(a) In the event the Master Servicer shall for any reason no longer be
the Master Servicer (including by reason of any Event of Default by the Master
Servicer under this Agreement), the Trustee shall thereupon assume all of the
rights and obligations of such Master Servicer hereunder and under each
Purchase and Servicing Agreement entered into with respect to the Mortgage
Loans or shall appoint or petition a court to appoint a Xxxxxx-Xxx or
FHLMC-approved servicer as successor servicer that is acceptable to the
Depositor and the Rating Agencies. The Trustee, as successor master servicer,
its designee or any successor master servicer appointed by the Trustee shall
be deemed to have assumed all of the Master Servicer's interest herein and
therein to the same extent as if such Purchase and Servicing Agreements had
been assigned to the assuming party, except that the Master Servicer shall not
thereby be relieved of any liability or obligations of the Master Servicer
under such Purchase and Servicing Agreement accruing prior to its replacement
as Master Servicer, and shall be liable to the Trustee, and hereby agrees to
indemnify and hold harmless the Trustee (in its individual corporate capacity
and as Trustee hereunder) from and against all costs, damages, expenses and
liabilities (including reasonable attorneys' fees) incurred by the Trustee as
a result of such liability or obligations of the Master Servicer and in
connection with the Trustee's assumption (but not its performance, except to
the extent that costs or liability of the Trustee are created or increased as
a result of negligent or wrongful acts or omissions of the Master Servicer
prior to its replacement as Master Servicer) of the Master Servicer's
obligations, duties or responsibilities thereunder. To the extent that the
costs and expenses of the Trustee described in this Section are not timely
reimbursed by the Master Servicer, the Trustee shall be entitled to
reimbursement from the Distribution Account and the Master Servicer is hereby
obligated to reimburse the Trust promptly for such amounts by deposit thereof
in the Distribution Account.
(b) The Master Servicer that has been terminated shall, upon request of
the Trustee but at the expense of such Master Servicer, deliver to the
assuming party all documents and records relating to each Purchase and
Servicing Agreement, this Agreement and the related Mortgage Loans and an
accounting of amounts collected and held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of each Purchase and
Servicing Agreement and this Agreement to the assuming party.
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Section 9.03. Representations and Warranties of the Master Servicer.
The Master Servicer hereby represents and warrants to the Depositor, the
Securities Administrator and the Trustee, for the benefit of the
Certificateholders, as of the Closing Date that:
(i) it is validly existing and in good standing under the laws of
the United States of America as a national banking association, and as
Master Servicer has full power and authority to transact any and all
business contemplated by this Agreement and to execute, deliver and
comply with its obligations under the terms of this Agreement, the
execution, delivery and performance of which have been duly authorized
by all necessary corporate action on the part of the Master Servicer;
(ii) the execution and delivery of this Agreement by the Master
Servicer and its performance and compliance with the terms of this
Agreement will not (A) violate the Master Servicer's charter or bylaws,
(B) violate any law or regulation or any administrative decree or order
to which it is subject or (C) constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a default)
under, or result in the breach of, any material contract, agreement or
other instrument to which the Master Servicer is a party or by which it
is bound or to which any of its assets are subject, which violation,
default or breach would materially and adversely affect the Master
Servicer's ability to perform its obligations under this Agreement;
(iii) this Agreement constitutes, assuming due authorization,
execution and delivery hereof by the other respective parties hereto, a
legal, valid and binding obligation of the Master Servicer, enforceable
against it in accordance with the terms hereof, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
in general, and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law);
(iv) the Master Servicer is not in default with respect to any
order or decree of any court or any order or regulation of any federal,
state, municipal or governmental agency to the extent that any such
default would materially and adversely affect its performance hereunder;
(v) the Master Servicer is not a party to or bound by any
agreement or instrument or subject to any charter provision, bylaw or
any other corporate restriction or any judgment, order, writ,
injunction, decree, law or regulation that may materially and adversely
affect its ability as Master Servicer to perform its obligations under
this Agreement or that requires the consent of any third person to the
execution of this Agreement or the performance by the Master Servicer of
its obligations under this Agreement;
(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;
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(vii) the Master Servicer, or an affiliate thereof the primary
business of which is the servicing of conventional residential mortgage
loans, is a Xxxxxx Mae- or FHLMC-approved seller/servicer;
(viii) no consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery
and performance by the Master Servicer of or compliance by the Master
Servicer with this Agreement or the consummation of the transactions
contemplated by this Agreement, except for such consents, approvals,
authorizations and orders (if any) as have been obtained; and
(ix) the consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Master Servicer.
It is understood and agreed that the representations and warranties set
forth in this Section shall survive the execution and delivery of this
Agreement. The Master Servicer shall indemnify the Depositor, the Securities
Administrator and the Trustee and hold them harmless against any loss,
damages, penalties, fines, forfeitures, legal fees and related costs,
judgments, and other costs and expenses resulting from any claim, demand,
defense or assertion based on or grounded upon, or resulting from, a material
breach of the Master Servicer's representations and warranties contained in
this Section 9.03. It is understood and agreed that the enforcement of the
obligation of the Master Servicer set forth in this Section to indemnify the
Depositor, the Securities Administrator and the Trustee as provided in this
Section constitutes the sole remedy (other than as set forth in Section 6.14)
of the Depositor, the Securities Administrator and the Trustee, respecting a
breach of the foregoing representations and warranties. Such indemnification
shall survive any termination of the Master Servicer as Master Servicer
hereunder, the resignation or removal of the Trustee and any termination of
this Agreement.
Any cause of action against the Master Servicer relating to or arising
out of the breach of any representations and warranties made in this Section
shall accrue upon discovery of such breach by either the Depositor, the Master
Servicer or the Trustee or notice thereof by any one of such parties to the
other parties.
Section 9.04. Compensation to the Master Servicer.
The Master Servicer shall be compensated for its duties hereunder
pursuant to Section 4.02(b) hereof. The Master Servicer shall either retain or
withdraw from the Distribution Account (i) amounts necessary to reimburse
itself for any previously unreimbursed Advances, Servicer Advances and
Nonrecoverable Advances with respect to the Mortgage Loans in accordance with
the definition of "Available Funds" and (ii) amounts representing assumption
fees, late payment charges or other ancillary income not included in the
definition of "Available Funds" and which are not required to be remitted by
the Servicers to the Securities Administrator or deposited by the Securities
Administrator into the Distribution Account and (iii) any amounts to which the
Master Servicer is entitled pursuant to 4.01(e) hereof. The Master Servicer
shall be required to pay all expenses incurred by it in connection with its
activities hereunder and shall not be entitled to reimbursement therefor
except as provided in this Agreement.
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In addition, the Master Servicer shall be entitled to reimbursement from
the Distribution Account for all reasonable expenses, disbursements and
advances incurred or made by the Master Servicer in connection with the
performance of its duties hereunder and under the Purchase and Servicing
Agreements, as modified by the Acknowledgements (including the reasonable
compensation and the expenses and disbursements of its agents and counsel), to
the extent not otherwise reimbursed pursuant to this Agreement, except any
such expense, disbursement or advance as may be attributable to its willful
misfeasance, bad faith or negligence.
The Master Servicer and any director, officer, employee or agent of the
Master Servicer shall be indemnified by the Trust and held harmless thereby
against any loss, liability or expense (including reasonable legal fees and
disbursements of counsel) incurred on their part that may be sustained in
connection with, arising out of, or related to, any claim or legal action
(including any pending or threatened claim or legal action) relating to this
Agreement, the Purchase and Servicing Agreements or the Certificates, other
than any loss, liability or expense resulting from the Master Servicer's
failure to perform its duties hereunder or thereunder or incurred by reason of
the Master Servicer's negligence, willful misfeasance or bad faith.
Section 9.05. Merger or Consolidation.
Any Person into which the Master Servicer may be merged or consolidated,
or any Person resulting from any merger, conversion, other change in form or
consolidation to which the Master Servicer shall be a party, or any Person
succeeding to the business of the Master Servicer shall be the successor to
the Master Servicer hereunder, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to
the contrary notwithstanding; provided, however, that the successor or
resulting Person to the Master Servicer shall be a Person that shall be
qualified and approved to service mortgage loans for Xxxxxx Xxx or FHLMC and
shall have a net worth of not less than $15,000,000.
As a condition to the effectiveness of any merger or consolidation, at
least 15 calendar days prior to the effective date of any merger or
consolidation of the Master Servicer, the Master Servicer shall provide (x)
written notice to the Depositor of any successor pursuant to this Section and
(y) in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement Master Servicer.
Section 9.06. Resignation of Master Servicer and Securities
Administrator.
Except as otherwise provided in Sections 9.05, 9.07 and 9.10 hereof,
neither the Master Servicer nor the Securities Administrator shall resign from
the obligations and duties hereby imposed on it unless the duties of the
Master Servicer or the Securities Administrator, as applicable, hereunder are
no longer permissible under applicable law or are in material conflict by
reason of applicable law with any other activities carried on by it and cannot
be cured. Any such determination permitting the resignation of the Master
Servicer or the Securities Administrator shall be evidenced by an Opinion of
Counsel that shall be Independent to such effect delivered to the Trustee. No
resignation of the Master Servicer or the Securities Administrator shall
become effective until the Trustee shall have assumed, or a successor master
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servicer or successor securities administrator, as applicable, shall have been
appointed pursuant to Section 6.07 or 9.02, as applicable, and until such
successor shall have assumed, such Master Servicer's or Securities
Administrator's responsibilities and obligations under this Agreement. Notice
of any such resignation shall be given promptly by the Master Servicer or the
Securities Administrator, as applicable, to the Depositor and the Trustee.
If, at any time, the Master Servicer resigns under this Section 9.06, or
transfers or assigns its rights and obligations under Section 9.07, or is
removed as Master Servicer pursuant to Section 6.14, then at such time Xxxxx
Fargo Bank, National Association (or any successor thereto) also shall resign
or be removed, as applicable, as Securities Administrator, Auction
Administrator, Paying Agent, Authenticating Agent and Certificate Registrar
under this Agreement. In such event, the obligations of the Master Servicer
and the Securities Administrator shall be assumed by the Trustee as successor
or by such other successor master servicer and/or securities administrator, as
applicable, appointed by the Trustee (subject to the provisions of Sections
6.07 and 9.02(a)).
As a condition to the effectiveness of any such resignation, at least 15
calendar days prior to the effective date of such resignation, the Master
Servicer shall provide (x) written notice to the Depositor of any successor
pursuant to this Section and (y) in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K with respect to the resignation of the Master Servicer.
Section 9.07. Assignment or Delegation of Duties by the Master Servicer
and Securities Administrator.
Except as expressly provided herein, neither the Master Servicer nor the
Securities Administrator shall assign or transfer any of their respective
rights, benefits or privileges hereunder to any other Person, or delegate to
or subcontract with, or authorize or appoint any other Person to perform any
of the respective duties, covenants or obligations to be performed by the
Master Servicer or Securities Administrator, as applicable, hereunder;
provided, however, that the Master Servicer and the Securities Administrator
shall each have the right with the prior written consent of the Trustee and
the Depositor (which consent shall not be unreasonably withheld), and upon
delivery to the Trustee and the Depositor of a letter from each Rating Agency
to the effect that such action shall not result in a downgrading of the
Certificates, to delegate or assign to or subcontract with or authorize or
appoint any qualified Person to perform and carry out any of the respective
duties, covenants or obligations to be performed and carried out by the Master
Servicer or the Securities Administrator, as applicable, hereunder. Notice of
such permitted assignment shall be given promptly by the Master Servicer or
the Securities Administrator, as applicable, to the Depositor and the Trustee.
If, pursuant to any provision hereof, the respective duties of the Master
Servicer or the Securities Administrator are transferred to a successor master
servicer or successor securities administrator, as applicable, the entire
amount of the compensation payable to the Master Servicer or Securities
Administrator pursuant hereto shall thereafter be payable to such successor
master servicer or successor securities administrator. Such successor Master
Servicer shall also pay the fees of the Trustee, as provided herein.
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Section 9.08. Limitation on Liability of the Master Servicer and Others.
(a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Trustee or the Certificateholders for any action taken or for refraining from
the taking of any action in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect
the Master Servicer or any such person against any liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
in its performance of its duties or by reason of reckless disregard for its
obligations and duties under this Agreement. The Master Servicer and any
director, officer, employee or agent of 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 Master Servicer
shall be under no obligation to appear in, prosecute or defend any legal
action that is not incidental to its duties to master service the Mortgage
Loans in accordance with this Agreement and that in its opinion may involve it
in any expenses or liability; provided, however, that the Master Servicer may
in its sole discretion undertake any such action that it may deem necessary or
desirable in 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 shall be expenses, costs and liabilities of the Trust Fund and the
Master Servicer shall be entitled to be reimbursed therefor out of the
Distribution Account.
The Master Servicer shall not be liable for any acts or omissions of the
Servicers except to the extent that damages or expenses are incurred as a
result of such act or omissions and such damages and expenses would not have
been incurred but for the negligence, willful misfeasance, bad faith or
recklessness of the Master Servicer in supervising, monitoring and overseeing
the obligations of the Servicers in this Agreement and the Purchase and
Servicing Agreements.
Section 9.09. Indemnification; Third-Party Claims.
The Master Servicer agrees to indemnify the Depositor, the Securities
Administrator and the Trustee, and hold them harmless against any and all
claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, liability, fees and expenses that the
Depositor, the Securities Administrator or the Trustee may sustain as a result
of the Master Servicer's willful misfeasance, bad faith or negligence in the
performance of its duties hereunder or by reason of its reckless disregard for
its obligations and duties under this Agreement, the Acknowledgements and the
related Purchase and Servicing Agreements. The Depositor, the Securities
Administrator and the Trustee shall immediately notify the Master Servicer if
a claim is made by a third party with respect to this Agreement or the
Mortgage Loans entitling the Depositor, the Securities Administrator or the
Trustee to indemnification under this Section 9.09, whereupon the Master
Servicer shall assume the defense of any such claim and pay all expenses in
connection therewith, including counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or them in
respect of such claim.
Section 9.10. Eligibility Requirements for Securities Administrator.
The Securities Administrator hereunder shall at all times be a
corporation or association organized and doing business under the laws the
United States of America or any state thereof,
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authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $50,000,000, subject to supervision
or examination by federal or state authority and with a credit rating of at
least investment grade or at least "A/F1" by Fitch if Fitch is a Rating
Agency. If such corporation or association publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section 9.10
the combined capital and surplus of such corporation or association 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 Securities
Administrator shall cease to be eligible in accordance with the provisions of
this Section 9.10, the Securities Administrator shall resign immediately in
the manner and with the effect specified in Section 6.06 hereof. The entity
serving as Securities Administrator may have normal banking and trust
relationships with the Depositor, the Seller, the Master Servicer, any
Custodian or the Trustee and their respective affiliates.
The Securities Administrator (i) may not be an Originator, Master
Servicer, Servicer, the Depositor or an affiliate of the Depositor unless the
Securities Administrator is in an institutional trust department, (ii) must be
authorized to exercise corporate trust powers under the laws of its
jurisdiction of organization, and (iii) must be rated at least "A/F1" by
Fitch, if Fitch is a Rating Agency, or the equivalent rating by S&P or Xxxxx'x
(or such rating acceptable to Fitch pursuant to a written confirmation). If at
any time the Securities Administrator shall cease to be eligible in accordance
with the provisions of this Section 9.10, the Securities Administrator shall
resign in the manner and with the effect specified in Section 6.06 hereof. If
no successor Securities Administrator shall have been appointed and shall have
accepted appointment within 60 days after the Securities Administrator ceases
to be the Securities Administrator pursuant to this Section 9.10, then the
Trustee shall become the successor Securities Administrator and shall, in
accordance with Article VI hereof and in such capacity, perform the duties of
the Securities Administrator pursuant to this Agreement. The Trustee shall
notify the Rating Agencies of any change of Securities Administrator.
Section 9.11. Annual Statement as to Compliance.
The Master Servicer and the Securities Administrator shall deliver (and
the Master Servicer and Securities Administrator shall cause any Additional
Servicer engaged by it to deliver) or otherwise make available to the
Depositor and the Securities Administrator on or before March 15 of each year,
commencing in March 2007, an Officer's Certificate stating, as to the signer
thereof, that (A) a review of such party's activities during the preceding
calendar year or portion thereof and of such party's performance under this
Agreement, or such other applicable agreement in the case of an Additional
Servicer, has been made under such officer's supervision, (B) to the best of
such officer's knowledge, based on such review, such party has fulfilled all
its obligations under this Agreement, or such other applicable agreement in
the case of an Additional Servicer, in all material respects throughout such
year or portion thereof, or, if there has been a failure to fulfill any such
obligation in any material respect, specifying each such failure known to such
officer and the nature and status thereof and (C) in the case of the Master
Servicer, to the best of such officer's knowledge, each Servicer has fulfilled
all its obligations under its Servicing Agreement in all material respects
throughout such year, or, if there has been a failure to fulfill any such
obligation in any material respect specifying each such failure known to such
officer and the nature and status thereof.
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The Master Servicer shall enforce any obligation of the Servicers, to
the extent set forth in the related Servicing Agreement, to deliver to the
Master Servicer and to the Depositor an annual statement of compliance and all
reports and other information required from the Servicers under Reg AB within
the time frame set forth in, and in such form and substance as may be required
pursuant to, the related Servicing Agreement The Master Servicer shall include
such annual statements of compliance with its own annual statement of
compliance to be submitted to the Securities Administrator pursuant to this
Section.
ARTICLE X
REMIC ADMINISTRATION
Section 10.01. REMIC Administration.
(a) REMIC elections as set forth in the Preliminary Statement shall be
made on Forms 1066 or other appropriate federal tax or information return for
the taxable year ending on the last day of the calendar year in which the
Certificates are issued. The regular interests and residual interest in each
REMIC shall be as designated in the Preliminary Statement.
(b) The Closing Date is hereby designated as the "Startup Day" of each
REMIC within the meaning of section 860G(a)(9) of the Code. The latest
possible maturity date for purposes of Treasury Regulation 1.860G-1(a)(4) will
be the Latest Possible Maturity Date.
(c) The Securities Administrator shall represent the Trust Fund in any
administrative or judicial proceeding relating to an examination or audit by
any governmental taxing authority with respect thereto. The Securities
Administrator shall pay any and all tax related expenses (not including taxes)
of each REMIC, including but not limited to any professional fees or expenses
related to audits or any administrative or judicial proceedings with respect
to such REMIC that involve the Internal Revenue Service or state tax
authorities, but only to the extent that (i) such expenses are ordinary or
routine expenses, including expenses of a routine audit but not expenses of
litigation (except as described in (ii)); or (ii) such expenses or liabilities
(including taxes and penalties) are attributable to the negligence or willful
misconduct of the Securities Administrator in fulfilling its duties hereunder
(including its duties as tax return preparer). The Securities Administrator
shall be entitled to reimbursement of expenses to the extent provided in
clause (i) above from the Distribution Account, provided, however, the
Securities Administrator shall not be entitled to reimbursement for expenses
incurred in connection with the preparation of tax returns and other reports
as required by Section 6.20 and this Section.
(d) The Securities Administrator shall prepare, the Trustee shall sign
and the Securities Administrator shall file all of each REMIC's federal and
appropriate state tax and information returns as such REMIC's direct
representative. The expenses of preparing and filing such returns shall be
borne by the Securities Administrator. In preparing such returns, the
Securities Administrator shall, with respect to each REMIC other than the
Master REMIC: (i) treat the accrual period for interests in such REMIC as the
calendar month; (ii) account for distributions made from each REMIC other than
the Master REMIC as made on the first day of each succeeding calendar month;
(iii) account for income under the all-OID method at the
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weighted average of the Net Mortgage Rates; (iv) use the aggregation method
provided in Treasury Regulation section 1.1275-2(c); and (v) account for
income and expenses related to each REMIC other than the Master REMIC in the
manner resulting in the lowest amount of excess inclusion income possible
accruing to the Holder of the residual interest in each such REMIC.
(e) The Securities Administrator or its designee shall perform on behalf
of each REMIC all reporting and other tax compliance duties that are the
responsibility of such REMIC under the Code, the REMIC Provisions, or other
compliance guidance issued by the Internal Revenue Service or any state or
local taxing authority. Among its other duties, if required by the Code, the
REMIC Provisions, or other such guidance, the Securities Administrator shall
provide, upon receipt of additional reasonable compensation, (i) to the
Treasury or other governmental authority such information as is necessary for
the application of any tax relating to the transfer of a Residual Certificate
to any disqualified person or organization pursuant to Treasury Regulation
1.860E-2(a)(5) and any person designated in Section 860E(e)(3) of the Code and
(ii) to the Certificateholders and the Trustee such information or reports as
are required by the Code or REMIC Provisions.
(f) To the extent within their control, the Trustee, the Securities
Administrator, the Master Servicer and the Holders of Certificates shall take
any action or cause any REMIC to take any action necessary to maintain the
status of any REMIC as a REMIC under the REMIC Provisions and shall assist
each other as necessary to create or maintain such status. None of the
Trustee, the Securities Administrator, the Master Servicer, nor the Holder of
any Residual Certificate shall knowingly take any action, cause any REMIC to
take any action or fail to take (or fail to cause to be taken) any action
that, under the REMIC Provisions, if taken or not taken, as the case may be,
could result in an Adverse REMIC Event unless the Trustee, the Securities
Administrator and the Master Servicer have received an Opinion of Counsel (at
the expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such status or result in the imposition
of such a tax. In addition, prior to taking any action with respect to any
REMIC or the assets therein, or causing any REMIC to take any action, which is
not expressly permitted under the terms of this Agreement, any Holder of a
Residual Certificate will consult with the Trustee, the Securities
Administrator, the Master Servicer or their respective designees, in writing,
with respect to whether such action could cause an Adverse REMIC Event to
occur with respect to any REMIC, and no such Person shall take any such action
or cause any REMIC to take any such action as to which the Trustee, the
Securities Administrator or the Master Servicer has advised it in writing that
an Adverse REMIC Event could occur; provided, however, that if no Adverse
REMIC Event would occur but such action could result in the imposition of
additional taxes on the Residual Certificateholders, no such Person shall take
any such action, or cause any REMIC to take any such action without the
written consent of the Residual Certificateholders.
(g) Each Holder of a Residual Certificate shall pay when due any and all
taxes imposed on the related REMIC by federal or state governmental
authorities. To the extent that such taxes are not paid by a Residual
Certificateholder, the Paying Agent shall pay any remaining REMIC taxes out of
current or future amounts otherwise distributable to the Holder of the
Residual Certificate in any such REMIC or, if no such amounts are available,
(A) out of other amounts held in the Distribution Account, and shall reduce
amounts otherwise payable to holders
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of regular interests in any such REMIC or (B) to the extent that any such
taxes are imposed on the REMIC as a result of the breach of any
representation, warranty or covenant of the Master Servicer, the Securities
Administrator or any Servicer, then the Master Servicer, the Securities
Administrator, or that Servicer, as applicable, shall pay when due any and all
such taxes.
(h) The Securities Administrator shall, for federal income tax purposes,
maintain books and records with respect to each REMIC on a calendar year and
on an accrual basis.
(i) No additional contributions of assets shall be made to any REMIC,
except as expressly provided in this Agreement.
(j) Neither the Securities Administrator nor the Master Servicer shall
enter into any arrangement by which any REMIC will receive a fee or other
compensation for services.
(k) [Reserved].
(l) The Class A-R Holder shall act as "tax matters person" with respect
to each REMIC created hereunder and the Securities Administrator shall act as
agent for the Class A-R Holder in such roles, unless and until another party
is so designated by the Class A-R Holder.
(m) The Securities Administrator, on behalf of the Trustee, shall treat
the rights of the holders of the Group 1 Certificates to receive Basis Risk
Carry Forward Amounts from amounts on deposit in the Group 1 Reserve Fund as
rights in an interest rate cap contract written by the Holders of the Class OC
Certificates in favor of the Holders of the Group 1 Certificates. Thus, the
Group 1 Certificates shall be treated as representing ownership of not only a
Master REMIC regular interest, but also ownership of an interest in an
interest rate cap contract. For purposes of determining the issue price of the
Master REMIC regular interest, the Securities Administrator, on behalf of the
Trustee, shall assume that this interest rate cap contract has a value of
$5,000.
(n) [Reserved].
(o) [Reserved].
Section 10.02. Prohibited Transactions and Activities.
Neither the Depositor, the Master Servicer nor the Trustee shall sell,
dispose of, or substitute for any of the Mortgage Loans, except in a
disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii) the
bankruptcy of the Trust Fund, (iii) the termination of each REMIC pursuant to
Article VII of this Agreement, (iv) a substitution pursuant to Article II of
this Agreement or (v) a repurchase of Mortgage Loans pursuant to Article II of
this Agreement, nor acquire any assets for any REMIC, nor sell or dispose of
any investments in the Distribution Account for gain, nor accept any
contributions to any REMIC after the Closing Date, unless it has received an
Opinion of Counsel (at the expense of the party causing such sale,
disposition, substitution or acceptance) that such disposition, acquisition,
substitution, or acceptance will not result in an Adverse REMIC Event, (b)
affect the distribution of interest or principal on the Certificates or (c)
result in the encumbrance of the assets transferred or assigned to the Trust
Fund (except pursuant to the provisions of this Agreement).
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The Master Servicer with respect to the Mortgage Loans shall not consent
to any modification of any such Mortgage Loan for which the consent of the
Master Servicer is required under the applicable Purchase and Servicing
Agreement under which such Mortgage Loan is serviced, that would (i) increase
the interest rate in respect of such Mortgage, defer for a period in excess of
six months or forgive the payment of any principal or interest, reduce the
outstanding principal amount (except for actual payments of principal),
increase the Servicing Fee on such Mortgage Loan or extend the final maturity
date on such Mortgage Loan, or (ii) result in a substitution or release of
collateral or in the provision of additional collateral for the Mortgage Loan,
unless the applicable Mortgage Loan is in default or default is reasonably
foreseeable in respect of such Mortgage Loan, or the Master Servicer has
received an Opinion of Counsel (at the expense of the party requesting consent
for such modification) that such modification will not result in an Adverse
REMIC Event.
Section 10.03. Indemnification with Respect to Prohibited Transactions
or Loss of REMIC Status.
Upon the occurrence of an Adverse REMIC Event due to the negligent
performance by the Securities Administrator of its duties and obligations set
forth herein, the Securities Administrator shall indemnify the
Certificateholders of the related Residual Certificate against any and all
losses, claims, damages, liabilities or expenses ("Losses") resulting from
such negligence; provided, however, that the Securities Administrator shall
not be liable for any such Losses attributable to the action or inaction of
the Depositor, the Trustee or the Holder of the Residual Certificate, nor for
any such Losses resulting from misinformation provided by any of the foregoing
parties on which the Securities Administrator has relied. Notwithstanding the
foregoing, however, in no event shall the Securities Administrator have any
liability (1) for any action or omission that is taken in accordance with and
in compliance with the express terms of, or which is expressly permitted by
the terms of, this Agreement or under any Purchase and Servicing Agreements or
under any Acknowledgement, (2) for any Losses other than arising out of
malfeasance, willful misconduct or negligent performance by the Service
Administrator of its duties and obligations set forth herein, and (3) for any
special or consequential damages to Certificateholders of the related Residual
Certificate (in addition to payment of principal and interest on the
Certificates).
Section 10.04. REO Property.
(a) Notwithstanding any other provision of this Agreement, the Master
Servicer, acting on behalf of the Trustee hereunder, shall not, except to the
extent provided in the applicable Purchase and Servicing Agreement, knowingly
permit any Servicer to, rent, lease, or otherwise earn income on behalf of any
REMIC with respect to any REO Property which might cause an Adverse REMIC
Event unless the applicable Servicer has provided to the Trustee and the
Securities Administrator an Opinion of Counsel concluding that, under the
REMIC Provisions, such action would not adversely affect the status of any
REMIC as a REMIC and any income generated for any REMIC by the REO Property
would not result in an Adverse REMIC Event.
(b) The Depositor shall cause the applicable Servicer (to the extent
provided in its Purchase and Servicing Agreement) to make reasonable efforts
to sell any REO Property for its
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fair market value. In any event, however, the Depositor shall, or shall cause
the applicable Servicer (to the extent provided in its Purchase and Servicing
Agreement) to, dispose of any REO Property within three years of its
acquisition by the Trust Fund unless the Depositor or the applicable Servicer
(on behalf of the Trust Fund) has received a grant of extension from the
Internal Revenue Service to the effect that, under the REMIC Provisions and
any relevant proposed legislation and under applicable state law, the REMIC
may hold REO Property for a longer period without causing an Adverse REMIC
Event. If such an extension has been received, then the Depositor, acting on
behalf of the Trustee hereunder, shall, or shall cause the applicable Servicer
to, continue to attempt to sell the REO Property for its fair market value for
such period longer than three years as such extension permits (the "Extended
Period"). If such an extension has not been received and the Depositor or the
applicable Servicer, acting on behalf of the Trust Fund hereunder, is unable
to sell the REO Property within 33 months after its acquisition by the Trust
Fund or if such an extension, has been received and the Depositor or the
applicable Servicer is unable to sell the REO Property within the period
ending three months before the close of the Extended Period, the Depositor
shall cause the applicable Servicer, before the end of the three year period
or the Extended Period, as applicable, to (i) purchase such REO Property at a
price equal to the REO Property's fair market value or (ii) auction the REO
Property to the highest bidder (which may be the applicable Servicer) in an
auction reasonably designed to produce a fair price prior to the expiration of
the three-year period or the Extended Period, as the case may be.
Section 10.05. Fidelity.
The Master Servicer, at its expense, shall maintain in effect a blanket
fidelity bond and an errors and omissions insurance policy, affording coverage
with respect to all directors, officers, employees and other Persons acting on
such Master Servicer's behalf, and covering errors and omissions in the
performance of the Master Servicer's obligations hereunder. The errors and
omissions insurance policy and the fidelity bond shall be in such form and
amount generally acceptable for entities serving as master servicers and
trustees.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Binding Nature of Agreement; Assignment.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
Section 11.02. Entire Agreement.
This Agreement contains the entire agreement and understanding among the
parties hereto with respect to the subject matter hereof, and supersedes all
prior and contemporaneous agreements, understandings, inducements and
conditions, express or implied, oral or written, of any nature whatsoever with
respect to the subject matter hereof. The express terms hereof control and
supersede any course of performance and/or usage of the trade inconsistent
with any of the terms hereof.
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Section 11.03. Amendment.
(a) This Agreement (other than the provisions of Article XII hereof) may
be amended from time to time by the Depositor, the Master Servicer, the
Securities Administrator, and the Trustee, without notice to or the consent of
any of the Holders, (i) to cure any ambiguity or mistake, (ii) to cause the
provisions herein to conform to or be consistent with or in furtherance of the
statements made with respect to the Certificates, the Trust Fund or this
Agreement in any Offering Document, or to correct or supplement any provision
herein which may be inconsistent with any other provisions herein or with the
provisions of any Purchase and Servicing Agreement, (iii) to make any other
provisions with respect to matters or questions arising under this Agreement
or (iv) to add, delete, or amend any provisions to the extent necessary or
desirable to comply with any requirements imposed by the Code and the REMIC
Provisions. No such amendment effected pursuant to the preceding sentence
shall, as evidenced by an Opinion of Counsel, result in an Adverse REMIC
Event, nor shall such amendment effected pursuant to clause (iii) of such
sentence adversely affect in any material respect the interests of any Holder.
Prior to entering into any amendment without the consent of Holders pursuant
to this paragraph, the Trustee shall be provided with an Opinion of Counsel
(at the expense of the party requesting such amendment) to the effect that
such amendment is permitted under this Section. Any such amendment shall be
deemed not to adversely affect in any material respect any Holder, if the
Trustee receives written confirmation from each Rating Agency that such
amendment will not cause such Rating Agency to reduce the then current rating
assigned to the Certificates.
(b) This Agreement (other than the provisions of Article XII hereof) may
also be amended from time to time by the Depositor, the Master Servicer, the
Securities Administrator and the Trustee, with the consent of the Holders of
not less than 66-2/3% of the Class Principal Balance (or Percentage Interest)
of each Class of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or of modifying in any manner the rights of the Holders;
provided, however, that no such amendment shall be made unless the Trustee
receives an Opinion of Counsel, at the expense of the party requesting the
change, that such change will not cause an Adverse REMIC Event; and provided
further, that no such amendment may (i) reduce in any manner the amount of, or
delay the timing of, payments received on Mortgage Loans which are required to
be distributed on any Certificate, without the consent of the Holder of such
Certificate or (ii) reduce the aforesaid percentages of Class Principal
Balance or Class Notional Amount (or Percentage Interest) of Certificates of
each Class, the Holders of which are required to consent to any such amendment
without the consent of the Holders of 100% of the Class Principal Balance or
Class Notional Amount (or Percentage Interest) of each Class of Certificates
affected thereby. For purposes of this paragraph, references to "Holder" or
"Holders" shall be deemed to include, in the case of any Class of Book-Entry
Certificates, the related Certificate Owners.
(c) In the event the parties to this Agreement desire to further clarify
or amend any provision of Article XII hereof, this Agreement shall be amended
to reflect the new agreement between the parties covering matters in Article
XII, which amendment shall not require any Opinion of Counsel or Rating Agency
confirmations or the consent of any Certificateholder.
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(d) Promptly after the execution of any such amendment, the Securities
Administrator shall furnish written notification of the substance of such
amendment to each Holder, the Depositor and the Rating Agencies.
(e) It shall not be necessary for the consent of Holders under this
Section 11.03 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Holders shall be subject to such reasonable regulations
as the Trustee may prescribe.
Section 11.04. Voting Rights.
Except to the extent that the consent of all affected Certificateholders
is required pursuant to this Agreement, with respect to any provision of this
Agreement requiring the consent of Certificateholders representing specified
percentages of aggregate outstanding Certificate Balance or Class Notional
Amount (or Percentage Interest), Certificates owned by the Depositor, the
Master Servicer, the Securities Administrator, the Trustee, any Servicer or
any Affiliates thereof are not to be counted so long as such Certificates are
owned by the Depositor, the Master Servicer, the Securities Administrator, the
Trustee, any Servicer or any Affiliate thereof.
Section 11.05. Provision of Information.
(a) For so long as any of the Certificates of any Class are "restricted
securities" within the meaning of Rule 144(a)(3) under the Act, each of the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
(upon instruction from the Depositor) agree to cooperate with each other to
provide to any Certificateholders and to any prospective purchaser of
Certificates designated by such holder, upon the request of such holder or
prospective purchaser, any information required to be provided to such holder
or prospective purchaser to satisfy the condition set forth in Rule 144A(d)(4)
under the Act. Any reasonable, out-of-pocket expenses incurred by the Trustee,
the Master Servicer or the Securities Administrator in providing such
information shall be reimbursed by the Depositor.
(b) The Securities Administrator shall provide to any person to whom a
Prospectus was delivered, upon the request of such person specifying the
document or documents requested, a copy (excluding exhibits) of any report on
Form 8-K or Form 10-K filed with the Securities and Exchange Commission
pursuant to Section 6.20(b). Any reasonable out-of-pocket expenses incurred by
the Securities Administrator in providing copies of such documents shall be
reimbursed by the Depositor.
Section 11.06. Governing Law.
(a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK (OTHER THAN SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW).
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Section 11.07. Notices.
All requests, demands, notices, authorizations, directions, consents,
waivers and communications hereunder shall be in writing and shall be deemed
to have been duly given when received by (a) in the case of the Depositor,
Xxxxxx Xxxxxxx Capital I Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
telephone number (000) 000-0000, Attention: Xxxxxx Xxxxxxx Mortgage Loan Trust
2006-11, (b) in the case of the Seller, Xxxxxx Xxxxxxx Mortgage Capital Inc.,
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx
Xxxxxxx Mortgage Loan Trust 2006-11, (c) in the case of the Master Servicer or
the Securities Administrator, Xxxxx Fargo Bank, National Association, X.X. Xxx
00, Xxxxxxxx, Xxxxxxxx 00000 (or, for overnight deliveries, 0000 Xxx Xxxxxxxxx
Xxxx, Xxxxxxxx, Xxxxxxxx 00000), telecopy number (000) 000-0000, Attention:
Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-11, (d) with respect to the Trustee or
the Certificate Registrar, its respective Corporate Trust Office and (e) in
the case of the Rating Agencies, the address specified therefor in the
definition corresponding to the name of such Rating Agency, or as to each
party such other address as may hereafter be furnished by such party to the
other parties in writing. All demands, notices and communications to a party
hereunder shall be in writing and shall be deemed to have been duly given when
delivered to such party at the relevant address, facsimile number or
electronic mail address set forth above or at such other address, facsimile
number or electronic mail address as such party may designate from time to
time by written notice in accordance with this Section 11.07.
Section 11.08. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.09. Indulgences; No Waivers.
Neither the failure nor any delay on the part of a party to exercise any
right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy,
power or privilege preclude any other or further exercise of the same or of
any other right, remedy, power or privilege, nor shall any waiver of any
right, remedy, power or privilege with respect to any occurrence be construed
as a waiver of such right, remedy, power or privilege with respect to any
other occurrence. No waiver shall be effective unless it is in writing and is
signed by the party asserted to have granted such waiver.
Section 11.10. Headings Not To Affect Interpretation.
The headings contained in this Agreement are for convenience of
reference only, and they shall not be used in the interpretation hereof.
Section 11.11. Benefits of Agreement.
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Nothing in this Agreement or in the Certificates, express or implied,
shall give to any Person, other than the parties to this Agreement and their
successors hereunder and the Holders of the Certificates, any benefit or any
legal or equitable right, power, remedy or claim under this Agreement, except
to the extent specified in Section 11.15.
Section 11.12. Special Notices to the Rating Agencies.
(a) The Depositor shall give prompt notice to the Rating Agencies of the
occurrence of any of the following events of which it has notice:
(i) any amendment to this Agreement pursuant to Section 11.03;
(ii) any assignment by the Master Servicer of its rights hereunder
or delegation of its duties hereunder;
(iii) the occurrence of any Event of Default described in Section
6.14;
(iv) any notice of termination given to the Master Servicer
pursuant to Section 6.14 and any resignation of the Master Servicer
hereunder;
(v) the appointment of any successor to any Master Servicer
pursuant to Section 6.14;
(vi) the making of a final payment pursuant to Section 7.02; and
(vii) any termination of the rights and obligations of any
Servicer under the applicable Purchase and Servicing Agreement.
(b) All notices to the Rating Agencies provided for this Section shall
be in writing and sent by first class mail, telecopy or overnight courier, to
the address specified therefor in the definition corresponding to the name of
such Rating Agency.
(c) The Securities Administrator shall provide or make available to the
Rating Agencies reports prepared pursuant to Section 4.05. In addition, the
Securities Administrator shall, at the expense of the Trust Fund, make
available to each Rating Agency such information as such Rating Agency may
reasonably request regarding the Certificates or the Trust Fund, to the extent
that such information is reasonably available to the Securities Administrator.
(d) The Depositor hereby represents to S&P that, to the Depositor's
knowledge, the information provided to such Rating Agency, including the loan
level detail, is true and correct according to such Rating Agency's
requirements.
Section 11.13. Conflicts.
To the extent that the terms of this Agreement conflict with the terms
of any Purchase and Servicing Agreement, the related Purchase and Servicing
Agreement shall govern.
Section 11.14. Counterparts.
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This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, and all of which together shall
constitute one and the same instrument.
Section 11.15. No Petitions.
The Trustee and the Master Servicer (not in its individual corporate
capacity, but solely as Master Servicer hereunder), by entering into this
Agreement, hereby covenant and agree that they shall not at any time institute
against the Depositor, or join in any institution against the Depositor of,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations relating to this
Agreement or any of the documents entered into by the Depositor in connection
with the transactions contemplated by this Agreement, except that the Trustee
shall not be prohibited from filing a proof of claim in any such proceeding.
Section 11.16. Indemnification by Trust.
Pursuant to the Purchase and Servicing Agreements, each of the
Originators and Servicers shall be indemnified by the Trust to the extent
specified in the related Purchase and Servicing Agreement.
Pursuant to the Custodial Agreements, each of the Custodians shall be
indemnified by the Trust to the extent specified in the related Custodial
Agreement.
ARTICLE XII
EXCHANGE ACT REPORTING
Section 12.01. Filing Obligations.
(a) The Master Servicer, the Securities Administrator, the Trustee and
each Custodian shall reasonably cooperate with the Depositor in connection
with the satisfaction of the Depositor's reporting requirements under the
Exchange Act with respect to the Trust Fund. In addition to the information
specified below, if so requested by the Depositor for the purpose of
satisfying its reporting obligation under the Exchange Act, the Master
Servicer, the Securities Administrator, the Trustee and each Custodian shall
(and the Master Servicer shall cause each Servicer, to the extent required by
the related Servicing Agreement, to) provide the Depositor with (a) such
information which is available to such Person without unreasonable effort or
expense and within such timeframe as may be reasonably requested by the
Depositor to comply with the Depositor's reporting obligations under the
Exchange Act and (b) to the extent such Person is a party (and the Depositor
is not a party) to any agreement or amendment required to be filed, copies of
such agreement or amendment in XXXXX-compatible form. Each of the Master
Servicer (and the Master Servicer shall cause any Servicer to notify promptly,
to the extent required by the related Servicing Agreement), the Securities
Administrator, each Custodian and the Trustee shall promptly notify the
Depositor and the Master Servicer (if the notifying party is not the Master
Servicer), but in no event later than two (2) Business Days after its
occurrence, of any Reportable Event either (i) with respect to itself or any
Affiliate of it or (ii) with respect to any Reporting Party, to the extent
that it has received notice thereof.
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(b) On or prior to January 30 of the first year in which the Securities
Administrator is able to do so under applicable law, the Securities
Administrator shall prepare and file a Form 15 relating to the automatic
suspension of reporting in respect of the Trust under the Exchange Act.
(c) In the event that the Securities Administrator is unable to file
timely with the Commission all or any required portion of any Form 8-K, Form
10-D or Form 10-K required to be filed by this Agreement because required
disclosure information was either not delivered to it or delivered to it after
the delivery deadlines set forth in this Agreement or for any other reason,
the Securities Administrator will immediately notify the Depositor. In the
case of Form 10-D and Form 10-K, the parties to this Agreement will (and the
Master Servicer shall cause each Servicer to cooperate) prepare and file a
Form 12b-25 and a Form 10-DA and Form 10-KA as applicable, pursuant to Rule
12b-25 of the Exchange Act. In the case of Form 8-K, the Securities
Administrator will, upon receipt of all required Form 8-K Disclosure
Information shall include such disclosure information in the next Form 10-D
unless directed by the Depositor to file a Form 8-K with such Form 8-K
Disclosure Information. In the event that any previously filed Form 8-K, Form
10-D or Form 10-K needs to be amended, and such amendment includes any
Additional Form 10-D Disclosure, any Additional Form 10-K Disclosure or any
Form 8-K Disclosure Information or an amendment to any such disclosure, the
Securities Administrator will notify the Depositor and each Servicer affected
by such amendment (unless such amendment is solely for the purpose of
restating the monthly statement referred to in Section 4.05 hereof) and such
parties will cooperate to prepare any necessary Form 8-KA, Form 10-DA or Form
10-KA. Any Form 15, Form 12b-25 or any amendment to a Form 8-K or a Form 10-D
shall be signed by a duly authorized representative of the Master Servicer.
Any amendment to a Form 10-K shall be signed by a senior officer of the Master
Servicer in charge of the master servicing function. The parties to this
Agreement acknowledge that the performance by the Master Servicer and the
Securities Administrator of its duties under this Article XII related to the
timely preparation and filing of a Form 15, Form 12b-25 or any amendment to a
Form 8-K, Form 10-D or Form 10-K is contingent upon each such party performing
its duties under this Section. Neither the Master Servicer nor the Securities
Administrator shall have any liability for any loss, expense, damage, claim
arising out of or with respect to any failure to properly prepare, execute
and/or timely file any such Form 15, Form 12b-25 or any amendments to a Form
8-K, Form 10-D or Form 10-K, where such failure results from the Securities
Administrator's inability or failure to obtain or receive, on a timely basis,
any information from any other party hereto needed to prepare, arrange for
execution or file such Form 15, Form 12b-25 or any amendments to Form 8-K,
Form 10-D or Form 10-K, not resulting from their own respective negligence,
bad faith or willful misconduct.
(d) All items under this Article XII to be reviewed by the Depositor
should be forwarded electronically to xxxxxxxxxxxxxx@xxxxxxxxxxxxx.xxx. In
addition, for purposes of this Article XII, if the Securities Administrator or
the Master Servicer is required to provide any information or documentation to
such other party, for so long as Xxxxx Fargo Bank, National Association is
both Securities Administrator and Master Servicer, that delivery will be
automatically deemed to have been made.
(e) Each of Form 10-D and Form 10-K requires the registrant to indicate
(by checking "yes" or "no") that it "(1) has filed all reports required to be
filed by Section 13 or
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15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days." The Depositor
shall notify the Securities Administration in writing, no later than the fifth
calendar day after the related Distribution Date with respect to the filing of
a report on Form 10-D and no later than March 15th with respect to the filing
of a report on Form 10-K, if the answer to the questions should be "no." In
the absence of such notification by the Depositor to the Securities
Administrator, the Securities Administrator shall be entitled to assume that
the answer to the questions on Form 10-D and Form 10-K should be "yes". The
Securities Administrator shall be entitled to rely on such representations in
preparing, executing and/or filing any such report.
Section 12.02. Form 10-D Reporting.
(a) No later than 5:00 p.m., New York time, on the 15th calendar day
after each Distribution Date (subject to permitted extensions under the
Exchange Act), the Securities Administrator shall prepare and file on behalf
of the Trust any Form 10-D required by the Exchange Act, in form and substance
as required by the Exchange Act. The Securities Administrator shall file each
Form 10-D with a copy of the related Monthly Statement attached thereto. Any
disclosure in addition to the Monthly Statement that is required to be
included on Form 10-D ("Additional Form 10-D Disclosure") shall be prepared
and filed by the Securities Administrator pursuant to the following paragraph
and the Securities Administrator will have no duty or liability for any
failure hereunder to determine any Additional Form 10-D Disclosure, except as
set forth in the next paragraph.
(b) In accordance with the respective reporting obligations set forth on
Exhibit N-1 hereto, within 5 calendar days after the related Distribution
Date, the Master Servicer and any other Reporting Party shall be required to
provide to the Securities Administrator and the Depositor in XXXXX-compatible
form, or in such other form as otherwise agreed upon by the Securities
Administrator and such party, the form and substance of any Additional Form
10-D Disclosure, if applicable, together with an Additional Disclosure
Notification in the form of Exhibit P attached hereto (an "Additional
Disclosure Notification"). The Securities Administrator shall notify the
Depositor of any Additional Form 10-D Disclosure with respect to itself or any
of its Affiliates and any other Additional Form 10-D Disclosure received by
it. Within one (1) Business Day of such notification, the Depositor will
approve or disapprove, as the case may be, the inclusion of the Additional
Form 10-D Disclosure on Form 10-D. The Depositor will be responsible for any
reasonable additional fees and expenses assessed or incurred by the Securities
Administrator in connection with including any Additional Form 10-D Disclosure
on Form 10-D pursuant to this paragraph.
(c) After preparing the Form 10-D, and no later than the close of
business on the 11th calendar day after the Distribution Date, the Securities
Administrator shall forward electronically a draft copy of the Form 10-D to
the Master Servicer and to the Depositor for review. No later than the 13th
calendar day after the Distribution Date, the Depositor shall notify the
Securities Administrator in writing (which may be provided electronically) of
any changes to or approve the filing of such Form 10-D. In the absence of
receipt of any written changes or approval, or if the Depositor does not
request a copy of a Form 10-D, the Securities Administrator shall be entitled
to assume that such Form 10-D is in final form and the Securities
173
Administrator may proceed with the execution and filing of the Form 10-D. A
duly authorized representative of the Master Servicer shall sign the Form 10-D
and return an electronic or fax copy of such signed Form 10-D (with an
original executed hard copy to follow by overnight mail) to the Securities
Administrator. If a Form 10-D cannot be filed on time or if a previously filed
Form 10-D needs to be amended, the Securities Administrator will follow the
procedures set forth in Section 12.01(c) hereof. Promptly (but no later than 1
Business Day) after filing with the Commission, the Securities Administrator
will make available on its internet website a final executed copy of each Form
10-D prepared and filed by the Securities Administrator. The signing party at
the Master Servicer can be contacted by e-mail at
xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx or by facsimile (000) 000-0000. Each
party to this Agreement acknowledges that the performance by the Securities
Administrator and the Master Servicer of its duties under this Section 12.02
related to the timely preparation, execution and filing of Form 10-D is
contingent upon such parties strictly observing all applicable deadlines in
the performance of their duties under this Section 12.02. Neither the
Securities Administrator nor the Master Servicer shall have any liability for
any loss, expense, damage, claim arising out of or with respect to any failure
to properly prepare, execute and/or timely file such Form 10-D, where such
failure results from the Securities Administrator's inability or failure to
obtain or receive, on a timely basis, any information from any other party
hereto (other than an Affiliate thereof) needed to prepare, arrange for
execution or file such Form 10-D, not resulting from their respective
negligence, bad faith or willful misconduct.
Section 12.03. Form 8-K Reporting.
(a) As directed by the Depositor, within four (4) Business Days after
the occurrence of an event requiring disclosure on Form 8-K (each such event,
a "Reportable Event"), the Securities Administrator shall prepare and file on
behalf of the Trust any Form 8-K, as required by the Exchange Act, provided
that the Depositor shall file the initial Form 8-K (operative agreements) in
connection with the issuance of the Certificates. Any disclosure or
information related to a Reportable Event or that is otherwise required to be
included on Form 8-K ("Form 8-K Disclosure Information") shall be prepared by
the Securities Administrator pursuant to the following paragraph and the
Securities Administrator will have no duty or liability for any failure
hereunder to determine or prepare any Form 8-K Disclosure Information or any
Form 8-K, except as set forth in the next paragraph.
(b) In accordance with the respective reporting obligations set forth on
Exhibit N-3 hereto, no later than the end of business on the second Business
Day immediately following the occurrence of a Reportable Event, each of the
Securities Administrator, the Custodian, the Trustee, the Master Servicer and
the Depositor shall be required to provide to the Securities Administrator and
the Depositor, as applicable, in XXXXX-compatible form, or in such other form
as otherwise agreed upon by the Securities Administrator and such party, the
form and substance of any Additional Form 8-K Disclosure, if applicable,
together with an Additional Disclosure Notification. The Securities
Administrator shall notify the Depositor of any Form 8-K Disclosure Information
with respect to itself or any of its Affiliates and any other Form 8-K
Disclosure Information received by it. The Depositor will approve or
disapprove, as the case may be, the inclusion of the Form 8-K Disclosure
Information on Form 8-K. The Depositor will be responsible for any reasonable
additional fees and expenses assessed or incurred by the Securities
Administrator in connection with including any Form 8-K Disclosure Information
on Form 8-K pursuant to this paragraph.
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(c) After preparing the Form 8-K, the Securities Administrator shall
forward electronically a draft copy of the Form 8-K to the Depositor and the
Master Servicer for review no later than 12:00 p.m., New York time, on the
third Business Day following the Reportable Event. The Depositor shall notify
the Securities Administrator in writing (which may be provided electronically)
of any changes to or approval of such Form 8-K no later than the close of
business on the third Business Day following the Reportable Event. In the
absence of receipt of any written changes or approval, the Securities
Administrator shall be entitled to assume that such Form 8-K is in final form
and the Securities Administrator may proceed with the execution and filing of
the Form 8-K. By 12:00 p.m., New York time, on the fourth Business Day after
the occurrence of the Reportable Event, a duly authorized representative of
the Master Servicer shall sign the Form 8-K, then return an electronic or fax
copy of such signed Form 8-K (with an original executed hard copy to follow by
overnight mail) to the Securities Administrator. If a Form 8-K cannot be filed
on time or if a previously filed Form 8-K needs to be amended, the Securities
Administrator will follow the procedures set forth in Section 12.01(c). With
respect to each Form 8-K prepared and filed by the Securities Administrator,
promptly (but no later than 1 Business Day) after filing with the Commission,
the Securities Administrator will, make available on its internet website a
final executed copy thereof. The parties to this Agreement acknowledge that
the performance by the Master Servicer and the Securities Administrator of its
duties under this Section 12.03 related to the timely preparation, execution
and filing of Form 8-K is contingent upon such parties strictly observing all
applicable deadlines in the performance of their duties under this Section
12.03. Neither the Securities Administrator nor the Master Servicer shall have
any liability for any loss, expense, damage, claim arising out of or with
respect to any failure to properly prepare, execute and/or timely file such
Form 8-K, where such failure results from the Securities Administrator's
inability or failure to obtain or receive, on a timely basis, any information
from any other party hereto (other than an Affiliate thereof) needed to
prepare, arrange for execution or file such Form 8-K, not resulting from their
respective negligence, bad faith or willful misconduct.
Section 12.04. Form 10-K Reporting.
(a) Within 90 days (including the 90th day) after the end of each fiscal
year of the Trust or such earlier date as may be required by the Exchange Act
(the "10-K Filing Deadline"), commencing in March 2007 and continuing until
the Trust has been deregistered with the Commission, the Securities
Administrator shall prepare and file on behalf of the Trust a Form 10-K, in
form and substance as required by the Exchange Act. Each such Form 10-K shall
include the following items, in each case to the extent they have been
delivered to the Securities Administrator within the applicable time frames
set forth in this Agreement and the related Servicing Agreement, (i) an annual
compliance statement for each Servicer, each Additional Servicer, the Master
Servicer, each Custodian and the Securities Administrator (each such party and
each Custodian, a "Reporting Servicer") as described under Section 9.11,
(ii)(A) the annual reports on assessment of compliance with servicing criteria
for each Reporting Servicer, as described under Section 12.06, and (B) if each
Reporting Servicer's report on assessment of compliance with servicing
criteria described under Section 12.06 identifies any material instance of
noncompliance, disclosure identifying such instance of noncompliance, or if
each Reporting Servicer's report on assessment of compliance with servicing
criteria described under Section 12.06 is not included as an exhibit to such
Form 10-K, disclosure that such report is not included and an explanation why
such report is not included, (iii)(A) the registered public accounting firm
175
attestation report for each Reporting Servicer, as described under Section
12.06, and (B) if any registered public accounting firm attestation report
described under Section 12.06 identifies any material instance of
noncompliance, disclosure identifying such instance of noncompliance, or if
any such registered public accounting firm attestation report is not included
as an exhibit to such Form 10-K, disclosure that such report is not included
and an explanation why such report is not included, and (iv) a Xxxxxxxx-Xxxxx
Certification as described in Section 12.05. Any disclosure or information in
addition to (i) through (iv) above that is required to be included on Form
10-K ("Additional Form 10-K Disclosure") shall be determined and prepared by
and at the direction of the Depositor pursuant to the following paragraph and
the Securities Administrator will have no duty or liability for any failure
hereunder to determine or prepare any Additional Form 10-K Disclosure, except
as set forth in the next paragraph.
(b) In accordance with the respective reporting obligations set forth on
Exhibit N-2 hereto, no later than March 15 of each year that the Trust is
subject to the Exchange Act reporting requirements, commencing in 2007 and
continuing until the Trust has been deregistered with the Commission, the
Master Servicer and any other Reporting Party shall be required to provide to
the Securities Administrator and the Depositor, in XXXXX-compatible form, or
in such other form as otherwise agreed upon by the Securities Administrator
and such party, the form and substance of any Additional Form 10-K Disclosure,
if applicable, together with an Additional Disclosure Notification. The
Securities Administrator shall notify the Depositor of any Additional Form
10-K Disclosure with respect to itself or any of its Affiliates and any other
Additional Form 10-K Disclosure received by it. Within one (1) Business Day of
such notification, the Depositor will approve or disapprove, as the case may
be, the inclusion of the Additional Form 10-K Disclosure on Form 10-K. The
Depositor will be responsible for any reasonable additional fees and expenses
assessed or incurred by the Securities Administrator in connection with
including any Additional Form 10-K Disclosure on Form 10-K pursuant to this
paragraph.
(c) After preparing the Form 10-K, the Securities Administrator shall
forward electronically a draft copy of the Form 10-K to the Master Servicer
and, upon request, to the Depositor for review. No later than the earlier of:
(x) three (3) Business Days following the receipt by the Depositor and (y)
March 25th, the Depositor and the Master Servicer shall notify the Securities
Administrator in writing (which may be provided electronically) of any changes
to or approve the filing of such Form 10-K. In the absence of receipt of any
written changes or approval, or if the Depositor does not request a copy of a
Form 10-K, the Securities Administrator shall be entitled to assume that such
Form 10-K is in final form and the Securities Administrator may proceed with
the execution and filing of the Form 10-K. A senior officer of the Master
Servicer in charge of the master servicing function shall sign the Form 10-K
and return an electronic or fax copy of such signed Form 10-K (with an
original executed hard copy to follow by overnight mail) to the Securities
Administrator. If a Form 10-K cannot be filed on time or if a previously filed
Form 10-K needs to be amended, the Securities Administrator will follow the
procedures set forth in Section 12.01(c). Promptly (but no later than 1
Business Day) after filing with the Commission, the Securities Administrator
will make available on its internet website a final executed copy of each Form
10-K prepared and filed by the Securities Administrator. The parties to this
Agreement acknowledge that the performance by the Master Servicer and the
Securities Administrator of its duties under this Section 12.04 related to the
timely preparation, execution and filing of Form 10-K is contingent upon such
parties (and any
176
Additional Servicer or Servicing Function Participant) strictly observing all
applicable deadlines in the performance of their duties under this Section
12.04, Section 9.11 Section 12.05 and Section 12.06. Neither the Master
Servicer nor the Securities Administrator shall have any liability for any
loss, expense, damage, claim arising out of or with respect to any failure to
properly prepare, execute and/or timely file such Form 10-K, where such
failure results from the Master Servicer's or the Securities Administrator's
inability or failure to obtain or receive, on a timely basis, any information
from any other party hereto needed to prepare, arrange for execution or file
such Form 10-K, not resulting from their own respective negligence, bad faith
or willful misconduct.
Section 12.05. Xxxxxxxx-Xxxxx Certification.
Each Form 10-K shall include a Xxxxxxxx-Xxxxx Certification required to
be included therewith pursuant to the Xxxxxxxx-Xxxxx Act. The senior officer
of the Master Servicer in charge of the master servicing function shall sign
the Xxxxxxxx-Xxxxx Certification and shall serve as the Certifying Person on
behalf of the Trust.
The respective parties hereto agree to cooperate with all reasonable
requests made by any Certifying Person or Certification Party in connection
with such Person's attempt to conduct any due diligence that such Person
reasonably believes to be appropriate in order to allow it to deliver any
Xxxxxxxx-Xxxxx Certification or portion thereof with respect to the Trust
Fund. Section 12.06. Reports on Assessment of Compliance and Attestation.
(a) By March 15 of each year (such date includes the expiration of any
applicable grace period), commencing in March 2007, the Master Servicer, the
Securities Administrator, each Custodian (for so long as a Form 10-K will be
filed on behalf of the Trust for the preceding calendar year) and each other
Reporting Party, each at its own expense, shall furnish or otherwise make
available, and each such party shall cause any Servicing Function Participant
engaged by it to furnish, each at its own expense, to the Securities
Administrator and the Depositor, a report on an assessment of compliance with
the Relevant Servicing Criteria that contains (A) a statement by such party of
its responsibility for assessing compliance with the Relevant Servicing
Criteria, (B) a statement that such party used the Relevant Servicing Criteria
to assess compliance with the Relevant Servicing Criteria, (C) such party's
assessment of compliance with the Relevant Servicing Criteria as of and for
the fiscal year covered by the Form 10-K required to be filed pursuant to
Section 12.04, including, if there has been any material instance of
noncompliance with the Relevant Servicing Criteria, a discussion of each such
failure and the nature and status thereof, and (D) a statement that a
registered public accounting firm has issued an attestation report on such
party's assessment of compliance with the Relevant Servicing Criteria as of
and for such period.
No later than the end of each fiscal year for the Trust for which a 10-K
is required to be filed, the Master Servicer and each Custodian shall each
forward to the Securities Administrator the name of each Servicing Function
Participant engaged by it and what Relevant Servicing Criteria will be
addressed in the report on assessment of compliance prepared by such Servicing
Function Participant; however if the Master Servicer and the Securities
Administrator are the same entity, then the Master Servicer is not required to
forward to the Securities Administrator
177
its assessment of compliance with the Relevant Servicing Criteria as of and
for the fiscal year covered by the Form 10-K required to be filed pursuant to
Section 12.04. When the Master Servicer and the Securities Administrator (or
any Servicing Function Participant engaged by them) submit their assessments
to the Securities Administrator, such parties will also at such time include
the assessment (and attestation pursuant to Section 12.06(b) of each Servicing
Function Participant engaged by it.
Promptly after receipt of each such report on assessment of compliance,
(i) the Depositor shall review each such report and, if applicable, consult
with the Master Servicer, the Securities Administrator, each Custodian and any
Servicing Function Participant engaged by such parties as to the nature of any
material instance of noncompliance with the Relevant Servicing Criteria by
each such party, and (ii) the Securities Administrator shall confirm that the
assessments, taken as a whole, address all of the Servicing Criteria and taken
individually address the Relevant Servicing Criteria for each party as set
forth on Exhibit O and on any similar exhibit set forth in each Servicing
Agreement in respect of each Servicer and notify the Depositor of any
exceptions.
(b) By March 15 of each year, commencing in March 2007, the Master
Servicer, the Securities Administrator, each Custodian (for so long as a Form
10-K will be filed in respect of the Trust for the preceding calendar year) and
each other Reporting Party, each at its own expense, shall cause, and each such
party shall cause any Servicing Function Participant engaged by it to cause,
each at its own expense, a registered public accounting firm (which may also
render other services to the Master Servicer, the Trustee, the Custodian, the
Securities Administrator, or such other Servicing Function Participants, as the
case may be) and that is a member of the American Institute of Certified Public
Accountants to furnish a report to the Securities Administrator and the
Depositor, to the effect that (i) it has obtained a representation regarding
certain matters from the management of such party, which includes an assertion
that such party has complied with the Relevant Servicing Criteria, and (ii) on
the basis of an examination conducted by such firm in accordance with standards
for attestation engagements issued or adopted by the PCAOB, it is expressing an
opinion as to whether such party's compliance with the Relevant Servicing
Criteria was fairly stated in all material respects, or it cannot express an
overall opinion regarding such party's assessment of compliance with the
Relevant Servicing Criteria. In the event that an overall opinion cannot be
expressed, such registered public accounting firm shall state in such report
why it was unable to express such an opinion. Such report must be available for
general use and not contain restricted use language.
Promptly after receipt of such report from the Master Servicer, the
Securities Administrator, each Custodian or any Servicing Function Participant
engaged by such parties, (i) the Depositor shall review the report and, if
applicable, consult with such parties as to the nature of any defaults by such
parties, in the fulfillment of any of each such party's obligations hereunder
or under any other applicable agreement, and (ii) the Securities Administrator
shall confirm that each assessment submitted pursuant to Section 12.06(a) is
coupled with an attestation meeting the requirements of this Section 12.06(b)
and notify the Depositor of any exceptions.
Section 12.07. Use of Subcontractors.
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(a) The Master Servicer shall cause any Subcontractor used by the Master
Servicer for the benefit of the Depositor to comply with the provisions of
Section 9.11 and this Article XII to the same extent as if such Subcontractor
were the Master Servicer (except with respect to the Master Servicer's duties
with respect to preparing and filing any Exchange Act Reports or as the
Certifying Person). The Master Servicer shall be responsible for obtaining
from each Subcontractor and delivering to the Depositor any servicer
compliance statement required to be delivered by such Subcontractor under
Section 9.11, any assessment of compliance and attestation required to be
delivered by such Subcontractor under Section 12.07 and any certification
required to be delivered to the Certifying Person under Section 12.05 as and
when required to be delivered. As a condition to the succession to any
Subcontractor as subservicer under this Agreement by any Person (i) into which
such Subcontractor may be merged or consolidated, or (ii) which may be
appointed as a successor to any Subcontractor, the Master Servicer shall
provide to the Depositor, at least 15 calendar days prior to the effective
date of such succession or appointment, (x) written notice to the Depositor of
such succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K.
(b) It shall not be necessary for the Master Servicer or the Trustee to
seek the consent of the Depositor or any other party hereto to the utilization
of any Subcontractor. The Master Servicer or the Trustee, as applicable, shall
promptly upon request provide to the Depositor (or any designee of the
Depositor, such as the Master Servicer or administrator) a written description
(in form and substance satisfactory to the Depositor) of the role and function
of each Subcontractor utilized by such Person, specifying (i) the identity of
each such Subcontractor, (ii) which (if any) of such Subcontractors are
"participating in the servicing function" within the meaning of Item 1122 of
Regulation AB, and (iii) which elements of the Servicing Criteria will be
addressed in assessments of compliance provided by each Subcontractor
identified pursuant to clause (ii) of this paragraph.
As a condition to the utilization of any Subcontractor determined to be
a Reporting Subcontractor, the Master Servicer or the Trustee, as applicable,
shall cause any such Subcontractor used by such Person for the benefit of the
Depositor to comply with the provisions of Sections 12.07 and 12.09 of this
Agreement to the same extent as if such Subcontractor were the Master Servicer
(except with respect to the Master Servicer's duties with respect to preparing
and filing any Exchange Act Reports or as the Certifying Person) or the
Trustee, as applicable. The Master Servicer or the Trustee, as applicable,
shall be responsible for obtaining from each Subcontractor and delivering to
the Depositor and the Master Servicer, any assessment of compliance and
attestation required to be delivered by such Subcontractor under Section
12.07, in each case as and when required to be delivered.
Section 12.08. Indemnification by the Master Servicer and the Securities
Administrator.
(a) The Master Servicer and the Securities Administrator (each, an
"Indemnifying Party"), shall, severally and not jointly, indemnify the
Depositor and the Seller for the preparation, execution or filing of any
report required to be filed with the Commission with respect to the Trust
Fund, or for execution of a certification pursuant to Rule 13a-14(d) or Rule
15d-14(d) under the Exchange Act with respect to the Trust Fund; and the
respective present and
179
former directors, officers, employees and agents of each of the foregoing and
shall hold each of them harmless from and against any losses, damages,
penalties, fines, forfeitures, legal fees and expenses and related costs,
judgments, and any other costs, fees and expenses that any of them may sustain
arising out of or based upon:
(i) any untrue statement of a material fact contained or alleged
to be contained in or the omission or alleged omission to state a
material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading in (A) any compliance certificate
delivered by it, or by any Servicing Function Participant engaged by it,
pursuant to this Agreement, (B) any assessment or attestation delivered
by or on behalf of it, or by any Servicing Function Participant engaged
by it, pursuant to this Agreement, or (C) any Additional Form 10-D
Disclosure, Additional Form 10-K Disclosure or Form 8-K Disclosure
Information concerning the Securities Administrator or the Master
Servicer and provided by either of them;
(ii) any failure by the Indemnifying Party to perform its
obligations when and as required under this Article XII; or
(iii) any negligence, bad faith or willful misconduct by the
Indemnifying Party.
In the case of any failure of performance described in clause (a)(ii) of
this Section, the Indemnifying Party shall promptly reimburse the Seller or
the Depositor, as applicable, and each Person responsible for the preparation,
execution or filing of any report required to be filed with the Commission
with respect to such Securitization Transaction, or for execution of a
certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the Exchange
Act with respect to the Trust, for all costs reasonably incurred by each such
party in order to obtain the information, report, certification, accountants'
letter or other material not delivered as required by the Indemnifying Party
or any Subservicer or Subcontractor of the Indemnifying Party.
(b) (i) Any failure by the Indemnifying Party or any Subservicer or any
Subcontractor of the Indemnifying Party to deliver any information, report,
certification or accountants' letter when and as required under this Article
XII, including (except as provided below) any failure by the Indemnifying
Party to identify pursuant to Section 12.07 any Subcontractor "participating
in the servicing function" within the meaning of Item 1122 of Regulation AB,
which continues unremedied for ten calendar days after the date on which such
information, report, certification or accountants' letter was required to be
delivered shall constitute an Event of Default with respect to the
Indemnifying Party under this Agreement, and shall entitle the Seller or
Depositor, as applicable, in its sole discretion to terminate the rights and
obligations of the Indemnifying Party under this Agreement without payment
(notwithstanding anything in this Agreement to the contrary) of any
compensation to the Indemnifying Party; provided that to the extent that any
provision of this Agreement and/or any applicable Reconstitution Agreement
expressly provides for the survival of certain rights or obligations following
termination of the Master Servicer as servicer, such provision shall be given
effect.
Neither the Seller nor any Depositor shall be entitled to terminate the
rights and obligations of an Indemnifying Party pursuant to this subparagraph
(b)(ii) if a failure of the
180
Master Servicer to identify a Subcontractor "participating in the servicing
function" within the meaning of Item 1122 of Regulation AB was attributable
solely to the role or functions of such Subcontractor with respect to mortgage
loans other than the Mortgage Loans.
(ii) The Indemnifying Party shall promptly reimburse the Seller
and any Depositor for all reasonable expenses incurred by them, in
connection with the termination of the Indemnifying Party and the
transfer of their duties to a successor. The provisions of this
paragraph shall not limit whatever rights the Seller or the Depositor
may have under other provisions of this Agreement or otherwise, whether
in equity or at law, such as an action for damages, specific performance
or injunctive relief.
Section 12.09. Indemnification by Custodian.
(a) If the entity serving as Trustee is also serving as a Custodian, such
entity in its capacity as Custodian shall indemnify the Depositor, each
affiliate of the Depositor, the Master Servicer and each Person who controls
any of such parties (within the meaning of Section 15 of the Securities Act and
Section 20 of the Exchange Act); and the respective directors, officers, and
employees of each of the foregoing (each, an "Indemnified Party"), and shall
hold each of them harmless from and against any losses, damages, penalties,
fines, forfeitures, legal fees and expenses and related costs, judgments, and
any other costs, fees and expenses that any of them may sustain directly
relating to:
(i) (A) any untrue statement of a material fact contained or
alleged to be contained in any information, compliance assessment or
other material it is required to provide or cause to be provided under
this Article XII (collectively, the "Custodian Information"), or (B) the
omission or alleged omission to state in the Custodian Information a
material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading; or
(ii) any failure to deliver or cause to be delivered any
information, report, certification, accountants' attestation or other
material when and as required under this Article XII.
If the indemnification provided for herein is unavailable or insufficient
to hold harmless an Indemnified Party, then the Custodian agrees that it shall
contribute to the amount paid or payable by such Indemnified Party as a result
of any claims, losses, damages or liabilities incurred by such Indemnified
Party in such proportion as is appropriate to reflect the relative fault of
such Indemnified Party on the one hand and the Custodian on the other.
(b) In the case of any failure of performance described in clause (a) of
this Section 12.09, the Custodian shall promptly reimburse the Indemnified
Party responsible for the preparation, execution or filing of any report
required to be filed with the Commission with respect to such Securitization
Transaction, or for execution of a certification pursuant to Rule 13a-14(d) or
Rule 15d-14(d) under the Exchange Act with respect to the Trust, for all costs
reasonably incurred by each such party in order to obtain the information,
report, certification, accountants' letter or other material not delivered as
required.
(c) This indemnification shall survive the termination of this Agreement
or the termination of any party to this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers hereunto duly authorized as of the
day and year first above written.
XXXXXX XXXXXXX CAPITAL I INC.,
as Depositor
By: /s/ XXXXXXX XXX
-------------------------------------------------
Name: XXXXXXX XXX
Title: VICE PRESIDENT
LASALLE BANK NATIONAL ASSOCIATION,
as Trustee and a Custodian
By: /s/ XXXX XXXXX
-------------------------------------------------
Name: XXXX XXXXX
Title: VICE PRESIDENT
By: /s/ XXXX XXXXX
-------------------------------------------------
Name: XXXX XXXXX
Title: VICE PRESIDENT
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Master Servicer
By: /s/ XXXXXXXX XXXXX
-------------------------------------------------
Name: XXXXXXXX XXXXX
Title: VICE PRESIDENT
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Securities Administrator
By: /s/ XXXXXXXX XXXXX
-------------------------------------------------
Name: XXXXXXXX XXXXX
Title: VICE PRESIDENT
Solely for purposes of Section 2.05
accepted and agreed to by:
XXXXXX XXXXXXX MORTGAGE CAPITAL INC.
By: /s/ XXXXXXX XXX
---------------------------------
Name: XXXXXXX XXX
Title: VICE PRESIDENT
EXHIBIT A
FORMS OF CERTIFICATES
A-1
EXHIBIT B
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEREE)
STATE OF )
) ss.:
COUNTY OF )
[NAME OF OFFICER], _________________ being first duly sworn, deposes and
says:
1. That he [she] is [title of officer] ________________________ of
[name of Purchaser] _________________________________________ (the
"Purchaser"), a _______________________ [description of type of
entity] duly organized and existing under the laws of the [State
of __________] [United States], on behalf of which he [she] makes
this affidavit.
2. That the Purchaser's Taxpayer Identification Number is [ ].
3. That the Purchaser is not a "disqualified organization" within the
meaning of Section 860E(e)(5) of the Internal Revenue Code of
1986, as amended (the "Code") and will not be a "disqualified
organization" as of [date of transfer], and that the Purchaser is
not acquiring a Residual Certificate (as defined in the Agreement)
for the account of, or as agent (including a broker, nominee, or
other middleman) for, any person or entity from which it has not
received an affidavit substantially in the form of this affidavit.
For these purposes, a "disqualified organization" means the United
States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or
instrumentality of any of the foregoing (other than an
instrumentality if all of its activities are subject to tax and a
majority of its board of directors is not selected by such
governmental entity), any cooperative organization furnishing
electric energy or providing telephone service to persons in rural
areas as described in Code Section 1381(a)(2)(C), any "electing
large partnership" within the meaning of Section 775 of the Code,
or any organization (other than a farmers' cooperative described
in Code Section 521) that is exempt from federal income tax unless
such organization is subject to the tax on unrelated business
income imposed by Code Section 511.
4. That the Purchaser either (x) is not, and on __________________
[date of transfer] will not be, an employee benefit plan or other
retirement arrangement subject to Section 406 of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or
Section 4975 of the Code ("Code"), (collectively, a "Plan") or a
person acting on behalf of any such Plan or investing the assets
of any such Plan to acquire a Residual Certificate; (y) is an
insurance company that is purchasing the Certificate with funds
contained in an "insurance company general account" as defined in
Section V(e) of Prohibited Transaction Class Exemption ("PTCE")
95-60 and the purchase and holding of the Certificate satisfy the
requirements for exemptive relief under Sections I and III of XXXX
X-0
95-60; or (z) herewith delivers to the Certificate Registrar an
opinion of counsel satisfactory to the Certificate Registrar and
the Securities Administrator and upon which the Certificate
Registrar, the Trustee, the Master Servicer, the Depositor and
Securities Administrator shall be entitled to rely, to the effect
that the purchase or holding of such Residual Certificate by the
Investor will not result in any non-exempt prohibited transactions
under Title I of ERISA or Section 4975 of the Code and will not
subject the Certificate Registrar, the Trustee, the Depositor, the
Master Servicer or the Securities Administrator to any obligation
in addition to those undertaken by such entities in the Pooling
and Servicing Agreement, which opinion of counsel shall not be an
expense of the Trust Fund or any of the above parties.
5. That the Purchaser hereby acknowledges that under the terms of the
Pooling and Servicing Agreement, dated as of July 1, 2006 (the
"Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as
Depositor, Xxxxx Fargo Bank, National Association, as Master
Servicer and as Administrator and LaSalle Bank National
Association, as Trustee with respect to Xxxxxx Xxxxxxx Mortgage
Loan Trust 2006-11, Mortgage Pass-Through Certificates, no
transfer of the Residual Certificates shall be permitted to be
made to any person unless the Certificate Registrar has received a
certificate from such transferee containing the representations in
paragraphs 3 and 4 hereof.
6. That the Purchaser does not hold REMIC residual securities as
nominee to facilitate the clearance and settlement of such
securities through electronic book-entry changes in accounts of
participating organizations (such entity, a "Book-Entry Nominee").
7. That the Purchaser does not have the intention to impede the
assessment or collection of any federal, state or local taxes
legally required to be paid with respect to such Residual
Certificate.
8. That the Purchaser will not transfer a Residual Certificate to any
person or entity (i) as to which the Purchaser has actual
knowledge that the requirements set forth in paragraph 3,
paragraph 6 or paragraph 10 hereof are not satisfied or that the
Purchaser has reason to believe does not satisfy the requirements
set forth in paragraph 7 hereof, and (ii) without obtaining from
the prospective Purchaser an affidavit substantially in this form
and providing to the Certificate Registrar a written statement
substantially in the form of Exhibit C to the Agreement.
9. That the Purchaser understands that, as the holder of a Residual
Certificate, the Purchaser may incur tax liabilities in excess of
any cash flows generated by the interest and that it intends to
pay taxes associated with holding such Residual Certificate as
they become due.
10. That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
Non-U.S. Person that holds a Residual Certificate in connection
with the conduct of a trade or business within the United States
and has furnished the transferor the Certificate Registrar
B-2
with an effective Internal Revenue Service Form W-8ECI
(Certificate of Foreign Person's Claim for Exemption From
Withholding on Income Effectively Connected With the Conduct of a
Trade or Business in the United States) or successor form at the
time and in the manner required by the Code or (iii) is a Non-U.S.
Person that has delivered to the transferor, the Trustee and the
Certificate Registrar an opinion of a nationally recognized tax
counsel to the effect that the transfer of such Residual
Certificate to it is in accordance with the requirements of the
Code and the regulations promulgated thereunder and that such
transfer of a Residual Certificate will not be disregarded for
federal income tax purposes. "Non-U.S. Person" means an
individual, corporation, partnership or other person other than
(i) a citizen or resident of the United States; (ii) a
corporation, partnership or other entity created or organized in
or under the laws of the United States or any state thereof,
including for this purpose, the District of Columbia; (iii) an
estate that is subject to U.S. federal income tax regardless of
the source of its income; (iv) a trust if a court within the
United States is able to exercise primary supervision over the
administration of the trust and one or more United States trustees
have authority to control all substantial decisions of the trust;
and, (v) to the extent provided in Treasury regulations, certain
trusts in existence on August 20, 1996 that are treated as United
States persons prior to such date and elect to continue to be
treated as United States persons.
11. The Purchaser will not cause income from the Residual Certificate
to be attributable to a foreign permanent establishment or fixed
base of the Purchaser or another U.S. taxpayer.
12. That the Purchaser agrees to such amendments of the Pooling and
Servicing Agreement as may be required to further effectuate the
restrictions on transfer of any Residual Certificate to such a
"disqualified organization," an agent thereof, a Book-Entry
Nominee, or a person that does not satisfy the requirements of
paragraph 7 and paragraph 10 hereof.
13. That the Purchaser consents to the designation of the Securities
Administrator to act as agent for the "tax matters person" of each
REMIC created by the Trust Fund pursuant to the Pooling and
Servicing Agreement.
B-3
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its [title of officer] this _____ day of __________ 20__.
---------------------------------
[name of Purchaser]
By:
--------------------------------------
Name:
Title:
Personally appeared before me the above-named [name of officer]
________________, known or proved to me to be the same person who executed the
foregoing instrument and to be the [title of officer] _________________ of the
Purchaser, and acknowledged to me that he [she] executed the same as his [her]
free act and deed and the free act and deed of the Purchaser.
Subscribed and sworn before me this _____ day of __________ 20__.
NOTARY PUBLIC
----------------------------
COUNTY OF ________________
STATE OF __________________
My commission expires the _____ day of __________ 20__.
B-4
EXHIBIT C
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)
----------------------------
Date
Re: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-11
Mortgage Pass-Through Certificates
_______________________ (the "Transferor") has reviewed the attached
affidavit of _____________________________ (the "Transferee"), and has no
actual knowledge that such affidavit is not true and has no reason to believe
that the information contained in paragraph 7 thereof is not true, and has no
reason to believe that the Transferee has the intention to impede the
assessment or collection of any federal, state or local taxes legally required
to be paid with respect to a Residual Certificate. In addition, the Transferor
has conducted a reasonable investigation at the time of the transfer and found
that the Transferee had historically paid its debts as they came due and found
no significant evidence to indicate that the Transferee will not continue to
pay its debts as they become due.
Very truly yours,
------------------------------------------
Name:
Title:
C-1
EXHIBIT D
[RESERVED]
D-1
EXHIBIT E
LIST OF PURCHASE AND SERVICING AGREEMENTS
1. Second Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of December 1, 2005, between American Home Mortgage Corp.,
as seller and Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser.
2. First Amended and Restated Servicing Agreement, dated as of January 1,
2006, between GMAC Mortgage Corporation, as servicer and Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser.
3. Amended and Restated Mortgage Loan Purchase And Warranties Agreement, dated
as of May 1, 2005, between MortgageIT, Inc., as seller and Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser.
4. Third Amended And Restated Master Mortgage Loan Purchase Agreement, dated
as of November 1, 2005 and an Amended and Restated Master Servicing Agreement,
dated as of February 1, 2004, between Xxxxxx Xxxxxxx Credit Corporation, as
seller and servicer and Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser.
5. Second Amended and Restated Mortgage Loan Purchase and Warranties Servicing
Agreement, dated as of June 1, 2006, between Xxxxxx Xxxxxxx Mortgage Capital
Inc., as purchaser, and Quicken Loans, Inc., as seller.
6. Mortgage Loan Purchase And Warranties Agreement, dated as of June 1, 2006,
between Sovereign Bank, as seller, and Xxxxxx Xxxxxxx Mortgage Capital Inc.,
as purchaser.
7. First Amended and Restated Mortgage Loan Sale And Servicing Agreement,
dated as of March 15, 2005, Fourth Amended and Restated Mortgage Loan Sale And
Servicing Agreement, dated as of December 1, 2005, and Fifth Amended and
Restated Mortgage Loan Sale And Servicing Agreement, dated as of June 1, 2006,
each between GreenPoint Mortgage Funding, Inc., as seller and servicer, and
Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser.
8. Third Amended and Restated Mortgage Loan Flow Purchase, Sale & Servicing
Agreement, dated as of January 1, 2006, among PHH Mortgage Corporation
(formerly known as Cendant Mortgage Corporation), as seller and servicer, and
Xxxxxx'x Gate Residential Mortgage Trust, as a seller, and Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser.
E-1
EXHIBIT F
LIST OF CUSTODIAL AGREEMENTS
1. Custodial Agreement, dated as of July 1, 2005, among Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser, GMAC Mortgage Corporation, as servicer,
Xxxxx Fargo Bank, National Association, as securities administrator and master
servicer, LaSalle Bank National Association, as trustee, and Deutsche Bank
Trust Company Americas, as custodian.
2. Custodial Agreement, dated as of July 1, 2006, among Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser, GreenPoint Mortgage Funding, Inc., as
seller and servicer, PHH Mortgage Corporation (formerly known as Cendant
Mortgage Corporation), as seller and servicer, Xxxxxx'x Gate Residential
Mortgage Trust (formerly known as Cendant Residential Mortgage Trust), as
seller, Xxxxx Fargo Bank, National Association, as securities administrator
and master servicer, LaSalle Bank National Association, as trustee, and X.X.
Xxxxxx Trust Company, National Association, as custodian.
3. Custodial Agreement, dated as of July 1, 2006, among Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser, Xxxxxx Xxxxxxx Credit Corporation, as
seller and servicer, LaSalle Bank National Association, as trustee, Xxxxx
Fargo Bank, National Association, as securities administrator and master
servicer, and Xxxxx Fargo Bank, National Association, as custodian.
F-1
EXHIBIT G
ASSIGNMENT AND NOTICE OF TRANSFER WITH RESPECT TO ADDITIONAL
COLLATERAL MORTGAGE LOANS
G-1
EXHIBIT H
FORM OF RULE 144A TRANSFER CERTIFICATE
Re: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-11,
Mortgage Pass-Through Certificates
Reference is hereby made to the Pooling and Servicing Agreement, dated
as of July 1, 2006 (the "Pooling and Servicing Agreement"), by and among
Xxxxxx Xxxxxxx Capital I Inc., as Depositor, Xxxxx Fargo Bank, National
Association, as Master Servicer, as Securities Administrator and, in its
capacity as Securities Administrator, as Auction Administrator, LaSalle Bank
National Association, as Trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Pooling and Servicing
Agreement.
This letter relates to $__________ initial Certificate Balance of Class
_____ Certificates which are held in the form of Definitive Certificates
registered in the name of ______________ (the "Transferor"). The Transferor
has requested a transfer of such Definitive Certificates for Definitive
Certificates of such Class registered in the name of [insert name of
transferee].
In connection with such request, and in respect of such Certificates,
the Transferor hereby certifies that such Certificates are being transferred
in accordance with (i) the transfer restrictions set forth in the Pooling and
Servicing Agreement and the Certificates and (ii) Rule 144A under the
Securities Act to a purchaser that the Transferor reasonably believes is a
"qualified institutional buyer" within the meaning of Rule 144A purchasing for
its own account or for the account of a "qualified institutional buyer," which
purchaser is aware that the sale to it is being made in reliance upon Rule
144A, in a transaction meeting the requirements of Rule 144A and in accordance
with any applicable securities laws of any state of the United States or any
other applicable jurisdiction.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Underwriter, the Certificate Registrar and the
Depositor.
------------------------------------------
[Name of Transferor]
By:
---------------------------------------
Name:
Title:
Dated: ___________, ____
H-1
EXHIBIT I
FORM OF PURCHASER'S LETTER FOR
INSTITUTIONAL ACCREDITED INVESTOR
Date
Dear Sirs:
In connection with our proposed purchase of $______________ principal
amount of Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-11, Mortgage Pass-Through
Certificates (the "Privately Offered Certificates") of Xxxxxx Xxxxxxx Capital
I Inc. (the "Depositor"), we confirm that:
(1) We understand that the Privately Offered Certificates have not been, and
will not be, registered under the Securities Act of 1933, as amended
(the "Securities Act"), and may not be sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any
accounts for which we are acting as hereinafter stated, that if we
should sell any Privately Offered Certificates within two years of the
later of the date of original issuance of the Privately Offered
Certificates or the last day on which such Privately Offered
Certificates are owned by the Depositor or any affiliate of the
Depositor we will do so only (A) to the Depositor, (B) to "qualified
institutional buyers" (within the meaning of Rule 144A under the
Securities Act) in accordance with Rule 144A under the Securities Act
("QIBs"), (C) pursuant to the exemption from registration provided by
Rule 144 under the Securities Act, or (D) to an institutional
"accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act that is not a QIB (an
"Institutional Accredited Investor") which, prior to such transfer,
delivers to the Certificate Registrar under the Pooling and Servicing
Agreement, dated as of July 1, 2006 (the "Pooling and Servicing
Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as Depositor,
Xxxxx Fargo Bank, National Association, as Master Servicer, as
Securities Administrator and, in its capacity as Securities
Administrator, as Auction Administrator and LaSalle Bank National
Association, as Trustee, a signed letter in the form of this letter; and
we further agree, in the capacities stated above, to provide to any
person purchasing any of the Privately Offered Certificates from us a
notice advising such purchaser that resales of the Privately Offered
Certificates are restricted as stated herein.
(2) We understand that, in connection with any proposed resale of any
Privately Offered Certificates to an Institutional Accredited Investor,
we will be required to furnish to the Certificate Registrar a
certification from such transferee in the form hereof to confirm that
the proposed sale is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act. We further understand that the Privately Offered
Certificates purchased by us will bear a legend to the foregoing effect.
(3) We are acquiring the Privately Offered Certificates for investment
purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the
I-1
Securities Act. We have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of
our investment in the Privately Offered Certificates, and we and any
account for which we are acting are each able to bear the economic risk
of such investment.
(4) We are an Institutional Accredited Investor and we are acquiring the
Privately Offered Certificates purchased by us for our own account or
for one or more accounts (each of which is an Institutional Accredited
Investor) as to each of which we exercise sole investment discretion.
(5) We have received such information as we deem necessary in order to make
our investment decision.
(6) If we are acquiring ERISA-Restricted Certificates, we understand that in
accordance with ERISA, the Code and the Exemption, no Plan and no person
acting on behalf of such a Plan may acquire such Certificate except in
accordance with Section 3.03(d) of the Pooling and Servicing Agreement.
Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Pooling and Servicing
Agreement.
I-2
You and the Certificate Registrar are entitled to rely upon this letter
and are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
----------------------------------------
[Purchaser]
By:
----------------------------------------
Name:
Title:
I-3
EXHIBIT J
FORM OF ERISA TRANSFER AFFIDAVIT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is the ______________________ of ______________ (the
"Investor"), a [corporation duly organized] and existing under the laws of
__________, on behalf of which he makes this affidavit.
2. The Investor either (x) is not, and on ___________ [date of transfer]
will not be, an employee benefit plan or other plan or arrangement subject to
Section 406 of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or Section 4975 of the Internal Revenue Code of 1986, as amended
(the "Code"), (collectively, a "Plan") or a person acting on behalf of any
such Plan or investing the assets of any such Plan; (y) if the Certificate has
been the subject of an ERISA-Qualifying Underwriting, is an insurance company
that is purchasing the Certificate with funds contained in an "insurance
company general account" as defined in Section V(e) of Prohibited Transaction
Class Exemption ("PTCE") 95-60 and the purchase and holding of the Certificate
satisfy the requirements for exemptive relief under Sections I and III of PTCE
95-60; or (z) herewith delivers to the Certificate Registrar an opinion of
counsel satisfactory to the Certificate Registrar and the Securities
Administrator and upon which the Certificate Registrar, the Trustee, the
Master Servicer, the Depositor and the Securities Administrator shall be
entitled to rely, to the effect that the purchase and holding of such
Certificate by the Investor will not constitute or result in any non-exempt
prohibited transactions under Title I of ERISA or Section 4975 of the Code and
will not subject the Certificate Registrar, the Trustee, the Master Servicer,
the Depositor or the Securities Administrator to any obligation in addition to
those undertaken by such entities in the Pooling and Servicing Agreement,
which opinion of counsel shall not be an expense of the Trust Fund or the
above parties.
3. The Investor hereby acknowledges that under the terms of the Pooling
and Servicing Agreement, dated as of July 1, 2006 (the "Pooling and Servicing
Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as Depositor, Xxxxx
Fargo Bank, National Association, as Master Servicer, as Securities
Administrator and, in its capacity as Securities Administrator, as Auction
Administrator and LaSalle Bank National Association, as Trustee, no transfer
of the ERISA-Restricted Certificates shall be permitted to be made to any
person unless the Certificate Registrar has received a certificate from such
transferee in the form hereof.
J-1
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to proper authority, by its duly authorized
officer, duly attested, this ____ day of _______________ 20___.
[Investor]
By:
---------------------------------------
Name:
Title:
ATTEST:
STATE OF )
) ss.:
COUNTY OF )
Personally appeared before me the above-named ________________, known or
proved to me to be the same person who executed the foregoing instrument and
to be the ____________________ of the Investor, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Investor.
Subscribed and sworn before me this _____ day of _________ 20___.
________________________________
NOTARY PUBLIC
My commission expires the
_____ day of __________ 20___.
J-2
EXHIBIT K
FORM OF LETTER OF REPRESENTATIONS
WITH THE DEPOSITORY TRUST COMPANY
[On File with Securities Administrator]
K-1
EXHIBIT L-1
FORM OF INITIAL CUSTODIAL CERTIFICATION
May __, 2006
Xxxxxx Xxxxxxx Capital I Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
LaSalle Bank National Association, as Trustee
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Trust Administration - MSM 2006-11
Re: Pooling and Servicing Agreement ("Pooling and Servicing
Agreement") relating to Xxxxxx Xxxxxxx Mortgage
Loan Trust 2006-11, Mortgage Pass-Through Certificates,
Series 2006-11
Ladies and Gentlemen:
In accordance with and subject to the provisions of Section 2.02 of the
Pooling and Servicing Agreement, the undersigned, as Custodian, hereby
certifies that, except for the exceptions noted on the schedule attached
hereto, (a) all documents required to be delivered to the Custodian pursuant
to Sections 2.01(a)(i) through (iv) and (ix)(b), (c) (solely to the extent of
the UCC-1), (g) and (h), and if delivered to it, the documents identified in
Section 2.01(a)(v) through (vii) and (ix)(c) (solely to the extent of the
UCC-3) and (f) of the Pooling and Servicing Agreement are in its possession,
(b) such documents have been reviewed by it and have not been mutilated,
damaged, defaced, torn or otherwise physically altered, and such documents
relate to such Mortgage Loan, (c) based on its review and examination and only
as to the foregoing documents, such documents appear regular on their face and
related to such Mortgage Loan and (d) each Mortgage Note has been endorsed and
each assignment of Mortgage has been delivered as provided in Section 2.01 of
the Pooling and Servicing Agreement. The Custodian has made no independent
examination of any documents contained in each Mortgage File beyond the review
specifically mentioned above. The Custodian makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any
of the documents delivered in accordance with Section 2.01 of the Pooling and
Servicing Agreement or any of the Mortgage Loans identified in the Mortgage
Loan Schedule, or (ii) the collectibility, insurability, effectiveness or
suitability of any such Mortgage Loan.
L-1-1
The Custodian acknowledges receipt of notice that the Depositor has
granted to the Trustee for the benefit of the Certificateholders a security
interest in all of the Depositor's right, title and interest in and to the
Mortgage Loans.
L-1-2
Capitalized terms used herein without definition shall have the meaning
assigned to them in the Pooling and Servicing Agreement.
[DEUTSCHE BANK TRUST COMPANY AMERICAS, as
Custodian]
[X.X. XXXXXX TRUST COMPANY,
NATIONAL ASSOCIATION, as Custodian]
[XXXXX FARGO BANK, NATIONAL ASSOCIATION,]
as Custodian
By: _______________________
Authorized Representative
X-0-0
XXXXXXX X-0
FORM OF FINAL CUSTODIAL CERTIFICATION
May __, 2006
Xxxxxx Xxxxxxx Capital I Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
LaSalle Bank National Association, as Trustee
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Trust Administration - MSM 2006-11
Re: Pooling and Servicing Agreement ("Pooling and Servicing
Agreement") relating to Xxxxxx Xxxxxxx Mortgage Loan Trust
2006-11, Mortgage Pass-Through Certificates, Series 2006-11
Ladies and Gentlemen:
In accordance with and subject to the provisions of Section 2.02 of the
Pooling and Servicing Agreement, the undersigned, as Custodian, hereby
certifies that, except for the exceptions noted on the schedule attached
hereto, (a) all documents required to be delivered to the Custodian pursuant
to Sections 2.01(a)(i) through (iv) and (ix)(b), (c) (solely to the extent of
the UCC-1), (g) and (h), and if delivered to it, the documents identified in
Section 2.01(a)(v) through (vii) and (ix)(c) (solely to the extent of the
UCC-3) and (f) of the Pooling and Servicing Agreement are in its possession,
(b) such documents have been reviewed by it and have not been mutilated,
damaged, defaced, torn or otherwise physically altered, and such documents
relate to such Mortgage Loan, (c) based on its examination and only as to the
foregoing documents, these documents with respect to each Mortgage Loan
accurately reflect the information contained in the Mortgage Note and Mortgage
and (d) each Mortgage Note has been endorsed and each assignment of Mortgage
has been delivered as provided in Section 2.01 of the Pooling and Servicing
Agreement. The Custodian has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically mentioned
above. The Custodian makes no representations as to: (i) the validity,
legality, sufficiency, enforceability or genuineness of any of the documents
delivered in accordance with Section 2.01 of the Pooling and Servicing
Agreement or any of the Mortgage Loans identified in the Mortgage Loan
Schedule, or (ii) the collectibility, insurability, effectiveness or
suitability of any such Mortgage Loan.
L-2-1
The Custodian acknowledges receipt of notice that the Depositor has
granted to the Trustee for the benefit of the Certificateholders a security
interest in all of the Depositor's right, title and interest in and to the
Mortgage Loans.
L-2-2
Capitalized terms used herein without definition shall have the meaning
assigned to them in the Pooling and Servicing Agreement.
[DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Custodian]
[X.X. XXXXXX TRUST COMPANY,
NATIONAL ASSOCIATION, as Custodian]
[XXXXX FARGO BANK, NATIONAL ASSOCIATION,]
as Custodian
By: ___________________________
Authorized Representative
L-2-3
EXHIBIT M
REQUEST FOR RELEASE OF DOCUMENTS
[Name and Address of appropriate Custodian]
Re: Pooling and Servicing Agreement ("Pooling and Servicing
Agreement") relating to Xxxxxx Xxxxxxx Mortgage Loan Trust
2006-11, Mortgage Pass-Through Certificates, Series 2006-11
and Custodial Agreement relating to Xxxxxx Xxxxxxx Mortgage
Loan Trust 2006-11
In connection with the administration of the Mortgage Loans in the Trust
created by the above-captioned Pooling and Servicing Agreement and that are
held by you as Custodian pursuant to the above-captioned Custodial Agreement,
we request the release, and hereby acknowledge receipt, of the Mortgage File
for the Mortgage Loan described below, for the reason indicated.
Mortgage Loan Number:
Mortgagor Name, Address & Zip Code:
Reason for Requesting Documents (check one):
__________ 1. Mortgage Paid in Full
__________ 2. Foreclosure
__________ 3. Substitution
__________ 4. Other Liquidation (Repurchases, etc.)
__________ 5. Nonliquidation
Reason: ______________________
Address to which Custodian should
Deliver the Mortgage File:
__________________________________________
__________________________________________
__________________________________________
By:_______________________________________
(authorized signer)
Issuer:_____________________________________
Address:____________________________________
____________________________________
M-1
Date:_____________________________________
Custodian
---------------
[insert name of appropriate Custodian]
Please acknowledge the execution of the above request by your signature and date
below:
------------------------------------
Signature
---------------------
Date
Documents returned to Custodian:
------------------------------------
Signature
---------------------
Date
M-2
EXHIBIT N-1
Additional Form 10-D Disclosure
-------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
-------------------------------------------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
-------------------------------------------------------------------------------------------------------------------
Item 1: Distribution and Pool Performance Information
-------------------------------------------------------------------------------------------------------------------
Information included in the [Monthly Statement] Servicer, Master Servicer and Securities Administrator
-------------------------------------------------------------------------------------------------------------------
Any information required by 1121 which is NOT included Depositor
on the [Monthly Statement]
-------------------------------------------------------------------------------------------------------------------
Item 2: Legal Proceedings
Any legal proceeding pending against the following
entities or their respective property, that is material
to Certificateholders, including any proceedings
known to be contemplated by governmental authorities:
-------------------------------------------------------------------------------------------------------------------
o Issuing Entity (Trust Fund) Trustee, Master Servicer, Securities Administrator and
Depositor
-------------------------------------------------------------------------------------------------------------------
o Sponsor (Seller) Seller (if a party to the Pooling and Servicing
Agreement) or Depositor
-------------------------------------------------------------------------------------------------------------------
o Depositor Depositor
-------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------------------------------------------
o Custodian Custodian
-------------------------------------------------------------------------------------------------------------------
o 1110(b) Originator Depositor
-------------------------------------------------------------------------------------------------------------------
o Any 1108(a)(2) Servicer (other than the Master Servicer
Servicer or Securities Administrator)
-------------------------------------------------------------------------------------------------------------------
o Any other party contemplated by 1100(d)(1) Depositor
-------------------------------------------------------------------------------------------------------------------
Item 3: Sale of Securities and Use of Proceeds (i) Depositor (with respect to the Closing Date) and
Information from Item 2(a) of Part II of Form 10-Q: (ii) Master Servicer
With respect to any sale of securities by the sponsor,
depositor or issuing entity, that are backed by the same
asset pool or are otherwise issued by the issuing entity,
whether or not registered, provide the sales and use of
proceeds information in Item 701 of Regulation S-K.
Pricing information can be omitted if securities
-------------------------------------------------------------------------------------------------------------------
N-1-1
-------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
-------------------------------------------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
-------------------------------------------------------------------------------------------------------------------
were not registered.
-------------------------------------------------------------------------------------------------------------------
Item 4: Defaults Upon Senior Securities Securities Administrator and Trustee
Information from Item 3 of Part II of Form 10-Q:
Report the occurrence of any Event of Default (after
expiration of any grace period and provision of any
required notice)
-------------------------------------------------------------------------------------------------------------------
Item 5: Submission of Matters to a Vote of Security Securities Administrator and
Holders Trustee
Information from Item 4 of Part II of Form 10-Q
-------------------------------------------------------------------------------------------------------------------
Item 6: Significant Obligors of Pool Assets Depositor
Item 1112(b) - Significant Obligor Financial Information*
-------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the Form 10-D
for the distribution period in which updated information
is required pursuant to the Item.
-------------------------------------------------------------------------------------------------------------------
Item 7: Significant Enhancement Provider Information
Item 1114(b)(2) - Credit Enhancement Provider Financial
Information*
-------------------------------------------------------------------------------------------------------------------
o Determining applicable disclosure threshold Depositor
-------------------------------------------------------------------------------------------------------------------
o Requesting required financial information (including Depositor
any required accountants' consent to the use thereof) or
effecting incorporation by reference
-------------------------------------------------------------------------------------------------------------------
Item 1115(b) - Derivative Counterparty Financial
Information*
-------------------------------------------------------------------------------------------------------------------
o Determining current maximum probable exposure Depositor
-------------------------------------------------------------------------------------------------------------------
o Determining current significance percentage Depositor
-------------------------------------------------------------------------------------------------------------------
o Requesting required financial information (including Depositor
any required accountants' consent to the use thereof) or
effecting incorporation by reference
-------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the Form 10-D
for the distribution period in which updated information
is required pursuant to the Items.
-------------------------------------------------------------------------------------------------------------------
Item 8: Other Information Any responsible party for the applicable
Form 8-K Disclosure item
-------------------------------------------------------------------------------------------------------------------
N-1-2
-------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
-------------------------------------------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
-------------------------------------------------------------------------------------------------------------------
Disclose any information required to be reported on Form
8-K during the period covered by the Form 10-D but not
reported
-------------------------------------------------------------------------------------------------------------------
Item 9: Exhibits
-------------------------------------------------------------------------------------------------------------------
Monthly Statement to Certificateholders Securities Administrator
-------------------------------------------------------------------------------------------------------------------
Exhibits required by Item 601 of Regulation S-K, such as Depositor
material agreements
-------------------------------------------------------------------------------------------------------------------
N-1-3
EXHIBIT N-2
Additional Form 10-K Disclosure
-------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
-------------------------------------------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
-------------------------------------------------------------------------------------------------------------------
Item 1B: Unresolved Staff Comments Depositor
-------------------------------------------------------------------------------------------------------------------
Item 9B: Other Information Any responsible party for disclosure items on
Disclose any information required to be reported on Form Form 8-K
8-K during the fourth quarter covered by the Form 10-K but
not reported
-------------------------------------------------------------------------------------------------------------------
Item 15: Exhibits, Financial Statement Schedules (i) As to agreements, Securities
Administrator/Depositor and (ii) as to financial
statements, Reporting Parties (as to themselves)
-------------------------------------------------------------------------------------------------------------------
Reg AB Item 1112(b): Significant Obligors of Pool Assets
-------------------------------------------------------------------------------------------------------------------
Significant Obligor Financial Information* Depositor
-------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the Form 10-D
for the distribution period in which updated information
is required pursuant to the Item.
-------------------------------------------------------------------------------------------------------------------
Reg AB Item 1114(b)(2): Credit Enhancement Provider
Financial Information
-------------------------------------------------------------------------------------------------------------------
o Determining applicable disclosure threshold Depositor
-------------------------------------------------------------------------------------------------------------------
o Requesting required financial information (including Depositor
any required accountants' consent to the use thereof) or
effecting incorporation by reference
-------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the Form 10-D
for the distribution period in which updated information
is required pursuant to the Items.
-------------------------------------------------------------------------------------------------------------------
Reg AB Item 1115(b): Derivative Counterparty Financial
Information
-------------------------------------------------------------------------------------------------------------------
o Determining current maximum probable exposure Depositor
-------------------------------------------------------------------------------------------------------------------
o Determining current significance percentage Depositor
-------------------------------------------------------------------------------------------------------------------
o Requesting required financial information (including Depositor
any required accountants' consent to the use thereof) or
effecting incorporation by reference
-------------------------------------------------------------------------------------------------------------------
*This information need only be reported on the Form 10-D
for the distribution period in which updated information
is required pursuant to the Items.
-------------------------------------------------------------------------------------------------------------------
Reg AB Item 1117: Legal Proceedings
-------------------------------------------------------------------------------------------------------------------
N-2-1
-------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
-------------------------------------------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
-------------------------------------------------------------------------------------------------------------------
Any legal proceeding pending against the following
entities or their respective property, that is material
to Certificateholders, including any proceedings
known to be contemplated by governmental authorities:
-------------------------------------------------------------------------------------------------------------------
o Issuing Entity (Trust Fund) Trustee, Master Servicer, Securities Administrator and
Depositor
-------------------------------------------------------------------------------------------------------------------
o Sponsor (Seller) Seller (if a party to the Pooling and Servicing
Agreement) or Depositor
-------------------------------------------------------------------------------------------------------------------
o Depositor Depositor
-------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------------------------------------------
o Custodian Custodian
-------------------------------------------------------------------------------------------------------------------
o 1110(b) Originator Depositor
-------------------------------------------------------------------------------------------------------------------
o Any 1108(a)(2) Servicer (other than the Master Servicer
Servicer or Securities Administrator)
-------------------------------------------------------------------------------------------------------------------
o Any other party contemplated by 1100(d)(1) Depositor
-------------------------------------------------------------------------------------------------------------------
Reg AB Item 1119: Affiliations and Relationships
-------------------------------------------------------------------------------------------------------------------
Whether (a) the Sponsor (Seller), Depositor or Issuing
Depositor as to (a) Entity is an affiliate of the following
parties, and (b) Sponsor/Seller as to (a) to the extent
known and material, any of the following parties are
affiliated with one another:
-------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
-------------------------------------------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Provider Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
Whether there are any "outside the ordinary course Depositor as to (a)
business arrangements" other than would be obtained in Sponsor/Seller as to (a)
an arm's length transaction between (a) the Sponsor
(Seller), Depositor or Issuing Entity on the one hand,
and (b) any of the following parties (or their
affiliates) on the other hand, that exist currently or
within the past two years and that are material to a
Certificateholder's understanding of the Certificates:
-------------------------------------------------------------------------------------------------------------------
N-2-2
-------------------------------------------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
-------------------------------------------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
-------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
-------------------------------------------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Provider Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
Whether there are any specific relationships involving
Depositor as to (a) the transaction or the pool assets
between (a) the Sponsor/Seller as to (a) Sponsor (Seller),
Depositor or Issuing Entity on the one hand, and (b)
any of the following parties (or their affiliates) on
the other hand, that exist currently or within the past
two years and that are material:
-------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
-------------------------------------------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Provider Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
-------------------------------------------------------------------------------------------------------------------
N-2-3
EXHIBIT N-3
Form 8-K Disclosure Information
-------------------------------------------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
-------------------------------------------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
-------------------------------------------------------------------------------------------------------------------
Item 1.01- Entry into a Material Definitive Agreement All parties (with respect to any
agreement entered into by such party)
Disclosure is required regarding entry into or amendment of
any definitive agreement that is material to the
securitization, even if depositor is not a party.
Examples: servicing agreement, custodial agreement.
Note: disclosure not required as to definitive agreements
that are fully disclosed in the prospectus
-------------------------------------------------------------------------------------------------------------------
Item 1.02- Termination of a Material Definitive Agreement All parties (with respect to any
agreement entered into by such party)
Disclosure is required regarding termination of any definitive
agreement that is material to the securitization (other than
expiration in accordance with its terms), even if depositor is
not a party.
Examples: servicing agreement, custodial agreement.
-------------------------------------------------------------------------------------------------------------------
Item 1.03- Bankruptcy or Receivership
Disclosure is required regarding the bankruptcy or receivership,
with respect to any of the following:
-------------------------------------------------------------------------------------------------------------------
o Sponsor (Seller) Depositor/Sponsor (Seller)
-------------------------------------------------------------------------------------------------------------------
o Depositor Depositor
-------------------------------------------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------------------------------------------
o Affiliated Servicer Servicer
-------------------------------------------------------------------------------------------------------------------
o Other Servicer servicing 20% or more of the pool Servicer
assets at the time of the report
-------------------------------------------------------------------------------------------------------------------
o Other material servicers Servicer
-------------------------------------------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------------------------------------------
o Significant Obligor Depositor
-------------------------------------------------------------------------------------------------------------------
o Credit Enhancer (10% or more) Depositor
-------------------------------------------------------------------------------------------------------------------
o Derivative Counterparty Depositor
-------------------------------------------------------------------------------------------------------------------
o Custodian Custodian
-------------------------------------------------------------------------------------------------------------------
N-3-1
-------------------------------------------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
-------------------------------------------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
-------------------------------------------------------------------------------------------------------------------
Item 2.04- Triggering Events that Accelerate or Increase Master Servicer nor the Securities
a Direct Financial Obligation or an Obligatin under an Administrator/Depositor (with respect
Off-Balance Sheet Arrangement to any agreement to which neither
the Master) Servicer not the
Securities Administrator is a party)
Includes an early amortization, performance trigger or other
event, including event of default, that would materially alter
the payment priority/distribution of cash flows/amortization
schedule.
Disclosure will be made of events other than waterfall triggers
which are disclosed in the monthly statements to the
certificateholders.
----------------------------------------------------------------------------------------------------------------
Item 3.03- Material Modification to Rights of Security Securities Administrator
Holders
Disclosure is required of any material modification to
documents defining the rights of Certificateholders,
including the Pooling and Servicing Agreement.
-------------------------------------------------------------------------------------------------------------------
Item 5.03- Amendments of Articles of Incorporation or Securities Administrator and Depositor
Bylaws; Change of Fiscal Year
Disclosure is required of any amendment "to the governing
documents of the issuing entity".
-------------------------------------------------------------------------------------------------------------------
Item 6.01- ABS Informational and Computational Material Depositor
-------------------------------------------------------------------------------------------------------------------
Item 6.02- Change of Servicer or Trustee Master Servicer/Securities Administrator/
Servicer/Depositor/Trustee (as to itself)/
successor
Requires disclosure of any removal, replacement, trustee
substitution or addition of any master servicer, affiliated
servicer, other servicer servicing 10% or more of pool
assets at time of report, other material servicers or
trustee.
-------------------------------------------------------------------------------------------------------------------
Reg AB disclosure about any new servicer or master
Servicer/Master Servicer/Depositor servicer is also
required.
-------------------------------------------------------------------------------------------------------------------
Reg AB disclosure about any new Trustee is also required.
successor trustee
-------------------------------------------------------------------------------------------------------------------
Item 6.03- Change in Credit Enhancement or External Depositor/Securities Administrator/Trustee
Support (to the extent action is required by the
Trustee in connection
Covers termination of any enhancement in manner other with
any amendment or modification therewith) than by its terms,
the addition of an enhancement, or a material change in the
enhancement provided. Applies to external
-------------------------------------------------------------------------------------------------------------------
N-3-3
-------------------------------------------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
-------------------------------------------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
-------------------------------------------------------------------------------------------------------------------
credit enhancements as well as derivatives.
Reg AB disclosure about any new enhancement provider is
Depositor also required.
-------------------------------------------------------------------------------------------------------------------
Item 6.04- Failure to Make a Required Distribution Securities Administrator/Trustee (to the extent the
Trustee has knowledge thereof)/Depositor (to the
extent the Depositor has knowledge thereof)
-------------------------------------------------------------------------------------------------------------------
Item 6.05- Securities Act Updating Disclosure Depositor
If any material pool characteristic differs by 5% or more at
the time of issuance of the securities from the description
in the final prospectus, provide updated Reg AB disclosure
about the actual asset pool.
-------------------------------------------------------------------------------------------------------------------
If there are any new servicers or originators required
Depositor to be disclosed under Regulation AB as a result of
the foregoing, provide the information called for in Items
1108 and 1110 respectively.
-------------------------------------------------------------------------------------------------------------------
Item 7.01- Reg FD Disclosure All parties
-------------------------------------------------------------------------------------------------------------------
Item 8.01- Other Events Depositor
Any event, with respect to which information is not
otherwise called for in Form 8-K, that the registrant deems
of importance to certificateholders.
-------------------------------------------------------------------------------------------------------------------
Item 9.01- Financial Statements and Exhibits Responsible party for reporting/disclosing the
financial statement or exhibit
-------------------------------------------------------------------------------------------------------------------
N-3-3
EXHIBIT O
[FORM OF]
SERVICING CRITERIA TO BE ADDRESSED IN
ASSESSMENT OF COMPLIANCE STATEMENT
The assessment of compliance to be delivered by each party listed below
shall address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
-----------------------------------------------------------------------------------------------------------------
Applicable Servicing
Criteria/
Servicing Criteria Responsible Party
-----------------------------------------------------------------------------------------------------------------
Reference Criteria
-----------------------------------------------------------------------------------------------------------------
General Servicing Considerations
--------------------- ----------------------
1122(d)(1)(i) Policies and procedures are instituted to monitor any performance S, MS, SA
or other triggers and events of default in accordance with the
transaction agreements.
--------------------- ----------------------
1122(d)(1)(ii) If any material servicing activities are outsourced to third
parties, policies and procedures are instituted to monitor the
third party's performance and compliance with such servicing S, MS, SA
activities.
--------------------- ----------------------
1122(d)(1)(iii) Any requirements in the transaction agreements to maintain
a N/A back-up servicer for the mortgage loans are
maintained.
--------------------- ----------------------
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in effect on
the party participating in the servicing function throughout the
reporting period in the amount of coverage required by and S, MS, SA
otherwise in accordance with the terms of the transaction
agreements.
--------------------- ----------------------
Cash Collection and Administration
--------------------- ----------------------
1122(d)(2)(i) Payments on mortgage loans are deposited into the
appropriate custodial bank accounts and related bank
clearing accounts no more than two business days following
receipt, or such other number of S, MS, SA days specified
in the transaction agreements.
--------------------- ----------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an
obligor or to S, MS, SA an investor are made only by
authorized personnel.
--------------------- ----------------------
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash flows
or distributions, and any interest or other fees charged for such
advances, are made, reviewed and approved as specified in the S, MS
transaction agreements.
--------------------- ----------------------
O-1
-----------------------------------------------------------------------------------------------------------------
Applicable Servicing
Criteria/
Servicing Criteria Responsible Party
-----------------------------------------------------------------------------------------------------------------
Reference Criteria
-----------------------------------------------------------------------------------------------------------------
1122(d)(2)(iv) The related accounts for the transaction, such as cash reserve S, MS, SA
accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g., with
respect to commingling of cash) as set forth in the transaction
agreements.
--------------------- ----------------------
1122(d)(2)(v) Each custodial account is maintained at a federally insured S, MS, SA
depository institution as set forth in the transaction agreements.
For purposes of this criterion, "federally insured depository
institution" with respect to a foreign financial institution means
a foreign financial institution that meets the requirements of
Rule 13k-1(b)(1) of the Securities Exchange Act.
--------------------- ----------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized S, MS, SA
access.
--------------------- ----------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all
asset-backed securities related bank accounts, including custodial
accounts and related bank clearing accounts. These reconciliations
are (A) mathematically accurate; (B) prepared within 30 calendar
days after the bank statement cutoff date, or such other number of
days specified in the transaction agreements; (C) reviewed and S, MS, SA
approved by someone other than the person who prepared the
reconciliation; and (D) contain explanations for reconciling
items. These reconciling items are resolved within 90 calendar
days of their original identification, or such other number of
days specified in the transaction agreements.
--------------------- ----------------------
Investor Remittances and Reporting
--------------------- ----------------------
1122(d)(3)(i) Reports to investors, including those to be filed with the
Commission, are maintained in accordance with the transaction
agreements and applicable Commission requirements. Specifically,
such reports (A) are prepared in accordance with timeframes and
other terms set forth in the transaction agreements; (B) provide
information calculated in accordance with the terms specified in S, MS, SA
the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with
investors' or the trustee's records as to the total unpaid
principal balance and number of mortgage loans serviced by the
Servicer.
--------------------- ----------------------
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in accordance
with timeframes, distribution priority and other terms set forth S, MS, SA
in the transaction agreements.
--------------------- ----------------------
O-2
-----------------------------------------------------------------------------------------------------------------
Applicable Servicing
Criteria/
Servicing Criteria Responsible Party
-----------------------------------------------------------------------------------------------------------------
Reference Criteria
-----------------------------------------------------------------------------------------------------------------
1122(d)(3)(iii) Disbursements made to an investor are posted within two business S, MS, SA
days to the Servicer's investor records, or such other number of
days specified in the transaction agreements.
--------------------- ----------------------
1122(d)(3)(iv) Amounts remitted to investors per the investor reports agree with
cancelled checks, or other form of payment, or custodial bank S, MS, SA
statements.
--------------------- ----------------------
Pool Asset Administration
--------------------- ----------------------
1122(d)(4)(i) Collateral or security on mortgage loans is maintained as required S, C
by the transaction agreements or related mortgage loan documents.
--------------------- ----------------------
1122(d)(4)(ii) Mortgage loan and related documents are safeguarded as required by S, C
the transaction agreements.
--------------------- ----------------------
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool are
made, reviewed and approved in accordance with any conditions or S
requirements in the transaction agreements.
--------------------- ----------------------
1122(d)(4)(iv) Payments on mortgage loans, including any payoffs, made in
accordance with the related mortgage loan documents are posted to
the Servicer's obligor records maintained no more than two
business days after receipt, or such other number of days S
specified in the transaction agreements, and allocated to
principal, interest or other items (e.g., escrow) in accordance
with the related mortgage loan documents.
--------------------- ----------------------
1122(d)(4)(v) The Servicer's records regarding the mortgage loans agree with the
Servicer's records with respect to an obligor's unpaid principal S
balance.
--------------------- ----------------------
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's
mortgage loans (e.g., loan modifications or re-agings) are made,
reviewed and approved by authorized personnel in accordance with S
the transaction agreements and related pool asset documents.
--------------------- ----------------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance plans,
modifications and deeds in lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated, conducted and S
concluded in accordance with the timeframes or other requirements
established by the transaction agreements.
--------------------- ----------------------
1122(d)(4)(viii) Records documenting collection efforts are maintained during the
period a mortgage loan is delinquent in accordance with the
transaction agreements. Such records are maintained on at least a
monthly basis, or such other period specified in the transaction
agreements, and describe the entity's activities in monitoring S
delinquent mortgage loans
--------------------- ----------------------
O-3
-----------------------------------------------------------------------------------------------------------------
Applicable Servicing
Criteria/
Servicing Criteria Responsible Party
-----------------------------------------------------------------------------------------------------------------
Reference Criteria
-----------------------------------------------------------------------------------------------------------------
including, for example, phone calls, letters and payment
rescheduling plans in cases where delinquency
is deemed temporary (e.g., illness or unemployment).
--------------------- ----------------------
1122(d)(4)(ix) Adjustments to interest rates or rates of return for mortgage
loans with variable rates are computed based on the related S
mortgage loan documents.
--------------------- ----------------------
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as escrow
accounts): (A) such funds are analyzed, in accordance with the
obligor's mortgage loan documents, on at least an annual basis, or
such other period specified in the transaction agreements; (B)
interest on such funds is paid, or credited, to obligors in S
accordance with applicable mortgage loan documents and state laws;
and (C) such funds are returned to the obligor within 30 calendar
days of full repayment of the related mortgage loans, or such
other number of days specified in the transaction agreements.
--------------------- ----------------------
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or insurance
payments) are made on or before the related penalty or expiration
dates, as indicated on the appropriate bills or notices for such
payments, provided that such support has been received by the S
servicer at least 30 calendar days prior to these dates, or such
other number of days specified in the transaction agreements.
--------------------- ----------------------
1122(d)(4)(xii) Any late payment penalties in connection with any payment to be
made on behalf of an obligor are paid from the servicer's funds
and not charged to the obligor, unless the late payment was due to S
the obligor's error or omission.
--------------------- ----------------------
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted within two S
business days to the obligor's records maintained by the servicer,
or such other number of days specified in the transaction
agreements.
--------------------- ----------------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are S, MS
recognized and recorded in accordance with the transaction
agreements.
--------------------- ----------------------
1122(d)(4)(xv) Any external enhancement or other support, identified in Item
1114(a)(1) through (3) or Item 1115 of Regulation AB, is SA
maintained as set forth in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
[NAME OF REPORTING PARTY]
Date: _________________________
By: ____________________________
Name:
Title:
Key:
S = each Servicer
MS = Master Servicer
SA = Securities Administrator
C = Custodian
O-5
EXHIBIT P
Additional Disclosure Notification
Xxxxx Fargo Bank, N.A. as Securities Administrator
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
E-mail: xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx
[insert name and address of Depositor]
Attn: Corporate Trust Services - MSM 2006-11-SEC REPORT PROCESSING
RE: **Additional Form [ ] Disclosure**Required
Ladies and Gentlemen:
In accordance with Section [12.02(b)][12.03(b)][12.04(b)] of the
Pooling and Servicing Agreement, dated as of [ ] [ ], 2006, among [ ], as [ ], [
], as [ ], [ ], as [ ] and [ ], as [ ]. The Undersigned, as [ ], hereby notifies
you that certain events have come to our attention that [will][may] need to be
disclosed on Form [ ].
Description of Additional Form [ ] Disclosure:
------------------------------------------------
List of Any Attachments hereto to be included in the Additional Form [ ]
Disclosure:
Any inquiries related to this notification should be directed to [ ],
phone number: [ ]; email address: [ ].
[NAME OF PARTY]
as [role]
By: __________________
Name:
Title:
P-1
EXHIBIT Q
GLOSSARY of TERMS for STANDARD & POOR'S LEVELS(R) VERSION 5.7 FILE FORMAT
APPENDIX E - Standard & Poor's Predatory Lending Categories
------------------------------------------------------------
Standard & Poor's has categorized loans governed by anti-predatory lending laws
in the Jurisdictions listed below into three categories based upon a combination
of factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note that
certain loans classified by the relevant statute as Covered are included in
Standard & Poor's High Cost Loan Category because they included thresholds and
tests that are typical of what is generally considered High Cost by the
industry.
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Name of Anti-Predatory Lending Category under Applicable
------------------------------ -------------------------
State/Jurisdiction Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------ --------------------------
---------------------------------------------------------------------------------------------------------------------
Arkansas Arkansas Home Loan Protection Act, Ark. Code High Cost Home Loan
Xxx. xx.xx. 00-00-000 et seq.
Effective July 16, 2003
---------------------------------------------------------------------------------------------------------------------
Cleveland Heights, OH Ordinance No. 72-2003 (PSH), Mun. Code xx.xx. Covered Loan
757.01 et seq.
Effective June 2, 2003
---------------------------------------------------------------------------------------------------------------------
Colorado Consumer Equity Protection, Colo. Stat. Xxx. Covered Loan
xx.xx. 5-3.5-101 et seq.
Effective for covered loans offered or entered
into on or after January 1, 2003. Other
provisions of the Act took effect on June 7,
2002
---------------------------------------------------------------------------------------------------------------------
Connecticut Connecticut Abusive Home Loan Lending Practices High Cost Home Loan
Act, Conn. Gen. Stat. xx.xx. 36a-746 et seq.
Effective October 1, 2001
---------------------------------------------------------------------------------------------------------------------
District of Columbia Home Loan Protection Act, D.C. Code xx.xx. Covered Loan
26-1151.01 et seq.
Effective for loans closed on or after January
28, 2003
---------------------------------------------------------------------------------------------------------------------
Florida Fair Lending Act, Fla. Stat. Xxx. xx.xx. 494.0078 High Cost Home Loan
et seq.
---------------------------------------------------------------------------------------------------------------------
Q-1
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Name of Anti-Predatory Lending Category under Applicable
------------------------------ -------------------------
State/Jurisdiction Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------ --------------------------
---------------------------------------------------------------------------------------------------------------------
Effective October 2, 2002
---------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. High Cost Home Loan
2003) 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
---------------------------------------------------------------------------------------------------------------------
Georgia as amended (Mar. 7, 0000 Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. High Cost Home Loan
- current) 7-6A-1 et seq.
Effective for loans closed on or after March 7,
2003
---------------------------------------------------------------------------------------------------------------------
HOEPA Section 32 Home Ownership and Equity Protection Act of High Cost Loan
1994, 15 U.S.C. ss. 1639, 12 C.F.R.
xx.xx. 226.32 and 226.34
Effective October 1, 1995, amendments October
1, 2002
---------------------------------------------------------------------------------------------------------------------
Illinois High Risk Home Loan Act, Ill. Comp. Stat. tit. High Risk Home Loan
815, xx.xx. 137/5 et seq.
Effective January 1, 2004 (prior to this
date, regulations under Residential Mortgage
License Act effective from May 14, 2001)
---------------------------------------------------------------------------------------------------------------------
Kansas Consumer Credit Code, Kan. Stat. Xxx. xx.xx. High Loan to Value Consumer
16a-1-101 et seq. Loan (id. ss. 16a-3-207) and;
Sections 16a-1-301 and 16a-3-207 became High APR Consumer Loan (id. ss.
effective April 14, 1999; Section 16a-3-308a 16a-3-308a)
became effective July 1, 1999
---------------------------------------------------------------------------------------------------------------------
Kentucky 2003 KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. High Cost Home Loan
Rev. Stat. xx.xx. 360.100 et seq.
Effective June 24, 2003
---------------------------------------------------------------------------------------------------------------------
Maine Truth in Lending, Me. Rev. Stat. tit. 9-A, xx.xx. High Rate High Fee Mortgage
8-101 et seq.
Effective September 29, 1995 and as amended
from time to time
---------------------------------------------------------------------------------------------------------------------
Q-2
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Name of Anti-Predatory Lending Category under Applicable
------------------------------ -------------------------
State/Jurisdiction Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------ --------------------------
---------------------------------------------------------------------------------------------------------------------
Massachusetts Part 40 and Part 32, 209 C.M.R. xx.xx. 32.00 et High Cost Home Loan
seq. and 209 C.M.R. xx.xx. 40.01 et seq.
Effective March 22, 2001 and amended from time
to time
---------------------------------------------------------------------------------------------------------------------
Nevada Assembly Xxxx No. 284, Nev. Rev. Stat. xx.xx. Home Loan
598D.010 et seq.
Effective October 1, 2003
---------------------------------------------------------------------------------------------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, High Cost Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 et seq.
Effective for loans closed on or after November
27, 2003
---------------------------------------------------------------------------------------------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. xx.xx. High Cost Home Loan
58-21A-1 et seq.
Effective as of January 1, 2004; Revised as of
February 26, 2004
---------------------------------------------------------------------------------------------------------------------
New York N.Y. Banking Law Article 6-l High Cost Home Loan
Effective for applications made on or after
April 1, 2003
---------------------------------------------------------------------------------------------------------------------
North Carolina Restrictions and Limitations on High Cost Home High Cost Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E et seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
---------------------------------------------------------------------------------------------------------------------
Ohio H.B. 386 (codified in various sections of the Covered Loan
Ohio Code), Ohio Rev. Code Xxx. xx.xx. 1349.25 et
seq.
Effective May 24, 2002
---------------------------------------------------------------------------------------------------------------------
Oklahoma Consumer Credit Code (codified in various Subsection 10 Mortgage
sections of Title 14A)
Effective July 1, 2000; amended effective
January 1, 2004
---------------------------------------------------------------------------------------------------------------------
Q-3
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Name of Anti-Predatory Lending Category under Applicable
------------------------------ -------------------------
State/Jurisdiction Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------ --------------------------
---------------------------------------------------------------------------------------------------------------------
South Carolina South Carolina High Cost and Consumer Home High Cost Home Loan
Loans Act, S.C. Code Xxx. xx.xx. 37-23-10 et seq.
Effective for loans taken on or after January
1, 2004
---------------------------------------------------------------------------------------------------------------------
West Virginia West Virginia Residential Mortgage Lender, West Virginia Mortgage Loan
Broker and Servicer Act, W. Va. Code Xxx. xx.xx. Act Loan
31-17-1 et seq.
Effective June 5, 2002
---------------------------------------------------------------------------------------------------------------------
Standard & Poor's Covered Loan Categorization
---------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Name of Anti-Predatory Lending Category under Applicable
------------------------------ -------------------------
State/Jurisdiction Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------ --------------------------
---------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. Covered Loan
2003) 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
---------------------------------------------------------------------------------------------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Covered Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 et seq.
Effective November 27, 2003 - July 5, 2004
---------------------------------------------------------------------------------------------------------------------
Standard & Poor's Home Loan Categorization
------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Name of Anti-Predatory Lending Category under Applicable
------------------------------ -------------------------
State/Jurisdiction Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------ --------------------------
---------------------------------------------------------------------------------------------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. Home Loan
2003) 7-6A-1 et seq.
-- ---
Effective October 1, 2002 - March 6, 2003
---------------------------------------------------------------------------------------------------------------------
Q-4
Standard & Poor's Home Loan Categorization
------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Name of Anti-Predatory Lending Category under Applicable
------------------------------ -------------------------
State/Jurisdiction Law/Effective Date Anti-Predatory Lending Law
------------------ ------------------ --------------------------
---------------------------------------------------------------------------------------------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 et seq.
Effective for loans closed on or after November
27, 2003
---------------------------------------------------------------------------------------------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. xx.xx. Home Loan
58-21A-1 et seq.
Effective as of January 1, 2004; Revised as of
February 26, 2004
---------------------------------------------------------------------------------------------------------------------
North Carolina Restrictions and Limitations on High Cost Home Consumer Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E et seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
---------------------------------------------------------------------------------------------------------------------
South Carolina South Carolina High Cost and Consumer Home Consumer Home Loan
Loans Act, S.C. Code Xxx. xx.xx. 37-23-10
et seq.
Effective for loans taken on or after January
1, 2004
---------------------------------------------------------------------------------------------------------------------
Q-5
EXHIBIT R
FORM OF LOST NOTE AFFIDAVIT - LA SALLE AS CUSTODIAN
I, as _________________________ (title) of ________ (the "Custodian"), am
authorized to make this Lost Note Affidavit on behalf of __________. In
connection with the administration of the Mortgage Loans held by
_______________ as Custodian on behalf of ____________ ("____") or the Trust of
such mortgage loans, as the case may be (the "Investor"), I (hereinafter called
"Deponent"), being duly sworn, depose and say that:
Custodian's address is:
[CUSTODIAN'S Address]
Custodian previously delivered to the Investor a signed Trust Receipt
with respect to the Mortgage Note referred to below;
Such Mortgage Note was endorsed or sold to the Investor by
_________________________ pursuant to the terms and provisions of a
____________________ Agreement dated and effective as of _________
______, ____;
Such Mortgage Note is not outstanding pursuant to a Request for
Release of Documents;
Such Mortgage Note (hereinafter called the "Original") has been
lost;
Deponent has made or has caused to be made diligent search for Original
and has been unable to find or recover same;
The Custodian was the Custodian of the Original at the time of
loss; and
Deponent agrees that, if the Original should ever come into Custodian's
possession, custody or power, Custodian will immediately and without
consideration surrender Original to the Investor.
Attached hereto is a true and correct copy of the (i) Mortgage Note,
endorsed in blank by the Mortgagee, and (ii) [Mortgage][Deed of Trust] with
evidence of recording thereon which secures the Mortgage Note.
Deponent hereby agrees that the Custodian shall indemnify and hold
harmless the Purchaser, the Trust, the Servicer of the related Mortgage Loan
and their respective employees, officers, directors and agents against any
loss, liability or damage, including reasonable attorney's fees, resulting from
the unavailability of the Mortgage Note, including but not limited to any loss,
liability or damage arising from (i) any false statement contained in this Lost
Note Affidavit, (ii) any claim of any party that it has already purchased a
mortgage loan evidenced by the lost Mortgage Note or any interest in such
mortgage loan, (iii) any claim of any borrower with respect to the existence of
terms of a Mortgage Loan evidenced by the lost Mortgage Note, (iv) the issuance
of new instrument in lieu thereof and (v) any claim whether or not based upon
or arising from honoring or refusing to honor the Original when presented by
anyone (items (i)
R-1
through (iv) above are hereinafter referred to as the "Losses") and (b) if
required by any Rating Agency in connection with placing such lost Mortgage
Note into a securitization transaction, shall obtain a surety bond from an
insurer acceptable to the applicable Rating Agency in an amount acceptable to
such Rating Agency to cover any Losses with respect to such lost Mortgage Note.
Capitalized terms used herein but not defined herein have the meanings
given them in the Custodial Agreement, dated as of July 1, 2006, between Xxxxxx
Xxxxxxx Mortgage Capital Inc. and the Custodian.
This Lost Note Affidavit is intended to be relied on by the Investor, its
successors, and assigns and _______________________ represents and warrants
that it has the authority to perform its obligations under this Lost Note
Affidavit.
IN WITNESS WHEREOF, the Custodian has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
[title of officer] this _____ day of __________ 20__.
---------------------------------
[LA SALLE BANK NATIONAL ASSOCIATION]
By:
Name:
Title:
On this _________ day of _______________________, ____, before me
appeared ____________________________________________, to me personally known,
who being duly sworn did say that she/he is the ______________________________
of ______________________, and that said Lost Note Affidavit was signed and
sealed on behalf of such corporation and said _____________________________
acknowledged this instrument to be the free act and deed of said corporation.
Subscribed and sworn before me this _____ day of __________ 20__.
NOTARY PUBLIC
----------------------------
COUNTY OF __________________
STATE OF ___________________
My commission expires the _____ day of __________ 20__.
Signature
R-2
Typed Name
R-3
SCHEDULE A
MORTGAGE LOAN SCHEDULE
[On File with the Trustee and the Securities Administrator]
SCH. A-1
SCHEDULE B
PRINCIPAL BALANCES SCHEDULE
[Attached to Prospectus Supplement, if applicable]
SCH. B-1
