Exhibit 4.1
EXECUTION
STRUCTURED ASSET SECURITIES CORPORATION, as Depositor,
XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as Master Servicer
THE MURRAYHILL COMPANY, as Loss Mitigation Advisor,
and
BANK ONE, NATIONAL ASSOCIATION, as Trustee
---------------------------
TRUST AGREEMENT
Dated as of May 1, 2001
---------------------------
AMORTIZING RESIDENTIAL COLLATERAL TRUST
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2001-BC3
Table of Contents
Page
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions................................................................................10
Section 1.02. Calculations Respecting Mortgage Loans.....................................................35
Section 1.03. Calculations Respecting Accrued Interest...................................................35
ARTICLE II
DECLARATION OF TRUST; ISSUANCE OF CERTIFICATES
Section 2.01. Creation and Declaration of Trust Fund; Conveyance of Mortgage Loans.......................35
Section 2.02. Acceptance of Trust Fund by Trustee: Review of Documentation for Trust Fund................38
Section 2.03. Representations and Warranties of the Depositor............................................40
Section 2.04. Discovery of Breach........................................................................41
Section 2.05. Repurchase, Purchase or Substitution of Mortgage Loans.....................................42
Section 2.06. Grant Clause...............................................................................43
Section 2.07. Purchase of Defaulted Mortgage Loans.......................................................43
ARTICLE III
THE CERTIFICATES
Section 3.01. The Certificates...........................................................................43
Section 3.02. Registration...............................................................................44
Section 3.03. Transfer and Exchange of Certificates......................................................44
Section 3.04. Cancellation of Certificates...............................................................47
Section 3.05. Replacement of Certificates................................................................47
Section 3.06. Persons Deemed Owners......................................................................48
Section 3.07. Temporary Certificates.....................................................................48
Section 3.08. Appointment of Paying Agent................................................................48
Section 3.09. Book-Entry Certificates....................................................................48
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01. Collection Account.........................................................................50
Section 4.02. Application of Funds in the Collection Account.............................................52
Section 4.03. Reports to Trustee and Certificateholders..................................................54
Section 4.04. Reports to Certificateholders..............................................................54
Section 4.05. Certificate Account........................................................................57
Section 4.06. Determination of LIBOR.....................................................................58
ARTICLE V
DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
Section 5.01. Distributions Generally....................................................................61
Section 5.02. Distributions from the Certificate Account.................................................61
Section 5.03. Allocation of Losses. .....................................................................66
Section 5.04. Advances by Master Servicer, Servicers and Trustee.........................................66
Section 5.05. Compensating Interest Payments.............................................................67
Section 5.06. Basis Risk Reserve Fund....................................................................67
ARTICLE VI
CONCERNING THE TRUSTEE; EVENTS OF DEFAULT
Section 6.01. Duties of Trustee. ........................................................................68
Section 6.02. Certain Matters Affecting the Trustee. ....................................................71
Section 6.03. Trustee Not Liable for Certificates. ......................................................72
Section 6.04. Trustee May Own Certificates. .............................................................72
Section 6.05. Eligibility Requirements for Trustee. .....................................................72
Section 6.06. Resignation and Removal of Trustee. .......................................................73
Section 6.07. Successor Trustee. ........................................................................74
Section 6.08. Merger or Consolidation of Trustee. .......................................................75
Section 6.09. Appointment of Co-Trustee, Separate Trustee or Custodian. .................................75
Section 6.10. Authenticating Agents. ....................................................................76
Section 6.11. Indemnification of Trustee. ...............................................................77
Section 6.12. Fees and Expenses of Trustee...............................................................78
Section 6.13. Collection of Monies. .....................................................................78
Section 6.14. Trustee To Act; Appointment of Successor...................................................78
Section 6.15. Additional Remedies of Trustee Upon Event of Default.......................................82
Section 6.16. Waiver of Defaults.........................................................................82
Section 6.17. Notification to Holders....................................................................82
Section 6.18. Directions by Certificateholders and Duties of Trustee During Event of Default.............82
Section 6.19. Action Upon Certain Failures of the Master Servicer and Upon Event of Default..............83
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......................................................................84
Section 7.02. Procedure Upon Termination of Trust Fund...................................................85
Section 7.03. Additional Trust Fund Termination Requirements.............................................86
ARTICLE VIII
RIGHTS OF CERTIFICATEHOLDERS
Section 8.01. Limitation on Rights of Holders............................................................87
Section 8.02. Access to List of Holders..................................................................87
Section 8.03. Acts of Holders of Certificates............................................................88
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS BY THE MASTER SERVICER; LOSS MITIGATION ADVISOR
Section 9.01. Duties of the Master Servicer..............................................................89
Section 9.02. Master Servicer Fidelity Bond and Master Servicer Errors and Omissions Insurance
Policy.....................................................................................89
Section 9.03. Master Servicer's Financial Statements and Related Information.............................90
Section 9.04. Power to Act; Procedures...................................................................90
Section 9.05. Enforcement of Servicer's and Master Servicer's Obligations................................92
Section 9.06. Collection of Taxes, Assessments and Similar Items.........................................92
Section 9.07. Termination of Servicing Agreements; Successor Servicers...................................93
Section 9.08. Master Servicer Liable for Enforcement.....................................................93
Section 9.09. No Contractual Relationship Between Any Servicer and Trustee or Depositor..................94
Section 9.10. Assumption of Servicing Agreement by Trustee...............................................94
Section 9.11. "Due-on-Sale" Clauses; Assumption Agreements...............................................94
Section 9.12. Release of Mortgage Files..................................................................95
Section 9.13. Documents, Records and Funds in Possession of Master Servicer To Be Held for
Trustee....................................................................................95
Section 9.14. Representations and Warranties of the Master Servicer......................................97
Section 9.15. Opinion....................................................................................99
Section 9.16. Standard Hazard and Flood Insurance Policies...............................................99
Section 9.17. Presentment of Claims and Collection of Proceeds..........................................100
Section 9.18. Maintenance of the Primary Mortgage Insurance Policies....................................100
Section 9.19. Trustee To Retain Possession of Certain Insurance Policies and Documents..................100
Section 9.20. [Reserved]................................................................................101
Section 9.21. Compensation to the Master Servicer.......................................................101
Section 9.22. REO Property..............................................................................101
Section 9.23. Preparation of Tax Returns and Other Reports..............................................102
Section 9.24. Reports to the Trustee....................................................................103
Section 9.25. Annual Officer's Certificate as to Compliance.............................................103
Section 9.26. Annual Independent Accountants' Servicing Report..........................................104
Section 9.27. Merger or Consolidation...................................................................104
Section 9.28. Resignation of Master Servicer............................................................104
Section 9.29. Assignment or Delegation of Duties by the Master Servicer.................................105
Section 9.30. Limitation on Liability of the Master Servicer and Others.................................105
Section 9.31. Indemnification; Third-Party Claims.......................................................106
Section 9.32. Special Servicing of Delinquent Mortgage Loans............................................106
Section 9.33. Alternative Index.........................................................................106
Section 9.34. Duties of the Loss Mitigation Advisor.....................................................106
Section 9.35. Limitation Upon Liability of the Loss Mitigation Advisor..................................107
ARTICLE X
REMIC ADMINISTRATION
Section 10.01. REMIC Administration......................................................................107
Section 10.02. Prohibited Transactions and Activities....................................................109
Section 10.03. Indemnification with Respect to Certain Taxes and Loss of REMIC Status....................109
Section 10.04. REO Property..............................................................................111
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Binding Nature of Agreement; Assignment...................................................112
Section 11.02. Entire Agreement..........................................................................112
Section 11.03. Amendment.................................................................................112
Section 11.04. Voting Rights.............................................................................113
Section 11.05. Provision of Information..................................................................113
Section 11.06. Governing Law.............................................................................114
Section 11.07. Notices...................................................................................114
Section 11.08. Severability of Provisions................................................................114
Section 11.09. Indulgences; No Waivers...................................................................114
Section 11.10. Headings Not To Affect Interpretation.....................................................115
Section 11.11. Benefits of Agreement.....................................................................115
Section 11.12. Special Notices to the Rating Agencies....................................................115
Section 11.13. Conflicts.................................................................................116
Section 11.14. Counterparts..............................................................................116
Section 11.15. Transfer of Servicing.....................................................................116
ATTACHMENTS
Exhibit A......... Forms of Certificates
Exhibit B-1....... Form of Initial Certification
Exhibit B-2....... Form of Interim Certification
Exhibit B-3....... Form of Final Certification
Exhibit B-4....... Form of Endorsement
Exhibit C......... Request for Release of Documents and Receipt
Exhibit D-l....... Residual Certificate Transfer Affidavit (Transferee)
Exhibit D-2....... Residual Certificate Transfer Affidavit (Transferor)
Exhibit E-1....... Servicing Agreement (Countrywide Home Loans, Inc.)
Exhibit E-2....... Servicing Agreement (Ocwen Federal Bank F.S.B.)
Exhibit E-3....... Servicing Agreement (Xxxxx Fargo Home Mortgage, Inc.)
Exhibit F......... Form of Rule 144A Transfer Certificate
Exhibit G......... Form of Purchaser's Letter for Institutional Accredited Investors
Exhibit H......... Form of ERISA Transfer Affidavit
Exhibit I......... [Reserved]
Exhibit J......... [Reserved]
Exhibit K-1 Custodial Agreement Bankers Trust Company of California, N.A.
Exhibit K-2 [Reserved]
Exhibit K-3....... Custodial Agreement (U.S. Bank Trust National Association)
Exhibit L-1 [Reserved]
Exhibit L-2....... [Reserved]
Exhibit M......... [Reserved]
Exhibits N Form of Loss Mitigation Advisory Agreement, dated as of May 11, 2001, between The
Murrayhill Company, as Loss Mitigation Advisor, and the Servicers
Exhibit O-1 Form of Transfer Certificate for Transfer from Restricted Global Security to
Regulation S Global Security
Exhibit O-2 Form of Transfer Certificate for Transfer from Regulation S Global Security to
Restricted Global Security
Schedule A Mortgage Loan Schedule
This TRUST AGREEMENT, dated as of May 1, 2001 (the "Agreement"), is by
and between STRUCTURED ASSET SECURITIES CORPORATION, a Delaware corporation, as
depositor (the "Depositor"), BANK ONE, NATIONAL ASSOCIATION, as Trustee (the
"Trustee"), XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as master
servicer (the "Master Servicer") and THE MURRAYHILL COMPANY, a Colorado
corporation, as loss mitigation advisor (the "Loss Mitigation Advisor").
PRELIMINARY STATEMENT
The Depositor has acquired the Mortgage Loans from the Seller, and at
the Closing Date is the owner of the Mortgage Loans and the other property
being conveyed by it to the Trustee hereunder for inclusion in the Trust Fund.
On the Closing Date, the Depositor will acquire the Certificates from the Trust
Fund, as consideration for its transfer to the Trust Fund of the Mortgage Loans
and the other property constituting the Trust Fund. The Depositor has duly
authorized the execution and delivery of this Agreement to provide for the
conveyance to the Trustee of the Mortgage Loans and the other property
constituting the Trust Fund. All covenants and agreements made by the
Depositor, the Master Servicer, the Loss Mitigation Advisor and the Trustee
herein with respect to the Mortgage Loans and the other property constituting
the Trust Fund are for the benefit of the Holders from time to time of the
Certificates. The Depositor, the Master Servicer, and the Loss Mitigation
Advisor are entering into this Agreement, and the Trustee is accepting the
Trust Fund created hereby, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged.
As provided herein, the Trustee shall elect that the Trust Fund be
treated for federal income tax purposes as comprising three real estate
mortgage investment conduits (each a "REMIC" or, in the alternative, REMIC 1,
REMIC 2, and REMIC 3, REMIC 3 also being referred to as the "Upper Tier
REMIC"). Each Certificate, other than the Class P and the Class R Certificates,
represents ownership of a regular interest in the Upper Tier REMIC for purposes
of the REMIC Provisions. In addition, each Certificate, other than the Class P
Certificate, the Class A-IO Certificates, the Class X Certificate and the Class
R Certificate, represents an entitlement to receive payments from the Basis
Risk Reserve Fund maintained by the Trustee pursuant to Section 5.06. The Class
R Certificate represents ownership of the sole class of residual interest in
each of REMIC 1, REMIC 2, and the Upper Tier REMIC for purposes of the REMIC
Provisions. The Upper Tier REMIC shall hold as its assets the several classes
of uncertificated Lower Tier Interests in REMIC 2, other than the Class LT2-R
Interest, and each such Lower Tier Interest in REMIC 2 is hereby designated as
a regular interest in REMIC 2 for purposes of the REMIC Provisions. REMIC 2
shall hold as its assets the several classes of uncertificated Lower Tier
Interests in REMIC 1, other than the Class LT1-R Interest, and each such Lower
Tier Interest in REMIC 1 is hereby designated as a regular interest in REMIC 1.
REMIC 1 shall hold as its assets the property of the Trust Fund other than the
Lower Tier Interests in REMIC 1 and REMIC 2 and the Basis Risk Reserve Fund.
The startup day for each REMIC created hereby for purposes of the REMIC
Provisions is the Closing Date. In addition, for purposes of the REMIC
Provisions, the latest possible maturity date for each regular interest in each
REMIC created hereby is January 25, 2032.
REMIC 1
The following table sets forth (or describes) the class designation,
interest rate, and initial principal amount for each class of REMIC 1 Lower
Tier Interests.
REMIC 1 REMIC 1
Lower Tier Class Lower Tier Initial Class
Designation Interest Rate Principal Amount
----------- ------------- ----------------
Class LT1-A (1) $232,121,568.00
Class LT1-B (1) $ 9,539,270.00
Class LT1-C (1) $ 9,539,271.00
Class LT1-D (1) $ 9,539,270.00
Class LT1-E (1) $ 19,078,540.00
Class LT1-F (1) $ 19,078,541.00
Class LT1-G (1) $ 19,078,540.00
Class LT1-R (2) (2)
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(1) The interest rate with respect to any Distribution Date (and the
related Accrual Period) for these Lower Tier Interests is a per annum
rate equal to the weighted average of the Net Mortgage Rates of the
Mortgage Loans as of the first day of the related Collection Period.
(2) The Class LT1-R Interest is the sole class of residual interest in the
REMIC 1. It does not have an interest rate or a principal balance.
On each Distribution Date, the Trustee shall distribute the Interest
Remittance Amount to the Lower Tier Interests in REMIC 1 at the rates shown
above.
On each Distribution Date the Trustee shall distribute the Principal
Remittance Amount, and shall allocate any Realized Losses, in the following
order and priority:
(i) First, to the Class LT1-A Interest until its principal balance is
reduced to zero;
(ii) Second, to the Class LT1-B Interest until its principal balance is
reduced to zero;
(iii) Third, to the Class LT1-C Interest until its principal balance is
reduced to zero;
(iv) Fourth, to the Class LT1-D Interest until its principal balance is
reduced to zero;
(v) Fifth, to the Class LT1-E Interest until its principal balance is
reduced to zero;
(vi) Sixth, to the Class LT1-F Interest until its principal balance is
reduced to zero; and
(vii) Finally, to the Class LT1-G Interest until its principal balance is
reduced to zero.
REMIC 2
The following table sets forth (or describes) the class designation,
interest rate, and principal amount for each class of REMIC 2 Lower Tier
Interests.
REMIC 2 REMIC 2
Lower Tier Class Lower Tier Initial Class Corresponding Class
Designation Interest Rate Principal Amount of Certificates
----------- ------------- ---------------- ---------------
Class LT2-A (1) $298,897,000.00 Class A
Class LT2-M1 (1) $ 4,372,000.00 Class M1
Class LT2-M2 (1) $ 3,577,000.00 Class M2
Class LT2-B (1) $ 1,590,000.00 Class B
Class LT2-D (1) $158,988,173.09 N/A
Class LT2-A-IO (2) (2) Class A-IO
Class LT2-B-IO (3) (3) Class A-IO
Class LT2-C-IO (4) (4) Class A-IO
Class LT2-D-IO (5) (5) Class A-IO
Class LT2 E-IO (6) (6) Class A-IO
Class LT2 F-IO (7) (7) Class A-IO
Class LT2-R (8) (8) Class R
-----------------
(1) The interest rate with respect to any Distribution Date (and the
related Accrual Period) for these interests is a per annum rate equal
to the Net Funds Cap for such Distribution Date.
(2) The Class LT2-A-IO Interest is an interest-only Class and does not
have a principal balance. For each Distribution Date through and
including the Distribution Date in October 2001 the Class LT2-A-IO
Interest shall be entitled to interest payable on the Class LT1-B
Interest at a rate of 6.00% per annum and shall not be entitled to any
payments thereafter.
(3) The Class LT2-B-IO Interest is an interest-only Class and does not
have a principal balance. For each Distribution Date through and
including the Distribution Date in April 2002 the Class LT2-B-IO
Interest shall be entitled to interest payable on the Class LT1-C
Interest at a rate of 6.00% per annum and shall not be entitled to any
payments thereafter.
(4) The Class LT2-C-IO Interest is an interest-only Class and does not
have a principal balance. For each Distribution Date through and
including the Distribution Date in October 2002 the Class LT2-C-IO
Interest shall be entitled to interest payable on the Class LT1-D
Interest at a rate of 6.00% per annum and shall not be entitled to any
payments thereafter.
(5) The Class LT2-D-IO Interest is an interest-only Class and does not
have a principal balance. For each Distribution Date through and
including the Distribution Date in April 2003 the Class LT2-D-IO
Interest shall be entitled to interest payable on the Class LT1-E
Interest at a rate of 6.00% per annum and shall not be entitled to any
payments thereafter.
(6) The Class LT2-E-IO Interest is an interest-only Class and does not
have a principal balance. For each Distribution Date through and
including the Distribution Date in October 2003 the Class LT2-E-IO
Interest shall be entitled to interest payable on the Class LT1-F
Interest at a rate of 6.00% per annum and shall not be entitled to any
payments thereafter.
(7) The Class LT2-F-IO Interest is an interest-only Class and does not
have a principal balance. For each Distribution Date through and
including the Distribution Date in April 2004 the Class LT2-F-IO
Interest shall be entitled to interest payable on the Class LT1-G
Interest at a rate of 6.00% per annum and shall not be entitled to any
payments thereafter.
(8) The Class LT2 -R Interest is the sole class of residual interest in
the REMIC 1. It does not have an interest rate or a principal balance.
On each Distribution Date, the Trustee shall distribute the interest
received with respect to the REMIC 1 Lower Tier Interests to the REMIC 2 Lower
Tier Interests at the rates shown above, except that, interest that accrues on
the Class LT2-D Lower Tier Interest shall be deferred to the extent of one-half
of the increase in the Overcollateralization Amount occurring on such
Distribution Date. Any amount so deferred shall be distributed as principal on
the Class LT2-A, Class LT2-M1, Class LT2-M2 and Class LT2B Lower Tier Interests
(to each such Class in proportion to the amount of interest distributed as
principal on the Corresponding Class of Certificates).
On each Distribution Date the Trustee shall distribute all principal
received with respect to the REMIC 1 Lower Tier Interests to each of the Class
LT2-A, Class LT2-M1, Class LT2-M2 and Class LT2-B Interests in an amount equal
to one half of the amount of principal allocated to its Corresponding Class of
Certificates, and shall allocate any Realized Losses, among the REMIC 2 Lower
Tier Interests in the following order and priority:
(i) First, to the Class LT2-B Interest until its principal balance
equals one-half of the principal balance of the Corresponding Class
of Certificate for such Distribution Date;
(ii) Second, to the Class LT2-M2 Interest until its principal balance
equals one-half of the principal balance of the Corresponding Class
of Certificate for such Distribution Date;
(iii) Third, to the Class LT2-M1 Interest until its principal balance
equals one-half of the principal balance of the Corresponding Class
of Certificate for such Distribution Date;
(iv) Fourth, to the Class LT2-A Interest until its principal balance
equals one-half of the principal balance of the Corresponding Class
of Certificate for such Distribution Date;
(v) Finally, to the Class LT2-D Interest.
REMIC 3
The following table specifies the Class designation, initial Class
Principal Amount, Certificate Interest Rate and minimum denomination (by dollar
amount or Percentage Interest) for each Class of Certificates representing the
interests in the Trust Fund created hereunder. Each Class of Certificates,
other than the Class P Certificates, shall represent ownership of an interest
in REMIC 3.
Initial Class Certificate Minimum
Class Designation Principal Amount Interest Rate Denomination
----------------- ---------------- ------------- ------------
Class A $298,897,000.00 (4) $ 25,000
Class A-IO (1) 6.00% $ 500,000
Class M1 $ 8,744,000.00 (5) $ 25,000
Class M2 $ 7,154,000.00 (6) $ 25,000
Class B $ 3,180,000.00 (7) $ 25,000
Class P (2) (8) 100%
Class X $ 673.09 (9) 100%
Class R (3) (8) 100%
-----------------
(1) The Class A-IO Certificates have no Class Principal Amount. The Class
A-IO Certificates will accrue interest on a Class Notional Amount. The
initial Class Notional Amount of the Class A-IO Certificates is equal
to $85,853,432.
(2) The Class P Certificate will be issued without a Certificate Principal
Amount and will not bear interest at a stated rate but shall entitle
the Holder thereof to receive Prepayment Premiums paid with respect to
the Mortgage Loans as provided in Section 5.02(e). The Class P
Certificate shall be an interest in the Trust Fund but shall not be an
interest in any REMIC created under this Agreement.
(3) The Class R Certificate has no Class Principal Amount.
(4) The Class A Certificates will bear interest during the initial Accrual
Period at 4.4275% per annum. The Class A Certificates will bear
interest during each Accrual Period thereafter at a per annum rate
equal to the lesser of (i) LIBOR plus 0.260% and (ii) the Net Funds
Cap; provided, that if the option to purchase the Mortgage Loans and
related property pursuant to Section 7.01(b) is not exercised on the
first Distribution Date on which the Total Loan Balance is less than
10% of the Cut-off Date Total Loan Balance, then with respect to such
Distribution Date and each subsequent Distribution Date the per annum
rate calculated pursuant to clause (i) above with respect to the Class
A Certificates will be LIBOR plus 0.520%.
(5) The Class M1 Certificates will bear interest during the initial
Accrual Period at 4.7975% per annum. The Class M1 Certificates will
bear interest during each Accrual Period thereafter at a per annum
rate equal to the lesser of (i) LIBOR plus 0.630% and (ii) the Net
Funds Cap; provided, that if the option to purchase the Mortgage Loans
and related property pursuant to Section 7.01(b) is not exercised on
the first Distribution Date on which the Total Loan Balance is less
than 10% of the Cut-off Date Total Loan Balance, then with respect to
such Distribution Date and each subsequent Distribution Date the per
annum rate calculated pursuant to clause (i) above with respect to the
Class M1 Certificates will be LIBOR plus 0.945%.
(6) The Class M2 Certificates will bear interest during the initial
Accrual Period at 5.2175% per annum. The Class M2 Certificates will
bear interest during each Accrual Period thereafter at a per annum
rate equal to the lesser of (i) LIBOR plus 1.050% and (ii) the Net
Funds Cap; provided, that if the option to purchase the Mortgage Loans
and related property pursuant to Section 7.01(b) is not exercised on
the first Distribution Date on which the Total Loan Balance is less
than 10% of the Cut-off Date Total Loan Balance, then with respect to
such Distribution Date and each subsequent Distribution Date the per
annum rate calculated pursuant to clause (i) above with respect to the
Class M2 Certificates will be LIBOR plus 1.575%.
(7) The Class B Certificates will bear interest during the initial Accrual
Period at 6.0675% per annum. The Class B Certificates will bear
interest during each Accrual Period thereafter at a per annum rate
equal to the lesser of (i) LIBOR plus 1.900% and (ii) the Net Funds
Cap; provided, that if the option to purchase the Mortgage Loans and
related property pursuant to Section 7.01(b) is not exercised on the
first Distribution Date on which the Total Loan Balance is less than
10% of the Cut-off Date Total Loan Balance, then with respect to such
Distribution Date and each subsequent Distribution Date the per annum
rate calculated pursuant to clause (i) above with respect to the Class
B Certificates will be LIBOR plus 2.850%.
(8) The Class P and Class R Certificates will not bear interest.
(9) The Class X Certificate shall have an initial principal balance of $673.09
but that balance shall not bear interest. Instead, for each Accrual
Period, the Class X Certificate shall accrue interest on the Class X
Notional Balance at a per annum rate equal to the excess of (i) the Net
Funds Cap for the Distribution Date related to the Accrual Period over
(ii) the Adjusted Lower Tier WAC for such Accrual Period.
As of the Cut-off Date, the Mortgage Loans had an aggregate Scheduled
Principal Balance of $317,975,673.09.
In consideration of the mutual agreements herein contained, the
Depositor, the Master Servicer, the Trustee and the Loss Mitigation Advisor
hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. The following words and phrases, unless
the context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: As provided in each Servicing
Agreement.
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.
Accrual Period: With respect to any Distribution Date and any Class of
Certificates (other than the Class X Certificates), the period beginning on the
Distribution Date in the calendar month immediately preceding the month in
which the related Distribution Date occurs (or, in the case of the first
Distribution Date, beginning on the Closing Date) and ending on the day
immediately preceding the related Distribution Date. With respect to the Class
X Certificates, the calendar month immediately preceding the month in which
such Distribution Date occurs.
Act: As defined in Section 3.03(c).
Additional Collateral: None.
Adjustable Rate Mortgage Loan: Any Mortgage Loan as to which the
related Mortgage Note provides for the adjustment of the Mortgage Rate
applicable thereto.
Adjusted Lower Tier WAC: For any Accrual Period, the product of (a)
two, and (b) the weighted average of the interest rates on the LT2-D, LT2-A,
LT2-M1, LT2-M2, and LT2-B Interests determined for this purpose by first
subjecting the rate payable on the Class LT2-D Interest to a cap of zero, and
subjecting the rate payable on each of the Class LT2-A, Class LT2-M1, Class
LT2-M2, and Class LT2-B Interests to a cap that corresponds to the Certificate
Interest Rate for the Corresponding Class of Certificates for such Accrual
Period.
Advance: An advance of the aggregate of payments of principal and
interest (net of the Net Master Servicing Fee and the Servicing Fee) on one or
more Mortgage Loans that were due on the Due Date in the related Collection
Period and not received as of the close of business on the related
Determination Date, required to be made by or on behalf of the Master Servicer
and any Servicer (or by the Trustee) pursuant to Section 5.04.
Advisor's Fee Rate: 0.015% per annum.
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 Expense Rate: With respect to any Mortgage Loan, the sum of
the Master Servicing Fee Rate, the Servicing Fee Rate and, if applicable, the
Insurance Fee Rate.
Aggregate Voting Interests: The aggregate of the Voting Interests of
all the Certificates under this Agreement.
Agreement: This Trust Agreement and all amendments and supplements
hereto.
Anniversary Year: The one-year period beginning on the Closing Date
and ending on the first anniversary thereof, and each subsequent one-year
period beginning on the day after the end of the preceding Anniversary Year and
ending on next succeeding anniversary of the Closing Date.
Applied Loss Amount: With respect to any Distribution Date, the
amount, if any, by which (x) the aggregate Certificate Principal Amount of the
Certificates after giving effect to distributions on such date, exceeds (y) the
Total Loan Balance for such Distribution Date.
Appraised Value: With respect to any Mortgage Loan, the amount set
forth in an appraisal made in connection with the origination of such Mortgage
Loan as the value of the related Mortgaged Property.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the
laws of the jurisdiction 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 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.
Authenticating Agent: Any authenticating agent appointed by the
Trustee pursuant to Section 6.10.
Authorized Officer: Any Person who may execute an Officer's
Certificate on behalf of the Depositor.
B Principal Distribution Amount: With respect to any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event has not occurred
with respect to such Distribution Date, the amount, if any, by which (x) the
sum of (i) the aggregate Class Principal Amount of the Class A, Class M1 and
Class M2 Certificates, in each case after giving effect to distributions on
such Distribution Date and (ii) the Class Principal Amount of the Class B
Certificates immediately prior to such Distribution Date exceeds (y) the lesser
of (A) the product of (i) 99.00% and (ii) the Total Loan Balance for that
Distribution Date and (B) the amount, if any, by which (i) the Total Loan
Balance for such Distribution Date exceeds (ii) 0.25% of the Cut-off Date Total
Loan Balance.
Balloon Mortgage Loan: Any Mortgage Loan having an original term to
maturity that is shorter than its amortization schedule, and a final Scheduled
Payment that is disproportionately large in comparison to other Scheduled
Payments.
Balloon Payment: The final Scheduled Payment in respect of a Balloon
Mortgage Loan.
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 United States
Bankruptcy Code of 1986, as amended, or any other similar state laws.
Basis Risk Reserve Fund: A fund created as part of the Trust Fund
pursuant to Section 5.06 of this Agreement but which is not an asset of any
REMIC.
Basis Risk Shortfall: With respect to any Distribution Date and any
Class of LIBOR Certificates, the amount by which the Certificate Interest Rate
applicable to such Class for such date, determined without regard to the Net
Funds Cap for such date but subject to a cap equal to the Maximum Interest
Rate, exceeds such Net Funds Cap.
Benefit Plan Opinion: An Opinion of Counsel satisfactory to the
Trustee to the effect that any proposed transfer will not (i) cause the assets
of the Trust Fund to be regarded as plan assets for purposes of the Plan Asset
Regulations or (ii) give rise to any fiduciary duty on the part of the
Depositor or the Trustee.
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 condition 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." As of the Closing Date, the following Classes of Certificates
constitute Book-Entry Certificates: the Class A, Class A-IO, Class M1, Class M2
and Class B Certificates.
Business Day: Any day other than (i) a Saturday or a Sunday, (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 closed, or (iii) with respect to any
Remittance Date or any Servicer reporting date, the States specified in the
definition of "Business Day" in each Servicing Agreement, are authorized or
obligated by law or executive order to be closed.
Carryforward Interest: With respect to any Distribution Date and each
Class of Certificates, the sum of (i) the amount, if any, by which (x) the sum
of (A) Current Interest for such Class for the immediately preceding
Distribution Date and (B) any unpaid Carryforward Interest for such Class from
previous Distribution Dates exceeds (y) the amount distributed in respect of
interest on such Class on such immediately preceding Distribution Date, and
(ii) interest on such amount for the related Accrual Period at the applicable
Certificate Interest Rate.
Certificate: Any one of the certificates signed and countersigned by
the Trustee in substantially the forms attached hereto as Exhibit A.
Certificate Account: The account maintained by the Trustee in
accordance with the provisions of Section 4.04.
Certificate Interest Rate: With respect to each Class of Certificates
and any Distribution Date, the applicable per annum rate set forth or described
in the Preliminary Statement hereto.
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).
Certificate Principal Amount: With respect to any Certificate (other
than the Class A-IO, Class P and Class R Certificates), the initial Certificate
Principal Amount thereof, less the amount of all principal distributions
previously distributed with respect to such Certificate and any Applied Loss
Amount previously allocated to such Certificate. The Class A-IO, Class P and
Class R Certificates are issued without Certificate Principal Amounts.
Certificate Register and Certificate Registrar: The register
maintained and the registrar appointed pursuant to Section 3.02.
Certificateholder: The meaning provided in the definition of "Holder."
Civil Relief Act: The Soldiers' and Sailors' Civil Relief Act of 1940,
as amended.
Class: All Certificates and, in the case of REMIC 1 and REMIC 2, all
Lower Tier Interests, bearing the same class designation.
Class Notional Amount: With respect to the Class A-IO Certificates and
any Distribution Date, the aggregate Notional Amount thereof (for the purpose
of calculating interest on such Certificates) which will be calculated as
follows:
(i) for each Distribution Date falling within the period from
May 2001 through October 2001, the Class Notional Amount will equal
the lesser of (i) $85,853,432 and (ii) the Total Loan Balance as of
the first day of the related Collection Period (or as of the Cut-off
Date, in the case of the first Distribution Date);
(ii) for each Distribution Date falling within the period from
November 2001 through April 2002, the Class Notional Amount will equal
the lesser of (i) $76,314,162 and (ii) the Total Loan Balance as of
the first day of the related Collection Period;
(iii) for each Distribution Date falling within the period from
May 2002 through October 2002, the Class Notional Amount will equal
the lesser of (i) $66,774,891 and (ii) the Total Loan Balance as of
the first day of the related Collection Period;
(iv) for each Distribution Date falling within the period from
November 2002 through April 2003, the Class Notional Amount will equal
the lesser of (i) $57,235,621 and (ii) the Total Loan Balance as of
the first day of the related Collection Period;
(v) for each Distribution Date falling within the period from
May 2003 through October 2003, the Class Notional Amount will equal
the lesser of (i) $38,157,081 and (ii) the Total Loan Balance as of
the first day of the related Collection Period;
(vi) for each Distribution Date falling within the period from
November 2003 through April 2004, the Class Notional Amount will equal
the lesser of (i) $19,078,540 and (ii) the Total Loan Balance as of
the first day of the related Collection Period; and
(vii) for any Distribution Date thereafter, the Class Notional
Amount will equal zero.
Class P Certificate: An interest in the Trust Fund that is not an
interest in any REMIC created under this Agreement and that is entitled to
distributions as provided in Section 5.02(e).
Class Principal Amount: With respect to each Class of Certificates
other than the Class A-IO, Class P and Class R Certificates, the aggregate of
the Certificate Principal Amounts of all Certificates of such Class at the date
of determination. With respect to the Class A-IO, Class P and Class R
Certificates, zero.
Class R Certificate: The Class R Certificate executed by the Trustee,
and authenticated and delivered by the Certificate Registrar, substantially in
the form annexed hereto as Exhibit A and evidencing the ownership of the Class
LT1-R Interest, Class LT2-R Interest and the residual interest in the Upper
Tier REMIC.
Class X Distributable Amount: On any Distribution Date, the amount of
interest that has accrued on the Class X Notional Balance, as described in the
Preliminary Statement, but that has not been distributed prior to such date. In
addition, such amount shall include the initial Overcollateralization Amount of
$673.09 to the extent such amount has not been distributed on an earlier
Distribution Date as part of the Overcollateralization Release Amount.
Class X Notional Balance: With respect to any Distribution Date (and
the related Accrual Period) the aggregate principal balance of the Class LT2-A,
Class LT2-M1, Class LT2-M2, Class LT2-B and Class LT2-D Interests in REMIC 2.
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.
Clearstream: Clearstream Banking, societe anonyme, and any successor
thereto.
Closing Date: May 11, 2001.
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.
Collection Account: A separate account established and maintained by
the Master Servicer pursuant to Section 4.01.
Collection Period: With respect to any Distribution Date, the period
commencing on the second day of the month immediately preceding the month in
which such Distribution Date occurs and ending on the first day of the month in
which such Distribution Date occurs.
Compensating Interest Payment: With respect to any Distribution Date,
an amount equal to the amount, if any, by which (x) the aggregate amount of any
Prepayment Interest Shortfalls required to be paid by the Servicers with
respect to such Distribution Date exceeds (y) the aggregate amount actually
paid by the Servicers in respect of such shortfalls; provided, that such
amount, to the extent payable by the Master Servicer, shall not exceed the
aggregate Net Master Servicing Fees that would be payable to the Master
Servicer in respect of such Distribution Date without giving effect to any
Compensating Interest Payment.
Conventional Loan: A Mortgage Loan that is not insured by the United
States Federal Housing Administration or guaranteed by the United States
Department of Veterans Affairs.
Conventional Loan Documents: None.
Cooperative Shares: None.
Corporate Trust Office: The principal corporate trust office of the
Trustee at which, at any particular time, its corporate trust business shall be
administered, which office at the date hereof is located at 1 Bank Xxx Xxxxx,
Xxxx Xxxxx XX0-0000, Xxxxxxx, XX 00000, Attention: Global Corporate Trust
Services, except for purposes of Section 7.02 such term shall mean the office
or agency of the Trustee in the Borough of Manhattan, the City of New York,
which office at the date hereof is located at 00 Xxxx Xxxxxx, Xxxxxx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000.
Corresponding Class: The Class of Certificates that corresponds to a
class of REMIC 2 Lower Tier Interests as described in the Preliminary
Statement.
Current Interest: With respect to each Class of Certificates and any
Distribution Date, the aggregate amount of interest accrued at the applicable
Certificate Interest Rate during the related Accrual Period on the Class
Principal Amount (or Class Notional Amount) of such Class immediately prior to
such Distribution Date.
Custodial Account: Any custodial account (other than an Escrow
Account) established and maintained by a Servicer pursuant to a Servicing
Agreement.
Custodial Agreement: Each custodial agreement attached as Exhibit K
hereto, and any custodial agreement subsequently executed by the Trustee and
acknowledged by the Master Servicer substantially in the form thereof.
Custodian: Each custodian appointed by the Trustee pursuant to a
Custodial Agreement, and any successor thereto. The initial Custodians are
Bankers Trust Company of California, N.A. and U.S. Bank Trust, National
Association.
Cut-off Date: April 1, 2001.
Cut-off Date Total Loan Balance: With respect to the Mortgage Loans in
the Trust Fund on the Closing Date, the Total Loan Balance as of the Cut-off
Date.
Deferred Amount: With respect to any Distribution Date and each
Certificate, the aggregate of Applied Loss Amounts previously applied in
reduction of the Certificate Principal Amount thereof, less any amounts
previously reimbursed in respect thereof.
Definitive Certificate: A Certificate of any Class issued in
definitive, fully registered, certificated form.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased from the
Trust Fund pursuant to the terms hereof or as to which one or more Qualifying
Substitute Mortgage Loans are substituted therefor.
Delinquency Rate: With respect to any calendar month, the fraction,
expressed as a percentage, the numerator of which is the aggregate outstanding
principal balance of all Mortgage Loans 60 or more days delinquent (including
all foreclosures and REO Properties) as of the close of business on the last
day of such month, and the denominator of which is the Total Loan Balance as of
the close of business on the last day of such month.
Deposit Date: With respect to each Distribution Date, the Business Day
immediately preceding such Distribution Date.
Depositor: Structured Asset Securities Corporation, a Delaware
corporation having its principal place of business in New York, or its
successors in interest.
Determination Date: With respect to each Distribution Date, the 18th
day of the month in which such Distribution Date occurs, or, if such 18th day
is not a Business Day, the next succeeding Business Day.
Directing Holder: The holder of the Class X Certificate.
Disqualified Organization: Either (i) the United States, (ii) any
state or political subdivision thereof, (iii) any foreign government, (iv) any
international organization, (v) any agency or instrumentality of any of the
foregoing, (vi) any tax-exempt organization (other than a cooperative described
in section 521 of the Code) which is exempt from the tax imposed by Chapter 1
of the Code unless such organization is subject to the tax imposed by section
511 of the Code, (vii) any organization described in section 1381(a)(2)(C) of
the Code, or (viii) any "electing large partnership" described in section 775
of the Code, or (ix) any other entity designated as a Disqualified Organization
by relevant legislation amending the REMIC Provisions and in effect at or
proposed to be effective as of the time of the determination. In addition, a
corporation will not be treated as an instrumentality of the United States or
of any state or political subdivision thereof if all of its activities are
subject to tax and, with the exception of the Federal Home Loan Mortgage
Corporation, a majority of its board of directors is not selected by such
governmental unit.
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 May 2001.
Due Date: With respect to any Mortgage Loan, the date on which a
Scheduled Payment is due under the related Mortgage Note.
Eligible Account: Either (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company acceptable
to the Rating Agencies or (ii) an account or accounts the deposits in which are
insured by the FDIC to the limits established by such corporation, provided
that any such deposits not so insured shall be maintained in an account at a
depository institution or trust company whose commercial paper or other short
term debt obligations (or, in the case of a depository institution or trust
company which is the principal subsidiary of a holding company, the commercial
paper or other short term debt or deposit obligations of such holding company
or depository institution, as the case may be) have been rated by each Rating
Agency in its highest short-term rating category, or (iii) a segregated trust
account or accounts (which shall be a "special deposit account") maintained
with the Trustee or any other federal or state chartered depository institution
or trust company, acting in its fiduciary capacity, in a manner acceptable to
the Trustee and the Rating Agencies. Eligible Accounts may bear interest.
Eligible Investments: Any one or more of the following obligations or
securities:
(i) direct obligations of, and obligations fully guaranteed as
to timely payment of principal and interest by, the United States of
America or any agency or instrumentality of the United States of
America the obligations of which are backed by the full faith and
credit of the United States of America ("Direct Obligations");
(ii) federal funds, or demand and time deposits in, certificates
of deposits of, or bankers' acceptances issued by, any depository
institution or trust company (including U.S. subsidiaries of foreign
depositories and the Trustee or any agent of the Trustee, acting in
its respective commercial capacity) incorporated or organized under
the laws of the United States of America or any state thereof and
subject to supervision and examination by federal or state banking
authorities, so long as at the time of investment or the contractual
commitment providing for such investment the commercial paper or other
short-term debt obligations of such depository institution or trust
company (or, in the case of a depository institution or trust company
which is the principal subsidiary of a holding company, the commercial
paper or other short-term debt or deposit obligations of such holding
company or deposit institution, as the case may be) have been rated by
each Rating Agency in its highest short-term rating category or one of
its two highest long-term rating categories;
(iii) repurchase agreements collateralized by Direct Obligations
or securities guaranteed by GNMA, FNMA or FHLMC with any registered
broker/dealer subject to Securities Investors' Protection Corporation
jurisdiction or any commercial bank insured by the FDIC, if such
broker/dealer or bank has an uninsured, unsecured and unguaranteed
obligation rated by each Rating Agency in its highest short-term
rating category;
(iv) securities bearing interest or sold at a discount issued by
any corporation incorporated under the laws of the United States of
America or any state thereof which have a credit rating from each
Rating Agency, at the time of investment or the contractual commitment
providing for such investment, at least equal to one of the two
highest long-term credit rating categories of each Rating Agency;
provided, however, that securities issued by any particular
corporation will not be Eligible Investments to the extent that
investment therein will cause the then outstanding principal amount of
securities issued by such corporation and held as part of the Trust
Fund to exceed 20% of the sum of the Total Loan Balance and the
aggregate principal amount of all Eligible Investments in the
Certificate Account; provided, further, that such securities will not
be Eligible Investments if they are published as being under review
with negative implications from either Rating Agency;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on
demand or on a specified date not more than 180 days after the date of
issuance thereof) rated by each Rating Agency in its highest
short-term rating category;
(vi) a Qualified GIC;
(vii) certificates or receipts representing direct ownership
interests in future interest or principal payments on obligations of
the United States of America or its agencies or instrumentalities
(which obligations are backed by the full faith and credit of the
United States of America) held by a custodian in safekeeping on behalf
of the holders of such receipts; and
(viii) any other demand, money market, common trust fund or time
deposit or obligation, or interest-bearing or other security or
investment, (A) rated in the highest rating category by each Rating
Agency or (B) that would not adversely affect the then current rating
by either Rating Agency of any of the Certificates. Such investments
in this subsection (viii) may include money market mutual funds or
common trust funds, including any fund for which Bank One, National
Association (the "Bank"), the Trustee, the Master Servicer or an
affiliate thereof serves as an investment advisor, administrator,
shareholder servicing agent, and/or custodian or subcustodian,
notwithstanding that (x) the Bank, the Master Servicer or an affiliate
thereof charges and collects fees and expenses from such funds for
services rendered, (y) the Bank, the Master Servicer or an affiliate
thereof charges and collects fees and expenses for services rendered
pursuant to this Agreement, and (z) services performed for such funds
and pursuant to this Agreement may converge at any time. The Trustee
specifically authorizes the Bank or an affiliate thereof to charge and
collect from the Trustee such fees as are collected from all investors
in such funds for services rendered to such funds (but not to exceed
investment earnings thereon);
provided, however, that no such instrument shall be an Eligible Investment if
such instrument evidences either (i) a right to receive only interest payments
with respect to the obligations underlying such instrument, or (ii) both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations, provided that any such
investment will be a "permitted investment" within the meaning of Section
860G(a)(5) of the Code.
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: Any Class P, Class X and Class R
Certificate and any Certificate with a rating below the lowest applicable
rating permitted under the Underwriter's Exemption.
Errors and Omission Insurance Policy: The errors or omission insurance
policy required to be obtained by each Servicer satisfying the requirements of
the related Servicing Agreement.
Escrow Account: Any account established and maintained by each
Servicer pursuant to the related Servicing Agreement.
Euroclear: Xxxxxx Guaranty Trust Company of New York, Brussels office,
as operator of the Euroclear System.
Event of Default: Any one of the conditions or circumstances
enumerated in Section 6.14(a).
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.
Fidelity Bond: The fidelity bond required to be obtained by each
Servicer satisfying the requirements of the related Servicing Agreement.
Final Scheduled Distribution Date: With respect to the Certificates
other than the Interest-Only Certificates, December 25, 2030; with respect to
the Class A-IO Certificates, April 25, 2004.
Financial Intermediary: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Clearing Agency Participant.
Fitch: Fitch, Inc., or any successor in interest
Fixed Rate Mortgage Loans: Any Mortgage Loan as to which the related
Mortgage Note provides for a fixed rate of interest throughout the term of such
Note.
FNMA: 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.
Global Securities: The global certificates representing the Book-Entry
Certificates.
GNMA: The Government National Mortgage Association, a wholly owned
corporate instrumentality of the United States within HUD.
Holder or Certificateholder: 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, any Servicer, the Loss Mitigation Advisor, MGIC
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 shall be protected in
relying upon any such consent, only Certificates which a Responsible Officer of
the Trustee knows to be so owned shall be disregarded. The Trustee may request
and conclusively rely on certifications by the Depositor, the Master Servicer,
the applicable Servicer, the Loss Mitigation Advisor or MGIC in determining
whether any Certificates are registered to an Affiliate of the Depositor, the
Master Servicer, any Servicer, the Loss Mitigation Advisor or MGIC.
HUD: The United States Department of Housing and Urban Development, or
any successor thereto.
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: The index specified in the related Mortgage Note for
calculation of the Mortgage Rate thereof.
Initial LIBOR Rate: 4.1675%.
Insurance Fee Rate: With respect to each MGIC-Insured Mortgage Loan, a
per annum rate equal to 0.98%, plus any taxes due and payable with respect to
any MGIC-Insured Mortgage Loan that is located in the states of Kentucky and
West Virginia; provided, that if the Loss Mitigation Advisor (or an appropriate
successor) ceases to provide its services under the Loss Mitigation Advisory
Agreement, the Insurance Fee Rate shall be 0.99%.
Insurance Policy: Any Primary Mortgage Insurance Policy (whether
obtained by the borrower, the originator or the Trust), any standard hazard
insurance policy, flood insurance policy, earthquake insurance policy or title
insurance policy relating to the Mortgage Loans or the Mortgaged Properties, to
be in effect as of the Closing Date or thereafter during the term of this
Agreement.
Insurance Proceeds: Amounts paid by the insurer under any Insurance
Policy, other than amounts (i) to cover expenses incurred by or on behalf of
any Servicer in connection with procuring such proceeds, (ii) to be applied to
restoration or repair of the related Mortgaged Property or (iii) required to be
paid over to the Mortgagor pursuant to law or the related Mortgage Note.
Interest Remittance Amount: With respect to any Distribution Date, (a)
the sum of (1) all interest collected (other than Payaheads and Prepayment
Premiums) or advanced in respect of Scheduled Payments on the Mortgage Loans
during the related Collection Period, less (x) the MGIC Insurance Premiums and
certain state taxes imposed on such premiums, (y) the Servicing Fee, the Net
Master Servicing Fee and the Trustee Fee with respect to such Mortgage Loans
and (z) previously unreimbursed Advances to the extent allocable to interest
and the allocable portion of previously unreimbursed Servicing Advances, (2)
any Prepayment Interest Shortfalls and any Compensating Interest Payments with
respect to the related Prepayment Period, (3) the portion of any Purchase Price
or Substitution Amount paid with respect to such Mortgage Loans during the
related Prepayment Period allocable to interest, and (4) all Net Liquidation
Proceeds, Insurance Proceeds and any other recoveries collected with respect to
the Mortgage Loans during the related Prepayment Period, to the extent
allocable to interest, as reduced by (b) other costs, expenses or liabilities
reimbursable to the Trustee, the Master Servicer and each Servicer to the
extent provided in this Agreement and each Servicing Agreement; provided,
however, that in the case of the Master Servicer, such reimbursable amounts may
not exceed $500,000 during any Anniversary Year. In the event that the Master
Servicer incurs reimbursable amounts in excess of $500,000, it may seek
reimbursement for such amounts in subsequent Anniversary Years, but in no event
shall more than $500,000 be reimbursed to the Master Servicer per Anniversary
Year. Notwithstanding the foregoing, costs and expenses incurred by the Master
Servicer pursuant to Section 9.07(a) in connection with any transfer of
servicing shall be excluded from the $500,000 per Anniversary Year limit on
reimbursable amounts.
Intervening Assignments: The original intervening assignments of the
Mortgage, notices of transfer or equivalent instrument.
Latest Possible Maturity Date: The Distribution Date occurring in
January 2032.
LIBOR: With respect to the first Accrual Period, the Initial LIBOR
Rate. With respect to each subsequent Accrual Period, the per annum rate
determined pursuant to Section 4.05 on the basis of London interbank offered
rate quotations for one-month Eurodollar deposits, as such quotations may
appear on the display designated as page "LIUS01M" on the Bloomberg Financial
Markets Commodities News (or such other page as may replace such page on that
service for the purpose of displaying London interbank offered quotations of
major banks).
LIBOR Certificate: Any Class A, Class M1, Class M2 and Class B
Certificate.
LIBOR Determination Date: The second London Business Day immediately
preceding the commencement of each Accrual Period for any LIBOR Certificates.
Liquidated Mortgage Loan: Any defaulted Mortgage Loan as to which the
Master Servicer or the applicable Servicer has determined that all amounts that
it expects to recover on behalf of the Trust Fund from or on account of such
Mortgage Loan have been recovered.
Liquidation Expenses: Expenses that are incurred by the Master
Servicer or a Servicer in connection with the liquidation of any defaulted
Mortgage Loan and are not recoverable under the applicable Primary Mortgage
Insurance Policy, if any, including, without limitation, foreclosure and
rehabilitation expenses, legal expenses and unreimbursed amounts, if any,
expended pursuant to Sections 9.06, 9.16 or 9.22.
Liquidation Proceeds: Cash received in connection with the liquidation
of a defaulted Mortgage Loan, whether through the sale or assignment of such
Mortgage Loan, trustee's sale, foreclosure sale, payment in full, discounted
payoff or otherwise, or the sale of the related Mortgaged Property if the
Mortgaged Property is acquired in satisfaction of the Mortgage Loan, including
any amounts remaining in the related Escrow Account.
London Business Day: Any day on which banks are open for dealing in
foreign currency and exchange in London, England and New York City.
Loss Mitigation Advisor: The Murrayhill Company, a Colorado
corporation, and its successors and assigns.
Loss Mitigation Advisory Agreement: The loss mitigation and advisory
agreement, dated as of the Closing Date, entered into by each Servicer and the
Loss Mitigation Advisor.
Loss Mitigation Advisor's Fee: As to any Distribution Date and each
Mortgage Loan, an amount equal to the product of (a) one twelfth, (b) the
Advisor's Fee Rate and (c) the Scheduled Principal Balance of such Mortgage
Loan as of the first day of the related Collection Period.
Lower Tier Interest: As described in the Preliminary Statement.
M1 Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event has not
occurred with respect to such Distribution Date, the amount, if any, by which
(x) the sum of (i) the aggregate Class Principal Amount of the Class A
Certificates after giving effect to distributions on such Distribution Date and
(ii) the Class Principal Amount of the Class M1 Certificates immediately prior
to such Distribution Date exceeds (y) the lesser of (A) the product of (i)
92.50% and (ii) the Total Loan Balance for such Distribution Date and (B) the
amount, if any, by which (i) the Total Loan Balance for such Distribution Date
exceeds (ii) 0.25% of the Cut-off Date Total Loan Balance.
M2 Principal Distribution Amount: With respect to any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event has not
occurred with respect to such Distribution Date, the amount, if any, by which
(x) the sum of (i) the aggregate Class Principal Amount of the Class A and
Class M1 Certificates, in each case after giving effect to distributions on
such Distribution Date and (ii) the Class Principal Amount of the Class M2
Certificates immediately prior to such Distribution Date exceeds (y) the lesser
of (A) the product of (i) 97.00% and (ii) the Total Loan Balance for such
Distribution Date and (B) the amount, if any, by which (i) the Total Loan
Balance for such Distribution Date exceeds (ii) 0.25% of the Cut-off Date Total
Loan Balance.
Master Servicer: Xxxxx Fargo Bank Minnesota, National Association, or
any successor in interest, or if any successor master servicer shall be
appointed as herein provided, then such successor master servicer.
Master Servicing Fee: As to any Distribution Date and each Mortgage
Loan, an amount equal to the product of one-twelfth of the Master Servicing Fee
Rate and the Scheduled Principal Balance of such Mortgage Loan as of the first
day of the related Collection Period.
Master Servicing Fee Rate: 0.0075% per annum.
Material Defect: As defined in Section 2.02(c) hereof.
Maximum Interest Rate: With respect to any Class of LIBOR Certificates
and any Distribution Date, an annual rate equal to the amount, if any, by which
(1) the weighted average of the maximum "lifetime" Mortgage Rates specified in
the related Mortgage Notes of the Adjustable Rate Mortgage Loans and the
Mortgage Rates of the Fixed Rate Mortgage Loans exceeds, (2) the sum of (A) the
Aggregate Expense Rate and (B) (I) in the case of the first 36 Distribution
Dates only, the product of (x) 6.00% and (y) a fraction, the numerator of which
is the Class Notional Amount of the Class A-IO Certificates and the denominator
of which is the Total Loan Balance for that Distribution Date and (II)
thereafter, zero.
MERS: Mortgage Electronic Registration Systems, Inc., a Delaware
corporation, or any successor in interest thereto.
MERS Mortgage Loan: Any Mortgage Loan as to which the related
Mortgage, or an Assignment of Mortgage, has been or will be recorded in the
name of MERS, as nominee for the holder from time to time of the Mortgage Note.
MGIC: Mortgage Guaranty Insurance Corporation, a monoline insurance
company and its successors or assigns.
MGIC-Insured Mortgage Loan: Any Mortgage Loan included for coverage
under a MGIC Insurance Policy.
MGIC Insurance Policy: The loan-level Primary Mortgage Insurance
Policies on certain of the MGIC-Insured Mortgage Loans issued by MGIC to the
Trust, as the insured, as evidenced by the issuance of a Mortgage Guaranty
Master Policy Number 0502041171 and related endorsements.
MGIC Insurance Premium: With respect to each Distribution Date and
each MGIC-Insured Mortgage Loan, the product of (a) one-twelfth of the
Insurance Fee Rate and (b) the Scheduled Principal Balance of such Mortgage
Loan as of the first day of the related Collection Period.
Monthly Excess Cashflow: With respect to any Distribution Date, the
sum of (x) Monthly Excess Interest for such date and (y) the
Overcollateralization Release Amount for such date.
Monthly Excess Interest: With respect to any Distribution Date, the
amount of any Interest Remittance Amount remaining after application pursuant
to clauses (i) through (vi) of Section 5.02(b) on such date.
Moody's: Xxxxx'x Investors Service, Inc., or any successor in
interest.
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 File: The mortgage documents listed in Section 2.01(b)
pertaining to a particular Mortgage Loan required to be delivered to the
Trustee pursuant to this Agreement.
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 or Section
2.05, including without limitation, each Mortgage Loan listed on the Mortgage
Loan Schedule, as amended from time to time.
Mortgage Loan Sale Agreement: The mortgage loan sale and assignment
agreement, dated as of May 1, 2001, for the sale of the Mortgage Loans by the
Seller to the Depositor.
Mortgage Loan Schedule: The schedule attached hereto as Schedule A,
which shall identify each Mortgage Loan, as such schedule may be amended from
time to time to reflect the addition of Mortgage Loans to, or the deletion of
Mortgage Loans from, the Trust Fund. Such schedule shall, among other things
(i) designate the Servicer servicing such Mortgage Loan; (ii) designate the
Custodian with respect to the Mortgage File related to such Mortgage Loan; and
(iii) where applicable, indicate whether such Mortgage Loan is a MGIC-Insured
Mortgage Loan.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage under a Mortgage Loan.
Mortgage Pool: The aggregate of the Adjustable Rate Mortgage Loan and
the Fixed Rate Mortgage Loans identified on the Mortgage Loan Schedule as being
included in the Mortgage Pool.
Mortgage Rate: As to any Mortgage Loan, the per annum rate at which
interest accrues on such Mortgage Loan.
Mortgaged Property: The fee simple interest in real property, together
with improvements thereto including any exterior improvements to be completed
within 120 days of disbursement of the related Mortgage Loan proceeds.
Mortgagor: The obligor on a Mortgage Note.
Net Excess Spread: With respect to any Distribution Date, (A) the
fraction, expressed as a percentage, the numerator of which is equal to the
product of (i) the amount, if any, by which (a) the Interest Remittance Amount
for such Distribution Date exceeds (b) the Current Interest payable with
respect to the Certificates for such date and (ii) twelve, and the denominator
of which is the Total Loan Balance for such Distribution Date, multiplied by
(B) a fraction, the numerator of which is thirty and the denominator of which
is the greater of thirty and the actual number of days in the immediately
preceding calendar month.
Net Funds Cap: With respect to any Distribution Date, a per annum rate
equal to (a) a fraction, expressed as a percentage, the numerator of which is
the product of (i) the Optimal Interest Remittance Amount for such date and
(ii) 12, and the denominator of which is the Total Loan Balance for the
immediately preceding Distribution Date multiplied by (b) a fraction, the
numerator of which is 30 and the denominator of which is the greater of 30 and
the actual number of days in the immediately preceding calendar month.
Net Liquidation Proceeds: With respect to any Liquidated Mortgage
Loan, the related Liquidation Proceeds net of (i) unreimbursed expenses and
(ii) any unreimbursed Advances, if any, received and retained in connection
with the liquidation of such Mortgage Loan.
Net Master Servicing Fee: As to any Distribution Date, the amount, if
any, by which the Master Servicing Fee for such Distribution Date exceeds the
portion of the Trustee Fee payable on such Distribution Date.
Net Master Servicing Fee Rate: The Master Servicing Fee Rate as
reduced by the Trustee Fee Rate.
Net Mortgage Rate: With respect to any Mortgage Loan, the Mortgage
Rate thereof reduced by the sum of the Servicing Fee Rate, the Net Master
Servicing Fee Rate, the Trustee Fee Rate, Insurance Fee Rate, in the case of a
MGIC-Insured Mortgage Loan, and the Advisor's Fee Rate.
Net Prepayment Interest Shortfall: With respect to any Remittance
Date, the excess, if any, of any Prepayment Interest Shortfalls with respect to
the Mortgage Loans for such date over any amounts paid with respect to such
shortfalls by the Servicers or the Master Servicer pursuant to the Servicing
Agreements or this Agreement.
Non-Book-Entry Certificate: Any Certificate other than a Book-Entry
Certificate.
Non-MERS Mortgage Loan: Any Mortgage Loan other than a MERS Mortgage
Loan.
Non-permitted Foreign Holder: As defined in Section 3.03(f).
Non-U.S. Person: Any individual, corporation, partnership or other
person other than (i) a citizen or resident of the United States; (ii) a
corporation (or entity treated as a corporation for tax purposes) created or
organized in the United States or under the laws of the United States or of any
state thereof, including, for this purpose, the District of Columbia; (iii) a
partnership (or entity treated as a partnership for tax purposes) organized in
the United States or under the laws of the United States or of any state
thereof, including, for this purpose, the District of Columbia (unless provided
otherwise by future Treasury regulations); (iv) an estate whose income is
includible in gross income for United States income tax purposes regardless of
its source; or (v) 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 U.S. Persons have authority to control all substantial decisions of the
trust. Notwithstanding the last clause of the preceding sentence, to the extent
provided in Treasury regulations, certain trusts in existence on August 20,
1996, and treated as U.S. Persons prior to such date, may elect to continue to
be U.S. Persons.
Notional Amount: With respect to any Notional Certificate and any
Distribution Date, such Certificate's Percentage Interest of the Class Notional
Amount of such Class of Certificates for such Distribution Date.
Notional Certificate: Any Class A-IO Certificate.
Offering Document: The Prospectus.
Officer's Certificate: A certificate signed by the Chairman of the
Board, any Vice Chairman, the President, any Vice President or any Assistant
Vice President of a Person, and in each case delivered to the Trustee.
Opinion of Counsel: A written opinion of counsel, reasonably
acceptable in form and substance to the Trustee, and who may be in-house or
outside counsel to the Depositor, the Master Servicer or the Trustee but which
must be Independent outside counsel with respect to any such opinion of counsel
concerning the transfer of any Residual Certificate or concerning certain
matters with respect to the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), or the taxation, or the federal income tax status, of each
REMIC.
Optimal Interest Remittance Amount: With respect to each Distribution
Date, the amount, if any, by which (1) the product of (A)(x) the weighted
average of the Net Mortgage Rates of the Mortgage Loans as of the first day of
the related Collection Period, divided by (y) 12, and (B) the Total Loan
Balance for the immediately preceding Distribution Date exceeds (2)(I) in the
case of the first 36 Distribution Dates only, an amount equal to the product of
(A) 0.50% and (B) the Class Notional Amount of the Class A-IO Certificates
immediately before such Distribution Date and (II) thereafter, zero.
Original Loan-to-Value Ratio: With respect to any Mortgage Loan, the
ratio of the principal balance of such Mortgage Loan at origination, or such
other date as is specified, to the Original Value of the related Mortgage
Property.
Original Value: The lesser of (a) the Appraised Value of a Mortgaged
Property at the time the related Mortgage Loan was originated and (b) if the
Mortgage Loan was made to finance the acquisition of the related Mortgaged
Property, the purchase price paid for the Mortgaged Property by the Mortgagor
at the time the related Mortgage Loan was originated.
Overcollateralization Amount: With respect to any Distribution Date,
the amount, if any, by which (x) the Total Loan Balance for such Distribution
Date exceeds (y) the aggregate Certificate Principal Amount of the Certificates
after giving effect to distributions on such Distribution Date.
Overcollateralization Deficiency: With respect to any Distribution
Date, the amount, if any, by which (x) the Targeted Overcollateralization
Amount for such Distribution Date exceeds (y) the Overcollateralization Amount
for such Distribution Date, calculated for this purpose after giving effect to
the reduction on such Distribution Date of the Certificate Principal Amounts of
the Certificates resulting from the distribution of the Principal Distribution
Amount on such Distribution Date, but prior to allocation of any Applied Loss
Amount on such Distribution Date.
Overcollateralization Release Amount: With respect to any Distribution
Date, the lesser of (x) the Principal Remittance Amount for such Distribution
Date and (y) the amount, if any, by which (i) the Overcollateralization Amount
for such date, calculated for this purpose on the basis of the assumption that
100% of the Principal Remittance Amount for such date is applied on such date
in reduction of the aggregate of the Certificate Principal Amounts of the
Certificates, exceeds (ii) the Targeted Overcollateralization Amount for such
date.
Payahead: With respect to any Mortgage Loan and any Due Date therefor,
any Scheduled Payment received by the applicable Servicer during any Collection
Period in addition to the Scheduled Payment due on such Due Date, intended by
the related Mortgagor to be applied on a subsequent Due Date.
Paying Agent: Any paying agent appointed pursuant to Section 3.08.
Percentage Interest: With respect to any Certificate, its percentage
interest in the undivided beneficial ownership interest in the Trust Fund
evidenced by all Certificates of the same Class as such Certificate. With
respect to any Certificate other than the Class A-IO, Class P, Class X and
Class R Certificates, the Percentage Interest evidenced thereby shall equal the
initial Certificate Principal Amount thereof divided by the initial Class
Principal Amount of all Certificates of the same Class. With respect to the
Class P, Class X and Class R Certificates, the Percentage Interest evidenced
thereby shall be 100%. With respect to any Class A-IO Certificate, the
Percentage Interest evidenced thereby shall equal the initial Notional Amount
of such Class A-IO Certificate as set forth on the face thereof divided by the
initial Class Notional Amount of the Class A-IO Certificates.
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.
Placement Agent: Xxxxxx Brothers Inc.
Plan Asset Regulations: The Department of Labor regulations set forth
in 29 C.F.R. 2510.3-101.
Pool Balance: The aggregate of the Scheduled Principal Balances of all
Mortgage Loans in the Mortgage Pool at the date of determination.
Prepayment Interest Excess: With respect to any Remittance Date and
any Principal Prepayment in full received on the Mortgage Loans made on the
first day of the month during which such Remittance Date occurs, all amounts
paid in respect of interest, to the extent in excess of one month's interest
and excluding any delinquent interest, at the applicable Net Mortgage Rate on
the amount of such Principal Prepayment (such amounts generally to equal one
day's interest thereon at the applicable Net Mortgage Rate).
Prepayment Interest Shortfall: With respect to any full or partial
Principal Prepayment of a Mortgage Loan, the excess, if any, of (i) one full
month's interest at the applicable Mortgage Rate (as reduced by the Servicing
Fee Rate and the Net Master Servicing Fee Rate in the case of Principal
Prepayments in full), on the outstanding principal balance of such Mortgage
Loan immediately prior to such prepayment over (ii) the amount of interest
actually received with respect to such Mortgage Loan in connection with such
Principal Prepayment.
Prepayment Period: With respect to each Remittance Date, the one-month
period beginning on the Cut-off Date, in the case of the first Distribution
Date, and on the second day of the calendar month immediately preceding the
month in which the related Distribution Date occurs, in the case of each
subsequent Remittance Date, and ending on the first day of the month in which
such Remittance Date occurs.
Prepayment Premiums: Any prepayment fees and penalties to be paid by
the Mortgagor on a Mortgage Loan.
Primary Mortgage Insurance Policy: The MGIC Insurance Policy and any
other mortgage guaranty insurance, if any, on an individual Mortgage Loan, as
evidenced by a policy or certificate, whether such policy is obtained by the
originator, the borrower or the Trust.
Principal Distribution Amount: With respect to any Distribution Date,
an amount equal to the Principal Remittance Amount for such date minus the
Overcollateralization Release Amount, if any, for such date.
Principal Prepayment: Any Mortgagor payment of principal (other than a
Balloon Payment) or other recovery of principal on a Mortgage Loan that is
recognized as having been received or recovered in advance of its scheduled Due
Date and applied to reduce the principal balance of the Mortgage Loan in
accordance with the terms of the Mortgage Note or the Servicing Agreement.
Principal Remittance Amount: With respect to any Distribution Date,
(a) the sum of (i) all principal collected (other than Payaheads) or advanced
in respect of Scheduled Payments on the Mortgage Loans during the related
Collection Period (less unreimbursed Advances, to the extent allocable to
principal, and the allocable portion of unreimbursed Servicing Advances), (ii)
all Principal Prepayments in full or in part received during the related
Prepayment Period, (iii) the portion of any Purchase Price or Substitution
Amount paid with respect to each Mortgage Loan that was purchased from the
Trust Fund during the related Prepayment Period allocable to principal, and
(iv) all Net Liquidation Proceeds, Insurance Proceeds and other recoveries
(less unreimbursed Advances, to the extent allocable to principal, and the
allocable portion of unreimbursed Servicing Advances) collected with respect to
such Mortgage Loans during the related Prepayment Period, to the extent
allocable to principal, as reduced by (b) after application of the Interest
Remittance Amount, other costs, expenses or liabilities reimbursable to the
Trustee, the Master Servicer and any Servicer to the extent provided in this
Agreement.
Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Proprietary Lease: None.
Prospectus: The prospectus supplement dated May 9, 2001, together with
the accompanying prospectus dated January 26, 2001, relating to the Class A,
Class A-IO, Class M1, Class M2 and Class B Certificates.
Purchase Price: With respect to the purchase of a Mortgage Loan
pursuant to this Agreement, an amount equal to the sum of (a) 100% of the
unpaid principal balance of such Mortgage Loan, (b) accrued interest thereon at
the applicable Mortgage Rate, from the date as to which interest was last paid
to (but not including) the Due Date in the Collection Period immediately
preceding the related Distribution Date and (c) the fair market value of all
other property being purchased. The Master Servicer, each Servicer (or the
Trustee, if applicable) shall be reimbursed from the Purchase Price for any
Mortgage Loan or related REO Property for any Advances made or other amounts
advanced with respect to such Mortgage Loan that are reimbursable to the Master
Servicer, or such Servicer under this Agreement or the Servicing Agreement (or
to the Trustee hereunder), together with any accrued and unpaid compensation
due to the Master Servicer, any Servicer or the Trustee hereunder or
thereunder.
QIB: As defined in Section 3.03(c).
Qualified GIC: A guaranteed investment contract or surety bond
providing for the investment of funds in the Collection Account or the
Certificate Account and insuring a minimum, fixed or floating rate of return on
investments of such funds, which contract or surety bond shall:
(i) be an obligation of an insurance company or other
corporation whose long-term debt is rated by each Rating Agency in one
of its two highest rating categories or, if such insurance company has
no long-term debt, whose claims paying ability is rated by each Rating
Agency in one of its two highest rating categories, and whose
short-term debt is rated by each Rating Agency in its highest rating
category;
(ii) provide that the Trustee may exercise all of the rights
under such contract or surety bond without the necessity of taking any
action by any other Person;
(iii) provide that if at any time the then current credit
standing of the obligor under such guaranteed investment contract is
such that continued investment pursuant to such contract of funds
would result in a downgrading of any rating of the Certificates, the
Trustee shall terminate such contract without penalty and be entitled
to the return of all funds previously invested thereunder, together
with accrued interest thereon at the interest rate provided under such
contract to the date of delivery of such funds to the Trustee;
(iv) provide that the Trustee's interest therein shall be
transferable to any successor trustee hereunder; and
(v) provide that the funds reinvested thereunder and accrued
interest thereon be returnable to the Collection Account or the
Certificate Account, as the case may be, not later than the Business
Day prior to any Distribution Date.
Qualified Insurer: An insurance company duly qualified as such under
the laws of the states in which the related Mortgaged Properties are located,
duly authorized and licensed in such states to transact the applicable
insurance business and to write the insurance provided and whose claims paying
ability is rated by each Rating Agency in its highest rating category or whose
selection as an insurer will not adversely affect the rating of the
Certificates.
Qualifying Substitute Mortgage Loan: In the case of a Mortgage Loan
substituted for a Deleted Mortgage Loan, a Mortgage Loan that, on the date of
substitution, (i) has a Scheduled Principal Balance (together with that of any
other mortgage loan substituted for the same Deleted Mortgage Loan) as of the
Due Date in the month in which such substitution occurs not in excess of the
Scheduled Principal Balance of the related Deleted Mortgage Loan; provided,
however, that, to the extent that the Scheduled Principal Balance of such
Mortgage Loan is less than the Scheduled Principal Balance of the related
Deleted Mortgage Loan, then such differential in principal amount, together
with interest thereon at the applicable Mortgage Rate from the date as to which
interest was last paid through the end of the Collection Period in which such
substitution occurs (such amount, a "Substitution Amount"), shall be paid by
the party effecting such substitution to the Trustee for deposit into the
Certificate Account, and shall be treated as a Principal Prepayment hereunder;
(ii) has a Net Mortgage Rate not lower than the Net Mortgage Rate of the
related Deleted Mortgage Loan; (iii) if the total principal balance of
Qualifying Substitute Mortgage Loans in the Trust Fund is less than 5% of the
initial principal balance of the Mortgage Loans, has a remaining stated term to
maturity not longer than, and not more than one year shorter than, the
remaining term to stated maturity of the related Deleted Mortgage Loan; (iv)
(A) has an Original Loan-to-Value Ratio as of the date of such substitution of
not greater than 80%; provided, however, that if the related Deleted Mortgage
Loan has an Original Loan-to-Value Ratio of greater than 80%, then the Original
Loan-to-Value Ratio of such substitute Mortgage Loan may be greater than 80%
but shall not be greater than the Original Loan-to-Value Ratio of the related
Deleted Mortgage Loan and (B) the addition of such substitute Mortgage Loan
does not increase the weighted average Original Loan-to-Value Ratio of the
Mortgage Pool by more than 5%; (v) will comply with all of the representations
and warranties relating to Mortgage Loans set forth herein, as of the date as
of which such substitution occurs; (vi) if applicable, has the same index as
and a margin not less than that of the related Deleted Mortgage Loan and (vii)
has not been delinquent for a period of more than 30 days more than twice in
the twelve months immediately preceding such date of substitution. In the event
that either one mortgage loan is substituted for more than one Deleted Mortgage
Loan or more than one mortgage loan is substituted for one or more Deleted
Mortgage Loans, then (a) the Scheduled Principal Balance referred to in clause
(i) above shall be determined on a loan-by-loan basis, (b) the rate referred to
in clause (ii) above shall be determined on a loan-by-loan basis and (c) the
remaining term to stated maturity referred to in clause (iii) above, and the
Original Loan-to-Value Ratio referred to in clause (iv) above shall be
determined on a weighted average basis, provided that the final scheduled
maturity date of any Qualifying Substitute Mortgage Loan shall not exceed the
latest Final Scheduled Distribution Date of any Class of Certificates. Whenever
a Qualifying Substitute Mortgage Loan is substituted for a Deleted Mortgage
Loan pursuant to this Agreement, the party effecting such substitution shall
certify such qualification in writing to the Trustee.
Rating Agency: Each of Fitch, Xxxxx'x and S&P.
Realized Loss: With respect to each Liquidated Mortgage Loan, an
amount equal to (i) the unpaid principal balance of such Mortgage Loan as of
the date of liquidation, minus (ii) Liquidation Proceeds received, to the
extent allocable to principal, net of amounts that are reimbursable therefrom
to the Master Servicer or any Servicer with respect to such Mortgage Loan
(other than Advances of principal) including expenses of liquidation. In
determining whether a Realized Loss is a Realized Loss of principal,
Liquidation Proceeds shall be allocated, first, to payment of expenses related
to such Liquidated Mortgage Loan, then to accrued unpaid interest and finally
to reduce the principal balance of the Mortgage Loan.
Recognition Agreement: None.
Record Date: With respect to the LIBOR Certificates and the Class A-IO
Certificates and any Distribution Date, the close of business on the Business
Day immediately preceding such Distribution Date. With respect to the Class P,
Class X and Class R Certificates and any Distribution Date, the last Business
Day of the month immediately preceding the month in which the Distribution Date
occurs (or, in the case of the first Distribution Date, the Closing Date).
Reference Banks: As defined in Section 4.05.
Regulation S: Regulation S promulgated under the Act or any successor
provision thereto, in each case as the same may be amended from time to time;
and all references to any rule, section or subsection of, or definition or term
contained in, Regulation S means such rule, section, subsection, definition or
term, as the case may be, or any successor thereto, in each case as the same
may be amended from time to time.
Regulation S Global Security: The meaning specified in Section
3.01(c).
REMIC: Each pool of assets in the Trust Fund designated as a REMIC
pursuant to Section 10.01(a) hereof.
REMIC 1: As described in the Preliminary Statement.
REMIC 2: As described in the Preliminary Statement.
REMIC 3: 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 Subchapter M of Chapter 1 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.
Remittance Date: The day in each calendar month on which the Servicer
is required to remit payments to the Collection Account, as specified in the
related Servicing Agreement, which is the 18th day of each calendar month (or,
if such 18th day is not a Business Day, the next succeeding Business Day).
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.
Required Reserve Fund Amount: With respect to any Distribution Date on
which the Net Excess Spread is less than 0.25%, the amount, if any by which (a)
the product of 1.00% and the Total Loan Balance for such date exceeds (b) the
amount on deposit in the Basis Risk Reserve Fund immediately prior to such
date. With respect to any Distribution Date on which the Net Excess Spread is
equal to or greater than 0.25%, the amount, if any, by which (i) $1,000 exceeds
(ii) the amount on deposit in the Basis Risk Reserve Fund immediately prior to
such date.
Reserve Interest Rate: As defined in Section 4.05.
Residual Certificate: The Class R Certificate.
Responsible Officer: When used with respect to the Trustee, any Vice
President, Assistant Vice President, the Secretary, any assistant secretary, or
any officer, working in its Corporate Trust Office and having responsibility
for the administration of this Agreement, and any other officer to whom a
matter arising under this Agreement may be referred.
Restricted Certificate: Any Class P, Class X or Class R Certificate.
Restricted Global Security: As defined in Section 3.01(c).
Rolling Three Month Delinquency Rate: With respect to any Distribution
Date, the fraction, expressed as a percentage, equal to the average of the
Delinquency Rates for each of the three (or one and two, in the case of the
first and second Distribution Dates) immediately preceding calendar months.
S&P: Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx
Companies, Inc., or any successor in interest.
Scheduled Payment: Each scheduled payment of principal and interest
(or of interest only, if applicable) to be paid by the Mortgagor on a Mortgage
Loan, as reduced (except where otherwise specified herein) by the amount of any
related Debt Service Reduction (excluding all amounts of principal and interest
that were due on or before the Cut-off Date whenever received) and, in the case
of an REO Property, an amount equivalent to the Scheduled Payment that would
have been due on the related Mortgage Loan if such Mortgage Loan had remained
in existence. In the case of any bi-weekly payment Mortgage Loan, all payments
due on such Mortgage Loan during any Collection Period shall be deemed
collectively to constitute the Scheduled Payment due on such Mortgage Loan in
such Collection Period.
Scheduled Principal Balance: With respect to (i) any Mortgage Loan as
of any Distribution Date, the principal balance of such Mortgage Loan at the
close of business on the Cut-off Date, after giving effect to principal
payments due on or before the Cut-off Date, whether or not received, less an
amount equal to principal payments due after the Cut-off Date and on or before
the Due Date in the related Collection Period, whether or not received from the
Mortgagor or advanced by any Servicer or the Master Servicer, and all amounts
allocable to unscheduled principal payments (including Principal Prepayments,
Liquidation Proceeds, Insurance Proceeds and condemnation proceeds, in each
case to the extent identified and applied prior to or during the related
Prepayment Period) and (ii) any REO Property as of any Distribution Date, the
Scheduled Principal Balance of the related Mortgage Loan on the Due Date
immediately preceding the date of acquisition of such REO Property by or on
behalf of the Trustee (reduced by any amount applied as a reduction of
principal on the Mortgage Loan). With respect to any Mortgage Loan and the
Cut-off Date, as specified in the Mortgage Loan Schedule.
Security Agreement: None.
Seller: Xxxxxx Capital, A Division of Xxxxxx Brothers Holdings Inc.,
or any successor in interest.
Senior Certificate: Any Class A or Class A-IO Certificate.
Senior Enhancement Percentage: With respect to any Distribution Date,
the fraction, expressed as a percentage, the numerator of which is the sum of
the aggregate Class Principal Amount of the Class M1, Class M2 and Class B
Certificates and the Overcollateralization Amount (which amount, for purposes
of this definition only, shall not be less than zero and assuming for purposes
of this definition that the Principal Distribution Amount has been distributed
on such Distribution Date and no Trigger Event has occurred) and the
denominator of which is the Total Loan Balance for such Distribution Date.
Senior Principal Distribution Amount: With respect to any Distribution
Date (a) prior to the Stepdown Date or if a Trigger Event has occurred with
respect to such Distribution Date, an amount equal to 100% of the Principal
Distribution Amount and (b) on or after the Stepdown Date and as long as a
Trigger Event has not occurred with respect to such Distribution Date, the
amount, if any, by which (i) the aggregate Certificate Principal Amount of the
Class A Certificates immediately prior to such Distribution Date exceeds (ii)
the lesser of (x) the product of (A) 87.00% and (B) the Total Loan Balance for
such Distribution Date and (y) the amount, if any, by which (A) the Total Loan
Balance for such Distribution Date exceeds (B) 0.25% of the Cut-off Date Total
Loan Balance.
Servicers: Countrywide Home Loans, Inc., Ocwen Federal Bank FSB and
Xxxxx Fargo Home Mortgage, Inc., or any successors in interest.
Servicing Agreement: Each Reconstituted Servicing Agreement dated as
of May 1, 2001, between the Seller and one of the above-named Servicers
attached hereto as part of Exhibit E and any other servicing agreement entered
into between a successor servicer and the Seller pursuant to the terms of this
Agreement.
Servicing Fee: As to any Distribution Date and each Mortgage Loan, an
amount equal to the product of (a) one-twelfth of the Servicing Fee Rate and
(b) the outstanding principal balance of such Mortgage Loan as of the first day
of the related Collection Period.
Servicing Fee Rate: With respect to any Servicer, as specified in the
applicable Servicing Agreement.
Startup Day: The day designated as such pursuant to Section 10.01(b)
hereof.
Stepdown Date: The later to occur of (x) the Distribution Date in May
2004 and (y) the first Distribution Date on which the Senior Enhancement
Percentage (calculated for this purpose after giving effect to payments or
other recoveries in respect of the Mortgage Loans during the related Collection
Period but before giving effect to distributions on the Certificates on such
Distribution Date) is greater than to equal to 13.00%.
Subordinate Certificate: Any Class M1, Class M2, Class B or Class X
Certificate.
Substitution Amount: As defined in the definition of Qualifying
Substitute Mortgage Loan.
Target Amount: With respect to any Distribution Date, an amount equal
to the Total Loan Balance as of such Distribution Date minus the Targeted
Overcollateralization Amount for such Distribution Date.
Targeted Overcollateralization Amount: With respect to any
Distribution Date, (w) prior to the Distribution Date in February 2002, zero,
(x) beginning with the Distribution Date in February 2002 and prior to the
Stepdown Date, an amount equal to 0.50% of the Cut-off Date Total Loan Balance,
(y) on or after the Stepdown Date and provided a Trigger Event is not in
effect, an amount equal to the greater of (1) 1.00% of the Total Loan Balance
as of such Distribution Date and (2) 0.25% of the Cut-off Date Total Loan
Balance and (z) on or after the Stepdown Date and provided a Trigger Event is
in effect, an amount equal to the Targeted Overcollateralization Amount for the
immediately preceding Distribution Date.
Tax Matters Person: The "tax matters person" as specified in the REMIC
Provisions.
Telerate Page 120: The display designated as "Page 120" on the Dow
Xxxxx Telerate Service (or such other page selected by the Trustee as may
replace Page 120 on that service for the purpose of displaying daily Federal
Funds rates).
Termination Price: As defined in Section 7.01.
Title Insurance Policy: A title insurance policy maintained with
respect to a Mortgage Loan.
Total Distribution Amount: With respect to any Distribution Date, the
sum of the Interest Remittance Amount for such date, the Principal Remittance
Amount for such date and the Prepayment Premiums collected by the Servicers or
the Master Servicer during the related Collection Period.
Total Loan Balance: The aggregate of the Scheduled Principal Balances
of all Mortgage Loans at the date of determination.
Transfer Agreements: As defined in the Mortgage Loan Sale Agreement.
Transferor: Each seller of Mortgage Loans to the Seller or Xxxxxx
Brothers Bank FSB pursuant to the Transfer Agreements.
Trigger Event: A Trigger Event will have occurred with respect to any
Distribution Date if the Rolling Three Month Delinquency Rate as of the last
day of the immediately preceding Collection Period equals or exceeds 130% of
the Senior Enhancement Percentage for such Distribution Date.
Trust Fund: The corpus of the trust created pursuant to this
Agreement, consisting of the Mortgage Loans, the assignment of the Depositor's
rights under the Transfer Agreements, the Mortgage Loan Sale Agreement and each
Servicing Agreement, such amounts as shall from time to time be held in the
Collection Account, Certificate Account, any Custodial Account and any Escrow
Account, the Basis Risk Reserve Fund, the Insurance Policies, any REO Property
and the other items referred to in, and conveyed to the Trustee under, Section
2.01(a).
Trustee: Bank One, National Association, not in its individual
capacity but solely as Trustee, or any successor in interest, 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 Fee: $3,750 per year, payable in equal monthly installments.
Trustee Fee Rate: As to any Distribution Date and each Mortgage Loan,
the per annum rate represented by a fraction, the numerator of which is the
annual Trustee Fee and the denominator of which is the Total Scheduled
Principal Balance of the Mortgage Loans as of the first day of the related
Collection Period.
Underwriter's Exemption: Prohibited Transaction Exemption 2000-58, 65
Fed. Reg. 67765 (2000), as amended (or any successor thereto), or any
substantially similar administrative exemption granted by the U.S. Department
of Labor.
Uniform Commercial Code: The Uniform Commercial Code as in effect in
any applicable jurisdiction from time to time.
Unpaid Basis Risk Shortfall: With respect to any Distribution Date and
any Certificate, the aggregate of all Basis Risk Shortfalls with respect to
such Certificate remaining unpaid from previous Distribution Dates, plus
interest accrued thereon at the applicable Certificate Interest Rate
(calculated without giving effect to the applicable Net Funds Cap).
Upper Tier REMIC: REMIC 3.
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,
98% of all Voting Interests shall be allocated among the Class A, Class A-IO,
Class M1, Class M2, Class B and Class R Certificates. Voting Interests shall be
allocated among the Class A, Class M1, Class M2 and Class B Certificates shall
be based on a fraction, expressed as a percentage, the numerator of which is
the aggregate Class Principal Amount or Class Notional Amount then outstanding
and the denominator of which is the aggregate principal balance of the Mortgage
Loans then outstanding. The remainder of such percentage portion of Voting
Interests shall be allocated to the Class R Certificate. Voting Interests shall
be allocated among the Certificates of each such Class in proportion to their
Certificate Principal Amounts or Percentage Interests. Each of the Class X
Certificate and the Class P Certificate shall be allocated 1% of the Voting
Interests.
Section 1.02. Calculations Respecting Mortgage Loans. Calculations
required to be made pursuant to this Agreement with respect to any Mortgage
Loan in the Trust Fund shall be made based upon current information as to the
terms of the Mortgage Loans and reports of payments received from the Mortgagor
on such Mortgage Loans and payments to be made to the Trustee as supplied to
the Trustee by the Master Servicer. The Trustee shall not be required to
recompute, verify or recalculate the information supplied to it by the Master
Servicer, any Servicer or the Loss Mitigation Advisor.
Section 1.03. Calculations Respecting Accrued Interest. Accrued
interest, if any, on any Certificate other than any Interest-Only Certificate
shall be calculated based upon a 360-day year and the actual number of days in
each Accrual Period. Accrued interest, if any, on any Interest-Only Certificate
shall be calculated based upon a 360-day year consisting of twelve 30-day
months.
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, 2.04, 2.05 and 2.06, in trust, all the right, title and interest of the
Depositor in and to the Mortgage Loans. Such conveyance includes, without
limitation, 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
payments of principal and interest 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, together with all of the
Depositor's right, title and interest in and to the Collection Account and all
amounts from time to time credited to and the proceeds of the Collection
Account, the Certificate Account, and all amounts from time to time credited to
and the proceeds of the Certificate Account, any Custodial Accounts, any Escrow
Account established pursuant to Section 9.06 and any Basis Risk Reserve Fund
established pursuant to Section 5.06 and all amounts from time to time credited
to and the proceeds of each such account, any REO Property and the proceeds
thereof, the Depositor's rights under any Insurance Policies related to the
Mortgage Loans, the Depositor's security interest in any collateral pledged to
secure the Mortgage Loans, including the Mortgaged Properties and any
Additional Collateral, and any proceeds of the foregoing, 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.
Concurrently with the execution and delivery of this Agreement, the
Depositor does hereby assign to the Trustee all of its rights and interest
under the Mortgage Loan Sale Agreement, including all rights of the Seller
under each Servicing Agreement and the Transfer Agreements to the extent
assigned under the Mortgage Loan Sale Agreement. The Trustee hereby accepts
such assignment, and shall be entitled to exercise all rights of the Depositor
under the Mortgage Loan Sale Agreement as if, for such purpose, it were the
Depositor. 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.
(b) In connection with such transfer and assignment, the Depositor
does hereby deliver to, and deposit with, or cause to be delivered to and
deposited with, the Trustee, and/or the applicable Custodian acting on the
Trustee's behalf, the following documents or instruments with respect to each
Mortgage Loan (each a "Mortgage File") so transferred and assigned:
(i) with respect to each Mortgage Loan, the original Mortgage
Note endorsed without recourse in proper form to the order of the
Trustee, or in blank (in each case, with all necessary intervening
endorsements, as applicable) or with respect to any lost Mortgage
Note, a lost note affidavit stating that the original Mortgage Note
was lost, misplaced or destroyed, together with a copy of the related
Mortgage Note;
(ii) the original of any guarantee executed in connection with
the Mortgage Note, assigned to the Trustee;
(iii) with respect to any Mortgage Loan, the original recorded
Mortgage with evidence of recording indicated thereon and the original
recorded power of attorney, with evidence of recording thereon. If, in
connection with any Mortgage Loan, the Depositor cannot deliver the
Mortgage or power of attorney with evidence of recording thereon on or
prior to the Closing Date because of a delay caused by the public
recording office where such Mortgage has been delivered for
recordation or because such Mortgage or power of attorney has been
lost, the Depositor shall deliver or cause to be delivered to the
Trustee (or its custodian), in the case of a delay due to recording, a
true copy of such Mortgage or power of attorney, pending delivery of
the original thereof, together with an Officer's Certificate of the
Depositor certifying that the copy of such Mortgage or power of
attorney delivered to the Trustee (or the applicable Custodian) is a
true copy and that the original of such Mortgage or power of attorney
has been forwarded to the public recording office, or, in the case of
a Mortgage or power of attorney that has been lost, a copy thereof
(certified as provided for under the laws of the appropriate
jurisdiction) and a written Opinion of Counsel acceptable to the
Trustee and the Depositor that an original recorded Mortgage or power
of attorney is not required to enforce the Trustee's interest in the
Mortgage Loan;
(iv) the original of each assumption, modification or
substitution agreement, if any, relating to the Mortgage Loans, or, as
to any assumption, modification or substitution agreement which cannot
be delivered on or prior to the Closing Date because of a delay caused
by the public recording office where such assumption, modification or
substitution agreement has been delivered for recordation, a photocopy
of such assumption, modification or substitution agreement, pending
delivery of the original thereof, together with an Officer's
Certificate of the Depositor certifying that the copy of such
assumption, modification or substitution agreement delivered to the
Trustee (or the applicable Custodian) is a true copy and that the
original of such agreement has been forwarded to the public recording
office;
(v) with respect to each Non-MERS Mortgage Loan, an original
Assignment of Mortgage, in form and substance acceptable for
recording. The Mortgage shall be assigned either (A) in blank, without
recourse or (B) to "Bank One, National Association, as Trustee of the
Amortizing Residential Collateral Trust, 2001-BC3", without recourse;
(vi) if applicable, such original intervening assignments of the
Mortgage, notice of transfer or equivalent instrument (each, an
"Intervening Assignment"), as may be necessary to show a complete
chain of assignment from the originator, or, in the case of an
Intervening Assignment that has been lost, a written Opinion of
Counsel acceptable to the Trustee that such original Intervening
Assignment is not required to enforce the Trustee's interest in the
Mortgage Loans;
(vii) with respect to any Mortgage Loan, the original mortgagee
title insurance policy or attorney's opinion of title and abstract of
title; and
(viii) the original of any security agreement, chattel mortgage
or equivalent instrument executed in connection with the Mortgage or
as to any security agreement, chattel mortgage or their equivalent
instrument that cannot be delivered on or prior to the Closing Date
because of a delay caused by the public recording office where such
document has been delivered for recordation, a photocopy of such
document, pending delivery of the original thereof, together with an
Officer's Certificate of the Depositor certifying that the copy of
such security agreement, chattel mortgage or their equivalent
instrument delivered to the Trustee (or its custodian) is a true copy
and that the original of such document has been forwarded to the
public recording office.
The parties hereto acknowledge and agree that the form of endorsement
attached hereto as Exhibit B-4 is intended to effect the transfer to the
Trustee, for the benefit of the Certificateholders, of the Mortgage Notes and
the Mortgages.
(c) (i) Assignments of Mortgage with respect to each Non-MERS Mortgage
Loan shall be recorded; provided, however, that such Assignments need not be
recorded if, on or prior to the Closing Date, the Depositor delivers, at its
own expense, an Opinion of Counsel (which must be Independent counsel)
acceptable to the Trustee and the Rating Agencies, to the effect that recording
in such states is not required to protect the Trustee's interest in the related
Non-MERS Mortgage Loans. Subject to the preceding sentence, as soon as
practicable after the Closing Date (but in no event more than three months
thereafter except to the extent delays are caused by the applicable recording
office), the Trustee, at the expense of the Depositor and with the cooperation
of the applicable Servicer, shall cause to be properly recorded by each
Servicer in each public recording office where the related Mortgages are
recorded each Assignment of Mortgage referred to in subsection (b)(v) above
with respect to each Non-MERS Mortgage Loan.
(ii) With respect to each MERS Mortgage Loan, the Trustee, at the
expense of the Depositor and at the direction and with the cooperation of the
applicable Servicer, shall cause to be taken such actions as are necessary to
cause the Trustee to be clearly identified as the owner of each such Mortgage
Loan on the records of MERS for purposes of the system of recording transfers
of beneficial ownership of mortgages maintained by MERS.
(d) In instances where a Title Insurance Policy is required to be
delivered to the Trustee or the applicable Custodian on behalf of the Trustee
under clause (b)(vii) above and is not so delivered, the Depositor will provide
a copy of such Title Insurance Policy to the Trustee, or 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.
(e) 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 to the Trustee, or to the
applicable Custodian on behalf of the Trustee, 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 Collection
Account pursuant to Section 4.01 have been so deposited. All original documents
that are not delivered to the Trustee or the applicable Custodian on behalf of
the Trustee shall be held by the Master Servicer or the applicable Servicer in
trust for the benefit of the Trustee and the Certificateholders.
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 or by the applicable Custodian on its behalf
of the Mortgage Files pertaining to the Mortgage Loans listed on the Mortgage
Loan Schedule, subject to review thereof by the Trustee, or by the applicable
Custodian on behalf of the Trustee, under this Section 2.02. The Trustee, or
the applicable Custodian on behalf of the Trustee, will execute and deliver to
the Depositor and the Master Servicer on the Closing Date an Initial
Certification in the form annexed hereto as Exhibit B-1 (or in the form annexed
to the applicable Custodial Agreement as Exhibit B-1, as applicable).
(b) Within 45 days after the Closing Date, the Trustee or the
applicable Custodian on behalf of the Trustee, will, for the benefit of Holders
of the Certificates, review each Mortgage File to ascertain that all required
documents set forth in Section 2.01 have been received and appear on their face
to contain the requisite signatures by or on behalf of the respective parties
thereto, and shall deliver to the Depositor and the Master Servicer an Interim
Certification in the form annexed hereto as Exhibit B-2 (or in the form annexed
to the applicable Custodial Agreement as Exhibit B-2, as applicable) to the
effect that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan prepaid in full or any specifically identified in
such certification as not covered by such certification), (i) all of the
applicable documents specified in Section 2.01(b) are in its possession and
(ii) such documents have been reviewed by it and appear to relate to such
Mortgage Loan. The Trustee, or the applicable Custodian on behalf of the
Trustee, shall determine whether such documents are executed and endorsed, but
shall be under no duty or obligation to inspect, review or examine any such
documents, instruments, certificates or other papers to determine that the same
are valid, binding, legally effective, properly endorsed, genuine, enforceable
or appropriate for the represented purpose or that they have actually been
recorded or are in recordable form or that they are other than what they
purport to be on their face. Neither the Trustee nor any applicable Custodian
shall have any responsibility for verifying the genuineness or the legal
effectiveness of or authority for any signatures of or on behalf of any party
or endorser.
(c) If in the course of the review described in paragraph (a) above
the Trustee or the applicable Custodian discovers any document or documents
constituting a part of a Mortgage File that is missing, does not appear regular
on its face (i.e., is mutilated, damaged, defaced, torn or otherwise physically
altered) or appears to be unrelated to the Mortgage Loans identified in the
Mortgage Loan Schedule (each, a "Material Defect"), the Trustee, or the
applicable Custodian on behalf of the Trustee, discovering such Material Defect
shall promptly identify the Mortgage Loan to which such Material Defect relates
in the Interim Certification delivered to the Depositor and the Master
Servicer. Within 90 days of its receipt of such notice, the Transferor, or, if
the Transferor does not do so, the Depositor shall be required to cure such
Material Defect (and, in such event, the Depositor shall provide the Trustee
with an Officer's Certificate confirming that such cure has been effected). If
the applicable Transferor or the Depositor, as applicable, does not so cure
such Material Defect, the Transferor, or, if the Transferor does not do so, the
Depositor, shall, if a loss has been incurred with respect to such Mortgage
Loan that would, if such Mortgage Loan were not purchased from the Trust Fund,
constitute a Realized Loss, and such loss is attributable to the failure of the
Depositor to cure such Material Defect, repurchase the related Mortgage Loan
from the Trust Fund at the Purchase Price. A loss shall be deemed to be
attributable to the failure of the Depositor to cure a Material Defect if, as
determined by the Depositor, upon mutual agreement with the Trustee acting in
good faith, absent such Material Defect, such loss would not have been
incurred. Within the two-year period following the Closing Date, the Depositor
may, in lieu of repurchasing a Mortgage Loan pursuant to this Section 2.02,
substitute for such Mortgage Loan a Qualifying Substitute Mortgage Loan subject
to the provisions of Section 2.05. The failure of the Trustee or the applicable
Custodian to give the notice contemplated herein within 45 days after the
Closing Date shall not affect or relieve the Depositor of its obligation to
repurchase any Mortgage Loan pursuant to this Section 2.02 or any other Section
of this Agreement requiring the repurchase of Mortgage Loans from the Trust
Fund.
(d) Within 180 days following the Closing Date, the Trustee, or the
applicable Custodian, shall deliver to the Depositor and the Master Servicer a
Final Certification substantially in the form attached as Exhibit B-3 (or in
the form annexed to the applicable Custodial Agreement as Exhibit B-3, as
applicable) evidencing the completeness of the Mortgage Files in its possession
or control, with any exceptions noted thereto.
(e) 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.
(f) Each of the parties hereto acknowledges that the applicable
Custodian shall perform the applicable review of the Mortgage Loans and
respective certifications thereof as provided in this Section 2.02 and the
Custodial Agreement.
Section 2.03. Representations and Warranties of the Depositor. (a) The
Depositor hereby represents and warrants to the Trustee, for the benefit of
Certificateholders and to the Master Servicer 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 and the Master Servicer, 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, 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; and
(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.
(b) The representations and warranties of each Transferor with respect
to the related Mortgage Loans in the applicable Transfer Agreement, which have
been assigned to the Trustee hereunder, were made as of the date specified in
the applicable Transfer Agreement (or underlying agreement, if such Transfer
Agreement is in the form of an assignment of a prior agreement). To the extent
that any fact, condition or event with respect to a Mortgage Loan constitutes a
breach of both (i) a representation or warranty of the applicable Transferor
under the applicable Transfer Agreement and (ii) a representation or warranty
of the Seller under the Mortgage Loan Sale Agreement, the only right or remedy
of the Trustee or of any Certificateholder shall be the Trustee's right to
enforce the obligations of the applicable Transferor under any applicable
representation or warranty made by it. The Trustee acknowledges that the Seller
shall have no obligation or liability with respect to any breach of a
representation or warranty made by it with respect to the Mortgage Loans if the
fact, condition or event constituting such breach also constitutes a breach of
a representation or warranty made by the applicable Transferor in the
applicable Transfer Agreement, without regard to whether such Transferor
fulfills its contractual obligations in respect of such representation or
warranty. The Trustee further acknowledges that the Depositor shall have no
obligation or liability with respect to any breach of any representation or
warranty with respect to the Mortgage Loans (except as set forth in Section
2.03(a)(vi)) under any circumstances.
Section 2.04. Discovery of Breach. It is understood and agreed that
the representations and warranties (i) set forth in Section 2.03, (ii) of the
Seller set forth in the Mortgage Loan Sale Agreement and assigned to the
Depositor by the Seller under the Mortgage Loan Sale Agreement and to the
Trustee by the Depositor hereunder and (iii) of each Transferor and of each
Servicer assigned, by the Seller to the Depositor pursuant to the Mortgage Loan
Sale Agreement and assigned to the Trustee by the Depositor hereunder, shall
each survive delivery of the Mortgage Files and the Assignment of Mortgage of
each Mortgage Loan to the Trustee and shall continue throughout the term of
this Agreement. Upon discovery by any of the Depositor, the Master Servicer or
the Trustee of a breach of any of such representations and warranties that
adversely and materially affects the value of the related Mortgage Loan, the
party discovering such breach shall give prompt written notice to the other
party. Within 90 days of the discovery of a breach of any representation or
warranty given to the Trustee by the Depositor or given by any Transferor or
the Seller and assigned to the Trustee, the Depositor, such Transferor or the
Seller, as applicable, shall either (a) cure such breach in all material
respects, (b) repurchase such Mortgage Loan or any property acquired in respect
thereof from the Trustee at the Purchase Price (or, with respect to Mortgage
Loans as to which there is a breach of a representation or warranty set forth
in Section 1.04(b)(v) of the Mortgage Loan Sale Agreement, at the purchase
price therefor paid by the Seller under the Mortgage Loan Sale Agreement) or
(c) within the two-year period following the Closing Date, substitute a
Qualifying Substitute Mortgage Loan for the affected Mortgage Loan. In the
event of discovery of a breach of any representation and warranty of any
Transferor assigned to the Trustee, the Trustee shall enforce its rights under
the applicable Transfer Agreement and the Mortgage Loan Sale Agreement for the
benefit of Certificateholders. As provided in the Mortgage Loan Sale Agreement,
if any Transferor substitutes a mortgage loan for a Deleted Mortgage Loan
pursuant to the related Transfer Agreement and such substitute mortgage loan is
not a Qualifying Substitute Mortgage Loan, under the terms of the Mortgage Loan
Sale Agreement the Seller will, in exchange for such substitute mortgage loan,
(i) pay to the Trust Fund the applicable Purchase Price for the affected
Mortgage Loan or (ii) within two years of the Closing Date, substitute a
Qualifying Substitute Mortgage Loan. The Seller indemnifies and holds the Trust
Fund, the Master Servicer, the Trustee, the Depositor and each
Certificateholder harmless against any and all taxes, claims, losses,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgements, and any other costs, fees and expenses that the trust Fund, the
Trustee, the Depositor and any Certificateholder may sustain in connection with
any actions of the Seller relating to a repurchase of a Mortgage Loan other
than in compliance with the terms of this Section 2.05 and the Mortgage Loan
Sale Agreement, to the extent that any such action causes (i) any federal or
state tax to be imposed on the Trust Fund, including without limitation, any
federal tax imposed on "prohibited transactions" under Section 860F(a)(1) of
the Code or on "contributions after the startup date" under Section 860(d)(1)
of the Code, or (ii) the REMIC to fail to qualify as a REMIC at any time that
any Certificate is outstanding.
Section 2.05. Repurchase, Purchase or Substitution of Mortgage Loans.
(a) With respect to any Mortgage Loan repurchased by the Depositor pursuant to
this Agreement, by the Seller pursuant to the Mortgage Loan Sale Agreement or
by the Transferor pursuant to the applicable Transfer Agreement, the principal
portion of the funds received by the Trustee in respect of such repurchase of a
Mortgage Loan will be considered a Principal Prepayment and the Purchase Price
shall be deposited in the Collection Account or a Custodial Account, as
applicable. The Trustee, upon receipt of the full amount of the Purchase Price
for a Deleted Mortgage Loan, or upon receipt of the Mortgage File for a
Qualifying Substitute Mortgage Loan substituted for a Deleted Mortgage Loan
(and any applicable Substitution Amount), shall release or cause to be released
and reassign to the Depositor, the Seller or the Transferor, as applicable, the
related Mortgage File for the Deleted Mortgage Loan and shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranty, as shall be necessary to vest in such
party or its designee or assignee title to any Deleted Mortgage Loan released
pursuant hereto, free and clear of all security interests, liens and other
encumbrances created by this Agreement, which instruments shall be prepared by
the related Servicer and the Trustee shall have no further responsibility with
respect to the Mortgage File relating to such Deleted Mortgage Loan.
(b) With respect to each Qualifying Substitute Mortgage Loan to be
delivered to the Trustee (or its custodian) pursuant to the terms of this
Article II in exchange for a Deleted Mortgage Loan: (i) the Depositor, the
Transferor or the Seller, as applicable, must deliver to the Trustee (or a
Custodian) the Mortgage File for the Qualifying Substitute Mortgage Loan
containing the documents set forth in Section 2.01(b) along with a written
certification certifying as to the delivery of such Mortgage File and
containing the granting language set forth in Section 2.01(a); and (ii) the
Depositor will be deemed to have made, with respect to such Qualified
Substitute Mortgage Loan, each of the representations and warranties made by it
with respect to the related Deleted Mortgage Loan. As soon as practicable after
the delivery of any Qualifying Substitute Mortgage Loan hereunder, the Trustee,
at the expense of the Depositor and with the cooperation of the applicable
Servicer, shall (i) with respect to a Qualifying Substitute Mortgage Loan that
is a Non-MERS Mortgage Loan, cause the Assignment of Mortgage to be recorded by
the applicable Servicer if required pursuant to Section 2.01(c), or (ii) with
respect to a Qualifying Substitute Mortgage Loan that is a MERS Mortgage Loan,
cause to be taken such actions as are necessary to cause the Trustee to be
clearly identified as the owner of each such Mortgage Loan on the records of
MERS if required pursuant to Section 2.01(c).
(c) Notwithstanding any other provision of this Agreement, the right
to substitute Mortgage Loans pursuant to this Article II shall be subject to
the additional limitations that no substitution of a Qualifying Substitute
Mortgage Loan for a Deleted Mortgage Loan shall be made unless the Trustee has
received an Opinion of Counsel (at the expense of the party seeking to make the
substitution) that, under current law, such substitution will not (A) affect
adversely the status of any REMIC established hereunder as a REMIC, or of the
related "regular interests" as "regular interests" in any such REMIC, or (B)
cause any such REMIC to engage in a "prohibited transaction" or prohibited
contribution pursuant to the REMIC Provisions.
Section 2.06. Grant Clause. 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, 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.
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 Principal Amount, or Notional Principal
Amount, as applicable, or in the Percentage Interests, specified herein. Each
Class of Book-Entry Certificates will be issued in the minimum denominations in
Certificate Principal Amount (or Notional Amount) specified in the Preliminary
Statement hereto and in integral multiples of $1 in excess thereof. The Class P
Certificate, the Class X Certificate and the Class R Certificate shall each be
issued as a single Certificate and maintained in definitive, fully registered
form in a denomination equal to 100% of the Percentage Interest of such Class.
The Certificates may be issued in the form of typewritten certificates.
(b) The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee by an authorized officer. Each Certificate
shall, on original issue, be authenticated by the Trustee upon the order of the
Depositor upon receipt by the Trustee of the 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 Trustee or the
Authenticating Agent, if any, 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 the Depositor to the Trustee or
the Authenticating Agent for authentication and the Trustee or the
Authenticating Agent shall authenticate and deliver such Certificates as in
this Agreement provided and not otherwise.
(c) The Class P, Class X or Class R Certificates offered and sold in
reliance on the exemption from registration under Rule 144A under the Act shall
be issued initially in the form of one or more permanent global Certificates 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"), which shall be deposited on behalf of the
subscribers for such Certificates represented thereby with the Trustee, as
custodian for The Depository Trust Company ("DTC") and registered in the name
of a nominee of DTC, duly executed and authenticated by the Trustee as
hereinafter provided. The aggregate principal amounts of the Restricted Global
Securities may from time to time be increased or decreased by adjustments made
on the records of the Trustee or DTC or its nominee, as the case may be, as
hereinafter provided.
The Class P, Class X or Class R Certificates sold in offshore
transactions in reliance on Regulation S shall be issued initially in the form
of one or more permanent global Certificates in definitive, fully registered
form without interest coupons with the applicable legends set forth in Exhibit
A hereto added to the forms of such Certificates (each, a "Regulation S Global
Security"), which shall be deposited on behalf of the subscribers for such
Certificates represented thereby with the Trustee, as custodian for DTC and
registered in the name of a nominee of DTC, duly executed and authenticated by
the Trustee as hereinafter provided. The aggregate principal amounts of the
Regulation S Global Securities may from time to time be increased or decreased
by adjustments made on the records of the Trustee or DTC or its nominee, as the
case may be, as hereinafter provided.
Section 3.02. Registration. The Trustee is hereby appointed, and
hereby accepts its appointment as, 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 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
Trustee and the appointment of a successor Trustee. The Certificate Registrar
may appoint, by a written instrument delivered to the Holders and the Master
Servicer, any bank or trust 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 Trustee shall execute, and the Trustee or any
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 Principal 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 Principal 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
Trustee shall execute, and the Trustee or 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 or a Regulation S Global
Security, 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. In addition, each Holder of a Regulation S
Global Security shall be deemed to have represented and warranted to the
Trustee, the Certificate Registrar and any of their respective successors that:
(i) such Person is not a U.S. person within the meaning of Regulation S and
was, at the time the buy order was originated, outside the United States and
(ii) such Person understands that such Certificates have not been registered
under the Securities Act of 1933, as amended (the "Act"), and that (x) until
the expiration of the 40-day distribution compliance period (within the meaning
of Regulation S), no offer, sale, pledge or other transfer of such Certificates
or any interest therein shall be made in the United States or to or for the
account or benefit of a U.S. person (each as defined in Regulation S), (y) if
in the future it decides to offer, resell, pledge or otherwise transfer such
Certificates, such Certificates may be offered, resold, pledged or otherwise
transferred only (A) to a person which the seller reasonably believes is a
"qualified institutional buyer" (a "QIB") as defined in Rule 144A under the
Act, that is purchasing such Certificates for its own account or for the
account of a qualified institutional buyer to which notice is given that the
transfer is being made in reliance on Rule 144A or (B) in an offshore
transaction (as defined in Regulation S) in compliance with the provisions of
Regulation S, in each case in compliance with the requirements of this
Agreement; and it will notify such transferee of the transfer restrictions
specified in this Section.
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 the Placement Agent, an affiliate (as defined in Rule 405
under the 0000 Xxx) of the Depositor or the Placement Agent or (y)
being made to a "qualified 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 Trustee with a certificate in
the form of Exhibit F 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 Trustee a
letter of the transferee substantially in the form of Exhibit G
hereto.
(d) No transfer of an ERISA-Restricted Certificate in the form of a
Definitive Certificate shall be made to any Person unless the Trustee and the
Master Servicer have received (A) a certificate substantially in the form of
Exhibit H hereto from such transferee or (B) an Opinion of Counsel satisfactory
to the Trustee, the Master Servicer and the Depositor to the effect that the
purchase and holding of such a Certificate will not constitute or result in the
assets of the Trust Fund being deemed to be "plan assets" subject to the
prohibited transactions provisions of ERISA or Section 4975 of the Code and
will not subject the Trustee, the Master Servicer or the Depositor to any
obligation in addition to those undertaken in the Agreement; provided, however,
that the Trustee 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
Trustee and the Master Servicer 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 ERISA or Section
4975 of the Code. Each Transferee of an ERISA-Restricted Certificate that is a
Book-Entry Certificate shall be deemed to have made the representations set
forth in Exhibit H. The preparation and delivery of the certificate and
opinions referred to above shall not be an expense of the Trust Fund, the
Trustee, the Master Servicer or the Depositor. Notwithstanding the foregoing,
no opinion or certificate shall be required for the initial issuance of the
ERISA-Restricted Certificates.
(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 is (A) 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 Trustee with an effective Internal
Revenue Service Form 4224 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 Trustee an affidavit in substantially the form attached hereto
as Exhibit D-1 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 an affidavit in substantially the form attached
hereto as Exhibit D-2. In addition, the Trustee 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
Depositor and the Trustee satisfactory in form and substance to the Depositor,
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 Trustee shall not be under any 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 maturity of 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 Trustee shall have actual knowledge at the time 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 Trustee 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 Trustee 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 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 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), for 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.
(h) Notwithstanding any provision to the contrary herein, so long as a
Global Security representing either of the Class P, Class X or Class R
Certificates remains outstanding and is held by or on behalf of DTC, transfers
of a Global Security representing any such Certificates, in whole or in part,
shall only be made in accordance with Section 3.01 and this Section 3.03(h).
(A) Subject to clauses (B) and (C) of this Section 3.03(h),
transfers of a Global Security representing any of the Class P, Class
X or Class R Certificates shall be limited to transfers of such Global
Security, in whole or in part, to nominees of DTC or to a successor of
DTC or such successor's nominee.
(B) Restricted Global Security to Regulation S Global Security.
If a holder of a beneficial interest in a Restricted Global Security
deposited with or on behalf of DTC wishes at any time to exchange its
interest in such Restricted Global Security for an interest in a
Regulation S Global Security, or to transfer its interest in such
Restricted Global Security to a Person who wishes to take delivery
thereof in the form of an interest in a Regulation S Global Security,
such holder, provided such holder is not a U.S. person, may, subject
to the rules and procedures of DTC, exchange or cause the exchange of
such interest for an equivalent beneficial interest in the Regulation
S Global Security. Upon receipt by the Trustee, as Certificate
Registrar, of (I) instructions from DTC directing the Trustee, as
Certificate Registrar, to be credited a beneficial interest in a
Regulation S Global Security in an amount equal to the beneficial
interest in such Restricted Global Security to be exchanged but not
less than the minimum denomination applicable to such holder's
Certificates held through a Regulation S Global Security, (II) a
written order given in accordance with DTC's procedures containing
information regarding the participant account of DTC and, in the case
of a transfer pursuant to and in accordance with Regulation S, the
Euroclear or Clearstream account to be credited with such increase and
(III) a certificate in the form of Exhibit N-1 hereto given by the
holder of such beneficial interest stating that the exchange or
transfer of such interest has been made in compliance with the
transfer restrictions applicable to the Global Securities, including
that the holder is not a U.S. person, and pursuant to and in
accordance with Regulation S, the Trustee, as Certificate Registrar,
shall reduce the principal amount of the Restricted Global Security
and increase the principal amount of the Regulation S Global Security
by the aggregate principal amount of the beneficial interest in the
Restricted Global Security to be exchanged, and shall instruct
Euroclear or Clearstream, as applicable, concurrently with such
reduction, to credit or cause to be credited to the account of the
Person specified in such instructions a beneficial interest in the
Regulation S Global Security equal to the reduction in the principal
amount of the Restricted Global Security.
(C) Regulation S Global Security to Restricted Global Security.
If a holder of a beneficial interest in a Regulation S Global Security
deposited with or on behalf of DTC wishes at any time to transfer its
interest in such Regulation S Global Security to a Person who wishes
to take delivery thereof in the form of an interest in a Restricted
Global Security, such holder may, subject to the rules and procedures
DTC, exchange or cause the exchange of such interest for an equivalent
beneficial interest in a Restricted Global Security. Upon receipt by
the Trustee, as Certificate Registrar, of (I) instructions from DTC
directing the Trustee, as Certificate Registrar, to cause to be
credited a beneficial interest in a Restricted Global Security in an
amount equal to the beneficial interest in such Regulation S Global
Security to be exchanged but not less than the minimum denomination
applicable to such holder's Certificates held through a Restricted
Global Security, to be exchanged, such instructions to contain
information regarding the participant account with DTC to be credited
with such increase, and (II) a certificate in the form of Exhibit O-2
hereto given by the holder of such beneficial interest and stating,
among other things, that the Person transferring such interest in such
Regulation S Global Security reasonably believes that the Person
acquiring such interest in a Restricted Global Security is a QIB, is
obtaining such beneficial interest in a transaction meeting the
requirements of Rule 144A under the Act and in accordance with any
applicable securities laws of any State of the United States or any
other jurisdiction, then the Trustee, as Certificate Registrar, will
reduce the principal amount of the Regulation S Global Security and
increase the principal amount of the Restricted Global Security by the
aggregate principal amount of the beneficial interest in the
Regulation S Global Security to be transferred and the Trustee, as
Certificate Registrar, shall instruct DTC, concurrently with such
reduction, to credit or cause to be credited to the account of the
Person specified in such instructions a beneficial interest in the
Restricted Global Security equal to the reduction in the principal
amount of the Regulation S Global Security.
(D) Other Exchanges. In the event that a Global Security is
exchanged for Certificates in definitive registered form without
interest coupons, pursuant to Section 3.09(c) hereof, such
Certificates may be exchanged for one another only in accordance with
such procedures as are substantially consistent with the provisions
above (including certification requirements intended to insure that
such transfers comply with Rule 144A, comply with Rule 501(a)(1), (2),
(3) or (7) or are to non-U.S. persons in compliance with Regulation S
under the Act, as the case may be), and as may be from time to time
adopted by the Trustee.
(E) Restrictions on U.S. Transfers. Transfers of interests in
the Regulation S Global Security to U.S. persons (as defined in
Regulation S) shall be limited to transfers made pursuant to the
provisions of Section 3.03(h)(C).
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 Trustee or the Certificate Registrar.
Section 3.05. Replacement of Certificates. If (i) any Certificate is
mutilated and is surrendered to the Trustee or any Authenticating Agent or (ii)
the Trustee or any Authenticating Agent receives evidence to its satisfaction
of the destruction, loss or theft of any Certificate, and there is delivered to
the Trustee or the Authenticating Agent 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 and any Authenticating Agent that such destroyed, lost or
stolen Certificate has been acquired by a bona fide purchaser, the Trustee
shall execute and the Trustee or any 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
Principal Amount. Upon the issuance of any new Certificate under this Section
3.05, the Trustee and Authenticating Agent may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee or the Authenticating Agent) 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.
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 Trustee, the Certificate Registrar and any agent of any of them
may 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
Trustee, the Certificate Registrar 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 Trustee shall
execute and 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 Trustee without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Trustee shall execute and authenticate and deliver in
exchange therefor a like aggregate Certificate Principal Amount 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. The Trustee may appoint a
Paying Agent (which may be the Trustee) for the purpose of making distributions
to Certificateholders hereunder. The Trustee shall cause such Paying Agent 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 Certificateholders in an Eligible 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 Trustee to any such
Paying Agent for the purpose of making distributions shall be paid to
Certificateholders on each Distribution Date and any amounts not so paid shall
be returned on such Distribution Date to the Trustee. If the Paying Agent is
not the Trustee, the Trustee 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 Depositor, the Master Servicer, the Paying Agent, the
Registrar and the Trustee may 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 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.
(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
Trustee 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 Depositor advises the Trustee 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
Trustee or the Depositor is unable to locate a qualified successor, (ii) the
Depositor, at its option, advises the Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency or (iii) after the
occurrence of an Event of Default, Certificate Owners representing beneficial
interests aggregating not less than 50% of the Class Principal Amount of a
Class of Book-Entry Certificates identified as such to the Trustee by an
Officer's Certificate from the Clearing Agency advise the Trustee 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 Trustee shall notify or cause the Certificate Registrar to
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 Trustee of the Book-Entry Certificates by the
Clearing Agency, accompanied by registration instructions from the Clearing
Agency for registration, the Trustee shall issue the Definitive Certificates.
Neither the Depositor 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
Trustee, to the extent applicable, with respect to such Definitive Certificates
and the Trustee shall recognize the holders of the Definitive Certificates as
Certificateholders hereunder.
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01. Collection Account. (a) On the Closing Date, the Master
Servicer shall open and shall thereafter maintain a segregated account held in
trust (the "Collection Account"), entitled "Collection Account, Xxxxx Fargo
Bank Minnesota, National Association, as Master Servicer, in trust for the
benefit of the Holders of Amortizing Residential Collateral Trust Mortgage
Pass-Through Certificates, Series 2001-BC3". The Collection Account shall
relate solely to the Certificates issued by the Trust Fund hereunder, and funds
in such Collection Account shall not be commingled with any other monies.
(b) The Collection Account shall be an Eligible Account. If an
existing Collection Account ceases to be an Eligible Account, the Master
Servicer shall establish a new Collection Account that is an Eligible Account
within 15 days and transfer all funds and investment property on deposit in
such existing Collection Account into such new Collection Account.
(c) The Master Servicer shall give to the Trustee prior written notice
of the name and address of the depository institution at which the Collection
Account is maintained and the account number of such Collection Account. The
Master Servicer shall take such actions as are necessary to cause the
depository institution holding the Collection Account to hold such account in
the name of the Master Servicer under this Agreement. On each Deposit Date, the
entire amount on deposit in the Collection Account (subject to permitted
withdrawals set forth in Section 4.02), other than amounts not included in the
Total Distribution Amount for such Distribution Date shall be remitted to the
Trustee for deposit into the Certificate Account by wire transfer in
immediately available funds. The Master Servicer, at its option, may choose to
make daily remittances from the Collection Account to the Trustee for deposit
into the Certificate Account.
(d) The Master Servicer shall deposit or cause to be deposited into
the Collection Account, no later than the Business Day following the Closing
Date, any amounts received with respect to the Mortgage Loans representing
Scheduled Payments on the Mortgage Loan due after the Cut-off Date and
unscheduled payments received on or after the Cut-off Date and on or before the
Closing Date. Thereafter, the Master Servicer shall deposit or cause to be
deposited in the Collection Account on the earlier of the applicable Remittance
Date and one Business Day following receipt thereof, the following amounts
received or payments made by it (other than in respect of principal of and
interest on the Mortgage Loans due on or before the Cut-off Date):
(i) all payments on account of principal, including Principal
Prepayments and Late Collections, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans,
including Prepayment Premiums, net of the Servicing Fee, the Net
Master Servicing Fee and the MGIC Insurance Premiums, if any, with
respect to each such Mortgage Loan, but only to the extent of the
amount permitted to be withdrawn or withheld from the Collection
Account in accordance with Sections 5.04 and 9.21;
(iii) any unscheduled payment or other recovery with respect to
a Mortgage Loan not otherwise specified in this paragraph (d),
including all Liquidation Proceeds with respect to the Mortgage Loans
and REO Property, and all amounts received in connection with the
operation of any REO Property, net of (x) any unpaid Servicing Fees
and Net Master Servicing Fees with respect to such Mortgage Loans (but
only to the extent of the amount permitted to be withdrawn or withheld
from the Collection Account in accordance with Sections 5.04 and 9.21)
and (y) any amounts reimbursable to a Servicer with respect to such
Mortgage Loan under the applicable Servicing Agreement and retained by
such Servicer;
(iv) all Insurance Proceeds;
(v) all Advances made by the Master Servicer or any Servicer
pursuant to Section 5.04 or applicable Servicing Agreement;
(vi) all amounts paid by any Servicer with respect to Prepayment
Interest Shortfalls, and any Compensating Interest Payment made by the
Master Servicer; and
(vii) the Purchase Price of any Mortgage Loan repurchased by the
Depositor, the Seller, the Master Servicer or any other Person and any
Substitution Amount related to any Qualifying Substitute Mortgage
Loan.
(e) Funds in the Collection Account may be invested in Eligible
Investments selected by and at the written direction of the Master Servicer,
which shall mature not later than two Business Days prior to the Deposit Date.
All such Eligible 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
Eligible Investment shall be for the benefit of the Master Servicer and shall
be subject to its withdrawal or order from time to time, and shall not be part
of the Trust Fund. The amount of any losses incurred in respect of any such
investments shall be deposited in such Collection Account by the Master
Servicer out of its own funds, without any right of reimbursement therefor,
immediately as realized. The foregoing requirements for deposit in the
Collection Account are exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments of interest on funds in the
Collection Account and payments in the nature of late payment charges,
assumption fees and other incidental fees and charges relating to the Mortgage
Loans (other than Prepayment Premiums) need not be deposited by the Master
Servicer in the Collection Account and may be retained by the Master Servicer
or the applicable Servicer as additional servicing compensation. If the Master
Servicer deposits in the Collection Account any amount not required to be
deposited therein, it may at any time withdraw such amount from such Collection
Account. In the event the Depositor does not provide written direction to the
Master Servicer pursuant to this Section, all funds on deposit in the
Collection Account shall be invested in a money market fund as described in
paragraph (viii) of the definition of "Eligible Investment" set forth in
Article I.
Section 4.02. Application of Funds in the Collection Account. The
Master Servicer may, from time to time, make, or cause to be made, withdrawals
from the Collection Account for the following purposes:
(i) to reimburse itself or any Servicer for Advances or
Servicing Advances made by it or by such Servicer pursuant to Section
5.04 or the applicable Servicing Agreement; such right to
reimbursement pursuant to this subclause (i) is limited to amounts
received on or in respect of a particular Mortgage Loan (including,
for this purpose, Liquidation Proceeds and amounts representing
Insurance Proceeds with respect to the property subject to the related
Mortgage) which represent late recoveries (net of the applicable
Servicing Fee and the Net Master Servicing Fee) of payments of
principal or interest respecting which any such Advance was made, it
being understood, in the case of any such reimbursement, that the
Master Servicer's or Servicer's right thereto shall be prior to the
rights of the Certificateholders;
(ii) to reimburse itself or any Servicer, following a final
liquidation of a Mortgage Loan (except as otherwise provided in the
related Servicing Agreement) for any previously unreimbursed Advances
made by it or by such Servicer (A) that it determines in good faith
will not be recoverable from amounts representing late recoveries of
payments of principal or interest respecting the particular Mortgage
Loan as to which such Advance was made or from Liquidation Proceeds or
Insurance Proceeds with respect to such Mortgage Loan and/or (B) to
the extent that such unreimbursed Advances exceed the related
Liquidation Proceeds or Insurance Proceeds, it being understood, in
the case of each such reimbursement, that such Master Servicer's or
Servicer's right thereto shall be prior to the rights of the
Certificateholders;
(iii) to reimburse itself or any Servicer from Liquidation
Proceeds for Liquidation Expenses and for amounts expended by it
pursuant to Section 9.22(c) or the applicable Servicing Agreement in
good faith in connection with the restoration of damaged property and,
to the extent that Liquidation Proceeds after such reimbursement
exceed the unpaid principal balance of the related Mortgage Loan,
together with accrued and unpaid interest thereon at the applicable
Mortgage Rate less the Servicing Fee and the Net Master Servicing Fee
for such Mortgage Loan to the Due Date next succeeding the date of its
receipt of such Liquidation Proceeds, to pay to itself out of such
excess the amount of any unpaid assumption fees, late payment charges
or other Mortgagor charges on the related Mortgage Loan and to retain
any excess remaining thereafter as additional servicing compensation,
it being understood, in the case of any such reimbursement or payment,
that such Master Servicer's or Servicer's right thereto shall be prior
to the rights of the Certificateholders;
(iv) in the event it has elected not to pay itself the Net
Master Servicing Fee out of any Mortgagor payment on account of
interest or other recovery with respect to a particular Mortgage Loan
prior to the deposit of such Mortgagor payment or recovery in the
Collection Account, to pay to itself the Net Master Servicing Fee for
each Distribution Date and any unpaid Net Master Servicing Fees for
prior Distribution Dates, as reduced pursuant to Section 5.05, from
any Mortgagor payment as to interest or such other recovery with
respect to that Mortgage Loan, as is permitted by this Agreement;
(v) to reimburse itself or any Servicer for expenses incurred by
and recoverable by or reimbursable to it or any Servicer pursuant to
Sections 9.04, 9.05(b), 9.07(a), 9.30 or 11.15, or to reimburse itself
for any expenses reimbursable to it pursuant to Section 10.01(c);
provided, however, that any amounts in excess of the annual cap
described in clause (b) of the definition of "Interest Remittance
Amount" in any Anniversary Year, other than costs and expenses
incurred by the Master Servicer pursuant to Section 9.07(a), in
connection with any transfer of servicing, shall be included in the
amount remitted by the Master Servicer to the Trustee pursuant to
clause (viii) below and the Master Servicer's reimbursement for such
excess amounts shall be made pursuant to Section 5.02(b) and 5.02(c)
hereof;
(vi) to pay to the Depositor, the Seller, any Transferor or the
Directing Holder, as applicable, with respect to each Mortgage Loan or
REO Property acquired in respect thereof that has been purchased
pursuant to this Agreement, all amounts received thereon and not
distributed on the date on which the related repurchase was effected,
and to pay to the applicable Person any Advances and Servicing
Advances to the extent specified in the definition of Purchase Price;
(vii) subject to Section 5.05, to pay to itself income earned on
the investment of funds deposited in the Collection Account;
(viii) to make payments to the Trustee for deposit into the
Certificate Account in the amounts and in the manner provided for in
Section 4.04;
(ix) to make payment to itself, the Trustee, and others pursuant
to any provision of this Agreement;
(x) to withdraw funds deposited in error in the Collection
Account;
(xi) to clear and terminate the Collection Account pursuant to
Section 7.02;
(xii) to reimburse a successor Master Servicer (solely in its
capacity as successor Master Servicer), for any fee or advance
occasioned by a termination of the Master Servicer, and the assumption
of such duties by the Trustee or a successor Master Servicer appointed
by the Trustee pursuant to Section 6.14, in each case to the extent
not reimbursed by the terminated Master Servicer, it being understood,
in the case of any such reimbursement or payment, that the right of
the Master Servicer or the Trustee thereto shall be prior to the
rights of the Certificateholders; and
(xiii) to reimburse any Servicer for such amounts as are due
thereto under the applicable Servicing Agreement and have not been
retained by or paid to such Servicer, to the extent provided in such
Servicing Agreement.
In connection with withdrawals pursuant to subclauses (i), (iii), (iv)
and (vi) above, the Master Servicer's, any Servicer's or such other Person's
entitlement thereto is limited to collections or other recoveries on the
related Mortgage Loan. The Master Servicer shall therefore keep and maintain a
separate accounting for each Mortgage Loan it master services for the purpose
of justifying any withdrawal from the Collection Account it maintains pursuant
to such subclause (i), (iii), (iv) and (vi).
Section 4.03. Reports to Trustee and Certificateholders. (a) On the
Deposit Date related to each Distribution Date, the Master Servicer shall
furnish a report to the Trustee by electronic medium as agreed to by the Master
Servicer and the Trustee.
(b) On each Distribution Date, the Trustee shall provide to each
Certificateholder, or shall make available via the Master Servicer's internet
website, a report setting forth the following information, which information
the Master Servicer will determine (on the basis of information obtained from
the Servicers) and provide to the Trustee pursuant to subsection (a) above:
(i) the aggregate amount of the distribution to be made on such
Distribution Date to the Holders of each Class of Certificates other
than any Class of Notional Certificates, to the extent applicable,
allocable to principal on the Mortgage Loans, including Liquidation
Proceeds and Insurance Proceeds, stating separately the amount
attributable to scheduled principal payments and unscheduled payments
in the nature of principal;
(ii) the aggregate amount of the distribution to be made on such
Distribution Date to the Holders of each Class of Certificates
allocable to interest;
(iii) the amount, if any, of any distribution to the Holders of
the Class P Certificate, the Class X Certificate and the Residual
Certificate;
(iv) (A) the aggregate amount of any Advances required to be
made by or on behalf of the Servicers (or the Master Servicer) with
respect to such Distribution Date, (B) the aggregate amount of such
Advances actually made, and (C) the amount, if any, by which (A) above
exceeds (B) above;
(v) the total number of Mortgage Loans in the Mortgage Pool and
the Total Loan Balance of the Mortgage Pool as of the close of
business on the last day of the related Collection Period, after
giving effect to payments allocated to principal reported under clause
(i) above;
(vi) the Class Principal Amount (or Class Notional Amount) of
each Class of Certificates, to the extent applicable, as of such
Distribution Date after giving effect to payments allocated to
principal reported under clause (i) above, separately identifying any
reduction of any of the foregoing Certificate Principal Amounts due to
Applied Loss Amounts;
(viii) any Realized Losses realized with respect to the Mortgage
Loans (x) in the applicable Prepayment Period and (y) in the aggregate
since the Cut-off Date;
(ix) the amount of the Net Master Servicing Fees, Servicing
Fees, Trustee Fees, Loss Mitigation Advisor's Fees and MGIC Insurance
Premiums paid during the Collection Period to which such distribution
relates;
(x) the number and aggregate Scheduled Principal Balance of
Mortgage Loans, as reported to the Trustee by the Master Servicer, (a)
remaining outstanding (b) delinquent 30 to 59 days on a contractual
basis, (c) delinquent 60 to 89 days on a contractual basis, (d)
delinquent 90 or more days on a contractual basis, and (e) as to which
foreclosure proceedings have been commenced as of the close of
business on the last Business Day of the calendar month immediately
preceding the month in which such Distribution Date occurs;
(xi) the aggregate deemed principal balance of all REO Property
as of the close of business on the last Business Day of the calendar
month immediately preceding the month in which such Distribution Date
occurs;
(xii) with respect to substitution of Mortgage Loans in the
preceding calendar month, the Scheduled Principal Balance of each
Deleted Mortgage Loan, and of each Qualifying Substitute Mortgage
Loan;
(xiii) the aggregate outstanding Carryforward Interest, Net
Prepayment Interest Shortfalls, Prepayment Interest Excess, Basis Risk
Shortfalls and Unpaid Basis Risk Shortfalls, if any, for each Class of
Certificates, after giving effect to the distribution made on such
Distribution Date;
(xiv) the Certificate Interest Rate applicable to such
Distribution Date with respect to each Class of Certificates;
(xv) if applicable, the amount of any shortfall (i.e., the
difference between the aggregate amounts of principal and interest
which Certificateholders would have received if there were sufficient
available amounts in the Certificate Account and the amounts actually
distributed);
(xvi) the aggregate amount of the mortgage insurance claim
payments received during the related Collection Period; and
(xvii) the level of LIBOR and the Interest Rate of the LIBOR
Certificates.
In the case of information furnished pursuant to subclauses (i), (ii)
and (viii) above, the amounts shall (except in the case of the report delivered
to the holder of the Class X Certificate) be expressed as a dollar amount per
$1,000 of original principal amount of Certificates.
The Master Servicer may also make such reports available each month
via the Master Servicer's website. The Master Servicer's website can be
accessed at xxxx://xxx.xxxxxxx.xxx. Assistance in using the website can be
obtained by calling the Master Servicer's customer service desk at (301)
815-6600. Parties that are unable to use the website are entitled to have a
paper copy mailed to them via first class mail by calling the Trustee at (800)
524-9472 and indicating such. In preparing or furnishing the foregoing
information to the Trustee, the Master Servicer shall be entitled to rely
conclusively on the accuracy of the information or data regarding the Mortgage
Loans and the related REO Property that has been provided to the Master
Servicer by the Servicers, and the Master Servicer shall not be obligated to
verify, recompute, reconcile or recalculate any such information or data.
(c) 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, shall be promptly forwarded to the Master
Servicer, the Master Servicer 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 Servicing Agreement, shall use
reasonable efforts to obtain such information and documentation from such
Servicer, and provide) to such Certificateholder such reports and access to
information and documentation regarding the Mortgage Loans as such
Certificateholder 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 investment in the Certificates;
provided, however, that the Master Servicer shall be entitled to be reimbursed
by such Certificateholder for the Master Servicer actual expenses incurred in
providing such reports and access.
(d) Within 90 days, or such shorter period as may be required by
statute or regulation, after the end of each calendar year, the Trustee shall
make available to each Person who at any time during the calendar year was a
Certificateholder of record, and make available to Certificate Owners
(identified as such by the Clearing Agency) in accordance with applicable
regulations, a report summarizing the items provided to Certificateholders
pursuant to Section 4.03(a) on an annual basis as may be required to enable
such Holders to prepare their federal income tax returns; provided, however
that this Section 4.03(d) shall not be applicable where relevant reports or
summaries are required elsewhere in this Agreement. Such information shall
include the amount of original issue discount accrued on each Class of
Certificates and information regarding the expenses of the Trust Fund. The
Master Servicer shall provide the Trustee with such information as is necessary
for the Trustee to prepare such reports.
(e) The Master Servicer shall prepare and file with the Internal
Revenue Service ("IRS"), on behalf of the Trust Fund, an application for an
employer identification number on IRS Form SS-4 or by any other acceptable
method. The Master Servicer shall also file a Form 8811 as required. The Master
Servicer, 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 Trustee shall furnish any other information
that is required by the Code and regulations thereunder to be made available to
Certificateholders. The Master Servicer shall provide the Trustee with such
information as is necessary for the Trustee to prepare such reports.
Section 4.04. Certificate Account. (a) The Trustee shall establish and
maintain in its name, as trustee, a trust account (the "Certificate Account")
entitled "Certificate Account, Bank One, National Association, as Trustee, in
trust for the benefit of the Holders of Amortizing Residential Collateral Trust
Mortgage Pass-Through Certificates, Series 2001-BC3" until disbursed pursuant
to the terms of this Agreement. The Certificate Account shall be an Eligible
Account. If the existing Certificate Account ceases to be an Eligible Account,
the Trustee shall establish a new Certificate Account that is an Eligible
Account within 20 Business Days and transfer all funds and investment property
on deposit in such existing Certificate Account into such new Certificate
Account. The Certificate Account shall relate solely to the Certificates issued
hereunder and funds in the Certificate Account shall be held separate and apart
from and shall not be commingled with any other monies including, without
limitation, other monies of the Trustee held under this Agreement.
(b) The Trustee shall deposit or cause to be deposited into the
Certificate Account, on the day on which, or, if such day is not a Business
Day, the Business Day immediately following the day on which, any monies are
remitted by the Master Servicer to the Trustee, all such amounts. The Trustee
shall make withdrawals from the Certificate Account only for the following
purposes:
(i) to withdraw amounts deposited in the Certificate Account in
error;
(ii) to make payments of the Net Master Servicing Fee (to the
extent not already withheld or withdrawn from the Collection Account
by the Master Servicer) to the Master Servicer;
(iii) to make distributions to Certificateholders pursuant to
Article V; and
(iv) to clear and terminate the Certificate Account pursuant to
Section 7.02.
The Trustee may invest, or cause to be invested, funds held in the
Certificate Account at the direction of the Depositor, which funds, if
invested, shall be invested in Eligible Investments (which may be obligations
of the Trustee). All such investments must be payable on demand or mature no
later than one Business Day prior to the next Distribution Date, and shall not
be sold or disposed of prior to their maturity. All such Eligible Investments
will be made in the name of the Trustee (in its capacity as such) or its
nominee. All income and gain realized from any such investment, shall be
compensation to the Trustee and shall be subject to its withdrawal on order
from time to time. The amount of any losses incurred in respect of any such
investments shall be paid by the Trustee for deposit in the Certificate Account
out of its own funds, without any right of reimbursement therefor, immediately
as realized. In the event the Depositor does not provide written direction to
the Trustee pursuant to this Section, all funds on deposit in the Certificate
Account shall be invested in a money market or common trust fund as described
in paragraph (viii) of the definition of "Eligible Investment" set forth in
Article I.
Section 4.05. Determination of LIBOR. (a) If the outstanding
Certificates include any LIBOR Certificates, then on each LIBOR Determination
Date the Master Servicer shall determine LIBOR on the basis of the offered
LIBOR quotations of the Reference Banks as of 11:00 a.m. London time on such
LIBOR Determination Date as follows:
(i) If on any LIBOR Determination Date two or more of the
Reference Banks provide such offered quotations, LIBOR for the next
Accrual Period will be the arithmetic mean of such offered quotations
(rounding such arithmetic mean if necessary to the nearest five
decimal places);
(ii) If on any LIBOR Determination Date only one or none of the
Reference Banks provides such offered quotations, LIBOR for the next
Accrual Period will be whichever is the higher of (x) LIBOR as
determined on the previous LIBOR Determination Date or (y) the Reserve
Interest Rate. The "Reserve Interest Rate" will be either (A) the rate
per annum which the Master Servicer determines to be the arithmetic
mean (rounding such arithmetic mean if necessary to the nearest five
decimal places) of the one-month Eurodollar lending rates that New
York City banks selected by the Depositor are quoting on the relevant
LIBOR Determination Date to the principal London offices of at least
two leading banks in the London interbank market or (B) in the event
that the Master Servicer can determine no such arithmetic mean, the
lowest one-month Eurodollar lending rate that the New York City banks
selected by the Depositor are quoting on such LIBOR Determination Date
to leading European banks; and
(iii) If on any LIBOR Determination Date the Master Servicer is
required but is unable to determine the Reserve Interest Rate in the
manner provided in paragraph (ii) above, LIBOR for the next Accrual
Period will be LIBOR as determined on the previous LIBOR Determination
Date or, in the case of the first LIBOR Determination Date, the
Initial LIBOR Rate.
(b) The establishment of LIBOR by the Master Servicer and the Master
Servicer's subsequent calculation of the Certificate Interest Rate (or Rates)
applicable to the LIBOR Certificates for the relevant Accrual Period, in the
absence of manifest error, will be final and binding. In all cases, the Master
Servicer may conclusively rely on quotations of LIBOR for the Reference Banks
as such quotations appear on the display designated "LIUS01M" on the Bloomberg
Financial Markets Commodities News and on other quotations, if any, obtained by
the Master Servicer pursuant to clauses (a)(ii) and (d) of this Section 4.05.
(c) As used herein, "Reference Banks" shall mean four leading banks
engaged in transactions in Eurodollar deposits in the international
Eurocurrency market (i) with an established place of business in London,
England, (ii) whose quotations appear on the "Bloomberg Screen LIUS01M Index
Page" (as described in the definition of LIBOR) on the applicable LIBOR
Determination Date and (iii) which have been designated as such by the
Depositor and are able and willing to provide such quotations to the Depositor
on each LIBOR Determination Date. The Reference Banks initially shall be:
Barclay's plc, Bank of Tokyo, National Westminster Bank and Trust Company and
Bankers Trust Company. If any of the initial Reference Banks should be removed
from the Bloomberg Screen LIUS01M Index Page or in any other way fail to meet
the qualifications of a Reference Bank, the Depositor shall use its best
efforts to designate alternate Reference Banks.
(d) If (i) with respect to any LIBOR Determination Date LIBOR is
determined pursuant to clause (a)(iii) of this Section and (ii) on the next
succeeding LIBOR Determination Date LIBOR would, without giving effect to this
paragraph (d), be determined pursuant to such clause (a)(iii), then the
Depositor shall select an alternative interest rate index over which the
Depositor has no control that is used for determining Eurodollar lending rates
and is calculated and published (or otherwise made available) by an independent
third party, and such alternative interest rate index shall constitute LIBOR
for all purposes hereof.
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 Trustee or the Paying Agent shall make 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 (which shall initially be the Trustee) or, upon written
request made to the Trustee at least five Business Days prior to the related
Record Date by any Certificateholder owning an aggregate initial Certificate
Principal Amount of at least $2,500,000, 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 be made only upon presentation and surrender
of such Certificate at the Corporate Trust Office. 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 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
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 Amounts or initial Class
Notional Amounts (or Percentage Interests).
Section 5.02. Distributions from the Certificate Account. (a) On each
Distribution Date the Trustee (or the Paying Agent on behalf of the Trustee)
shall withdraw from the Certificate Account the Total Distribution Amount and
shall allocate such amount to the interests issued in respect of REMIC 1, REMIC
2 and REMIC 3 and shall distribute such amount as specified in this Section.
(b) On each Distribution Date, the Trustee shall distribute the
Interest Remittance Amount for such date in the following order of priority
based on the report of the Master Servicer:
(i) to the holders of each Class of Senior Certificates, Current
Interest for such Class and such Distribution Date and any
Carryforward Interest for such Class and such Distribution Date;
provided, however, that any shortfall in available amounts shall be
allocated among such Classes in proportion to the amount of Current
Interest and Carryforward Interest that would otherwise be
distributable thereon;
(ii) to the Class M1 Certificates, Current Interest for such
Class and such Distribution Date;
(iii) to the Class M2 Certificates, Current Interest for such
Class and such Distribution Date;
(iv) to the Class B Certificates, Current Interest for such
Class and such Distribution Date;
(v) to the Loss Mitigation Advisor, the Loss Mitigation
Advisor's Fee for such Distribution Date;
(vi) to the Master Servicer, any amounts reimburseable pursuant
to Section 4.02(v) and not previously reimbursed to the Master
Servicer; and
(vii) for application as part of Monthly Excess Cashflow for
such Distribution Date, as provided in subsection (d) of this Section,
any Interest Remittance Amount remaining after application pursuant to
clauses (i) through (vi) above.
(c) On each Distribution Date, the Trustee shall distribute the
Principal Distribution Amount for such date as follows:
(i) On each Distribution Date (a) prior to the Stepdown Date or
(b) with respect to which a Trigger Event has occurred, until the
aggregate Certificate Principal Amount of all of the Certificates
equals the Target Amount for such Distribution Date, the Trustee shall
distribute the Principal Distribution Amount in the following order of
priority:
(A) to the Class A Certificates, until the Class
Principal Amount of such Class has been reduced to zero;
(B) to the Class M1 Certificates, until the Class
Principal Amount of such Class has been reduced to zero;
(C) to the Class M2 Certificates, until the Class
Principal Amount of such Class has been reduced to zero;
(D) to the Class B Certificates, until the Class
Principal Amount of such Class has been reduced to zero; and
(E) for application as part of Monthly Excess Cashflow
for such Distribution Date, as provided in subsection (d) of
this Section, any Principal Distribution Amount remaining after
application pursuant to clauses (A) through (D) above.
Any Principal Distribution Amount remaining after the Target Amount is
achieved will be applied as part of Monthly Excess Cashflow for such
Distribution Date as provided in subsection (d) of this Section.
(ii) On each Distribution Date (a) on or after the Stepdown Date
and (b) with respect to which a Trigger Event has not occurred, the
Trustee shall distribute the Principal Distribution Amount for such
date in the following order of priority:
(1) so long as the Class M1, Class M2 or Class B
Certificates are outstanding, to the Class A Certificates, an
amount equal to the lesser of (x) the Principal Distribution
Amount for such Distribution Date and (y) the Senior Principal
Distribution Amount for such date, in each case until the Class
Principal Amount of such Class has been reduced to zero;
otherwise to the Class A Certificates, the Principal
Distribution Amount for such Distribution Date;
(2) to the Class M1 Certificates, an amount equal to the
lesser of (x) the amount, if any, by which (a) the Principal
Distribution Amount for such Distribution Date exceeds (b) the
amount distributed to the Class A Certificates on such date
pursuant to clause (1) above, and (y) the M1 Principal
Distribution Amount for such date, until the Class Principal
Amount of such Class has been reduced to zero;
(3) to the Class M2 Certificates, an amount equal to the
lesser of (x) the amount, if any, by which (a) the Principal
Distribution Amount for such Distribution Date exceeds (b) the
amount distributed to the Class A and Class M1 Certificates on
such date pursuant to clauses (1) and (2) above, and (y) the M2
Principal Distribution Amount for such date, until the Class
Principal Amount of such Class has been reduced to zero;
(4) to the Class B Certificates, an amount equal to the
lesser of (x) the amount, if any, by which (a) the Principal
Distribution Amount for such Distribution Date exceeds (b) the
amount distributed to the Class A, Class M1 and Class M2
Certificates on such date pursuant to clauses (1) through (3)
above, and (y) the B Principal Distribution Amount for such
date, until the Class Principal Amount of such Class has been
reduced to zero; and
(5) for application as part of Monthly Excess Cashflow for
such Distribution Date, as provided in subsection (d) of this
Section, any Principal Distribution Amount remaining after
application pursuant to clauses (1) through (4) above.
Notwithstanding the foregoing, on any Distribution Date on which the
Class Principal Amount of each Class of Certificates having a higher
priority of distribution has been reduced to zero, any remaining
Principal Distribution Amount will be distributed to the remaining
Certificates in the order of priority set forth above until the Class
Principal Amount of each such Class has been reduced to zero.
(d) On each Distribution Date, the Trustee shall distribute the
Monthly Excess Cashflow for such date in the following order of priority:
(i) for each Distribution Date occurring prior to the
Distribution Date in February 2002, until the aggregate Certificate
Principal Amount of all of the Certificates equals the Total Loan
Balance for such Distribution Date:
(1) after giving effect to distribution of the Principal
Distribution Amount on such Distribution Date pursuant to
Section 5.02(c), to the Class A Certificates, until the Class
Principal Amount of such Class has been reduced to zero;
(2) to the Class M1 Certificates, until the Class Principal
Amount of such Class has been reduced to zero;
(3) to the Class M2 Certificates, until the Class Principal
Amount of such Class has been reduced to zero; and
(4) to the Class B Certificates, until the Class Principal
Amount of such Class has been reduced to zero;
(ii) for each Distribution Date occurring (a) on or after the
Distribution Date in February 2002 but before the Stepdown Date or (b)
on or after the Stepdown Date but for which a Trigger Event has
occurred, in each case until the aggregate Certificate Principal
Amount of all of the Certificates equals the Target Amount for such
date, to the extent of Monthly Excess Interest for such Distribution
Date, to the Certificates, in the following order of priority:
(1) to the Class A Certificates, until the Class Principal
Amount of such Class has been reduced to zero;
(2) to the Class M1 Certificates, until the Class Principal
Amount of such Class has been reduced to zero;
(3) to the Class M2 Certificates, until the Class Principal
Amount of such Class has been reduced to zero; and
(4) to the Class B Certificates, until the Class Principal
Amount of such Class has been reduced to zero;
(iii) for each Distribution Date occurring on or after the
Stepdown Date and for which a Trigger Event is not in effect,
(1) so long as the Class M1, Class M2, or Class B
Certificates are outstanding, to the Class A Certificates, an
amount equal to the lesser of (x) Monthly Excess Cashflow for
such Distribution Date and (y) the Senior Principal Distribution
Amount remaining unpaid after distribution of the Principal
Distribution Amount on such date, in each case until the Class
Principal Amount of such Class has been reduced to zero;
otherwise, to the Class A Certificates, the Principal
Distribution Amount for such Distribution Date;
(2) to the Class M1 Certificates, an amount equal to the
lesser of (x) the amount, if any, by which (a) Monthly Excess
Cashflow for such Distribution Date exceeds (b) the amount
distributed to the Class A Certificates on such date pursuant to
clause (1) above, and (y) the M1 Principal Distribution Amount
for such date remaining unpaid after distribution of the
Principal Distribution Amount on such date, until the Class
Principal Amount of such Class has been reduced to zero;
(3) to the Class M2 Certificates, an amount equal to the
lesser of (x) the amount, if any, by which (a) Monthly Excess
Cashflow for such Distribution Date exceeds (b) the amount
distributed to the Class A and Class M1 Certificates on such
date pursuant to clauses (1) and (2) above, respectively, and
(y) the M2 Principal Distribution Amount for such date remaining
unpaid after distribution of the Principal Distribution Amount
on such date, until the Class Principal Amount of such Class has
been reduced to zero;
(4) to the Class B Certificates, an amount equal to the
lesser of (x) the amount, if any, by which (a) Monthly Excess
Cashflow for such Distribution Date exceeds (b) the amount
distributed to the Class A, Class M1 and Class M2 Certificates
on such date pursuant to clauses (1), (2) and (3) above,
respectively, and (y) the B Principal Distribution Amount for
such date remaining unpaid after distribution of the Principal
Distribution Amount on such date, until the Class Principal
Amount of such Class has been reduced to zero;
(iv) to the Basis Risk Reserve Fund, and then, from the Basis
Risk Reserve Fund, to the extent of amounts on deposit therein, to the
Class A Certificates, any applicable Basis Risk Shortfall and Unpaid
Basis Risk Shortfall for such date, as required by Section 5.06 of
this Agreement;
(v) to the Basis Risk Reserve Fund, and then, from the Basis
Risk Reserve Fund, to the extent of amounts on deposit therein, to the
Class M1 Certificates, any applicable Basis Risk Shortfall and Unpaid
Basis Risk Shortfall for such date, as required by Section 5.06 of
this Agreement;
(vi) to the Basis Risk Reserve Fund, and then, from the Basis
Risk Reserve Fund, to the extent of amounts on deposit therein, to the
Class M2 Certificates, any applicable Basis Risk Shortfall and Unpaid
Basis Risk Shortfall for such date, as required by Section 5.06 of
this Agreement;
(vii) to the Basis Risk Reserve Fund, and then, from the Basis
Risk Reserve Fund, to the extent of amounts on deposit therein, to the
Class B Certificates, any applicable Basis Risk Shortfall and Unpaid
Basis Risk Shortfall for such date, as required by Section 5.06 of
this Agreement;
(viii) to the Class M1 Certificates, any Carryforward Interest
for such Class and such date;
(ix) to the Class M1 Certificates, any Deferred Amount for such
Class and such date;
(x) to the Class M2 Certificates, any Carryforward Interest for
such Class and such date;
(xi) to the Class M2 Certificates, any Deferred Amount for such
Class and such date;
(xii) to the Class B Certificates, any Carryforward Interest for
such Class and such date;
(xiii) to the Class B Certificates, any Deferred Amount for such
Class and such date;
(xiv) to the Basis Risk Reserve Fund, an amount sufficient to
cause the balance in the Basis Risk Reserve Fund to equal the Required
Reserve Fund Amount for such Distribution Date;
(xv) to the Class X Certificate, the Class X Distributable
Amount for such Distribution Date, together with any amounts withdrawn
from the Basis Risk Reserve Fund for distribution to such Class X
Certificate pursuant to Section 5.06 on such date; and
(xvi) to the Class R Certificate, any amount remaining on such
date after application pursuant to clauses (i) through (xv) above.
(e) On each Distribution Date, an amount equal to the aggregate of all
Prepayment Premiums collected during the preceding Prepayment Period shall be
distributed to the Class P Certificate.
Section 5.03. Allocation of Losses. On each Distribution Date, the
Class Principal Amounts of the Class M1, Class M2 and Class B Certificates will
be reduced by the amount of any Applied Loss Amount for such date, in the
following order of priority:
(i) to the Class B Certificates, until the Class Principal
Amount thereof has been reduced to zero;
(ii) to the Class M2 Certificates, until the Class Principal
Amount thereof has been reduced to zero; and
(iii) to the Class M1 Certificates, until the Class Principal
Amount thereof has been reduced to zero.
Section 5.04. Advances by Master Servicer, Servicers and Trustee. (a)
Subject to Section 9.07, Advances shall be made in respect of each Deposit Date
as provided herein. If, on any Determination Date, any Servicer determines that
any Scheduled Payments due during the related Collection Period (other than
Balloon Payments) have not been received, such Servicer shall advance such
amount to the extent provided in the applicable Servicing Agreement. If any
Servicer fails to remit Advances required to be made under the applicable
Servicing Agreement, the Master Servicer shall itself (in its capacity as
successor Servicer) make, or shall cause the successor Servicer to make, such
Advance on the Deposit Date immediately following such Determination Date. The
Master Servicer shall: (i) remit Advances to the Trustee from funds advanced by
the applicable Servicer (or from its own funds to the extent it is successor
Servicer) for deposit in the Certificate Account immediately available funds in
an amount equal to such Advance, (ii) cause to be made an appropriate entry in
the records of the Collection Account that funds in such account being held for
future distribution or withdrawal have been, as permitted by this Section 5.04,
used by the Master Servicer to make such Advance, and remit such immediately
available funds to the Trustee for deposit in the Certificate Account or (iii)
make Advances in the form of any combination of clauses (i) and (ii)
aggregating the amount of such Advance. Any funds being held in the Collection
Account for future distribution to Certificateholders and so used shall be
replaced by the Master Servicer from its own funds by remittance to the Trustee
for deposit in the Certificate Account on or before any future Deposit Date to
the extent that funds in the Certificate Account on such Deposit Date shall be
less than payments to Certificateholders required to be made on the related
Distribution Date. The Master Servicer and each Servicer shall be entitled to
be reimbursed from the Collection Account for all Advances made by it as
provided in Section 4.02. Notwithstanding anything to the contrary herein, in
the event the Master Servicer determines in its reasonable judgement that an
Advance is non-recoverable, the Master Servicer shall be under no obligation to
make such Advance.
(b) In the event that the Master Servicer or Servicer fails for any
reason to make an Advance required to be made pursuant to this Section 5.04 on
or before the Deposit Date, the Trustee, as successor Master Servicer pursuant
to Section 6.14, shall, on or before the related Distribution Date, deposit in
the Certificate Account an amount equal to the excess of (a) Advances required
to be made by the Master Servicer or the Servicer that would have been
deposited in such Certificate Account over (b) the amount of any Advance made
by the Master Servicer or any Servicer with respect to such Distribution Date;
provided, however, that the Trustee shall be required to make such Advance only
if it is not prohibited by law from doing so and it has determined that such
Advance would be recoverable from amounts to be received with respect to such
Mortgage Loan, including late payments, Liquidation Proceeds, Insurance
Proceeds, or otherwise. The Trustee shall be entitled to be reimbursed from the
Certificate Account for Advances made by it pursuant to this Section 5.04 as if
it were the Master Servicer.
Section 5.05. Compensating Interest Payments. The amount of the
aggregate Net Master Servicing Fees payable to the Master Servicer in respect
of any Distribution Date shall be reduced (but not below zero) by the amount of
any Compensating Interest Payment for such Distribution Date, but only to the
extent that Prepayment Interest Shortfalls relating to such Distribution Date
are required to be paid but not actually paid by the Servicers on the
applicable Remittance Date. Such amount shall not be treated as an Advance and
shall not be reimbursable to the Master Servicer.
Section 5.06. Basis Risk Reserve Fund. (a) On the Closing Date, the
Trustee shall establish and maintain in its name, in trust for the benefit of
the holders of the Class A, Class M1, Class M2 and Class B Certificates, a
Basis Risk Reserve Fund, into which the Depositor shall deposit $1,000. The
Basis Risk 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 of the
Trustee held pursuant to this Agreement.
(b) On each Distribution Date, the Trustee shall transfer, to the
extent of amounts available pursuant to Section 5.02(d)(iv)-(vii), to the Basis
Risk Reserve Fund an amount equal to the aggregate of the Basis Risk Shortfalls
and the aggregate of the Unpaid Basis Risk Shortfalls for all Classes of
Certificates for such Distribution Date. In addition, on each Distribution
Date, the Trustee shall transfer, to the extent of amounts available pursuant
to Section 5.02(d)(xiv), an amount sufficient to cause the balance in the Basis
Risk Reserve Fund to equal the Required Reserve Fund Amount for such
Distribution Date. On each Distribution Date, the Trustee shall withdraw
amounts from the Basis Risk Reserve Fund to make the distributions required
pursuant to Section 5.02(d)(iv) -(vii).
(c) Funds in the Basis Risk Reserve Fund shall be invested in Eligible
Investments. Any earnings on such amounts shall be distributed to the Class X
Certificate pursuant to Section 5.02(d)(xv). The Class X Certificate shall
evidence ownership of the Basis Risk Reserve Fund for federal income tax
purposes and the Holder thereof shall direct the Trustee, in writing, as to
investment of amounts on deposit therein. The Class X Certificateholder shall
be liable for any losses incurred on such investments. In the absence of
written instructions from the Class X Certificateholder as to investment of
funds on deposit in the Basis Risk Reserve Fund, such funds shall be invested
in the One Group Institutional Prime Money Market Fund. Any amounts on deposit
in the Basis Risk Reserve Fund in excess of the Required Reserve Fund Amount on
any Distribution Date shall be distributed to the Class X Certificate on such
Distribution Date pursuant to Section 5.02(d)(xv).
(d) Upon termination of the Trust Fund, any amounts remaining in the
Basis Risk Reserve Fund shall be distributed to the Class X Certificateholder
pursuant to Section 5.02(d)(xiv).
ARTICLE VI
CONCERNING THE TRUSTEE; EVENTS OF DEFAULT
Section 6.01. Duties of Trustee. (a) The Trustee, except during the
continuance of an Event of Default, undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. Any permissive
right of the Trustee provided for in this Agreement shall not be construed as a
duty of the Trustee. If an Event of Default has occurred and has not otherwise
been cured or waived, the Trustee shall exercise such of the rights and powers
vested in it by this Agreement and use the same degree of care and skill in
their exercise as a prudent 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 as the Master Servicer hereunder.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they are
in the form required by this Agreement; provided, however, that the Trustee
shall not be responsible for the accuracy or content of any such resolution,
certificate, statement, opinion, report, document, order or other instrument
furnished by the Master Servicer, any Servicer or the Loss Mitigation Advisor
to the Trustee pursuant to this Agreement, and shall not be required to
recalculate or verify any numerical information furnished to the Trustee
pursuant to this Agreement.
(c) The Trustee shall not have any liability arising out of or in
connection with this Agreement, except for its negligence or willful
misconduct. Notwithstanding anything in this Agreement to the contrary, the
Trustee shall not 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 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 (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 Trustee when
required to do so) 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, and such notice references the Holders of the
Certificates and this Agreement;
(iii) No provision of this Agreement shall require the Trustee
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 adequate
indemnity against such risk or liability is not reasonably assured to
it; and
(iv) The Trustee shall not be responsible for any act or
omission of the Master Servicer, the Depositor 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.
(e) 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 Certificateholders of any Class holding Certificates
which evidence, as to such Class, Percentage Interests aggregating not less
than 25% as to the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Agreement.
(f) The Trustee shall not 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
adequate indemnity against such risk or liability is not reasonably assured to
it, and none of the provisions contained in this Agreement shall in any event
require the Trustee to perform, or be responsible for the manner of performance
of, any of the obligations of the Master Servicer or any Servicer under this
Agreement or any 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) Subject to Section 4.04, the Trustee shall not be held liable by
reason of any insufficiency in any account (including without limitation the
Collection Amount) held by or on behalf of the Trustee resulting from any
investment loss on any Eligible Investment included therein (except to the
extent that the Trustee is the obligor and has defaulted thereon).
(h) Except as otherwise provided herein, the Trustee shall have no
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 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
Collection Account or the Certificate Account, or (D) to confirm or verify the
contents of any reports or certificates of the Master Servicer, any Servicer or
the Loss Mitigation Advisor delivered to the Trustee pursuant to this Agreement
believed by the Trustee to be genuine and to have been signed or presented by
the proper party or parties.
Section 6.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 6.01:
(i) The Trustee 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) The Trustee 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) The Trustee shall not 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, the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other paper or document (provided the same
appears regular on its face), unless requested in writing to do so by
Holders of at least a majority in Class Principal Amount (or
Percentage Interest) of each Class of Certificates; provided, however,
that, if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by
the terms of this Agreement, the Trustee may require reasonable
indemnity against such expense or liability or payment of such
estimated expenses as a condition to proceeding. The reasonable
expense thereof shall be paid by the Holders requesting such
investigation;
(v) The Trustee 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 conferred on them by such appointment,
provided that the Trustee shall continue to be responsible for its
duties and obligations hereunder to the extent provided herein, and
provided further that the Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent or attorney
appointed with due care by the Trustee;
(vi) The Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto, 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
reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(vii) The right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance of such act; and
(viii) The Trustee shall not 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 Not Liable for Certificates. The Trustee makes
no representations as to the validity or sufficiency of this Agreement or of
the Certificates (other than the certificate of authentication on the
Certificates) or of any Mortgage Loan, or related document save that the
Trustee represents 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 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
Collection Account, the Certificate Account, any Escrow Account or any other
fund or account maintained with respect to the Certificates. The Trustee shall
not be responsible for the legality or validity of this Agreement or the
validity, priority, perfection or sufficiency of the security for the
Certificates issued or intended to be issued hereunder. The Trustee shall have
no 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 May Own Certificates. The Trustee and any
Affiliate or agent of the Trustee 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 or such agent.
Section 6.05. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be (i) an institution 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. (a) The Trustee may
at any time resign and be discharged from the trust hereby created by giving
written notice thereof to 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 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.
(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 or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, (iii) 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, or (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, then the Depositor
shall remove the Trustee and appoint a successor trustee by written instrument,
one copy of which instrument shall be delivered to the Trustee so removed, one
copy to the successor trustee and one copy to the Master Servicer.
(c) The Holders of more than 50% of the Class Principal Amount (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 so removed, and one copy to the Master Servicer; the
Depositor shall thereupon use its best efforts to appoint a mutually acceptable
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 of appointment by the successor trustee as
provided in Section 6.07.
Section 6.07. Successor Trustee. (a) Any successor trustee appointed
as provided in Section 6.06 shall execute, acknowledge and deliver to the
Depositor, the Master Servicer and to its predecessor trustee an instrument
accepting such appointment hereunder, and thereupon the resignation or removal
of the predecessor trustee shall become effective and such successor trustee,
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 herein. The predecessor trustee
shall deliver to the successor trustee (or assign to the Trustee its interest
under each Custodial Agreement, to the extent permitted thereunder) all
Mortgage Files and documents and statements related to each 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 Master
Servicer and the predecessor trustee 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 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.
(c) Upon acceptance of appointment by a successor trustee as provided
in this Section, the predecessor trustee shall mail notice of the succession of
such trustee hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register and to any Rating Agency. The expenses of
such mailing shall be borne by the predecessor trustee.
Section 6.08. Merger or Consolidation of Trustee. Any Person into
which the Trustee may be merged or with which it may be consolidated, or any
Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Persons succeeding to the business of the
Trustee, shall be the successor to the Trustee hereunder, without the execution
or filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding, provided that such
Person shall be eligible under the provisions of Section 6.05.
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 Amount (or Percentage Interest) of every Class of
Certificates shall have the power from time to time to appoint one or more
Persons 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 Trustee to make Advances pursuant to Section
5.04 and 6.14 hereof shall not be affected or assigned by the appointment of a
co-trustee.
(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 or the Certificateholders evidencing more than
50% of the Aggregate Voting Interests of the Certificates may at any
time 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.
(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 Certificateholders of the appointment shall be
required under Section 6.07 hereof.
(f) The Trustee agrees to instruct the co-trustees, if any, to the
extent necessary to fulfill the Trustee's obligations hereunder.
(g) The Trustee 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. 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.
Any Authenticating Agent shall be entitled to reasonable compensation for its
services and, if paid by the Trustee, it shall be a reimbursable expense
pursuant to Section 6.12.
Section 6.11. Indemnification of Trustee. The Trustee and its directors,
officers, employees and agents shall be entitled to indemnification from the
Trust Fund for any loss, liability or expense 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, 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,
provided that:
(i) with respect to any such claim, the Trustee shall have given
the Depositor, the Master Servicer and the Holders written notice
thereof promptly after the Trustee shall have knowledge thereof;
(ii) while maintaining control over its own defense, the Trustee
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 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 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 Trustee. The Trustee shall be
compensated as separately agreed with the Master Servicer and will receive
compensation and reimbursement or payment of its expenses hereunder and under
each Custodial Agreement as provided herein and therein.
Section 6.13. Collection of Monies. Except as otherwise expressly
provided in this Agreement, the Trustee may demand payment or delivery of, and
shall receive and collect, all money and other property payable to or
receivable by the Trustee pursuant to this Agreement. 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. If the Trustee shall not have
timely received amounts to be remitted with respect to the Mortgage Loans from
the Master Servicer, the Trustee shall request the Master Servicer to make such
distribution as promptly as practicable or legally permitted. If the Trustee
shall subsequently receive any such amount, it may withdraw such request.
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":
(i) Any failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants
or agreements on the part of such Master Servicer contained in this
Agreement which continues unremedied for a period of 30 days after the
date on which written notice of such failure, requiring the same to be
remedied, shall have been given to such Master Servicer by the Trustee
or to such Master Servicer and the Trustee by the Holders of more than
50% of the Aggregate Voting Interests of the Certificates; or
(ii) 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
(iii) 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 such Master Servicer or of or
relating to all or substantially all of its property; or
(iv) 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
(v) 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 9.27 hereof;
or
(vi) If a representation or warranty set forth in Section 9.14
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 30 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 to the Master
Servicer and the Trustee by the Holders of more than 50% of the
Aggregate Voting Interests of the Certificates; or
(vii) 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
(viii) Any Servicer at any time is not either an FNMA- or FHLMC-
approved Seller/Servicer, and the Master Servicer has not terminated
the rights and obligations of such Servicer under the applicable
Servicing Agreement and replaced such Servicer with an FNMA- or
FHLMC-approved servicer within 45 days of the absence of such
approval; or
(ix) After receipt of notice from the Trustee, any failure of
the Master Servicer to remit to the Trustee any payment required to be
made to the Trustee for the benefit of Certificateholders under the
terms of this Agreement, including any Advance, on any Deposit Date.
If an Event of Default described in clauses (i) through (viii) of this
Section 6.14 shall occur, 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 6.14, the Trustee, by notice in
writing to the Master Servicer may, and shall, if so directed by
Certificateholders evidencing more than 50% of the Aggregate Voting Interests
of the Certificates affected thereby, terminate all of the rights and
obligations of the Master Servicer hereunder and in and to the Mortgage Loans
and the proceeds thereof. If an Event of Default described in clause (ix) of
this Section 6.14 shall occur, then, in each and every case, subject to
applicable law, the Trustee, by notice in writing to the Master Servicer, shall
promptly terminate all of the 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 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 pursuant to and under the terms of
this Agreement; 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 Mortgage Loans and related documents or otherwise. The
defaulting Master Servicer agrees to cooperate with the Trustee in effecting
the termination of the defaulting Master Servicer's responsibilities and rights
hereunder as Master Servicer including, without limitation, notifying the
Servicers of the assignment of the master servicing function and providing the
Trustee or its 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 Collection
Account maintained by such defaulting Master Servicer and any other account or
fund maintained with respect to the Certificates or thereafter received with
respect to the Mortgage Loans. The Master Servicer being terminated shall bear
its costs of a master servicing transfer and the reasonable out-of-pocket fees
and expenses of the Trustee associated with such master servicing transfer.
Notwithstanding the termination of its activities as Master Servicer,
each terminated Master Servicer shall continue to be entitled to reimbursement
to the extent provided in Section 4.02(i), (ii), (iii), (iv), (v) and (ix) to
the extent such reimbursement relates to the period prior to such Master
Servicer's termination.
If any Event of Default shall occur, the Trustee, upon becoming aware
of the occurrence thereof, shall promptly notify each Rating Agency of the
nature and extent of such Event of Default. The Trustee shall immediately give
written notice to the Master Servicer upon the Master Servicer's failure to
remit funds on the Deposit Date.
(b) On and after the time the Master Servicer receives a notice of
termination from the Trustee pursuant to Section 6.14(a) or the Trustee
receives the resignation of the Master Servicer evidenced by an Opinion of
Counsel pursuant to Section 9.28, 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 Master Servicer's failure to
provide information required by this Agreement shall not be considered a
default by the Trustee hereunder. In addition, the Trustee shall have no
responsibility for any act or omission of the Master Servicer prior to the
issuance of any notice of termination and shall have no liability relating to
the representations and warranties of the Master Servicer set forth in Section
9.14. In the Trustee's capacity as such successor, the Trustee shall have the
same limitations on liability herein granted to the Master Servicer. As
compensation therefor, the Trustee shall be entitled to receive all
compensation payable to the Master Servicer under this Agreement, including the
Net Master Servicing Fee.
(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, appoint,
or petition a court of competent jurisdiction to appoint, 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 responsibilities, duties or liabilities of a master
servicer, like the Master Servicer. Any entity designated by the Trustee as a
successor master servicer 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 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 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 Servicers of the
assignment of the master servicing functions and providing the Trustee and
successor master servicer, as applicable, 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 master servicer, as applicable, all amounts or investment property
which shall at the time be or should have been deposited by the Master Servicer
in the Collection Account and 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 any other successor master servicer shall be
deemed to be in default hereunder by reason of any failure to make, or any
delay in making, any distribution hereunder or any portion thereof 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 Mortgage Loan data to the Trustee as required by this
Agreement or (iv) restrictions imposed by any regulatory authority having
jurisdiction over the Master Servicer.
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 an express trust, 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 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 Certificate
Account that would result in a failure of the Trustee 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 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 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 Amount (or 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 reasonable
security or indemnity 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 or be unjustly
prejudicial to the non-assenting Certificateholders.
Section 6.19. Action Upon Certain Failures of the Master Servicer and
Upon Event of Default. In the event that the Trustee shall have actual
knowledge 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.
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 and the Master Servicer created
hereby (other than the obligation of the Trustee to make payments to
Certificateholders as set forth in Section 7.02, the obligation of the Master
Servicer to make a final remittance to the Trustee for deposit into the
Certificate Account pursuant to Section 4.01 and the obligations of the Master
Servicer to the Trustee pursuant to Sections 9.10 and 9.14) shall terminate on
the earlier 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 and
(ii) the sale of the property held by the Trust Fund in accordance with Section
7.01(b); 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 any Distribution Date occurring on or after the date on which
the expenses incurred by the Master Servicer in connection with the master
servicing of the Mortgage loans exceeds the amount of its Master Servicing Fee,
but in no event earlier than the first Distribution Date on which the Total
Loan Balance is less than 10% of the Cut-off Date Total Loan Balance, the
Master Servicer, with the prior written consent of the Seller which consent
shall not be unreasonably withheld, has the option to cause the Trust Fund to
adopt a plan of complete liquidation pursuant to Section 7.03(a)(i) hereof to
sell all of its property. Upon exercise of such option, the property of the
Trust Fund shall be sold to the Master Servicer at a price (the "Termination
Price") equal to the sum of (i) 100% of the unpaid principal balance of each
Mortgage Loan on the day of such purchase plus interest accrued thereon at the
applicable Mortgage Rate with respect to any Mortgage Loan to the Due Date in
the Collection Period immediately preceding the related Distribution Date to
the date of such repurchase and (ii) the fair market value of any REO Property
and any other property held by any REMIC, such fair market value to be
determined by an appraiser or appraisers mutually agreed upon by the Master
Servicer and the Trustee. The Master Servicer, each Servicer (or the Trustee,
if applicable) shall be reimbursed from the Termination Price for any Mortgage
Loan or related REO Property for any Advances made or other amounts advanced
with respect to the Mortgage Loans that are reimbursable to the Master Servicer
or the Trustee under this Agreement or the related Servicing Agreement (or to
the Trustee hereunder), together with any accrued and unpaid compensation due
to the Master Servicer hereunder or the Servicers thereunder.
If the Master Servicer fails to exercise its option on the first
Distribution Date on which the Total Loan Balance is less than 10% of the
Cut-off Date Total Loan Balance, Aurora Loan Services, Inc. may exercise such
option with the prior written consent of the Seller.
Section 7.02. Procedure Upon Termination 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, shall be
given promptly by the Trustee by first class mail to Certificateholders mailed
upon (x) the sale of all of the property of the Trust Fund by the Trustee
pursuant to Section 7.01(b) 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 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 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 Trustee therein specified. The Trustee shall give such
notice to 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 Certificates shall
terminate and the Trustee shall terminate or request the Master Servicer to
terminate, the Collection Account it maintains, the Certificate Account and any
other account or fund maintained with respect to the Certificates, subject to
the Trustee'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 Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice any Certificates shall not have been
surrendered for cancellation, the Trustee 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 Trustee 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 Trustee and not distributed to a Certificateholder due to
such Certificateholder's failure to surrender its Certificate(s) for payment of
the final distribution thereon in accordance with this Section.
(c) Any reasonable expenses incurred by the Trustee in connection with
any termination or liquidation of the Trust Fund shall be reimbursed from
proceeds received from the liquidation of the Trust Fund.
Section 7.03. Additional Trust Fund Termination Requirements. (a) Any
termination of the Trust Fund shall be effected in accordance with the
following additional requirements, unless the Trustee seeks (at the request of
the party exercising the option to purchase all of the Mortgage Loans pursuant
to Section 7.01(b)), and subsequently receives, an Opinion of Counsel (at the
expense of such requesting party), addressed to the Trustee to the effect that
the failure of the Trust Fund to comply with the requirements of this Section
7.03 will not (I) result in the imposition of taxes on any REMIC under the
REMIC Provisions or (II) cause any REMIC established hereunder to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) Within 89 days prior to the time of the making of the final
payment on the Certificates, upon notification by the Master Servicer
or Aurora Loan Services, Inc. that it intends to exercise its option
to cause the termination of the Trust Fund, the Trustee shall adopt a
plan of complete liquidation of the Trust Fund on behalf of each
REMIC, meeting the requirements of a qualified liquidation under the
REMIC Provisions;
(ii) Any sale of the assets of the Trust Fund pursuant to
Section 7.02 shall be a sale for cash and shall occur at or after the
time of adoption of such a plan of complete liquidation and prior to
the time of making of the final payment on the Certificates;
(iii) On the date specified for final payment of the
Certificates, the Trustee shall make final distributions of principal
and interest on the 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 Trust Fund
(and each REMIC) shall terminate at that time; and
(iv) In no event may the final payment on the 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 Trustee
under this Section and to take such other action in connection therewith as may
be reasonably requested by the Master Servicer or any Servicer.
Section 7.04. Optional Repurchase Right of Seller. The Seller may
repurchase any Mortgage Loan which becomes more than 90 days delinquent (a
"Distressed Mortgage Loan") for a purchase price equal to the outstanding
principal balance of such Mortgage Loan, plus accrued interest thereon to the
date of repurchase. The right of the Seller to repurchase for its own account a
Distressed Mortgage Loan shall expire on the day preceding the last day of the
fiscal quarter during which such Distressed Mortgage Loan became 91 days
delinquent (any such first quarter, an "Eligible Quarter"); provided, however,
that a Distressed Mortgage Loan which becomes current may be purchased by the
Seller for such purchase price in any subsequent Eligible Quarter following the
date on which such Distressed Mortgage Loan becomes current.
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 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 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 Trustee, 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 Trustee shall, within five Business Days after the receipt
of such application, afford such Applicants reasonable access during the normal
business hours of the Trustee to the most recent list of Certificateholders
held by the Trustee 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 Certificate Registrar and the Trustee that neither the
Depositor, the Master Servicer, 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
Owner, if the 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, 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 and the Master Servicer, if made in the manner provided in this
Section. Each of the Trustee 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 neither the Trustee, the Master Servicer, nor 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; LOSS MITIGATION ADVISOR
Section 9.01. Duties of the Master Servicer. The Certificateholders,
by their purchase and acceptance of the Certificates, appoint Xxxxx Fargo Bank
Minnesota, National Association, as Master Servicer. For and on behalf of the
Depositor, the Trustee and the Certificateholders, the Master Servicer shall
master service the Mortgage Loans in accordance with the provisions of this
Agreement and the provisions of each Servicing Agreement. Notwithstanding
anything in this Agreement, any Servicing Agreement or any Loss Mitigation
Advisory Agreement to the contrary, the Master Servicer shall have no duty or
obligation to enforce any Loss Mitigation Advisory Agreement or to supervise,
monitor or oversee the activities of any Servicer under its Loss Mitigation
Advisory Agreement with respect to any action taken or not taken by a Servicer
at the direction of the Seller or pursuant to a recommendation of the Loss
Mitigation Advisor.
Section 9.02. Master Servicer Fidelity Bond and Master Servicer Errors
and Omissions Insurance Policy. (a) The Master Servicer, at its expense, shall
maintain in effect a Master Servicer Fidelity Bond and a Master Servicer 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 Master Servicer Errors and
Omissions Insurance Policy and the Master Servicer Fidelity Bond shall be in
such form and amount that would be consistent with coverage customarily
maintained by master servicers of mortgage loans similar to the Mortgage Loans.
The Master Servicer shall (i) require each Servicer to maintain an Errors and
Omissions Insurance Policy and a Servicer Fidelity Bond in accordance with the
provisions of the applicable Servicing Agreement, (ii) cause each Servicer to
provide to the Master Servicer certificates evidencing that such policy and
bond is in effect and to furnish to the Master Servicer any notice of
cancellation, non-renewal or modification of the policy or bond received by it,
as and to the extent provided in the applicable Servicing Agreement, and (iii)
furnish copies of the certificates and notices referred to in clause (ii) to
the Trustee upon request.
(b) The Master Servicer shall promptly report to the Trustee any
material changes that may occur in the Master Servicer Fidelity Bond or the
Master Servicer Errors and Omissions Insurance Policy and shall furnish to the
Trustee, on request, certificates evidencing that such bond and insurance
policy are in full force and effect. The Master Servicer shall promptly report
to the Trustee all cases of embezzlement or fraud, if such events involve funds
relating to the Mortgage Loans. The total losses, regardless of whether claims
are filed with the applicable insurer or surety, shall be disclosed in such
reports together with the amount of such losses covered by insurance. If a bond
or insurance claim report is filed with any of such bonding companies or
insurers, the Master Servicer shall promptly furnish a copy of such report to
the Trustee. Any amounts relating to the Mortgage Loans collected by the Master
Servicer under any such bond or policy shall be promptly remitted by the Master
Servicer to the Trustee for deposit into the Certificate Account. Any amounts
relating to the Mortgage Loans collected by the applicable Servicer under any
such bond or policy shall be remitted to the Master Servicer to the extent
provided in the applicable Servicing Agreement.
Section 9.03. Master Servicer's Financial Statements and Related
Information. For each year this Agreement is in effect, the Master Servicer
shall submit to the Trustee, each Rating Agency and the Depositor a copy of its
annual unaudited financial statements on or prior to May 31 of each year,
beginning May 31, 2002. Such financial statements shall include a balance
sheet, income statement, statement of retained earnings, statement of
additional paid-in capital, statement of changes in financial position and all
related notes and schedules and shall be in comparative form, certified by a
nationally recognized firm of Independent Accountants to the effect that such
statements were examined and prepared in accordance with generally accepted
accounting principles applied on a basis consistent with that of the preceding
year.
Section 9.04. Power to Act; Procedures. (a) The Master Servicer shall
master service the Mortgage Loans and shall have full power and authority,
subject to the REMIC Provisions and the provisions of Article X hereof, and
each Servicer shall have full power and authority (to the extent provided in
the applicable Servicing Agreement) to do any and all things that it may deem
necessary or desirable in connection with the servicing and administration of
the Mortgage Loans, including but not limited to the power and authority (i) to
execute and deliver, on behalf of the Certificateholders and the Trustee,
customary consents or waivers and other instruments and documents, (ii) to
consent to transfers of any Mortgaged Property and assumptions of the Mortgage
Notes and related Mortgages, (iii) to collect any Insurance Proceeds and
Liquidation Proceeds, and (iv) to effectuate foreclosure or other conversion of
the ownership of the Mortgaged Property securing any Mortgage Loan, in each
case, in accordance with the provisions of this Agreement and the applicable
Servicing Agreement, as applicable; provided that the Master Servicer shall not
take, or knowingly permit any Servicer to take, any action that is inconsistent
with or prejudices the interests of the Trust Fund or the Certificateholders in
any Mortgage Loan or the rights and interests of the Depositor, the Trustee and
the Certificateholders under this Agreement. The Master Servicer shall
represent and protect the interests of the Trust Fund in the same manner as it
protects its own interests in mortgage loans in its own portfolio in any claim,
proceeding or litigation regarding a Mortgage Loan and shall not make or
knowingly permit any Servicer to make any modification, waiver or amendment of
any term of any Mortgage Loan that would cause any part of the Trust Fund to
fail to qualify as a REMIC or result in the imposition of any tax under Section
860F(a) or Section 860G(d) of the Code. Without limiting the generality of the
foregoing, the Master Servicer in its own name or in the name of a Servicer,
and each Servicer, to the extent such authority is delegated to such Servicer
under the applicable Servicing Agreement, is hereby authorized and empowered by
the Trustee when the Master Servicer or such Servicer, as the case may be,
believes it appropriate in its best judgment and in accordance with Accepted
Servicing Practices and the applicable Servicing Agreement, to execute and
deliver, on behalf of itself and the Certificateholders, the Trustee or any of
them, any and all instruments of satisfaction or cancellation, or of partial or
full release or discharge and all other comparable instruments, with respect to
the Mortgage Loans and with respect to the Mortgaged Properties. The Trustee
shall furnish the Master Servicer, upon request, with any powers of attorney
empowering the Master Servicer or any Servicer to execute and deliver
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and to foreclose upon or otherwise liquidate Mortgaged Property, and
to appeal, prosecute or defend in any court action relating to the Mortgage
Loans or the Mortgaged Property, in accordance with the applicable Servicing
Agreement and this Agreement, and the Trustee shall execute and deliver such
other documents, as the Master Servicer may request, necessary or appropriate
to enable the Master Servicer to master service and administer the Mortgage
Loans and carry out its duties hereunder, in each case in accordance with
Accepted Servicing Practices (and the Trustee shall have no liability for
misuse of any such powers of attorney by the Master Servicer or any Servicer).
If the Master Servicer or the Trustee has been advised that it is likely that
the laws of the state in which action is to be taken prohibit such action if
taken in the name of the Trustee or that the Trustee would be adversely
affected under the "doing business" or tax laws of such state if such action is
taken in its name, then upon request of the Trustee, the Master Servicer shall
join with the Trustee in the appointment of a co-trustee pursuant to Section
6.09 hereof. In the performance of its duties hereunder, the Master Servicer
shall be an independent contractor and shall not, except in those instances
where it is taking action in the name of the Trustee, be deemed to be the agent
of the Trustee.
(b) In master servicing and administering the Mortgage Loans, the
Master Servicer shall employ procedures, and shall cause each Servicer to
employ procedures (including, but not limited to, collection procedures),
consistent with the applicable Servicing Agreement. Consistent with the
foregoing, the Master Servicer may, and may permit any Servicer to, in its
discretion (i) waive any late payment charge (but not any Prepayment Premium)
and (ii) extend the due dates for payments due on a Mortgage Note for a period
not greater than 120 days; provided, however, that the maturity of any Mortgage
Loan shall not be extended past the date on which the final payment is due on
the latest maturing Mortgage Loan as of the Cut-off Date. In the event of any
extension described in clause (ii) above, the Master Servicer shall make or
cause such Servicer (if required by the applicable Servicing Agreement) to make
Advances on the related Mortgage Loan in accordance with the provisions of
Section 5.04 on the basis of the amortization schedule of such Mortgage Loan
without modification thereof by reason of such extension. Notwithstanding
anything to the contrary in this Agreement, the Master Servicer shall not
knowingly permit any modification, waiver or amendment of any material term of
any Mortgage Loan (including but not limited to the interest rate, the
principal balance, the amortization schedule, or any other term affecting the
amount or timing of payments on the Mortgage Loan or the collateral therefor),
unless: (1) such Mortgage Loan is in default or default by the related
Mortgagor is, in the reasonable judgment of the Master Servicer or the
applicable Servicer, imminent, or (2) the Master Servicer shall have provided
or (if required by the applicable Servicing Agreement) caused to be provided to
the Trustee an Opinion of Counsel (which opinion shall, if provided by the
Master Servicer, be an expense reimbursed from the Collection Account pursuant
to Section 4.02(v)) in writing to the effect that such modification, waiver or
amendment would not cause an Adverse REMIC Event, and, if required by the
related Servicing Agreement, the Servicer shall have obtained the written
consent of the Trustee and shall have provided a copy of such consent to the
Master Servicer.
Section 9.05. Enforcement of Servicer's and Master Servicer's
Obligations. (a) Each Servicing Agreement requires the applicable Servicer,
respectively, to service the Mortgage Loans in accordance with the provisions
thereof. References in this Agreement to actions taken or to be taken by the
Master Servicer include actions taken or to be taken by a Servicer on behalf of
the Master Servicer. Any fees and other amounts payable to a Servicer shall be
deducted from amounts remitted to the Master Servicer by such Servicer and
shall not be an obligation of the Trust Fund or the Master Servicer.
(b) The Master Servicer, for the benefit of the Trustee and the
Certificateholders, shall enforce the obligations of each Servicer under the
related Servicing Agreement, and shall, in the event that a Servicer fails to
perform its obligations in accordance therewith, terminate the rights and
obligations of such Servicer thereunder and either act as servicer of the
related Mortgage Loans or cause the other parties hereto to enter into a
Servicing Agreement (and such parties hereby agree to execute and deliver any
such successor Servicing Agreement), with a successor Servicer. Such
enforcement, including, without limitation, the legal prosecution of claims,
termination of Servicing Agreements and the pursuit of other appropriate
remedies, shall be in such form and carried out to such an extent and at such
time as the Master Servicer, in its good faith business judgment, would require
were it the owner of the related Mortgage Loans. The Master Servicer shall pay
the costs of such enforcement at its own expense, and shall be reimbursed
therefor initially (i) from a general recovery resulting from such enforcement
only to the extent, if any, that such recovery exceeds all amounts due in
respect of the related Mortgage Loans, (ii) from a specific recovery of costs,
expenses or attorneys' fees against the party against whom such enforcement is
directed, and then, (iii) to the extent that such amounts are insufficient to
reimburse the Master Servicer for the costs of such enforcement, from the
Collection Account.
Section 9.06. Collection of Taxes, Assessments and Similar Items. (a)
To the extent provided in the applicable Servicing Agreement, the Master
Servicer shall cause each Servicer to establish and maintain one or more
custodial accounts at a depository institution (which may be a depository
institution with which the Master Servicer or any Servicer establishes accounts
in the ordinary course of its servicing activities), the accounts of which are
insured to the maximum extent permitted by the FDIC (each, an "Escrow Account")
and to deposit therein any collections of amounts received with respect to
amounts due for taxes, assessments, water rates, standard hazard insurance
policy premiums, Payaheads, if applicable, or any comparable items for the
account of the Mortgagors. Withdrawals from any Escrow Account may be made (to
the extent amounts have been escrowed for such purpose) only in accordance with
the applicable Servicing Agreement. Each Servicer shall be entitled to all
investment income not required to be paid to Mortgagors on any Escrow Account
maintained by such Servicer. The Master Servicer shall make (or cause to be
made) to the extent provided in the applicable Servicing Agreement advances to
the extent necessary in order to effect timely payment of taxes, water rates,
assessments, Standard Hazard Insurance Policy premiums or comparable items in
connection with the related Mortgage Loan (to the extent that the Mortgagor is
required, but fails, to pay such items), provided that it or the applicable
Servicer has determined that the funds so advanced are recoverable from escrow
payments, reimbursement pursuant to Section 4.02 or otherwise.
(b) Costs incurred by the Master Servicer or by any Servicer in
effecting the timely payment of taxes and assessments on the properties subject
to the Mortgage Loans may be added to the amount owing under the related
Mortgage Note where the terms of the Mortgage Note so permit; provided,
however, that the addition of any such cost shall not be taken into account for
purposes of calculating the distributions to be made to Certificateholders.
Such costs, to the extent that they are unanticipated, extraordinary costs, and
not ordinary or routine costs shall be recoverable as a Servicing Advance by
the Master Servicer pursuant to Section 4.02.
Section 9.07. Termination of Servicing Agreements; Successor
Servicers. (a) The Master Servicer shall be entitled to terminate the rights
and obligations of any Servicer under the applicable Servicing Agreement in
accordance with the terms and conditions of such Servicing Agreement and
without any limitation by virtue of this Agreement; provided, however, that in
the event of termination of any Servicing Agreement by the Master Servicer, the
Master Servicer shall provide for the servicing of the Mortgage Loans by a
successor Servicer to be appointed as provided in the applicable Servicing
Agreement.
The Master Servicer agrees that it will use its best efforts to effect
the transfer of servicing to a successor Servicer within the first one to two
weeks after the termination of such Servicer in accordance with the first
paragraph of this Section 9.07(a). The parties acknowledge that notwithstanding
the preceding sentence, there may be a transition period, not to exceed 60 days
from the above-mentioned two-week period, in order to effect the transfer of
servicing to a successor Servicer. The Master Servicer shall be entitled to be
reimbursed from each Servicer (or by the Trust Fund, if the Servicer is unable
to fulfill its obligations hereunder) for all costs associated with the
transfer of servicing from the predecessor servicer, including without
limitation, any costs or expenses associated with the complete transfer or all
servicing data and the completion, correction or manipulation of such servicing
data, as may be required by the Master Servicer to correct any errors or
insufficiencies in the servicing data or otherwise to enable the Master
Servicer to service the Mortgage Loans properly and effectively.
(b) If the Master Servicer acts as a successor Servicer, it will not
assume liability for the representations and warranties of the Servicer, if
any, that it replaces. The Master Servicer shall use reasonable efforts to have
the successor Servicer assume liability for the representations and warranties
made by the terminated Servicer in the related Servicing Agreement, and in the
event of any such assumption by the successor Servicer, the Trustee or the
Master Servicer, as applicable, may, in the exercise of its business judgment,
release the terminated Servicer from liability for such representations and
warranties.
(c) If the Master Servicer acts as a successor Servicer, it will have
no obligation to make an Advance if it determines in its reasonable judgment
that such Advance is non-recoverable. To the extent that the Master Servicer is
unable to find a successor Servicer that is willing to service the Mortgage
Loans for the Servicing Fee because of the obligation of the Servicer to make
Advances regardless of whether such Advance is recoverable, the applicable
Servicing Agreement may be amended to provide that the successor Servicer shall
have no obligation to make an Advance if it determines in its reasonable
judgment that such Advance is non-recoverable and provides an Officer's
Certificate to such effect.
Section 9.08. Master Servicer Liable for Enforcement. Notwithstanding
any Servicing Agreement, the Master Servicer shall remain obligated and liable
to the Trustee and the Certificateholders in accordance with the provisions of
this Agreement, to the extent of its obligations hereunder, without diminution
of such obligation or liability by virtue of such Servicing Agreements. The
Master Servicer shall ensure that the Mortgage Loans are serviced in accordance
with the provisions of this Agreement and shall enforce the provisions of each
Servicing Agreement for the benefit of the Certificateholders. The Master
Servicer shall be entitled to enter into any agreement with any Servicer for
indemnification of the Master Servicer and nothing contained in this Agreement
shall be deemed to limit or modify such indemnification.
Section 9.09. No Contractual Relationship Between Any Servicer and
Trustee or Depositor. Any Servicing Agreement that may be entered into and any
other transactions or services relating to the Mortgage Loans involving any
Servicer in its capacity as such and not as an originator shall be deemed to be
between such Servicer, the Seller and the Master Servicer, and the Trustee and
the Depositor shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to such Servicer except
as set forth in Section 9.10 hereof.
Section 9.10. Assumption of Servicing Agreement 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 under this Agreement), the Trustee
shall thereupon assume all of the rights and obligations of such Master
Servicer hereunder and under each Servicing Agreement entered into with respect
to the Mortgage Loans. The Trustee, 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
Servicing Agreement 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 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 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.
(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 Servicing 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 Servicing Agreement to the assuming party.
Section 9.11. "Due-on-Sale" Clauses; Assumption Agreements. To the
extent provided in the applicable Servicing Agreement, to the extent Mortgage
Loans contain enforceable due-on-sale clauses, the Master Servicer shall cause
the related Servicer to enforce such clauses in accordance with the applicable
Servicing Agreement. If applicable law prohibits the enforcement of a
due-on-sale clause or such clause is otherwise not enforced in accordance with
the applicable Servicing Agreement, and, as a consequence, a Mortgage Loan is
assumed, the original Mortgagor may be released from liability in accordance
with the applicable Servicing Agreement.
Section 9.12. Release of Mortgage Files. (a) Upon (i) becoming aware
of the payment in full of any Mortgage Loan, (ii) the receipt by the Master
Servicer of a notification that payment in full has been or will be escrowed in
a manner customary for such purposes, or (iii) in the case of a Mortgage Loan
as to which the related Mortgaged Property is located in California, receipt by
the Master Servicer of notification from the Servicer that the Servicer
reasonably expects that payment in full will be received promptly, the Master
Servicer will, or will cause the related Servicer to, promptly notify the
Trustee (or the applicable Custodian) by a certification (which certification
shall include a statement to the effect that all amounts received in connection
with such payment that are required to be deposited in the Collection Account
maintained by the Master Servicer pursuant to Section 4.01 have been or will be
so deposited) of a Servicing Officer and shall request (on the form attached
hereto as Exhibit C or on the form attached to the related Custodial Agreement)
the Trustee or the applicable Custodian, to deliver to the applicable Servicer
the related Mortgage File; provided, however, that in the case of a Mortgage
Loan as to which the related Mortgaged Property is located in California, the
related Mortgage File shall be released upon notification from the Servicer or
the Master Servicer that such party reasonably expects that payment in full
will be received promptly. Upon receipt of such certification and request, the
Trustee or the applicable Custodian (with the consent, and at the direction of
the Trustee), shall promptly release the related Mortgage File to the
applicable Servicer and the Trustee shall have no further responsibility with
regard to such Mortgage File. Upon any such payment in full, the Master
Servicer is authorized, and each Servicer, to the extent such authority is
provided for under the applicable Servicing Agreement, is authorized, to give,
as agent for the Trustee, as the mortgagee under the Mortgage that secured the
Mortgage Loan, an instrument of satisfaction (or assignment of mortgage without
recourse) regarding the Mortgaged Property subject to the Mortgage, which
instrument of satisfaction or assignment, as the case may be, shall be
delivered to the Person or Persons entitled thereto against receipt therefor of
such payment, it being understood and agreed that no expenses incurred in
connection with such instrument of satisfaction or assignment, as the case may
be, shall be chargeable to the Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with Accepted Servicing
Practices and the applicable Servicing Agreement, the Trustee shall execute
such documents as shall be prepared and furnished to the Trustee by the Master
Servicer, or by a Servicer (in form reasonably acceptable to the Trustee) and
as are necessary to the prosecution of any such proceedings. The Trustee or the
applicable Custodian, shall, upon request of the Master Servicer, or of a
Servicer, and delivery to the Trustee or the applicable Custodian, of a trust
receipt signed by a Servicing Officer substantially in the form of Exhibit C,
release the related Mortgage File held in its possession or control to the
Master Servicer (or the applicable Servicer). Such trust receipt shall obligate
the Master Servicer or Servicer to return the Mortgage File to the Trustee or
the applicable Custodian, as applicable, when the need therefor by the Master
Servicer or Servicer no longer exists unless the Mortgage Loan shall be
liquidated, in which case, upon receipt of a certificate of a Servicing Officer
similar to that hereinabove specified, the trust receipt shall be released by
the Trustee or the applicable Custodian, as applicable, to the Master Servicer
(or the applicable Servicer).
Section 9.13. Documents, Records and Funds in Possession of Master
Servicer To Be Held for Trustee. (a) The Master Servicer shall transmit, or
cause the applicable Servicer to transmit, to the Trustee such documents and
instruments coming into the possession of the Master Servicer or such Servicer
from time to time as are required by the terms hereof or of the applicable
Servicing Agreement to be delivered to the Trustee or the applicable Custodian.
Any funds received by the Master Servicer or by a Servicer in respect of any
Mortgage Loan or which otherwise are collected by the Master Servicer or a
Servicer as Liquidation Proceeds or Insurance Proceeds in respect of any
Mortgage Loan shall be held for the benefit of the Trustee and the
Certificateholders subject to the Master Servicer's right to retain or withdraw
from the Collection Account the Net Master Servicing Fee and other amounts
provided in this Agreement and to the right of each Servicer to retain its
Servicing Fee and other amounts as provided in the related Servicing Agreement.
The Master Servicer shall, and shall (to the extent provided in the applicable
Servicing Agreement) cause each Servicer to, provide access to information and
documentation regarding the Mortgage Loans to the Trustee, its agents and
accountants at any time upon reasonable request and during normal business
hours, and to Certificateholders that are savings and loan associations, banks
or insurance companies, the Office of Thrift Supervision, the FDIC and the
supervisory agents and examiners of such Office and Corporation or examiners of
any other federal or state banking or insurance regulatory authority if so
required by applicable regulations of the Office of Thrift Supervision or other
regulatory authority, such access to be afforded without charge but only upon
reasonable request in writing and during normal business hours at the offices
of the Master Servicer designated by it. In fulfilling such a request the
Master Servicer shall not be responsible for determining the sufficiency of
such information.
(b) All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer, or any Servicer, in respect of any Mortgage
Loans, whether from the collection of principal and interest payments or from
Liquidation Proceeds or Insurance Proceeds, shall be held by the Master
Servicer, or by any Servicer, for and on behalf of the Trustee and the
Certificateholders and shall be and remain the sole and exclusive property of
the Trustee; provided, however, that the Master Servicer and each Servicer
shall be entitled to setoff against, and deduct from, any such funds any
amounts that are properly due and payable to the Master Servicer or such
Servicer under this Agreement or the applicable Servicing Agreement.
(c) The Master Servicer hereby acknowledges that concurrently with the
execution of this Agreement, the Trustee shall own or, to the extent that a
court of competent jurisdiction shall deem the conveyance of the Mortgage Loans
from the Seller to the Depositor not to constitute a sale, the Trustee shall
have a security interest in the Mortgage Loans and in all Mortgage Files
representing such Mortgage Loans and in all funds and investment property now
or hereafter held by, or under the control of, a Servicer or the Master
Servicer that are collected by any Servicer or the Master Servicer in
connection with the Mortgage Loans, whether as scheduled installments of
principal and interest or as full or partial prepayments of principal or
interest or as Liquidation Proceeds or Insurance Proceeds or otherwise, and in
all proceeds of the foregoing and proceeds of proceeds (but excluding any fee
or other amounts to which a Servicer is entitled under the applicable Servicing
Agreement, or the Master Servicer or the Depositor is entitled to hereunder);
and the Master Servicer agrees that so long as the Mortgage Loans are assigned
to and held by the Trustee or any Custodian, all documents or instruments
constituting part of the Mortgage Files, and such funds relating to the
Mortgage Loans which come into the possession or custody of, or which are
subject to the control of, the Master Servicer or any Servicer shall be held by
the Master Servicer or such Servicer for and on behalf of the Trustee as the
Trustee's agent and bailee for purposes of perfecting the Trustee's security
interest therein as provided by the applicable Uniform Commercial Code or other
applicable laws.
(d) The Master Servicer agrees that it shall not, and shall not
authorize any Servicer to, create, incur or subject any Mortgage Loans, or any
funds that are deposited in any Custodial Account, Escrow Account or the
Collection Account, or any funds that otherwise are or may become due or
payable to the Trustee, to any claim, lien, security interest, judgment, levy,
writ of attachment or other encumbrance, nor assert by legal action or
otherwise any claim or right of setoff against any Mortgage Loan or any funds
collected on, or in connection with, a Mortgage Loan.
Section 9.14. Representations and Warranties of the Master Servicer.
(a) The Master Servicer hereby represents and warrants to the Depositor 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;
(vii) the Master Servicer, or an affiliate thereof the primary
business of which is the servicing of conventional residential
mortgage loans, is a FNMA- 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;
(ix) the consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Master
Servicer;
(x) the Master Servicer has obtained an Errors and Omissions
Insurance Policy and a Fidelity Bond in accordance with Section 9.02
each of which is in full force and effect, and each of which provides
at least such coverage as is required hereunder; and
(xi) the information about the Master Servicer under the heading
"The Master Servicer" in the Offering Documents relating to the Master
Servicer does not include an untrue statement of a material fact and
does not omit to state a material fact, with respect to the statements
made, necessary in order to make the statements in light of the
circumstances under which they were made not misleading.
(b) It is understood and agreed that the representations and
warranties set forth in this Section 9.14 shall survive the execution and
delivery of this Agreement. The Master Servicer shall indemnify the Depositor
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 breach of the Master Servicer's
representations and warranties contained in Section 9.14(a). It is understood
and agreed that the enforcement of the obligation of the Master Servicer set
forth in this Section to indemnify the Depositor and the Trustee as provided in
this Section constitutes the sole remedy (other than as set forth in Section
6.14) of the Depositor 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, 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.
(c) It is understood and agreed that the representations and
warranties of the Depositor set forth in Sections 2.03(a)(i) through (vi) shall
survive the execution and delivery of this Agreement. The Depositor shall
indemnify the Master Servicer and hold it 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 breach of the Depositor's
representations and warranties contained in Sections 2.03(a)(i) through (vi)
hereof. It is understood and agreed that the enforcement of the obligation of
the Depositor set forth in this Section to indemnify the Master Servicer as
provided in this Section constitutes the sole remedy of the Master Servicer
respecting a breach by the Depositor of the representations and warranties in
Sections 2.03(a)(i) through (vi) hereof.
Any cause of action against the Depositor relating to or arising out
of the breach of the representations and warranties made in Sections 2.03(a)(i)
through (vi) hereof shall accrue upon discovery of such breach by either the
Depositor or the Master Servicer or notice thereof by any one of such parties
to the other parties.
Section 9.15. Opinion. On or before the Closing Date, the Master
Servicer shall cause to be delivered to the Depositor, the Seller and the
Trustee one or more Opinions of Counsel, dated the Closing Date, in form and
substance reasonably satisfactory to the Depositor and Xxxxxx Brothers Inc., as
to the due authorization, execution and delivery of this Agreement by the
Master Servicer and the enforceability thereof.
Section 9.16. Standard Hazard and Flood Insurance Policies. For each
Mortgage Loan, the Master Servicer shall maintain, or cause to be maintained by
each Servicer, standard fire and casualty insurance and, where applicable,
flood insurance, all in accordance with the provisions of this Agreement and
the related Servicing Agreement, as applicable. It is understood and agreed
that such insurance shall be with insurers meeting the eligibility requirements
set forth in the applicable Servicing Agreement and that no earthquake or other
additional insurance is to be required of any Mortgagor or to be maintained on
property acquired in respect of a defaulted loan, other than pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance.
Pursuant to Section 4.01, any amounts collected by the Master
Servicer, or by any Servicer, under any insurance policies maintained pursuant
to this Section 9.16 or any Servicing Agreement (other than amounts to be
applied to the restoration or repair of the property subject to the related
Mortgage or released to the Mortgagor in accordance with the applicable
Servicing Agreement) shall be deposited into the Collection Account, subject to
withdrawal pursuant to Section 4.02. Any cost incurred by the Master Servicer
or any Servicer in maintaining any such insurance if the Mortgagor defaults in
its obligation to do so shall be added to the amount owing under the Mortgage
Loan where the terms of the Mortgage Loan so permit; provided, however, that
the addition of any such cost shall not be taken into account for purposes of
calculating the distributions to be made to Certificateholders and shall be
recoverable by the Master Servicer or such Servicer pursuant to Section 4.02.
Section 9.17. Presentment of Claims and Collection of Proceeds. The
Master Servicer shall cause each Servicer (to the extent provided in the
applicable Servicing Agreement) to, prepare and present on behalf of the
Trustee and the Certificateholders all claims under the Insurance Policies with
respect to the Mortgage Loans, and take such actions (including the
negotiation, settlement, compromise or enforcement of the insured's claim) as
shall be necessary to realize recovery under such policies. Any proceeds
disbursed to the Master Servicer (or disbursed to a Servicer and remitted to
the Master Servicer) in respect of such policies or bonds shall be promptly
deposited in the Collection Account or the Custodial Account upon receipt,
except that any amounts realized that are to be applied to the repair or
restoration of the related Mortgaged Property as a condition requisite to the
presentation of claims on the related Mortgage Loan to the insurer under any
applicable Insurance Policy need not be so deposited (or remitted).
Section 9.18. Maintenance of the Primary Mortgage Insurance Policies.
(a) The Master Servicer shall remit on behalf of each Servicer to MGIC the MGIC
Insurance Premiums. The Master Servicer shall not take, or knowingly permit any
Servicer (consistent with the applicable Servicing Agreement) to take, any
action that would result in noncoverage under any applicable Primary Mortgage
Insurance Policy of any loss which, but for the actions of such Master Servicer
or such Servicer, would have been covered thereunder. The Master Servicer shall
use its best reasonable efforts to keep in force and effect, or to cause each
Servicer to keep in force and effect (to the extent that the Mortgage Loan
requires the Mortgagor to maintain such insurance), primary mortgage insurance
applicable to each Mortgage Loan in accordance with the provisions of this
Agreement and the related Servicing Agreement, as applicable. The Master
Servicer shall not, and shall not knowingly permit any Servicer to, cancel or
refuse to renew any such Primary Mortgage Insurance Policy that is in effect at
the date of the initial issuance of the Certificates and is required to be kept
in force hereunder except in accordance with the provisions of this Agreement
and the related Servicing Agreement, as applicable.
(b) The Master Servicer agrees, to the extent provided in each
Servicing Agreement, to cause each Servicer to present, on behalf of the
Trustee and the Certificateholders, claims to the insurer under any Primary
Mortgage Insurance Policies and, in this regard, to take such reasonable action
as shall be necessary to permit recovery under any Primary Mortgage Insurance
Policies respecting defaulted Mortgage Loans. Pursuant to Section 4.01, any
amounts collected by the Master Servicer or any Servicer under any Primary
Mortgage Insurance Policies shall be deposited in the Collection Account,
subject to withdrawal pursuant to Section 4.02.
Section 9.19. Trustee To Retain Possession of Certain Insurance
Policies and Documents. The Trustee shall retain possession and custody of the
originals of the Primary Mortgage Insurance Policies or certificate of
insurance if applicable and any certificates of renewal as to the foregoing as
may be issued from time to time as contemplated by this Agreement. Until all
amounts distributable in respect of the Certificates have been distributed in
full and the Master Servicer otherwise has fulfilled its obligations under this
Agreement, the Trustee (or the applicable Custodian) shall also retain
possession and custody of each Mortgage File in accordance with and subject to
the terms and conditions of this Agreement. The Master Servicer shall promptly
deliver or cause each Servicer to deliver to the Trustee (or the applicable
Custodian), upon the execution or receipt thereof the originals of the Primary
Mortgage Insurance Policies and any certificates of renewal thereof, and such
other documents or instruments that constitute portions of the Mortgage File
that come into the possession of the Master Servicer or any Servicer from time
to time.
Section 9.20. [Reserved]
Section 9.21. Compensation to the Master Servicer. The Master Servicer
shall (i) be entitled, at its election, either (a) to pay itself the Net Master
Servicing Fee, as reduced pursuant to Section 5.05, in respect of the Mortgage
Loans out of any Mortgagor payment on account of interest prior to the deposit
of such payment in the Collection Account it maintains or (b) to withdraw from
the Collection Account, subject to Section 5.05, the Net Master Servicing Fee
to the extent permitted by Section 4.02. The Master Servicer shall also be
entitled, at its election, either (a) to pay itself the Net Master Servicing
Fee in respect of each delinquent Mortgage Loan master serviced by it out of
Liquidation Proceeds in respect of such Mortgage Loan or other recoveries with
respect thereto to the extent permitted in Section 4.02 or (b) to withdraw from
the Collection Account it maintains the Net Master Servicing Fee in respect of
each Liquidated Mortgage Loan to the extent of such Liquidation Proceeds or
other recoveries, to the extent permitted by Section 4.02. Servicing
compensation in the form of assumption fees, if any, late payment charges, as
collected, if any, or otherwise (but not including any Prepayment Premium)
shall be retained by the Master Servicer (or the applicable Servicer) and shall
not be deposited in the Collection Account. If the Master Servicer does not
retain or withdraw the Net Master Servicing Fee from the Collection Account as
provided herein, the Master Servicer shall be entitled to direct the Trustee to
pay the Net Master Servicing Fee to such Master Servicer by withdrawal from the
Certificate Account to the extent that payments have been received with respect
to the applicable Mortgage Loan. 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. The provisions of this Section 9.21 are subject to the provisions of
Section 6.14(b).
Section 9.22. REO Property. (a) In the event the Trust Fund acquires
ownership of any REO Property in respect of any Mortgage Loan, the deed or
certificate of sale shall be issued to the Trustee, or to its nominee, on
behalf of the Certificateholders. The Master Servicer shall use its reasonable
best efforts to sell, or cause the applicable Servicer, to the extent provided
in the applicable Servicing Agreement any REO Property as expeditiously as
possible and in accordance with the provisions of this Agreement and the
related Servicing Agreement, as applicable, but in all events within the time
period, and subject to the conditions set forth in Article X hereof. Pursuant
to its efforts to sell such REO Property, the Master Servicer shall protect and
conserve, or cause the applicable Servicer to protect and conserve, such REO
Property in the manner and to such extent required by the applicable Servicing
Agreement, subject to Article X hereof.
(b) The Master Servicer shall deposit or cause to be deposited all
funds collected and received by it, or recovered from any Servicer, in
connection with the operation of any REO Property in the Collection Account.
(c) The Master Servicer and each Servicer, upon the final disposition
of any REO Property, shall be entitled to reimbursement for any related
unreimbursed Advances and other unreimbursed advances as well as any unpaid Net
Master Servicing Fees or Servicing Fees from Liquidation Proceeds received in
connection with the final disposition of such REO Property; provided, that any
such unreimbursed Advances as well as any unpaid Net Master Servicing Fees or
Servicing Fees may be reimbursed or paid, as the case may be, prior to final
disposition, out of any net rental income or other net amounts derived from
such REO Property.
(d) The Liquidation Proceeds from the final disposition of the REO
Property, net of any payment to the Master Servicer and the applicable Servicer
as provided above, shall be deposited in the Collection Account on or prior to
the Determination Date in the month following receipt thereof (and the Master
Servicer shall provide prompt written notice to the Trustee upon such deposit)
and be remitted by wire transfer in immediately available funds to the Trustee
for deposit into the Certificate Account on the next succeeding Deposit Date.
Section 9.23. Preparation of Tax Returns and Other Reports. (a) The
Master Servicer shall prepare in accordance with the provisions of Article X 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 Trustee shall file, federal tax returns and appropriate
state income tax returns and such other returns as may be required by
applicable law relating to the Trust Fund, and the Trustee shall forward copies
to the Depositor of all such returns and Form 1099 information and such other
information within the control of the Trustee 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 Trustee as are required by
the Code and the REMIC Provisions to be furnished to them, and the Master
Servicer will prepare, to the extent that they are familiar with applicable
state requirements, and the Trustee will file, annual reports (other than tax
returns), if any, as directed by the Master Servicer, and will file copies of
this Agreement with the appropriate state authorities as may be required by
applicable law, and will prepare and disseminate to Certificateholders Form
1099 (or otherwise furnish information within the control of the Trustee) to
the extent required by applicable law. The Master Servicer will indemnify the
Trustee on behalf of the Certificateholders for any liability of or assessment
against the Trust Fund resulting from any error in any of such tax or
information returns resulting from errors in the information provided by such
Master Servicer (other than any such information that is delivered solely from
information provided by a Servicer).
(b) The Depositor shall prepare or cause to be prepared the initial
current report on Form 8-K. Within 15 days after each Distribution Date, the
Master Servicer shall, in accordance with industry standards, file with the
Securities and Exchange Commission (the "SEC") via the Electronic Data
Gathering and Retrieval System (XXXXX), a Form 8-K with a copy of the statement
to the Certificateholders for such Distribution Date as an exhibit thereto.
Prior to January 30, 2002, the Master Servicer shall, in accordance with
industry standards, file a Form 15 Suspension Notification with respect to the
Trust Fund, if applicable. Prior to March 31, 2002, the Master Servicer shall
file a Form 10-K, in substance conforming to industry standards, with respect
to the Trust Fund. The Depositor hereby grants to the Master Servicer a limited
power of attorney to execute and file each such document on behalf of the
Depositor. Such power of attorney shall continue until either the earlier of
(i) receipt by the Master Servicer from the Depositor of written termination of
such power of attorney and (ii) the termination of the Trust Fund. The
Depositor agrees to promptly furnish to the Master Servicer from time to time
upon request such further information, reports, and financial statements within
the Depositor's control related to this Agreement and the Mortgage Loans as the
Master Servicer reasonably deems appropriate to prepare and file all necessary
reports with the SEC. The Master Servicer shall have no responsibility to file
any items other than those specified in this Section 9.23(b). Promptly after
filing a Form 15 or other applicable form with the SEC in connection with such
termination, the Master Servicer shall deliver to the Depositor a copy of such
form together with copies of confirmations of receipt by the SEC of each report
filed therewith on behalf of the Trust Fund.
Section 9.24. Reports to the Trustee. (a) Not later than 30 days after
each Distribution Date, the Master Servicer shall, upon request, forward to the
Trustee a statement, deemed to have been certified by a Servicing Officer,
setting forth the status of the Collection Account maintained by the Master
Servicer as of the close of business on the related Distribution Date,
indicating that all distributions required by this Agreement to be made by the
Master Servicer have been made (or if any required distribution has not been
made by the Master Servicer, specifying the nature and status thereof) and
showing, for the period covered by such statement, the aggregate of deposits
into and withdrawals from the Collection Account maintained by the Master
Servicer. Copies of such statement shall be provided by the Master Servicer,
upon request, to the Depositor, Attention: Contract Finance and any
Certificateholders (or by the Trustee at the Master Servicer's expense if the
Master Servicer shall fail to provide such copies to the Certificateholders
(unless (i) the Master Servicer shall have failed to provide the Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer's
failure to provide such statement)).
(b) Not later than two Business Days following each Distribution Date,
the Master Servicer shall deliver to one Person designated by the Depositor, in
a format consistent with other electronic loan level reporting supplied by the
Master Servicer in connection with similar transactions, "loan level"
information with respect to the Mortgage Loans as of the related Determination
Date, to the extent that such information has been provided to the Master
Servicer by the Servicers or by the Depositor.
Section 9.25. Annual Officer's Certificate as to Compliance. (a) The
Master Servicer shall deliver to the Trustee on or before May 31 of each year,
commencing on May 31, 2002, an Officer's Certificate, certifying that with
respect to the period ending on the immediately preceding December 31: (i) such
Servicing Officer has reviewed the activities of such Master Servicer during
the preceding calendar year or portion thereof and its performance under this
Agreement, (ii) to the best of such Servicing Officer's knowledge, based on
such review, such Master Servicer has performed and fulfilled its duties,
responsibilities and obligations under this Agreement in all material respects
throughout such year, or, if there has been a default in the fulfillment of any
such duties, responsibilities or obligations, specifying each such default
known to such Servicing Officer and the nature and status thereof, (iii)
nothing has come to the attention of such Servicing Officer to lead such
Servicing Officer to believe that any Servicer has failed to perform any of its
duties, responsibilities and obligations under its Servicing Agreement in all
material respects throughout such year, or, if there has been a material
default in the performance or fulfillment of any such duties, responsibilities
or obligations, specifying each such default known to such Servicing Officer
and the nature and status thereof, and (iv) the Master Servicer has received
from each Servicer an annual certificate of compliance and a copy of such
Servicer's annual audit report, in each case to the extent required under the
applicable Servicing Agreement, or, if any such certificate or report has not
been received by the Master Servicer, the Master Servicer is using its best
reasonable efforts to obtain such certificate or report.
(b) Copies of such statements shall be provided to any
Certificateholder upon request, by the Master Servicer or by the Trustee at the
Master Servicer's expense if the Master Servicer failed to provide such copies
(unless (i) the Master Servicer shall have failed to provide the Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer's
failure to provide such statement).
Section 9.26. Annual Independent Accountants' Servicing Report. If the
Master Servicer (or any of its Affiliates) has, during the course of any fiscal
year, directly serviced, as a successor Servicer, any of the Mortgage Loans,
then the Master Servicer at its expense shall cause a nationally recognized
firm of independent certified public accountants to furnish a statement to the
Trustee and the Depositor on or before May 31 of each year, commencing on May
31, 2002 to the effect that, with respect to the most recently ended fiscal
year, such firm has examined certain records and documents relating to the
Master Servicer's performance of its servicing obligations under this Agreement
and pooling and servicing and trust agreements in material respects similar to
this Agreement and to each other and that, on the basis of such examination
conducted substantially in compliance with the audit program for mortgages
serviced for FHLMC or the Uniform Single Attestation Program for Mortgage
Bankers, such firm is of the opinion that the Master Servicer's activities have
been conducted in compliance with this Agreement, or that such examination has
disclosed no material items of noncompliance except for (i) such exceptions as
such firm believes to be immaterial, (ii) such other exceptions as are set
forth in such statement and (iii) such exceptions that the Uniform Single
Attestation Program for Mortgage Bankers or the Audit Program for Mortgages
Serviced by FHLMC requires it to report. Copies of such statements shall be
provided to any Certificateholder upon request by the Master Servicer, or by
the Trustee at the expense of the Master Servicer if the Master Servicer shall
fail to provide such copies. If such report discloses exceptions that are
material, the Master Servicer shall advise the Trustee whether such exceptions
have been or are susceptible of cure, and will take prompt action to do so.
Section 9.27. 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 FNMA or FHLMC and shall have a net worth of not less than
$15,000,000.
Section 9.28. Resignation of Master Servicer. Except as otherwise
provided in Sections 9.27 and 9.29 hereof, the Master Servicer shall not resign
from the obligations and duties hereby imposed on it unless it or the Trustee
determines that the Master Servicer's duties 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 shall
be evidenced by an Opinion of Counsel that shall be Independent to such effect
delivered to the Trustee. No such resignation shall become effective until the
Trustee shall have assumed, or a successor master servicer shall have been
appointed by the Trustee and until such successor shall have assumed, the
Master Servicer's responsibilities and obligations under this Agreement. Notice
of such resignation shall be given promptly by the Master Servicer and the
Depositor.
Section 9.29. Assignment or Delegation of Duties by the Master
Servicer. Except as expressly provided herein, the Master Servicer shall not
assign or transfer any of its 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 duties, covenants or obligations to be
performed by the Master Servicer hereunder; provided, however, that the Master
Servicer shall have the right without the prior written consent of the Trustee
or the Depositor to delegate or assign to or subcontract with or authorize or
appoint an Affiliate of the Master Servicer to perform and carry out any
duties, covenants or obligations to be performed and carried out by the Master
Servicer hereunder. In no case, however, shall any such delegation,
subcontracting or assignment to an Affiliate of the Master Servicer relieve the
Master Servicer of any liability hereunder. Notice of such permitted assignment
shall be given promptly by the Master Servicer to the Depositor and the
Trustee. If, pursuant to any provision hereof, the duties of the Master
Servicer are transferred to a successor master servicer, the entire amount of
the Net Master Servicing Fees and other compensation payable to the Master
Servicer pursuant hereto, including amounts payable to or permitted to be
retained or withdrawn by the Master Servicer pursuant to Section 9.21 hereof,
shall thereafter be payable to such successor master servicer.
Section 9.30. Limitation on Liability of the Master Servicer and
Others. 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
Collection Account it maintains as provided by Section 4.02.
The Master Servicer shall not be liable for any acts or omissions of
any Servicer. In particular, the Master Servicer shall not be liable for any
course of action taken by the Servicers with respect to loss mitigation of
defaulted Mortgage Loans at the direction of the Loss Mitigation Advisor or the
Seller pursuant to any Loss Mitigation Advisory Agreement.
Section 9.31. Indemnification; Third-Party Claims. The Master Servicer
agrees to indemnify the Depositor 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 and the Trustee may sustain as a result of the failure of
the Master Servicer to perform its duties and master service the Mortgage Loans
in compliance with the terms of this Agreement. The Depositor 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 or the Trustee to indemnification hereunder, 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 9.32. Special Servicing of Delinquent Mortgage Loans. If
permitted under the terms of the applicable Servicing Agreement, the Seller may
appoint, pursuant to the terms of the applicable Servicing Agreement and with
the written consent of the Depositor, the Master Servicer and the Trustee, a
Special Servicer to special service any Mortgage Loans which are more than 90
days delinquent. Any applicable Termination Fee related to the termination of
the related Servicer and the appointment of any Special Servicer shall be paid
by the Seller. Any fees paid to any such Special Servicer shall not exceed the
Servicing Fee Rate.
Section 9.33. Alternative Index. In the event that the Index for any
Mortgage Loan, as specified in the related Mortgage Note, becomes unavailable
for any reason, the Master Servicer shall select an alternative index, which in
all cases shall be an index that constitutes a qualified rate on a regular
interest under the REMIC Provisions, in accordance with the terms of such
Mortgage Note or, if such Mortgage Note does not make provision for the
selection of an alternative index in such event, the Master Servicer shall,
subject to applicable law, select an alternative index based on information
comparable to that used in connection with the original Index and, in either
case, such alternative index shall thereafter be the Index for such Mortgage
Loan.
Section 9.34. Duties of the Loss Mitigation Advisor. The
Certificateholders, by their purchase and acceptance of the Certificates,
appoint The Murrayhill Company as Loss Mitigation Advisor. For and on behalf of
the Depositor, the Master Servicer, the Trustee and the Certificateholders, the
Loss Mitigation Advisor will provide reports and recommendations concerning
Mortgage Loans that are past due, as to which there has been commencement of
foreclosure, as to which there has been forbearance in exercise of remedies
which are in default, as to which any obligor is the subject of bankruptcy,
receivership, or an arrangement of creditors, or which have become REO
Properties. Such reports and recommendations will be based upon information
provided pursuant to Loss Mitigation Advisory Agreements to the Loss Mitigation
Advisor by the Servicers. The Loss Mitigation Advisor shall look solely to the
Servicers for all information and data (including loss and delinquency
information and data) and loan level information and data relating to the
servicing of the Mortgage Loans and neither the Master Servicer nor the Trustee
shall have any obligation to provide any such information to the Loss
Mitigation Advisor.
Section 9.35. Limitation Upon Liability of the Loss Mitigation
Advisor. Neither the Loss Mitigation Advisor, nor any of the directors,
officers, employees or agents of the Loss Mitigation Advisor, shall be under
any liability to the Trustee, the Certificateholders or the Depositor for any
action taken or for refraining from the taking of any action in good faith
pursuant to this Agreement, in reliance upon information provided by Servicers
under the Loss Mitigation Advisory Agreements or for errors in judgment;
provided, however, that this provision shall not protect the Loss Mitigation
Advisor or any such person against liability that would otherwise be imposed by
reason of willful malfeasance, bad faith or gross negligence in its performance
of its duties or by reason of reckless disregard for its obligations and duties
under this Agreement or the Loss Mitigation Advisory Agreements. The Loss
Mitigation Advisor and any director, officer, employee or agent of the Loss
Mitigation Advisor 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, and may rely in good faith upon the accuracy of information
furnished by the Servicers pursuant to the Loss Mitigation Advisory Agreements
in the performance of its duties thereunder and hereunder.
Section 9.36. Reports to Aurora. No later than one Business Day after
receipt, the Master Servicer shall deliver to Aurora Loan Services, Inc. any
reports the Master Servicer receives from any Servicers pursuant to the
applicable Servicing Agreement, or as the Depositor shall otherwise direct.
Pursuant to this Section 9.36, it is understood and agreed to by the parties to
this Agreement that the Master Servicer is merely delivering such reports and
the Master Servicer will not examine and does not warranty the accuracy or
validity of such reports and shall not be liable to Aurora Loan Services, Inc.
or others relying on such delivered reports.
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 86OG(a)(9) of the Code. The latest possible
maturity date for purposes of Treasury Regulation 1.86OG-1(a)(4) will be the
Latest Possible Maturity Date.
(c) The Master Servicer 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 Master Servicer
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 Master Servicer
in fulfilling its duties hereunder (including its duties as tax return
preparer). The Master Servicer shall be entitled to reimbursement of expenses
to the extent provided in clause (i) above from the Collection Account.
(d) The Master Servicer shall prepare, and the Trustee shall sign and
file, as instructed by the Master Servicer, 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 Master Servicer.
(e) The Master Servicer 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 Master Servicer shall provide (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 860(e)(3) of
the Code and (ii) to the Trustee such information as is necessary for the
Trustee to provide to the Certificateholders such information or reports as are
required by the Code or REMIC Provisions.
The Master Servicer shall be entitled to receive reasonable
compensation from the Trust for the performance of its duties under this
subsection (d); provided, however, that such compensation shall not exceed
$5,000 per year.
(f) The Trustee, the Master Servicer and the Holders of Certificates
shall take any action or cause any REMIC to take any action necessary to create
or 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. Neither
the Trustee, 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 (i) endanger the
status of any REMIC as a REMIC or (ii) result in the imposition of a tax upon
any REMIC (including but not limited to the tax on prohibited transactions as
defined in Code Section 860F(a)(2) and the tax on prohibited contributions set
forth on Section 860G(d) of the Code) (either such event, an "Adverse REMIC
Event") unless the Trustee 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 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 or the Master Servicer has advised it in writing
that an Adverse REMIC Event could occur.
(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 Trustee 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, out of
other amounts held in the Collection Account, and shall reduce amounts
otherwise payable to holders of regular interests in any such REMIC, as the
case may be.
(h) The Master Servicer 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 with respect to eligible
substitute mortgage loans.
(j) Neither the Trustee nor the Master Servicer shall enter into any
arrangement by which any REMIC will receive a fee or other compensation for
services.
(k) On or before April 15 of each calendar year beginning in 2002, the
Master Servicer shall deliver to the Trustee an Officer's Certificate stating,
without regard to any actions taken by any party other than the Master
Servicer, the Master Servicer's compliance with provisions of this Section
10.01.
(l) The Trustee shall treat the Basis Risk Reserve Fund as an outside
reserve fund within the meaning of Treasury Regulation Section 1.860G-2(h)
that is owned by the Holder of the Class X Certificate and that is not an
asset of any REMIC. The Trustee shall treat the rights of the Class A, Class
M1, Class M2 and Class B Certificateholders to receive payments from any Basis
Risk Reserve Fund in the event of a Basis Risk Shortfall as rights in an
interest rate cap contract written by the Class X Certificateholder in favor
of the Class A, Class M1, Class M2 and Class B Certificateholders. Thus, each
Class A, Class M1, Class M2 and Class B Certificate shall be treated as
representing not only ownership of regular interests in REMIC 3, but also
ownership of an interest in an interest rate cap contract. For tax purposes
the interest rate cap contract will be deemed to have a value of $15,898.78.
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
Certificate 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, or substitution) that such
disposition, acquisition, substitution, or acceptance will not (a) affect
adversely the status of any such REMIC as a REMIC or of the interests therein
other than the Residual Certificate as the regular interests therein, (b)
affect the distribution of interest or principal on the Certificates, (c)
result in the encumbrance of the assets transferred or assigned to the Trust
Fund (except pursuant to the provisions of this Agreement) or (d) cause any
such REMIC to be subject to any tax including a tax on prohibited transactions
or prohibited contributions pursuant to the REMIC Provisions.
Section 10.03. Indemnification with Respect to Certain Taxes and Loss
of REMIC Status. (a) In the event that any REMIC fails to qualify as a REMIC,
loses its status as a REMIC, or incurs federal, state or local taxes as a
result of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Master Servicer of its
duties and obligations set forth herein, the Master Servicer shall indemnify
the Holder of the related Residual Certificate or the Trust Fund, as
applicable, against any and all losses, claims, damages, liabilities or
expenses ("Losses") resulting from such negligence; provided, however, that the
Master Servicer shall not be liable for any such Losses attributable to the
action or inaction of the Depositor, the Class X Certificateholder or the
Holder of such Residual Certificate, as applicable, nor for any such Losses
resulting from misinformation provided by the Holder of such Residual
Certificate on which the Master Servicer has relied. The foregoing shall not be
deemed to limit or restrict the rights and remedies of the Holder of such
Residual Certificate now or hereafter existing at law or in equity.
Notwithstanding the foregoing, however, in no event shall the Master Servicer
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 any Servicing Agreement, (2) for
any Losses other than arising out of a negligent performance by the Master
Servicer of, as applicable, its duties and obligations set forth herein, and
(3) for any special or consequential damages to Certificateholders (in addition
to payment of principal and interest on the Certificates).
(b) If the Internal Revenue Service determines that one of the REMICs
established hereunder recognized income from a prohibited transaction within
the meaning of Section 860F(a)(2) of the Code as a result of the lapse of the
Class X Certificateholder's right to effect a Special Termination of the Trust
Fund by purchasing the assets of the Trust Fund, then the Seller shall
indemnify the Trust Fund for any such tax and any tax imposed upon such
indemnification.
(c) In the event that the REMIC incurs a state or local tax as a
result of a determination that the REMIC is domiciled in the State of
California for state tax purposes by virtue of the location of any Servicer,
the Seller agrees to pay on behalf of the Trust Fund when due any and all state
and local taxes imposed as a result of such determination. In the event that
the REMIC incurs a state or local tax as a result of a determination that the
REMIC is domiciled in the State of Minnesota for state tax purposes by virtue
of the location of the Master Servicer, the Seller agrees to pay on behalf of
the Trust Fund when due any and all state and local taxes imposed as a result
of such determination.
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 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 such REO Property to fail to qualify as "foreclosure" property within the
meaning of section 860G(a)(8) of the Code or result in the receipt by any REMIC
of any "income from non-permitted assets" within the meaning of section
860F(a)(2) of the Code or any "net income from foreclosure property" which is
subject to tax under the REMIC Provisions unless the Master Servicer has
advised, or has caused the applicable Servicer to advise, the Trustee in
writing to the effect 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 the imposition of a tax
upon such REMIC.
(b) The Master Servicer shall cause the applicable Servicer (to the
extent provided in its Servicing Agreement) to make reasonable efforts to sell
any REO Property for its fair market value. In any event, however, the Master
Servicer shall, or shall cause the applicable Servicer (to the extent provided
in its Servicing Agreement) to, dispose of any REO Property within three years
of its acquisition by the Trust Fund unless the Trustee 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 adversely
affecting the REMIC status of such REMIC or causing the imposition of a Federal
or state tax upon such REMIC. If the Trustee has received such an extension,
then the Trustee, or the Master Servicer, acting on its behalf 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 the Trustee has not
received such an extension and the Trustee or Master Servicer, or the
applicable Servicer, acting on behalf of the Trustee hereunder is unable to
sell the REO Property within 33 months after its acquisition by the Trust Fund
or if the Trustee has received such an extension, and the Trustee, or the
Master Servicer, acting on its behalf hereunder, 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 Master Servicer shall, or 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 or the Master 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.
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.
Section 11.03. Amendment. (a) This Agreement may be amended from time
to time by the Depositor, the Master Servicer and the Trustee, without the
consent of the Loss Mitigation Advisor except to the extent that the rights or
obligations of the Loss Mitigation Advisor hereunder are directly affected
thereby, and without notice to or the consent of any of the Holders, (i) to
cure any ambiguity, (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 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, adversely
affect the status of any REMIC created pursuant to this Agreement, 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 may also be amended from time to time by the
Depositor, the Master Servicer and the Trustee, without the consent of the Loss
Mitigation Advisor except to the extent that the rights or obligations of the
Loss Mitigation Advisor hereunder are directly affected thereby, but with the
consent of the Holders of not less than 66-2/3% of the Class Principal Amount
(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 adversely affect the status of
any REMIC as a REMIC or cause a tax to be imposed on such REMIC; 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 Amount
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 Amount 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) Promptly after the execution of any such amendment, the Trustee
shall furnish written notification of the substance of such amendment to each
Holder, the Depositor and to the Rating Agencies.
(d) 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.
(e) Notwithstanding anything to the contrary in any Servicing
Agreement, the Trustee shall not consent to any amendment of any Servicing
Agreement except pursuant to the standards provided in this Section with
respect to amendment of this Agreement.
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 Principal Amount or Class Notional Amount (or Percentage Interest),
Certificates owned by the Depositor, the Master Servicer, the Trustee, any
Servicer, MGIC, the Loss Mitigation Advisor or Affiliates thereof are not to be
counted so long as such Certificates are owned by the Depositor, the Master
Servicer, the Trustee, any Servicer, MGIC, the Loss Mitigation Advisor or any
Affiliate thereof.
Section 11.05. Provision of Information. (a) For so long as any of the
Certificates of any Series or Class are "restricted securities" within the
meaning of Rule 144(a)(3) under the Act, each of the Depositor, the Master
Servicer and the Trustee agree to cooperate with each other to provide to any
Certificateholders and to any prospective purchaser of Certificates designated
by such Certificateholder, upon the request of such Certificateholder 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
or the Master Servicer in providing such information shall be reimbursed by the
Depositor.
(b) The Master Servicer shall provide to any person to whom a
Prospectus was delivered, upon the request of such person specifying the
document or documents requested, (i) 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 9.23(b) and (ii) a copy of any other document incorporated
by reference in the Prospectus. Any reasonable out-of-pocket expenses incurred
by the Master Servicer in providing copies of such documents shall be
reimbursed by the Depositor.
(c) On each Distribution Date, the Trustee shall deliver or cause to
be delivered by first class mail to the Depositor, Attention: Contract Finance,
a copy of the report delivered to Certificateholders pursuant to Section 4.03.
Section 11.06. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
Section 11.07. Notices. All demands, notices 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, Structured Asset Securities
Corporation, 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Mortgage Finance ARC 2001-BC3, (b) in the case of the Seller, Lehman Capital, A
Division of Xxxxxx Brothers Holdings Inc., 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Mortgage Finance ARC 2001-BC3, (c) in the case
of the Loss Mitigation Advisor, The Murrayhill Company, 0000 Xxxxxxxx, Xxxxx
0000, Xxxxxx, Xxxxxxxx 00000, Attention: Xxx X. Xxxxxxx, (d) in the case of the
Trustee, the Corporate Trust Office and (e) in the case of the Master Servicer,
Xxxxx Fargo Bank Minnesota, National Association, 00000 Xxxxxx Xxxx Xxxxxxx,
Xxxxxxxx, Xxxxxxxx 00000; Attention: ARC 2001-BC3, 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. 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 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, as
follows:
If to Moody's, to:
Xxxxx'x Investors Services, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Residential Mortgages
If to S&P, to:
Standard & Poor's Rating Services
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
Attention: Residential Mortgages
If to Fitch, to:
Fitch, Inc.
Xxx Xxxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
(c) The Trustee shall provide or make available to the Rating Agencies
reports prepared pursuant to Section 4.03.
Section 11.13. Conflicts. To the extent that the terms of this
Agreement conflict with the terms of any Servicing Agreement, the related
Servicing Agreement shall govern.
Section 11.14. Counterparts. 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. Transfer of Servicing. The Seller agrees that it shall
provide written notice to the Master Servicer and the Trustee thirty days prior
to any transfer or assignment by the Seller of its rights under the Servicing
Agreement or of the servicing thereunder or delegation of its rights or duties
thereunder or any portion thereof to any other Person including any other
Servicer under the Servicing Agreement. In addition, the ability of the Seller
to transfer or assign its rights and delegate its duties under the Servicing
Agreement or to transfer the servicing thereunder to a successor servicer shall
be subject to the following conditions:
(i) satisfaction of the conditions to such transfer as set forth
in the Servicing Agreement including, without limitation, receipt of
written consent of the Seller to such transfer;
(ii) Such successor servicer must be qualified to service loans
for FNMA or FHLMC, and must be a member in good standing of MERS;
(iii) Such successor servicer must satisfy the seller/servicer
eligibility standards in the Servicing Agreement, exclusive of any
experience in mortgage loan origination;
(iv) Such successor servicer must execute and deliver to the
Trustee an agreement, in form and substance reasonably satisfactory to
the Trustee, that contains an assumption by such successor servicer of
the due and punctual performance and observance of each covenant and
condition to be performed and observed by such Servicer under the
Servicing Agreement;
(v) There must be delivered to the Trustee a letter from each
Rating Agency to the effect that such transfer of servicing will not
result in a qualification, withdrawal or downgrade of the then-current
rating of any of the Certificates; and
(vi) The Seller shall, at its cost and expense, take such steps,
or cause the terminated Servicer to take such steps, as may be
necessary or appropriate to effectuate and evidence the transfer of
the servicing of the Mortgage Loans to such successor servicer,
including, but not limited to, the following: (A) to the extent
required by the terms of the Mortgage Loans and by applicable federal
and state laws and regulations, the Seller shall cause the prior
Servicer to timely mail to each obligor under a Mortgage Loan any
required notices or disclosures describing the transfer of servicing
of the Mortgage Loans to the successor servicer; (B) prior to the
effective date of such transfer of servicing, the Seller shall cause
the prior Servicer to transmit to any related insurer notification of
such transfer of servicing; (C) on or prior to the effective date of
such transfer of servicing, the Seller shall cause the prior Servicer
to deliver to the successor servicer all Mortgage Loan Documents and
any related records or materials; (D) on or prior to the effective
date of such transfer of servicing, the Seller shall cause the prior
Servicer to transfer to the successor servicer, or, if such transfer
occurs after a Remittance Date but before the next succeeding Deposit
Date, to the Trustee, all funds held by the prior Servicer in respect
of the Mortgage Loans; (E) on or prior to the effective date of such
transfer of servicing, the Seller shall cause the prior Servicer to,
after the effective date of the transfer of servicing to the successor
servicer, continue to forward to such successor servicer, within one
Business Day of receipt, the amount of any payments or other
recoveries received by the prior Servicer, and to notify the successor
servicer of the source and proper application of each such payment or
recovery; and (F) the Seller shall cause the prior Servicer to, after
the effective date of transfer of servicing to the successor servicer,
continue to cooperate with the successor servicer to facilitate such
transfer in such manner and to such extent as the successor servicer
may reasonably request. Notwithstanding the foregoing, the prior
Servicer shall be obligated to perform the items listed above to the
extent provided in the Servicing Agreement.
IN WITNESS WHEREOF, the Depositor, the Trustee, the Master Servicer
and the Loss Mitigation Advisor have caused their names to be signed hereto by
their respective officers hereunto duly authorized as of the day and year first
above written.
STRUCTURED ASSET SECURITIES
CORPORATION, as Depositor
By:/s/ Xxxxx X. Xxxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
BANK ONE, NATIONAL ASSOCIATION,
as Trustee
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxx
Title: First Vice President
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, as Master Servicer
By: /s/ Xxx Xxxxx
------------------------------------------
Name: Xxx Xxxxx
Title: Assistant Vice President
THE MURRAYHILL COMPANY,
as Loss Mitigation Advisor
By: /s/ Xxx X. Xxxxxxx
-----------------------------------------
Name: Xxx X. Xxxxxxx
Title: Chief Operating Officer
EXHIBIT A
FORMS OF CERTIFICATES
EXHIBIT B-1
FORM OF INITIAL CERTIFICATION
_________________________
Date
Bank One, National Association
1 Bank Xxx Xxxxx
Xxxx Xxxxx XX0-0000
Xxxxxxx, XX 00000
Structured Asset Securities Corporation
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Trust Agreement (the "Trust Agreement"), dated as of May 1,
2001 between Structured Asset Securities Corporation, as
Depositor, Bank One, National Association, as Trustee, Xxxxx
Fargo Bank Minnesota, National Association, as Master
Servicer, and The Murrayhill Company, as Loss Mitigation
Advisor with respect to Amortizing Residential Collateral
Mortgage Pass-Through Certificates, Series 2001-BC3
Ladies and Gentlemen:
In accordance with Section 2.02(a) of the Trust Agreement, subject to
review of the contents thereof, the undersigned, as Custodian, hereby certifies
that it has received the documents listed in Section 2.01(b) of the Trust
Agreement for each Mortgage File pertaining to each Mortgage Loan listed on
Schedule A, to the Trust Agreement, subject to any exceptions noted on Schedule
I hereto.
Capitalized words and phrases used herein and not otherwise defined
herein shall have the respective meanings assigned to them in the Trust
Agreement. This Certificate is subject in all respects to the terms of Section
2.02 of the Trust Agreement and the Trust Agreement sections cross-referenced
therein.
[Custodian]
By:_____________________________________
Name:
Title:
EXHIBIT B-2
FORM OF INTERIM CERTIFICATION
_________________________
Date
Bank One, National Association
1 Bank Xxx Xxxxx
Xxxx Xxxxx XX0-0000
Xxxxxxx, XX 00000
Structured Asset Securities Corporation
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Trust Agreement (the "Trust Agreement"), dated as of May 1,
2001 between Structured Asset Securities Corporation, as
Depositor, Bank One, National Association, as Trustee, Xxxxx
Fargo Bank Minnesota, National Association, as Master
Servicer, and The Murrayhill Company, as Loss Mitigation
Advisor with respect to Amortizing Residential Collateral
Mortgage Pass-Through Certificates, Series 2001-BC3
Ladies and Gentlemen:
In accordance with Section 2.02(b) of the Trust Agreement, the
undersigned, as Custodian, hereby certifies that as to each Mortgage Loan
listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or listed on Schedule I hereto) it (or its custodian) has received the
applicable documents listed in Section 2.01(b) of the Trust Agreement.
The undersigned hereby certifies that as to each Mortgage Loan
identified on the Mortgage Loan Schedule, other than any Mortgage Loan listed
on Schedule I hereto, it has reviewed the documents identified above and has
determined that each such document appears regular on its face and appears to
relate to the Mortgage Loan identified in such document.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Trust Agreement. This Certificate is qualified
in all respects by the terms of said Trust Agreement including, but not limited
to, Section 2.02(b).
[Custodian]
By:_____________________________________
Name:
Title:
EXHIBIT B-3
FORM OF FINAL CERTIFICATION
_________________________
Date
Bank One, National Association
1 Bank Xxx Xxxxx
Xxxx Xxxxx XX0-0000
Xxxxxxx, XX 00000
Structured Asset Securities Corporation
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Trust Agreement (the "Trust Agreement"), dated as of May 1,
2001 between Structured Asset Securities Corporation, as
Depositor, Bank One, National Association, as Trustee, Xxxxx
Fargo Bank Minnesota, National Association, as Master
Servicer, and The Murrayhill Company, as Loss Mitigation
Advisor with respect to Amortizing Residential Collateral
Mortgage Pass-Through Certificates, Series 2001-BC3
Ladies and Gentlemen:
In accordance with Section 2.02(d) of the Trust Agreement, the
undersigned, as Custodian on behalf of the Trustee, hereby certifies that as to
each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or listed on Schedule I hereto) it (or its
custodian) has received the applicable documents listed in Section 2.01(b) of
the Trust Agreement.
The undersigned hereby certifies that as to each Mortgage Loan
identified on the Mortgage Loan Schedule, other than any Mortgage Loan listed
on Schedule I hereto, it has reviewed the documents listed above and has
determined that each such document appears to be complete and, based on an
examination of such documents, the information set forth in the Mortgage Loan
Schedule is correct.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Trust Agreement. This Certificate is qualified
in all respects by the terms of said Trust Agreement.
[Custodian]
By:_____________________________________
Name:
Title:
EXHIBIT B-4
FORM OF ENDORSEMENT
Pay to the order of Bank One, National Association, as trustee (the
"Trustee") under the Trust Agreement dated as of May 1, 2001 between Structured
Asset Securities Corporation, as Depositor the Trustee, Xxxxx Fargo Bank
Minnesota, National Association, as Master Servicer, and The Murrayhill
Company, as Loss Mitigation Advisor relating to Amortizing Residential
Collateral Mortgage Pass-Through Certificates, Series 2001-BC3, without
recourse.
___________________________________
[current signatory on note]
By:________________________________
Name:
Title:
EXHIBIT C
REQUEST FOR RELEASE OF DOCUMENTS AND RECEIPT
_________________________
Date
[Addressed to Trustee
or, if applicable, custodian]
In connection with the administration of the mortgages held by you as
Trustee under a certain Trust Agreement dated as of May 1, 2001 between
Structured Asset Securities Corporation, as Depositor, you, as Trustee, Xxxxx
Fargo Bank Minnesota, National Association, as Master Servicer, and The
Murrayhill Company, as Loss Mitigation Advisor, (the "Trust Agreement"), the
undersigned Servicer hereby requests a release of the Mortgage File held by you
as Trustee with respect to the following described Mortgage Loan for the reason
indicated below.
Mortgagor's Name:
Address:
Loan No.:
Reason for requesting file:
1. Mortgage Loan paid in full. (The Servicer hereby certifies that all
amounts received in connection with the loan have been or will be credited to
the Certificate Account pursuant to the Trust Agreement.)
2. The Mortgage Loan is being foreclosed.
3. Mortgage Loan substituted. (The Servicer hereby certifies that a
Qualifying Substitute Mortgage Loan has been assigned and delivered to you
along with the related Mortgage File pursuant to the Trust Agreement.)
4. Mortgage Loan repurchased. (The Servicer hereby certifies that
the Purchase Price has been credited to the Certificate Account pursuant to the
Trust Agreement.)
5. California Mortgage Loan expected to be paid in full
6. Other. (Describe)
The undersigned acknowledges that the above Mortgage File will be held
by the undersigned in accordance with the provisions of the Trust Agreement and
will be returned to you within ten (10) days of our receipt of the Mortgage
File, except if the Mortgage Loan has been paid in full, or repurchased or
substituted for a Qualifying Substitute Mortgage Loan (in which case the
Mortgage File will be retained by us permanently) and except if the Mortgage
Loan is being foreclosed (in which case the Mortgage File will be returned when
no longer required by us for such purpose).
Capitalized terms used herein shall have the meanings ascribed to them
in the Trust Agreement.
__________________________________________
[Name of Servicer]
By:_______________________________________
Name:
Title: Servicing Officer
EXHIBIT D-1
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 subject
to Section 406 or Section 407 of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or Section 4975 of
the Code, the trustee of any such 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 are covered under Section
I and III of PTCE 95-60; or (z) herewith delivers to the Trustee
and shall deliver to the Depositor an opinion of counsel (a
"Benefit Plan Opinion") satisfactory to the Trustee and the
Depositor, and upon which the Trustee and the Depositor shall be
entitled to rely, to the effect that the purchase or holding of
such Residual Certificate by the Investor will not result in the
assets of the Trust Fund being deemed to be plan assets and
subject to the prohibited transaction provisions of ERISA or the
Code and will not subject the Trustee or the Depositor to any
obligation in addition to those undertaken by such entities in
the Trust Agreement, which opinion of counsel shall not be an
expense of the Trustee or the Depositor.
5. That the Purchaser hereby acknowledges that under the terms of
the Trust Agreement (the "Agreement") between Structured Asset
Securities Corporation, as Depositor, Bank One, National
Association, as Trustee, Xxxxx Fargo Bank Minnesota, National
Association, as Master Servicer, and The Murrayhill Company, as
Loss Mitigation Advisor, dated as of May 1, 2001, no transfer of
the Residual Certificates shall be permitted to be made to any
person unless the Depositor and Trustee have 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 Trustee a written statement substantially in
the form of Exhibit D-2 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 and the Trustee 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 both the transferor and the Trustee 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. That the Purchaser agrees to such amendments of the Trust
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.
12. That the Purchaser consents to the designation of the Trustee as
its agent to act as "tax matters person" of the Trust Fund
pursuant to the Trust Agreement.
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__.
EXHIBIT D-2
RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)
____________________________
Date
Re: Amortizing Residential Collateral
Mortgage Pass-Through Certificates, Series 2001-BC3
---------------------------------------------------
_______________________ (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:
EXHIBIT E-1
SERVICING AGREEMENT (COUNTRYWIDE HOME LOANS, INC.)
EXHIBIT E-2
SERVICING AGREEMENT (OCWEN FEDERAL BANK F.S.B.)
EXHIBIT E-3
SERVICING AGREEMENT (XXXXX FARGO HOME MORTGAGE, INC.)
EXHIBIT F
FORM OF RULE 144A TRANSFER CERTIFICATE
Re: Amortizing Residential Collateral
Mortgage Pass-Through Certificates
Series 2001-BC3
----------------------------------
Reference is hereby made to the Trust Agreement dated as of May 1,
2001 (the "Trust Agreement") between Structured Asset Securities Corporation,
as Depositor Bank One, National Association, as Trustee, Xxxxx Fargo Bank
Minnesota, National Association, as Master Servicer, and The Murrayhill
Company, as Loss Mitigation Advisor. Capitalized terms used but not defined
herein shall have the meanings given to them in the Trust 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 Trust 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 Placement Agent and the Depositor.
__________________________________________
[Name of Transferor]
By:_______________________________________
Name:
Title:
Dated: ___________, ____
EXHIBIT G
FORM OF PURCHASER'S LETTER FOR
INSTITUTIONAL ACCREDITED INVESTOR
___________________________
Date
Dear Sirs:
In connection with our proposed purchase of $______________ principal
amount of Amortizing Residential Collateral Trust Mortgage Pass-Through
Certificates, Series 2001-BC3 (the "Privately Offered Certificates") of the
Structured Asset Securities Corporation (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 (which includes the Placement Agent) 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 Trustee
under the Trust Agreement dated as of May 1, 2001 between the
Depositor Bank One, National Association, as Trustee (the "Trustee"),
Xxxxx Fargo Bank Minnesota, National Association, as Master Servicer,
and The Murrayhill Company, as Loss Mitigation Advisor, 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 Trustee and the
Depositor 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 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 Trust Agreement.
Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Trust Agreement.
You and the Depositor 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:
EXHIBIT H
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 subject to Section 406 or
Section 407 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"), the trustee of any such 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 are covered under Section
I and III of PTCE 95-60; or (z) herewith delivers to the Trustee and shall
deliver to the Depositor an opinion of counsel (a "Benefit Plan Opinion")
satisfactory to the Trustee and the Depositor, and upon which the Trustee
and the Depositor shall be entitled to rely, to the effect that the
purchase or holding of such Certificate by the Investor will not result in
the assets of the Trust Fund being deemed to be plan assets and subject to
the prohibited transaction provisions of ERISA or the Code and will not
subject the Trustee or the Depositor to any obligation in addition to
those undertaken by such entities in the Trust Agreement, which opinion of
counsel shall not be an expense of the Trustee or the Depositor.
3. The Investor hereby acknowledges that under the terms of the
Trust Agreement (the "Agreement") between Structured Asset Securities
Corporation, as Depositor, Bank One, National Association, as Trustee,
Xxxxx Fargo Bank Minnesota, National Association, as Master Servicer, and
The Murrayhill Company, as Loss Mitigation Advisor, dated as of May 1,
2001, no transfer of the ERISA-Restricted Certificates shall be permitted
to be made to any person unless the Depositor and Trustee have received a
certificate from such transferee in the form hereof.
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___.
EXHIBIT I
MONTHLY REMITTANCE ADVICE
EXHIBIT J
MONTHLY ELECTRONIC DATA TRANSMISSION
EXHIBIT K-1
CUSTODIAL AGREEMENT BANKERS TRUST COMPANY OF CALIFORNIA, N.A.
EXHIBIT K-2
CUSTODIAL AGREEMENT (U.S. BANK TRUST NATIONAL ASSOCIATION)
EXHIBIT L-1
FIRST LIEN MASTER POLICY FOR AMORTIZING RESIDENTIAL COLLATERAL
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2001-BC3 ISSUED BY
MORTGAGE GUARANTY INSURANCE CORPORATION
EXHIBIT L-2
[RESERVED]
EXHIBIT M
[RESERVED]
EXHIBIT N-1
FORMS OF LOSS MITIGATION ADVISORY AGREEMENT BETWEEN THE
MURRAYHILL COMPANY, AS LOSS MITIGATION ADVISOR,
AND ______ OF THE SERVICERS
EXHIBIT O
CONSULTING AGREEMENT, DATED AS OF MAY 11, 2001 BETWEEN THE
DEPOSITOR AND THE MURRAYHILL COMPANY
EXHIBIT O-1
FORM OF TRANSFER CERTIFICATE
FOR TRANSFER FROM RESTRICTED GLOBAL SECURITY
TO REGULATION S GLOBAL SECURITY
(Transfers pursuant to SS. 3.03(h)(B)
of the Agreement)
----------------------------------------------
Re: Amortizing Residential Collateral Mortgage
Pass-Through Certificates, Series 2001-BC3
Reference is hereby made to the Trust Agreement (the "Agreement")
among Structured Asset Securities Corporation, as Depositor, Xxxxx Fargo Bank
Minnesota, N.A., as Master Servicer, The Murrayhill Company, as Loss Mitigation
Advisor, and Bank One, National Association, as Trustee, dated as of May 1,
2001. Capitalized terms used but not defined herein shall have the meanings
given to them in the Agreement.
This letter relates to U.S. $ aggregate principal amount of Securities
which are held in the form of a Restricted Global Security with DTC in the name
of [name of transferor] (the "Transferor") to effect the transfer of the
Securities in exchange for an equivalent beneficial interest in a Regulation S
Global Security.
In connection with such request, the Transferor does hereby certify
that such transfer has been effected in accordance with the transfer
restrictions set forth in the Agreement and the Securities and in accordance
with Rule 904 of Regulation S, and that:
a. the offer of the Securities was not made to a person in the
United States;
b. at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting on
its behalf reasonably believed that the transferee was outside the
United States;
c. no directed selling efforts have been made in contravention of
the requirements of Rule 903 or 904 of Regulation S, as applicable;
d. the transaction is not part of a plan or scheme to evade the
registration requirements of the United States Securities Act of 1933,
as amended; and
e. the transferee is not a U.S. person (as defined in Regulation S).
You 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 proceedings or official inquiry with respect to the
matters covered hereby. Terms used in this certificate have the meanings set
forth in Regulation S.
___________________________________
[Name of Transferor]
By:________________________________
Name:
Title:
Date:______________________,______
EXHIBIT O-2
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
FROM REGULATION S GLOBAL SECURITY
TO RESTRICTED GLOBAL SECURITY
(Transfers pursuant toss.3.03(h)(C)
of the Agreement)
---------------------------------
Re: Amortizing Residential Collateral Mortgage
Pass-Through Certificates, Series 2001-BC3
Reference is hereby made to the Trust Agreement (the "Agreement")
among Structured Asset Securities Corporation, as Depositor, Xxxxx Fargo Bank
Minnesota, N.A., as Master Servicer, The Murrayhill Company, as Loss Mitigation
Advisor, and Bank One, National Association, as Trustee, dated as of May 1,
2001. Capitalized terms used but not defined herein shall have the meanings
given to them in the Agreement.
This letter relates to U.S. $ aggregate principal amount of Securities
which are held in the form of a Regulations S Global Security in the name of
[name of transferor] (the "Transferor") to effect the transfer of the
Securities in exchange for an equivalent beneficial interest in a Restricted
Global Security.
In connection with such request, and in respect of such Securities,
the Transferor does hereby certify that such Securities are being transferred
in accordance with (i) the transfer restrictions set forth in the Agreement and
the Securities and (ii) Rule 144A under the United States Securities Act of
1933, as amended, to a transferee that the Transferor reasonably believes is
purchasing the Securities for its own account or an account with respect to
which the transferee exercises sole investment discretion, the transferee and
any such account is a qualified institutional buyer within the meaning of 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 jurisdiction.
___________________________________
[Name of Transferor]
By:________________________________
Name:
Title:
Date:______________________,______
SCHEDULE A
MORTGAGE LOAN SCHEDULE
