EXECUTION
GE CAPITAL MORTGAGE SERVICES, INC.
REMIC MULTI-CLASS PASS-THROUGH CERTIFICATES
SERIES 1996-HE3
TERMS AGREEMENT
(to Underwriting Agreement,
dated September 24, 1996
between the Company and the Underwriters)
GE Capital Mortgage Services, Inc. New York, New York
Three Executive Campus September 24, 0000
Xxxxxx Xxxx, XX 00000
Each of Prudential Securities Incorporated
("Prudential") and PaineWebber Incorporated ("PaineWebber," and
each an "Underwriter" and collectively the "Underwriters")
agrees, severally and not jointly, subject to the terms and
provisions herein and of the captioned Underwriting Agreement
(the "Underwriting Agreement"), to purchase the Classes of Series
1996- HE3 Certificates specified beneath its name in Section 3
hereof (the "Offered Certificates"). This Terms Agreement
supplements and modifies the Underwriting Agreement solely as it
relates to the purchase and sale of the Offered Certificates
described below. The Series 1996-HE3 Certificates are registered
with the Securities and Exchange Commission by means of an
effective Registration Statement (No. 333-3038). Capitalized
terms used and not defined herein have the meanings given them in
the Underwriting Agreement.
Section 1. The Mortgage Pool: The Series 1996-HE3
Certificates shall evidence the entire beneficial ownership
interest in a mortgage pool (the "Mortgage Pool") of closed end,
fixed rate, first- or second-lien, home equity mortgage loans
(the "Mortgage Loans") having the characteristics described in
the Final Prospectus.
Section 2. The Certificates: The Offered Certificates
shall be issued as follows:
(a) Classes: The Offered Certificates shall be issued
with the following Class designations, interest rates and
principal balances subject in the aggregate to a variance
described in the Final Prospectus:
Principal Interest Class Purchase
Class Balance Rate Price Percentage
Class A1 $37,643,000 6.950% 99.759375%
Class A2 12,194,000 6.950 99.743750
Class A3 24,250,000 7.150 99.728125
Class A4 22,860,000 7.485 99.775000
Class A5 10,911,000 (1) 99.775000
-------------------
(1) Interest will accrue on the Class A5 Certificates during
the initial interest Accrual Period at a rate of 7.925% per
annum and during each subsequent Interest Accrual Period at
a Certificate Interest Rate equal to the lesser of (i)
7.925% per annum and (ii) the Weighted Average Net Mortgage
Rate of the Mortgage Loans as of the first day of the
related Interest Accrual Period.
(b) The Offered Certificates shall have such other
characteristics as described in the Final Prospectus.
Section 3. Purchase Price: The Purchase Price for each
Class of the Offered Certificates shall be the Class Purchase
Price Percentage therefor (as set forth in Section 2(a) above) of
the initial Class Certificate Principal Balance thereof plus
accrued interest at the applicable interest rate per annum of
each such Class from and including September 1, 1996, up to, but
not including, September 27, 1996 (the "Closing Date").
Each of the Underwriters agrees, severally and not jointly,
subject to the terms and provisions herein and of the captioned
Underwriting Agreement, to purchase the principal balances of the
Classes of Series 1996-HE3 Certificates specified opposite its
name below.
2
Class Prudential PaineWebber
Class A1 $18,821,500 $18,821,500
Class A2 6,097,000 6,097,000
Class A3 12,125,000 12,125,000
Class A4 11,430,000 11,430,000
Class A5 5,455,500 5,455,500
Section 4. Required Ratings: The Offered
Certificates shall have received Required Ratings of at least
"Aaa" from Xxxxx'x Investors Service and "AAA" from Fitch
Investors Service, L.P.
Section 5. Tax Treatment: One or more elections will
be made to treat the assets of the Trust Fund as a REMIC (other
than assets excluded from a REMIC as described in the Final
Prospectus.
Section 6: Underwriter-Provided Information: The
Company acknowledges that the statements set forth in the first
sentence and the table under the caption "Plan of Distribution"
in the Final Prospectus as such statements relate to the Offered
Certificates constitute the only information furnished in writing
by or on behalf of the Underwriters for inclusion in such Final
Prospectus, and the Underwriters confirm that such statements are
correct.
3
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the
undersigned a counterpart hereof, whereupon this letter and your
acceptance shall represent a binding agreement between the
Underwriters and the Company.
Very truly yours,
PRUDENTIAL SECURITIES INCORPORATED
By:________________________________
Name:
Title:
PAINEWEBBER INCORPORATED
By:________________________________
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of
the date hereof.
GE CAPITAL MORTGAGE SERVICES, INC.
By:_______________________________
Name:
Title:
