EXECUTION COPY
STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.,
DEPOSITOR
JPMORGAN CHASE BANK,
TRUSTEE
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
MASTER SERVICER AND SECURITIES ADMINISTRATOR
and
EMC MORTGAGE CORPORATION
SELLER AND COMPANY
------------------------------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of July 1, 2004
------------------------------------------------------------
Structured Asset Mortgage Investments II Inc.
Bear Xxxxxxx ALT-A Trust, Mortgage Pass-Through Certificates
Series 2004-9
ARTICLE I
Definitions
ARTICLE II
Conveyance of Mortgage Loans; Original Issuance of Certificates
Section 2.01 Conveyance of Mortgage Loans to Trustee......................38
Section 2.02 Acceptance of Mortgage Loans by Trustee......................40
Section 2.03 Assignment of Interest in the Mortgage Loan Purchase
Agreement....................................................42
Section 2.04 Substitution of Mortgage Loans...............................43
Section 2.05 Issuance of Certificates.....................................44
Section 2.06 Representations and Warranties Concerning the Depositor......44
ARTICLE III
Administration and Servicing of Mortgage Loans
Section 3.01 Master Servicer..............................................46
Section 3.02 REMIC-Related Covenants......................................47
Section 3.03 Monitoring of Servicers......................................47
Section 3.04 Fidelity Bond................................................48
Section 3.05 Power to Act; Procedures.....................................48
Section 3.06 Due-on-Sale Clauses; Assumption Agreements...................49
Section 3.07 Release of Mortgage Files....................................49
Section 3.08 Documents, Records and Funds in Possession of Master
Servicer To Be Held for Trustee..............................50
Section 3.09 Standard Hazard Insurance and Flood Insurance Policies.......51
Section 3.10 Presentment of Claims and Collection of Proceeds.............51
Section 3.11 Maintenance of the Primary Mortgage Insurance Policies.......52
Section 3.12 Trustee to Retain Possession of Certain Insurance
Policies and Documents.......................................52
Section 3.13 Realization Upon Defaulted Mortgage Loans....................52
Section 3.14 Compensation for the Master Servicer.........................53
Section 3.15 REO Property.................................................53
Section 3.16 Annual Officer's Certificate as to Compliance................54
Section 3.17 Annual Independent Accountant's Servicing Report.............54
Section 3.18 Reports Filed with Securities and Exchange Commission........55
Section 3.19 The Company..................................................55
Section 3.20 UCC..........................................................55
Section 3.21 Optional Purchase of Defaulted Mortgage Loans................56
ARTICLE IV
Accounts
Section 4.01 Protected Accounts...........................................57
Section 4.02 Master Servicer Collection Account...........................58
Section 4.03 Permitted Withdrawals and Transfers from the Master
Servicer Collection Account..................................59
Section 4.04 Distribution Account.........................................60
Section 4.05 Permitted Withdrawals and Transfers from the
Distribution Account.........................................60
ARTICLE V
Certificates
Section 5.01 Certificates.................................................63
Section 5.02 Registration of Transfer and Exchange of Certificates........71
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates............75
Section 5.04 Persons Deemed Owners........................................75
Section 5.05 Transfer Restrictions on Residual Certificates...............75
Section 5.06 Restrictions on Transferability of Certificates..............76
Section 5.07 ERISA Restrictions...........................................77
Section 5.08 Rule 144A Information........................................78
ARTICLE VI
Payments to Certificateholders
Section 6.01 Distributions on the Certificates............................79
Section 6.02 Allocation of Losses.........................................83
Section 6.03 Payments.....................................................85
Section 6.04 Statements to Certificateholders.............................86
Section 6.05 Monthly Advances.............................................88
Section 6.06 Compensating Interest Payments...............................89
Section 6.07 Distributions on REMIC I Regular Interests and REMIC II
Regular Interests............................................89
ARTICLE VII
The Master Servicer
Section 7.01 Liabilities of the Master Servicer...........................91
Section 7.02 Merger or Consolidation of the Master Servicer...............91
Section 7.03 Indemnification of the Trustee, the Master Servicer and
the Securities Administrator.................................91
Section 7.04 Limitations on Liability of the Master Servicer and
Others.......................................................92
Section 7.05 Master Servicer Not to Resign................................93
Section 7.06 Successor Master Servicer....................................93
Section 7.07 Sale and Assignment of Master Servicing......................93
ARTICLE VIII
Default
Section 8.01 Events of Default............................................95
Section 8.02 Trustee to Act; Appointment of Successor.....................96
Section 8.03 Notification to Certificateholders...........................97
Section 8.04 Waiver of Defaults...........................................97
Section 8.05 List of Certificateholders...................................98
ARTICLE IX
Concerning the Trustee and the Securities Administrator
Section 9.01 Duties of Trustee............................................99
Section 9.02 Certain Matters Affecting the Trustee and the Securities
Administrator...............................................101
Section 9.03 Trustee and Securities Administrator Not Liable for
Certificates or Mortgage Loans..............................102
Section 9.04 Trustee and Securities Administrator May Own Certificates...103
Section 9.05 Trustee's and Securities Administrator's Fees and
Expenses....................................................103
Section 9.06 Eligibility Requirements for Trustee and Securities
Administrator...............................................103
Section 9.07 Insurance...................................................104
Section 9.08 Resignation and Removal of the Trustee and Securities
Administrator...............................................104
Section 9.09 Successor Trustee and Successor Securities Administrator....105
Section 9.10 Merger or Consolidation of Trustee or Securities
Administrator...............................................106
Section 9.11 Appointment of Co-Trustee or Separate Trustee...............106
Section 9.12 Federal Information Returns and Reports to
Certificateholders; REMIC Administration....................107
ARTICLE X
Termination
Xxxxxxx 00.00 Xxxxxxxxxxx Xxxx Xxxxxxxxxx by EMC or its Designee or
Liquidation of the Mortgage Loans...........................110
Section 10.02 Additional Termination Requirements.........................112
ARTICLE XI
Miscellaneous Provisions
Section 11.01 Intent of Parties...........................................114
Section 11.02 Amendment...................................................114
Section 11.03 Recordation of Agreement....................................115
Section 11.04 Limitation on Rights of Certificateholders..................115
Section 11.05 Acts of Certificateholders..................................116
Section 11.06 Governing Law...............................................117
Section 11.07 Notices.....................................................117
Section 11.08 Severability of Provisions..................................118
Section 11.09 Successors and Assigns......................................118
Section 11.10 Article and Section Headings................................118
Section 11.11 Counterparts................................................118
Section 11.12 Notice to Rating Agencies...................................118
APPENDIX
Appendix 1 - Calculation of Class Y Principal Reduction Amount
EXHIBITS
Exhibit A-1 - Form of Class A Certificates
Exhibit A-2 - Form of X-0, X-0, X-0 Certificates
Exhibit A-3 - Form of Class X-0, X-0, X-0 Certificates
Exhibit A-4 - Form of Class R Certificates
Exhibit B - Mortgage Loan Schedule
Exhibit C - [Reserved]
Exhibit D - Request for Release of Documents
Exhibit E - Form of Affidavit pursuant to Section 860E(e)(4)
Exhibit F-1 - Form of Investment Letter
Exhibit F-2 - Form of Rule 144A and Related Matters Certificate
Exhibit G - Form of Custodial Agreement
Exhibit H-1 - Chevy Chase Servicing Agreement
Exhibit H-2 - Countrywide Servicing Agreement
Exhibit H-3 - EMC Servicing Agreement
Exhibit X-0 - XxxxXxxx Xxxxxxxxx Xxxxxxxxx
Xxxxxxx X-0 - XxxxxXxxxx Servicing Agreement
Exhibit X-0 - XxxxxXxxxx Xxxxxxxxx Xxxxxxxxx
Xxxxxxx X-0 - Xxxxxxxxxx Servicing Agreement
Exhibit H-8 - Xxxxx Fargo Servicing Agreement
Exhibit I - Assignment Agreement
Exhibit J - Mortgage Loan Purchase Agreement
Exhibit K - Form of Trustee Limited Power of Attorney
POOLING AND SERVICING AGREEMENT
Pooling and Servicing Agreement dated as of July 1, 2004, among Structured
Asset Mortgage Investments II Inc., a Delaware corporation, as depositor (the
"Depositor"), JPMorgan Chase Bank, a New York banking corporation, not in its
individual capacity but solely as trustee (the "Trustee"), Xxxxx Fargo Bank,
National Association, as master servicer (in such capacity, the "Master
Servicer") and as securities administrator (in such capacity, the "Securities
Administrator"), and EMC Mortgage Corporation, as seller (in such capacity, the
"Seller") and as company (in such capacity, the "Company").
PRELIMINARY STATEMENT
On or prior to the Closing Date, the Depositor acquired the Mortgage Loans
from the Seller. On the Closing Date, the Depositor will sell the Mortgage Loans
and certain other property to the Trust Fund and receive in consideration
therefor Certificates evidencing the entire beneficial ownership interest in the
Trust Fund.
The Trustee on behalf of the Trust shall make an election for the assets
constituting REMIC I to be treated for federal income tax purposes as a REMIC.
On the Startup Day, the REMIC I Regular Interests will be designated "regular
interests" in such REMIC.
The Trustee on behalf of the Trust shall make an election for the assets
constituting REMIC II to be treated for federal income tax purposes as a REMIC.
On the Startup Day, the REMIC II Regular Interests will be designated "regular
interests" in such REMIC.
The Class R Certificate will evidence ownership of the "residual interest"
in each REMIC.
The Group I Loans will have an Outstanding Principal Balance as of the
Cut-off Date, after deducting all Scheduled Principal due on or before the
Cut-off Date, of $54,521,867.08. The Group II Loans will have an Outstanding
Principal Balance as of the Cut-off Date, after deducting all Scheduled
Principal due on or before the Cut-off Date, of $200,313,647.99. The Group III
Loans will have an Outstanding Principal Balance as of the Cut-off Date, after
deducting all Scheduled Principal due on or before the Cut-off Date, of
$118,238,291.91. The Group IV Loans will have an Outstanding Principal Balance
as of the Cut-off Date, after deducting all Scheduled Principal due on or before
the Cut-off Date, of $14,418,791.96. The Group V Loans will have an Outstanding
Principal Balance as of the Cut-off Date, after deducting all Scheduled
Principal due on or before the Cut-off Date, of $45,238,102.16. The Group VI
Loans will have an Outstanding Principal Balance as of the Cut-off Date, after
deducting all Scheduled Principal due on or before the Cut-off Date, of
$43,186,607.88. The Group VII Loans will have an Outstanding Principal Balance
as of the Cut-off Date, after deducting all Scheduled Principal due on or before
the Cut-off Date, of $193,264,008.44.
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer, the Securities Administrator, the Seller, the Company and
the Trustee agree as follows:
ARTICLE I
Definitions
Whenever used in this Agreement, the following words and phrases, unless
otherwise expressly provided or unless the context otherwise requires, shall
have the meanings specified in this Article.
Accepted Master Servicing Practices: With respect to any Mortgage Loan, as
applicable, either (x) those customary mortgage servicing practices of prudent
mortgage servicing institutions that master service mortgage loans of the same
type and quality as such Mortgage Loan in the jurisdiction where the related
Mortgaged Property is located, to the extent applicable to the Trustee or the
Master Servicer (except in its capacity as successor to a Servicer), or (y) as
provided in the Servicing Agreement, to the extent applicable to any Servicer,
but in no event below the standard set forth in clause (x).
Account: The Master Servicer Collection Account, the Distribution Account
and the Protected Account as the context may require.
Accrued Certificate Interest: For any Certificate (other than the Class R
Certificates) for any Distribution Date, the interest accrued during the related
Interest Accrual Period at the applicable Pass-Through Rate on the Current
Principal Amount, of such Certificate immediately prior to such Distribution
Date, on the basis of a 360-day year consisting of twelve 30-day months, less
(i) in the case of a Senior Certificate, such Certificate's share of any Net
Interest Shortfall from the related Mortgage Loans and, after the Cross-Over
Date, the interest portion of any Realized Losses on the related Mortgage Loans,
in each case allocated thereto in accordance with Section 6.02(g) and (ii) in
the case of a Subordinate Certificate, such Certificate's share of any Net
Interest Shortfall from the related Mortgage Loans and the interest portion of
any Realized Losses on the related Mortgage Loans, in each case allocated
thereto in accordance with Section 6.02(g).
Affiliate: As to any Person, any other Person controlling, controlled by
or under common control with such Person. "Control" means the power to direct
the management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise. "Controlled" and
"Controlling" have meanings correlative to the foregoing. The Trustee may
conclusively presume that a Person is not an Affiliate of another Person unless
a Responsible Officer of the Trustee has actual knowledge to the contrary.
Agreement: This Pooling and Servicing Agreement and all amendments hereof
and supplements hereto.
Aggregate Subordinate Optimal Principal Amount: With respect to any
Distribution Date, the sum of the Subordinate Optimal Principal Amounts for all
Loan Groups for such Distribution Date.
Allocable Share: With respect to any Class of Subordinate Certificates and
any Distribution Date, an amount equal to the product of (i) the Aggregate
Subordinate Optimal Principal Amount and (ii) the fraction, the numerator of
which is the Current Principal Amount of such Class and the denominator of which
is the aggregate Current Principal Amount of all
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Classes of the Subordinate Certificates; provided, however, that no Class of
Subordinate Certificates (other than the outstanding Class of Class B
Certificates with the lowest numerical designation) shall be entitled on any
Distribution Date to receive distributions pursuant to clauses (ii), (iii) and
(v) of the definition of Subordinate Optimal Principal Amount unless the related
Class Prepayment Distribution Trigger for such Distribution Date has been
satisfied (any amount distributable pursuant to clauses (ii), (iii) and (v) of
the definition of Subordinate Optimal Principal Amount shall be distributed
among the Classes entitled thereto, pro rata based on their respective Current
Principal Amounts); provided, further, that if on a Distribution Date, the
Current Principal Amount of any Class of Subordinate Certificates for which the
related Class Prepayment Distribution Trigger has been satisfied is reduced to
zero, such Class's remaining Allocable Share shall be distributed to the
remaining Classes of Subordinate Certificates which satisfy the related Class
Prepayment Distribution Trigger and to the outstanding Class of Class B
Certificates with the lowest numerical designation in reduction of their
respective Current Principal Amounts.
Applicable Credit Rating: For any long-term deposit or security, a credit
rating of AAA in the case of S&P or Aaa in the case of Moody's (or with respect
to investments in money market funds, a credit rating of "AAAm" or "AAAm-G" in
the case of S&P and the highest rating given by Moody's for money market funds
in the case of Moody's). For any short-term deposit or security, or a rating of
A-l+ in the case of S&P or Prime-1 in the case of Moody's.
Applicable State Law: For purposes of Section 9.12(d), the Applicable
State Law shall be (a) the law of the State of New York and (b) such other state
law whose applicability shall have been brought to the attention of the
Securities Administrator and the Trustee by either (i) an Opinion of Counsel
reasonably acceptable to the Securities Administrator and the Trustee delivered
to it by the Master Servicer or the Depositor, or (ii) written notice from the
appropriate taxing authority as to the applicability of such state law.
Appraised Value: For any Mortgaged Property related to a Mortgage Loan,
the amount set forth as the appraised value of such Mortgaged Property in an
appraisal made for the mortgage originator in connection with its origination of
the related Mortgage Loan.
Assignment Agreement: The agreement attached hereto as Exhibit I, whereby
the Servicing Agreement was assigned to the Trustee for the benefit of the
Certificateholders.
Assumed Final Distribution Date: September 25, 2034, or if such day is not
a Business Day, the next succeeding Business Day.
Available Funds: With respect to any Distribution Date and a Loan Group,
an amount equal to the aggregate of the following amounts with respect to the
Mortgage Loans in the related Loan Group: (a) all previously undistributed
payments on account of principal (including the principal portion of Scheduled
Payments, Principal Prepayments and the principal portion of Net Liquidation
Proceeds) and all previously undistributed payments on account of interest
received after the Cut-off Date and on or prior to the related Determination
Date, (b) any Monthly Advances and Compensating Interest Payments by the
Servicer or the Master Servicer with respect to such Distribution Date, (c) any
reimbursed amount in connection with losses on
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investments of deposits in an account and (d) any amount allocated from the
Available Funds of another Loan Group in accordance with Section 6.01(a)(i)(G)
under, except:
(i) all payments that were due on or before the Cut-off Date;
(ii) all Principal Prepayments and Liquidation Proceeds received
after the applicable Prepayment Period;
(iii) all payments, other than Principal Prepayments, that represent
early receipt of Scheduled Payments due on a date or dates subsequent to the
related Due Date;
(iv) amounts received on particular Mortgage Loans as late payments
of principal or interest and respecting which, and to the extent that, there are
any unreimbursed Monthly Advances;
(v) amounts representing Monthly Advances determined to be
Nonrecoverable Advances;
(vi) any investment earnings on amounts on deposit in the Master
Servicer Collection Account and the Distribution Account and amounts permitted
to be withdrawn from the Master Servicer Collection Account and the Distribution
Account pursuant to this Agreement;
(vii) amounts needed to pay the Servicing Fees or to reimburse any
Servicer or the Master Servicer for amounts due under the Servicing Agreement
and the Agreement to the extent such amounts have not been retained by, or paid
previously to, such Servicer or the Master Servicer; (viii) amounts applied to
pay any fees with respect to any lender-paid primary mortgage insurance policy;
and
(ix) any expenses or other amounts reimbursable to the Trustee, the
Securities Administrator, the Master Servicer and the Custodian pursuant to
Section 7.04(c) or Section 9.05.
Average Loss Severity Percentage: With respect to any Distribution Date
and each Loan Group, the percentage equivalent of a fraction, the numerator of
which is the sum of the Loss Severity Percentages for each Mortgage Loan in such
Loan Group which had a Realized Loss and the denominator of which is the number
of Mortgage Loans in the related Loan Group which had Realized Losses.
Bankruptcy Code: The United States Bankruptcy Code, as amended as codified
in 11 X.X.X.xx.xx. 101-1330.
Bankruptcy Loss: With respect to any Mortgage Loan, any Deficient
Valuation or Debt Service Reduction related to such Mortgage Loan as reported by
the Servicer to the Master Servicer.
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Book-Entry Certificates: Initially, all Classes of Certificates other than
the Private Certificates and the Residual Certificates.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a day
on which the New York Stock Exchange or Federal Reserve is closed or on which
banking institutions in the jurisdiction in which the Trustee, the Master
Servicer, any Servicer or the Securities Administrator are authorized or
obligated by law or executive order to be closed.
Calendar Quarter: January 1 through March 31, April 1 through June 30,
July 1 through September 30, or October 1 through December 31, as applicable.
Certificate: Any mortgage pass-through certificate evidencing a beneficial
ownership interest in the Trust Fund signed and countersigned by the Trustee in
substantially the forms annexed hereto as Exhibits X-0, X-0, X-0 and A-4 with
the blanks therein appropriately completed.
Certificate Group: With respect to Loan Group I, the Group I Certificates,
with respect to Loan Group II, the Group II Certificates, with respect to Loan
Group III, the Group III Certificates, with respect to Loan Group IV, the Group
IV Certificates, with respect to Loan Group V, the Group V Certificates, with
respect to Loan Group VI, the Group VI Certificates, and with respect to Loan
Group VII, the Group VII Certificates.
Certificate Owner: Any Person who is the beneficial owner of a Certificate
registered in the name of the Depository or its nominee.
Certificate Register: The register maintained pursuant to Section 5.02.
Certificateholder: A Holder of a Certificate.
Chevy Chase: Chevy Chase Bank, F.S.B., and its successor in interest.
Chevy Chase Servicing Agreement: Purchase, Warranties and Servicing
Agreement, dated as of July 1, 2001 (as amended) by and between EMC and Chevy
Chase, as attached hereto as Exhibit H-1.
Class: With respect to the Certificates, any of Class I-A-1, Class I-A-2,
Class II-A-1, Class II-A-2, Class III-A-1, Class IV-A-1, Class V-A-1, Class
VI-A-1, Class VII-A-1, Class R, Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates.
Class A Certificates: The Class I-A-1, Class I-A-2, Class II-A-1, Class
II-A-2, Class III-A-1, Class IV-A-1, Class V-A-1, Class VI-A-1 and Class VII-A-1
Certificates.
Class Prepayment Distribution Trigger: For a Class of Subordinate
Certificates for any Distribution Date, the Class Prepayment Distribution
Trigger is satisfied if the fraction (expressed as a percentage), the numerator
of which is the aggregate Current Principal Amount of such Class and each Class
of Subordinate Certificates, respectively, subordinate thereto, if any, and the
denominator of which is the Scheduled Principal Balance of all of the Mortgage
Loans as of the related Due Date, equals or exceeds such percentage calculated
as of the Closing Date.
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Class R Certificate: Any one of the Class R Certificates substantially in
the form annexed hereto as Exhibit A-4 and evidencing ownership of interests
designated as "residual interests" in REMIC I and REMIC II for purposes of the
REMIC Provisions. Component I of the Class R Certificates is designated as the
sole class of "residual interest" in REMIC I and Component II of the Class R
Certificates is designated as the sole class of "residual interest" in REMIC II.
Class R Deposit: The $100 deposit into the Distribution Account by the
Depositor on the Closing Date to pay the Class R Certificates in accordance with
Section 6.01(a) on the Distribution Date occurring in August 2004.
Class Y Principal Reduction Amounts: For any Distribution Date, the
amounts by which the Uncertificated Principal Balances of the Class Y Regular
Interests will be reduced on such Distribution Date by the allocation of
Realized Losses and the distribution of principal, determined as described in
Appendix I
Class Y Regular Interests: The Class Y-1, Class Y-2, Class Y-3, Class Y-4,
Class Y-5, Class Y-6 and Class Y-7 Regular Interests.
Class Y-1 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Y-1 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Y-1 Regular Interest on such Distribution Date.
Class Y-1 Principal Reduction Amount : The Class Y Principal Reduction
Amount for the Class Y-1 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Y-1 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Y-2 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Y-2 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Y-2 Regular Interest on such Distribution Date.
Class Y-2 Principal Reduction Amount : The Class Y Principal Reduction
Amount for the Class Y-2 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Y-2 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Y-3 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Y-3 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Y-3 Regular Interest on such Distribution Date.
Class Y-3 Principal Reduction Amount : The Class Y Principal Reduction
Amount for the Class Y-3 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Y-3 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
6
Class Y-4 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Y-4 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Y-1 Regular Interest on such Distribution Date.
Class Y-4 Principal Reduction Amount : The Class Y Principal Reduction
Amount for the Class Y-4 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Y-4 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Y-5 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Y-5 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Y-5 Regular Interest on such Distribution Date.
Class Y-5 Principal Reduction Amount : The Class Y Principal Reduction
Amount for the Class Y-1 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Y-5 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Y-6 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Y-6 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Y-6 Regular Interest on such Distribution Date.
Class Y-6 Principal Reduction Amount : The Class Y Principal Reduction
Amount for the Class Y-1 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Y-6 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Y-7 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Y-7 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Y-7 Regular Interest on such Distribution Date.
Class Y-7 Principal Reduction Amount : The Class Y Principal Reduction
Amount for the Class Y-7 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Y-7 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Z Principal Reduction Amounts: For any Distribution Date, the
amounts by which the Uncertificated Principal Balances of the Class Z Regular
Interests will be reduced on such Distribution Date by the allocation of
Realized Losses and the distribution of principal, which shall be in each case
the excess of (A) the sum of (x) the excess of the REMIC I Available
Distribution Amount for the related Group (i.e. the "related Group" for the
Class Z-1 Regular Interest is the Group I Loans, the "related Group" for the
Class Z-2 Regular Interest is the Group II Loans, the "related Group" for the
Class Z-3 Regular Interest is the Group III Loans, the "related Group" for the
Class Z-4 Regular Interest is the Group IV Loans, the "related Group"
7
for the Class Z-5 Regular Interest is the Group V Loans, the "related Group" for
the Class Z-VI Regular Interest is the Group VI Loans and the "related Group"
for the Class Z-7 Regular Interest is the Group VII Loans) over the sum of the
amounts thereof distributable (i) in respect of interest on such Class Z Regular
Interest and the related Class Y Regular Interest, (ii) to such Class Z Regular
Interest and the related Class Y Regular Interest pursuant to clause (c)(ii) of
the definition of "REMIC I Distribution Amount" and (iii) in the case of the
Group I Loans, to the Class R Residual Interest and (y) the amount of Realized
Losses allocable to principal for the related Group over (B) the Class Y
Principal Reduction Amount for the related Group.
Class Z Regular Interests: The Class Z-1, Class Z-2, Class Z-3, Class Z-4,
Class Z-5, Class Z-6 and Class Z-7 Regular Interests.
Class Z-1 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Z-1 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Z-1 Regular Interest on such Distribution Date.
Class Z-1 Principal Reduction Amount: The Class Z Principal Reduction
Amount for the Class Z-1 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Z-1 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Z-2 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Z-2 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Z-2 Regular Interest on such Distribution Date.
Class Z-2 Principal Reduction Amount: The Class Z Principal Reduction
Amount for the Class Z-2 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Z-2 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Z-3 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Z-3 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Z-3 Regular Interest on such Distribution Date .
Class Z-3 Principal Reduction Amount: The Class Z Principal Reduction
Amount for the Class Z-3 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Z-3 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Z-4 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Z-4 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Z-4 Regular Interest on such Distribution Date.
Class Z-4 Principal Reduction Amount: The Class Z Principal Reduction
Amount for the Class Z-4 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
8
Class Z-4 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Z-5 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Z-5 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Z-5 Regular Interest on such Distribution Date.
Class Z-5 Principal Reduction Amount : The Class Z Principal Reduction
Amount for the Class Z-5 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Z-5 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Z-6 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Z-6 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Z-6 Regular Interest on such Distribution Date.
Class Z-6 Principal Reduction Amount : The Class Z Principal Reduction
Amount for the Class Z-6 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Z-6 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Class Z-7 Principal Distribution Amount: For any Distribution Date, the
excess, if any, of the Class Z-7 Principal Reduction Amount for such
Distribution Date over the principal portion of Realized Losses allocated to the
Class Z-7 Regular Interest on such Distribution Date.
Class Z-7 Principal Reduction Amount : The Class Z Principal Reduction
Amount for the Class Z-7 Regular Interest as determined pursuant to the
provisons of the Appendix 1.
Class Z-7 Regular Interest: The uncertificated undivided beneficial
interest in REMIC I which constitutes a REMIC I Regular Interest and is entitled
to distributions as set forth herein.
Closing Date: July 30, 2004.
Code: The Internal Revenue Code of 1986, as amended.
Compensating Interest Payment: As defined in Section 6.06.
Corporate Trust Office: The designated office of the Trustee where at any
particular time its corporate trust business with respect to this Agreement
shall be administered, which office at the date of the execution of this
Agreement is located at 0 Xxx Xxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Institutional Trust Services/Global Debt, Bear Xxxxxxx ALT-A Trust
2004-9. For the purpose of registration and transfer and exchange only, the
Corporate Trust Office shall be located at 0000 Xxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx,
Xxxxx, 00000, Attn: ITS Transfer Department.
Countrywide: Countrywide Home Loans, Inc., and its successor in interest.
9
Countrywide Servicing: Countrywide Home Loans Servicing LP, and its
successor in interest.
Countrywide Servicing Agreement: The Seller's Warranties and Servicing
Agreement, dated as of September 1, 2002, as amended, between Countrywide
Servicing and EMC attached hereto as Exhibit H-2.
Cross-Over Date: The first Distribution Date on which the aggregate
Current Principal Amount of the Subordinate Certificates has been reduced to
zero.
Current Principal Amount: With respect to any Certificate as of any
Distribution Date, the initial principal amount of such Certificate plus, in the
case of a Subordinate Certificates, any Subsequent Recoveries added to the
Current Principal Amount of such Certificates pursuant to Section 6.02(h)
hereof, and reduced by (i) all amounts distributed on previous Distribution
Dates on such Certificate with respect to principal, (ii) the principal portion
of all Realized Losses (other than Realized Losses resulting from Debt Service
Reductions) allocated prior to such Distribution Date to such Certificate,
taking account of the Loss Allocation Limitation and (iii) in the case of a
Subordinate Certificate, such Certificate's pro rata share, if any, of the
applicable Subordinate Certificate Writedown Amount for previous Distribution
Dates. With respect to any Class of Certificates, the Current Principal Amount
thereof will equal the sum of the Current Principal Amounts of all Certificates
in such Class. The initial Current Principal Amount for each Class of
Certificates is set forth in Section 5.01(c)(iv). Notwithstanding the foregoing,
solely for purposes of giving consents, directions, waivers, approvals, requests
and notices, the Class R Certificates after the Distribution Date on which the
principal thereof has been paid in full shall be deemed to have a Current
Principal Amount equal to the Current Principal Amount thereof on the day
immediately preceding such Distribution Date.
Custodial Agreement: An agreement, dated as of the Closing Date among the
Depositor, the Master Servicer, the Trustee and the Custodian in substantially
the form of Exhibit G hereto.
Custodian: Xxxxx Fargo Bank, National Association, or any successor
custodian appointed pursuant to the provisions hereof and of the Custodial
Agreement.
Cut-off Date: July 1, 2004.
Cut-off Date Balance: $669,181,317.42.
Debt Service Reduction: Any reduction of the Scheduled Payments which a
Mortgagor is obligated to pay with respect to a Mortgage Loan as a result of any
proceeding under the Bankruptcy Code or any other similar state law or other
proceeding.
Deficient Valuation: With respect to any Mortgage Loan, a valuation of the
Mortgaged Property by a court of competent jurisdiction in an amount less than
the then outstanding indebtedness under the Mortgage Loan, which valuation
results from a proceeding initiated under the Bankruptcy Code or any other
similar state law or other proceeding.
Depositor: Structured Asset Mortgage Investments II Inc., a Delaware
corporation, or its successors in interest.
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Depository: The Depository Trust Company, the nominee of which is Cede &
Co., or any successor thereto.
Depository Agreement: The meaning specified in Section 5.01(a) hereof.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Designated Depository Institution: A depository institution (commercial
bank, federal savings bank, mutual savings bank or savings and loan association)
or trust company (which may include the Trustee), the deposits of which are
fully insured by the FDIC to the extent provided by law.
Determination Date: With respect to each Mortgage Loan, the Determination
Date as defined in the Servicing Agreement.
Disqualified Organization: Any of the following: (i) the United States,
any State or political subdivision thereof, any possession of the United States,
or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for the Xxxxxxx Mac or any successor thereto, a majority of its
board of directors is not selected by such governmental unit), (ii) any foreign
government, any international organization, or any agency or instrumentality of
any of the foregoing, (iii) any organization (other than certain farmers'
cooperatives described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code (including the tax imposed by Section 511 of
the Code on unrelated business taxable income), (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code or (v) any
other Person so designated by the Trustee based upon an Opinion of Counsel that
the holding of an ownership interest in a Residual Certificate by such Person
may cause any 2004-9 REMIC contained in the Trust or any Person having an
ownership interest in the Residual Certificate (other than such Person) to incur
a liability for any federal tax imposed under the Code that would not otherwise
be imposed but for the transfer of an ownership interest in a Residual
Certificate to such Person. The terms "United States," "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
Distribution Account: The trust account or accounts created and maintained
pursuant to Section 4.04, which shall be denominated "JPMorgan Chase Bank, as
Trustee f/b/o holders of Structured Asset Mortgage Investments II Inc., Bear
Xxxxxxx ALT-A Trust 2004-9, Mortgage Pass-Through Certificates, Series 2004-9 -
Distribution Account." The Distribution Account shall be an Eligible Account.
Distribution Account Deposit Date: The Business Day prior to each
Distribution Date.
Distribution Date: The 25th day of any month, beginning in the month
immediately following the month of the Closing Date, or, if such 25th day is not
a Business Day, the Business Day immediately following.
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DTC Custodian: JPMorgan Chase Bank, or its successors in interest as
custodian for the Depository.
Due Date: With respect to each Mortgage Loan, the date in each month on
which its Scheduled Payment is due if such due date is the first day of a month
and otherwise is deemed to be the first day of the following month or such other
date specified in the Servicing Agreement.
Due Period: With respect to any Distribution Date and each Mortgage Loan,
the period commencing on the second day of the month preceding the month in
which the Distribution Date occurs and ending at the close of business on the
first day of the month in which the Distribution Date occurs.
Eligible Account: Any of (i) a segregated account maintained with a
federal or state chartered depository institution (A) the short-term obligations
of which are rated A-1 or better by Standard & Poor's and P-1 by Moody's at the
time of any deposit therein or (B) insured by the FDIC (to the limits
established by such Corporation), the uninsured deposits in which account are
otherwise secured such that, as evidenced by an Opinion of Counsel (obtained by
the Person requesting that the account be held pursuant to this clause (i))
delivered to the Trustee prior to the establishment of such account, the
Certificateholders will have a claim with respect to the funds in such account
and a perfected first priority security interest against any collateral (which
shall be limited to Permitted Investments, each of which shall mature not later
than the Business Day immediately preceding the Distribution Date next following
the date of investment in such collateral or the Distribution Date if such
Permitted Investment is an obligation of the institution that maintains the
Distribution Account) securing such funds that is superior to claims of any
other depositors or general creditors of the depository institution with which
such account is maintained, (ii) a segregated trust account or accounts
maintained with a federal or state chartered depository institution or trust
company with trust powers acting in its fiduciary capacity or (iii) a segregated
account or accounts of a depository institution acceptable to the Rating
Agencies (as evidenced in writing by the Rating Agencies that use of any such
account as the Distribution Account will not have an adverse effect on the
then-current ratings assigned to the Classes of Certificates then rated by the
Rating Agencies). Eligible Accounts may bear interest.
EMC: EMC Mortgage Corporation, and any successor thereto.
EMC Servicing Agreement: The Servicing Agreement, dated as of July 1,
2004, between Structured Asset Mortgage Investments II Inc. and EMC as attached
hereto as Exhibit H-3.
Event of Default: As defined in Section 8.01.
EverHome: EverHome Mortgage Company (formerly known as Alliance Mortgage
Corporation), and any successor thereto.
EverHome Servicing Agreement: The Subservicing Agreement, dated as of
August 1, 2002, as amended, between EverHome (as successor to Alliance Mortgage
Company) and EMC attached hereto as Exhibit H-4.
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Excess Liquidation Proceeds: To the extent that such amount is not
required by law to be paid to the related Mortgagor, the amount, if any, by
which Liquidation Proceeds with respect to a Liquidated Mortgage Loan exceed the
sum of (i) the Outstanding Principal Balance of such Mortgage Loan and accrued
but unpaid interest at the related Mortgage Interest Rate through the last day
of the month in which the related Liquidation Date occurs, plus (ii) related
Liquidation Expenses.
Xxxxxx Xxx: Federal National Mortgage Association and any successor
thereto.
FDIC: Federal Deposit Insurance Corporation and any successor thereto.
Final Certification: The certification substantially in the form of
Exhibit Three to the Custodial Agreement.
Fractional Undivided Interest: With respect to any Class of Certificates,
the fractional undivided interest evidenced by any Certificate of such Class the
numerator of which is the Current Principal Amount of such Certificate and the
denominator of which is the Current Principal Amount of such Class. With respect
to the Certificates in the aggregate, the fractional undivided interest
evidenced by (i) a Residual Certificate will be deemed to equal 1.0% and (ii) a
Certificate of any other Class will be deemed to equal 99.0% multiplied by a
fraction, the numerator of which is the Current Principal Amount of such
Certificate and the denominator of which is the aggregate Current Principal
Amount of all the Certificates.
Xxxxxxx Mac: Xxxxxxx Mac, formerly the Federal Home Loan Mortgage
Corporation, and any successor thereto.
Global Certificate: Any Private Certificate registered in the name of the
Depository or its nominee, beneficial interests in which are reflected on the
books of the Depository or on the books of a Person maintaining an account with
such Depository (directly or as an indirect participant in accordance with the
rules of such depository).
GreenPoint: GreenPoint Mortgage Funding, Inc., and any successor
thereto.
GreenPoint Servicing Agreement: The Purchase, Warranties and Servicing
Agreement, dated as of September 1, 2003, between GreenPoint and EMC attached
hereto as Exhibit H-5.
Gross Margin: As to each Mortgage Loan, the fixed percentage set forth in
the related Mortgage Note and indicated on the Mortgage Loan Schedule which
percentage is added to the related Index on each Interest Adjustment Date to
determine (subject to rounding, the minimum and maximum Mortgage Interest Rate
and the Periodic Rate Cap) the Mortgage Interest Rate until the next Interest
Adjustment Date.
Group I Certificates: The Class I-A-1 Certificates and Class I-A-2
Certificates.
Group I Loans: The Mortgage Loans identified as such on the Mortgage Loan
Schedule.
Group II Certificates: The Class II-A-1 Certificates and Class II-A-2
Certificates.
Group II Loans: The Mortgage Loans identified as such on the Mortgage Loan
Schedule.
Group III Certificates: The Class III-A-1 Certificates.
13
Group III Loans: The Mortgage Loans identified as such on the Mortgage
Loan Schedule.
Group IV Certificates: The Class IV-A-1 Certificates.
Group IV Loans: The Mortgage Loans identified as such on the Mortgage Loan
Schedule.
Group V Certificates: The Class V-A-1 Certificates.
Group V Loans: The Mortgage Loans identified as such on the Mortgage Loan
Schedule.
Group VI Certificates: The Class VI-A-1 Certificates.
Group VI Loans: The Mortgage Loans identified as such on the Mortgage Loan
Schedule.
Group VII Certificates: The Class VII-A-1 Certificates.
Group VII Loans: The Mortgage Loans identified as such on the Mortgage
Loan Schedule.
Holder: The Person in whose name a Certificate is registered in the
Certificate Register, except that, subject to Sections 11.02(b) and 11.05(e),
solely for the purpose of giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Depositor, the Master Servicer or the
Trustee or any Affiliate thereof shall be deemed not to be outstanding and the
Fractional Undivided Interest evidenced thereby shall not be taken into account
in determining whether the requisite percentage of Fractional Undivided
Interests necessary to effect any such consent has been obtained.
Indemnified Persons: The Trustee, the Master Servicer, the Custodian and
the Securities Administrator and their officers, directors, agents and employees
and, with respect to the Trustee, any separate co-trustee and its officers,
directors, agents and employees.
Independent: When used with respect to any specified Person, this term
means that such Person (a) is in fact independent of the Depositor or the Master
Servicer and of any Affiliate of the Depositor or the Master Servicer, (b) does
not have any direct financial interest or any material indirect financial
interest in the Depositor or the Master Servicer or any Affiliate of the
Depositor or the Master Servicer and (c) is not connected with the Depositor or
the Master Servicer or any Affiliate as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
Index: The index, if any, specified in a Mortgage Note by reference to
which the related Mortgage Interest Rate will be adjusted from time to time.
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Individual Certificate: Any Private Certificate registered in the name of
the Holder other than the Depository or its nominee.
Initial Certification: The certification substantially in the form of
Exhibit One to the Custodial Agreement.
Institutional Accredited Investor: Any Person meeting the requirements of
Rule 501(a)(l), (2), (3) or (7) of Regulation D under the Securities Act or any
entity all of the equity holders in which come within such paragraphs.
Insurance Policy: With respect to any Mortgage Loan, any standard hazard
insurance policy, flood insurance policy or title insurance policy.
Insurance Proceeds: Amounts paid by the insurer under any Insurance Policy
covering any Mortgage Loan or Mortgaged Property other than amounts required to
be paid over to the Mortgagor pursuant to law or the related Mortgage Note or
Security Instrument and other than amounts used to repair or restore the
Mortgaged Property or to reimburse insured expenses.
Interest Accrual Period: With respect to each Distribution Date, for each
Class of Certificates, the calendar month preceding the month in which such
Distribution Date occurs.
Interest Adjustment Date: With respect to a Mortgage Loan, the date, if
any, specified in the related Mortgage Note on which the Mortgage Interest Rate
is subject to adjustment.
Interest Shortfall: With respect to any Distribution Date and each
Mortgage Loan that during the related Prepayment Period was the subject of a
Principal Prepayment or constitutes a Relief Act Mortgage Loan, an amount
determined as follows:
(a) Partial principal prepayments received during the relevant Prepayment
Period: The difference between (i) one month's interest at the applicable Net
Rate on the amount of such prepayment and (ii) the amount of interest for the
calendar month of such prepayment (adjusted to the applicable Net Rate) received
at the time of such prepayment;
(b) Principal prepayments in full received during the relevant Prepayment
Period: The difference between (i) one month's interest at the applicable Net
Rate on the Scheduled Principal Balance of such Mortgage Loan immediately prior
to such prepayment and (ii) the amount of interest for the calendar month of
such prepayment (adjusted to the applicable Net Rate) received at the time of
such prepayment; and
(c) Relief Act Mortgage Loans: As to any Relief Act Mortgage Loan, the
excess of (i) 30 days' interest (or, in the case of a principal prepayment in
full, interest to the date of prepayment) on the Scheduled Principal Balance
thereof (or, in the case of a principal prepayment in part, on the amount so
prepaid) at the related Net Rate over (ii) 30 days' interest (or, in the case of
a principal prepayment in full, interest to the date of prepayment) on such
Scheduled Principal Balance (or, in the case of a Principal Prepayment in part,
on the amount so prepaid) at the annual interest rate required to be paid by the
Mortgagor as limited by application of the Relief Act.
15
Interim Certification: The certification substantially in the form of
Exhibit Two to the Custodial Agreement.
Investment Letter: The letter to be furnished by each Institutional
Accredited Investor which purchases any of the Private Certificates in
connection with such purchase, substantially in the form set forth as Exhibit
F-1 hereto.
Lender-Paid PMI Rate: With respect to each Mortgage Loan covered by a
lender-paid primary mortgage insurance policy, the amount payable to the related
insurer, as stated in the Mortgage Loan Schedule.
Liquidated Mortgage Loan: Any defaulted Mortgage Loan as to which the
Servicer or the Master Servicer has determined that all amounts it expects to
recover from or on account of such Mortgage Loan have been recovered.
Liquidation Date: With respect to any Liquidated Mortgage Loan, the date
on which the Master Servicer or the Servicer has certified that such Mortgage
Loan has become a Liquidated Mortgage Loan.
Liquidation Expenses: With respect to a Mortgage Loan in liquidation,
unreimbursed expenses paid or incurred by or for the account of the Master
Servicer or the Servicer in connection with the liquidation of such Mortgage
Loan and the related Mortgage Property, such expenses including (a) property
protection expenses, (b) property sales expenses, (c) foreclosure and sale
costs, including court costs and reasonable attorneys' fees, and (d) similar
expenses reasonably paid or incurred in connection with liquidation.
Liquidation Proceeds: Cash received in connection with the liquidation of
a defaulted Mortgage Loan, whether through trustee's sale, foreclosure sale,
Insurance Proceeds, condemnation proceeds or otherwise and Subsequent
Recoveries.
Loan Group: Loan Group I, Loan Group II, Loan Group III, Loan Group IV,
Loan Group V, Loan Group VI or Loan Group VII, as applicable.
Loan Group I: The group of Mortgage Loans designated as belonging to Loan
Group I on the Mortgage Loan Schedule.
Loan Group II: The group of Mortgage Loans designated as belonging to Loan
Group II on the Mortgage Loan Schedule.
Loan Group III: The group of Mortgage Loans designated as belonging to
Loan Group III on the Mortgage Loan Schedule.
Loan Group IV: The group of Mortgage Loans designated as belonging to Loan
Group IV on the Mortgage Loan Schedule.
Loan Group V: The group of Mortgage Loans designated as belonging to Loan
Group V on the Mortgage Loan Schedule.
16
Loan Group VI: The group of Mortgage Loans designated as belonging to Loan
Group VI on the Mortgage Loan Schedule.
Loan Group VII: The group of Mortgage Loans designated as belonging to
Loan Group vII on the Mortgage Loan Schedule.
Loan-to-Value Ratio: With respect to any Mortgage Loan, the fraction,
expressed as a percentage, the numerator of which is the original principal
balance of the related Mortgage Loan and the denominator of which is the
Original Value of the related Mortgaged Property.
Loss Allocation Limitation: The meaning specified in Section 6.02(c)
hereof.
Loss Severity Percentage: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the amount of
Realized Losses incurred on a Mortgage Loan and the denominator of which is the
Scheduled Principal Balance of such Mortgage Loan immediately prior to the
liquidation of such Mortgage Loan.
Lost Notes: The original Mortgage Notes that have been lost, as indicated
on the Mortgage Loan Schedule.
Master Servicer: As of the Closing Date, Xxxxx Fargo Bank, National
Association and, thereafter, its respective successors in interest that meet the
qualifications of the Servicing Agreements and this Agreement.
Master Servicer Certification: A written certification covering servicing
of the Mortgage Loans by the Servicers and signed by an officer of the Master
Servicer that complies with (i) the Xxxxxxxx-Xxxxx Act of 2002, as amended from
time to time, and (ii) the February 21, 2003 Statement by the Staff of the
Division of Corporation Finance of the Securities and Exchange Commission
Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and
15d-14, as in effect from time to time; provided that if, after the Closing Date
(a) the Xxxxxxxx-Xxxxx Act of 2002 is amended, (b) the Statement referred to in
clause (ii) is modified or superceded by any subsequent statement, rule or
regulation of the Securities and Exchange Commission or any statement of a
division thereof, or (c) any future releases, rules and regulations are
published by the Securities and Exchange Commission from time to time pursuant
to the Xxxxxxxx-Xxxxx Act of 2002, which in any such case affects the form or
substance of the required certification and results in the required
certification being, in the reasonable judgment of the Master Servicer,
materially more onerous than the form of the required certification as of the
Closing Date, the Master Servicer Certification shall be as agreed to by the
Master Servicer and the Depositor following a negotiation in good faith to
determine how to comply with any such new requirements.
Master Servicer Collection Account: The trust account or accounts created
and maintained pursuant to Section 4.02, which shall be denominated "JPMorgan
Chase Bank, as Trustee f/b/o holders of Structured Asset Mortgage Investments II
Inc., Bear Xxxxxxx ALT-A Trust 2004-9, Mortgage Pass-Through Certificates,
Series 2004-9, Collection Account." The Master Servicer Collection Account shall
be an Eligible Account.
Master Servicing Compensation: The meaning specified in Section 3.14.
17
Material Defect: The meaning specified in Section 2.02(a).
Maximum Lifetime Mortgage Rate: The maximum level to which a Mortgage
Interest Rate can adjust in accordance with its terms, regardless of changes in
the applicable Index.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
MERS(R) System: The system of recording transfers of Mortgage Loans
electronically maintained by MERS.
MIN: The Mortgage Identification Number for Mortgage Loans registered with
MERS on the MERS(R) System.
Minimum Lifetime Mortgage Rate: The minimum level to which a Mortgage
Interest Rate can adjust in accordance with its terms, regardless of changes in
the applicable Index.
MOM Loan: With respect to any Mortgage Loan, MERS acting as the mortgagee
of such Mortgage Loan, solely as nominee for the originator of such Mortgage
Loan and its successors and assigns, at the origination thereof.
Monthly Advance: An advance of principal or interest required to be made
by the Servicer pursuant to the Servicing Agreement or the Master Servicer
pursuant to Section 6.05.
Moody's: Xxxxx'x Investors Service, Inc. or its successor in interest.
Mortgage: The mortgage, deed of trust or other instrument creating a first
priority lien on an estate in fee simple or leasehold interest in real property
securing a Mortgage Loan.
Mortgage File: The mortgage documents listed in Section 2.01(b) pertaining
to a particular Mortgage Loan and any additional documents required to be added
to the Mortgage File pursuant to this Agreement.
Mortgage Interest Rate: The annual rate at which interest accrues from
time to time on any Mortgage Loan pursuant to the related Mortgage Note, which
rate is initially equal to the "Mortgage Interest Rate" set forth with respect
thereto on the Mortgage Loan Schedule.
Mortgage Loan: A mortgage loan transferred and assigned to the Trustee
pursuant to Section 2.01 or Section 2.04 and held as a part of the Trust Fund,
as identified in the Mortgage Loan Schedule (which shall include, without
limitation, with respect to each Mortgage Loan, each related Mortgage Note,
Mortgage and Mortgage File and all rights appertaining thereto), including a
mortgage loan the property securing which has become an REO Property.
Mortgage Loan Purchase Agreement: The Mortgage Loan Purchase Agreement
dated as of July 30, 2004, between EMC, as seller, and Structured Asset Mortgage
Investments II Inc., as purchaser, and all amendments thereof and supplements
thereto, attached as Exhibit J.
18
Mortgage Loan Schedule: The schedule, attached hereto as Exhibit B with
respect to the Mortgage Loans and as amended from time to time to reflect the
repurchase or substitution of Mortgage Loans pursuant to this Agreement.
Mortgage Note: The originally executed note or other evidence of the
indebtedness of a Mortgagor under the related Mortgage Loan.
Mortgaged Property: Land and improvements securing the indebtedness of a
Mortgagor under the related Mortgage Loan or, in the case of REO Property, such
REO Property.
Mortgagor: The obligor on a Mortgage Note.
Net Interest Shortfall: With respect to any Distribution Date, the
Interest Shortfall, if any, for such Distribution Date net of Compensating
Interest Payments made with respect to such Distribution Date.
Net Liquidation Proceeds: As to any Liquidated Mortgage Loan, Liquidation
Proceeds net of (i) Liquidation Expenses which are payable therefrom to the
Servicer or the Master Servicer in accordance with the Servicing Agreement or
this Agreement and (ii) unreimbursed advances by the Servicer or the Master
Servicer and Monthly Advances.
Net Rate: With respect to each Mortgage Loan, the Mortgage Interest Rate
in effect from time to time less the sum of (1) the Servicing Fee Rate and (2)
the Lender Paid PMI Rate, if any, attributable thereto, in each case expressed
as a per annum rate.
Non-Offered Subordinate Certificates: The Class B-4, Class B-5 and Class
B-6 Certificates.
Nonrecoverable Advance: Any advance or Monthly Advance (i) which was
previously made or is proposed to be made by the Master Servicer, the Trustee
(as successor Master Servicer) or the applicable Servicer and (ii) which, in the
good faith judgment of the Master Servicer, the Trustee or the applicable
Servicer , will not or, in the case of a proposed advance or Monthly Advance,
would not, be ultimately recoverable by the Master Servicer, the Trustee (as
successor Master Servicer) or the applicable Servicer from Liquidation Proceeds,
Insurance Proceeds or future payments on the Mortgage Loan for which such
advance or Monthly Advance was made or is proposed to be made.
Offered Certificates: The Class I-A-1, Class I-A-2, Class II-A-1, Class
II-A-2, Class III-A-1, Class IV-A-1, Class V-A-1, Class VI-A-1, Class VII-A-1,
Class R, Class B-1, Class B-2 and Class B-3 Certificates.
Offered Subordinate Certificates: The Class X-x, Class B-2 and Class B-3
Certificates.
Officer's Certificate: A certificate signed by the Chairman of the Board,
the Vice Chairman of the Board, the President or a Vice President or Assistant
Vice President or other authorized officer of the Master Servicer or the
Depositor, as applicable, and delivered to the Trustee, as required by this
Agreement.
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Opinion of Counsel: A written opinion of counsel who is or are acceptable
to the Trustee and who, unless required to be Independent (an "Opinion of
Independent Counsel"), may be internal counsel for the Company, the Master
Servicer or the Depositor.
Optional Termination Date: The Distribution Date on which the aggregate
Scheduled Principal Balance of the Mortgage Loans is less than 10% of the
Cut-off Date Balance.
Original Subordinate Principal Balance: The sum of the aggregate Current
Principal Amounts of each Class of Subordinate Certificates as of the Closing
Date.
Original Value: The lesser of (i) the Appraised Value or (ii) the sales
price of a Mortgaged Property at the time of origination of a Mortgage Loan,
except in instances where either clauses (i) or (ii) is unavailable, the other
may be used to determine the Original Value, or if both clauses (i) and (ii) are
unavailable, Original Value may be determined from other sources reasonably
acceptable to the Depositor.
Outstanding Mortgage Loan: With respect to any Due Date, a Mortgage Loan
which, prior to such Due Date, was not the subject of a Principal Prepayment in
full, did not become a Liquidated Mortgage Loan and was not purchased or
replaced.
Outstanding Principal Balance: As of the time of any determination, the
principal balance of a Mortgage Loan remaining to be paid by the Mortgagor, or,
in the case of an REO Property, the principal balance of the related Mortgage
Loan remaining to be paid by the Mortgagor at the time such property was
acquired by the Trust Fund less any Net Liquidation Proceeds with respect
thereto to the extent applied to principal.
Pass-Through Rate: As to each Class of Certificates, the REMIC I Regular
Interests and REMIC II Regular Interests, the rate of interest determined as
provided with respect thereto, in Section 5.01(c). Any monthly calculation of
interest at a stated rate shall be based upon annual interest at such rate
divided by twelve.
Periodic Rate Cap: With respect to each Mortgage Loan, the maximum
adjustment that can be made to the Mortgage Interest Rate on each Interest
Adjustment Date in accordance with its terms, regardless of changes in the
applicable Index.
Permitted Investments: Any one or more of the following obligations or
securities held in the name of the Trustee for the benefit of the
Certificateholders:
(i) direct obligations of, and obligations the timely payment of
which are fully guaranteed 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;
(ii) (a) demand or time deposits, federal funds or bankers'
acceptances issued by any depository institution or trust company incorporated
under the laws of the United States of America or any state thereof (including
the Trustee or the Master Servicer or its Affiliates acting in its commercial
banking capacity) and subject to supervision and examination by federal and/or
state banking authorities, provided that the commercial paper and/or the
short-term debt
20
rating and/or the long-term unsecured debt obligations of such depository
institution or trust company at the time of such investment or contractual
commitment providing for such investment have the Applicable Credit Rating or
better from each Rating Agency and (b) any other demand or time deposit or
certificate of deposit that is fully insured by the Federal Deposit Insurance
Corporation;
(iii) repurchase obligations with respect to (a) any security
described in clause (i) above or (b) any other security issued or guaranteed by
an 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,
in either case entered into with a depository institution or trust company
(acting as principal) described in clause (ii)(a) above where the Trustee holds
the security therefor;
(iv) securities bearing interest or sold at a discount issued by any
corporation (including the Trustee or the Master Servicer or its Affiliates)
incorporated under the laws of the United States of America or any state thereof
that have the Applicable Credit Rating or better from each Rating Agency at the
time of such investment or contractual commitment providing for such investment;
provided, however, that securities issued by any particular corporation will not
be Permitted Investments to the extent that investments therein will cause the
then outstanding principal amount of securities issued by such corporation and
held as part of the Trust to exceed 10% of the aggregate Outstanding Principal
Balances of all the Mortgage Loans and Permitted Investments held as part of the
Trust;
(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 one year after the date of issuance thereof) having the
Applicable Credit Rating or better from each Rating Agency at the time of such
investment;
(vi) a Reinvestment Agreement issued by any bank, insurance company
or other corporation or entity;
(vii) any other demand, money market or time deposit, obligation,
security or investment as may be acceptable to each Rating Agency as evidenced
in writing by each Rating Agency to the Trustee; and
(viii) any money market or common trust fund having the Applicable
Credit Rating or better from each Rating Agency, including any such fund for
which the Trustee or the Master Servicer or any affiliate of the Trustee or the
Master Servicer acts as a manager or an advisor; provided, however, that no
instrument or security shall be a Permitted Investment if such instrument or
security evidences a right to receive only interest payments with respect to the
obligations underlying such instrument or if such security provides for payment
of both principal and interest with a yield to maturity in excess of 120% of the
yield to maturity at par or if such instrument or security is purchased at a
price greater than par.
Permitted Transferee: Any Person other than a Disqualified Organization or
an "electing large partnership" (as defined by Section 775 of the Code).
21
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Physical Certificates: The Residual Certificates and the Private
Certificates.
Plan: The meaning specified in Section 5.07(a).
Prepayment Charge: With respect to any Mortgage Loan, the charges or
premiums, if any, due in connection with a full or partial prepayment of such
Mortgage Loan in accordance with the terms thereof.
Prepayment Period: With respect to any Mortgage Loan and any Distribution
Date, the calendar month preceding the month in which such Distribution Date
occurs.
Primary Mortgage Insurance Policy: Any primary mortgage guaranty insurance
policy issued in connection with a Mortgage Loan which provides compensation to
a Mortgage Note holder in the event of default by the obligor under such
Mortgage Note or the related Security Instrument, if any or any replacement
policy therefor through the related Interest Accrual Period for such Class
relating to a Distribution Date.
Principal Prepayment: Any payment (whether partial or full) or other
recovery of principal on a Mortgage Loan which is received in advance of its
scheduled Due Date to the extent that it is not accompanied by an amount as to
interest representing scheduled interest due on any date or dates in any month
or months subsequent to the month of prepayment, including Insurance Proceeds
and Repurchase Proceeds, but excluding the principal portion of Net Liquidation
Proceeds.
Private Certificates: The Class B-4, Class B-5 or Class B-6 Certificate.
Prospectus: The prospectus, dated May 14, 2004, as supplemented by the
prospectus supplement dated July 29, 2004, relating to the offering of the
Offered Certificates.
Protected Account: An account established and maintained for the benefit
of Certificateholders by the Servicer with respect to the related Mortgage Loans
and with respect to REO Property pursuant to the Servicing Agreement.
QIB: A Qualified Institutional Buyer as defined in Rule 144A promulgated
under the Securities Act.
Qualified Insurer: Any insurance company duly qualified as such under the
laws of the state or states in which the related Mortgaged Property or Mortgaged
Properties is or are located, duly authorized and licensed in such state or
states to transact the type of insurance business in which it is engaged and
approved as an insurer by the Master Servicer, so long as the claims paying
ability of which is acceptable to the Rating Agencies for pass-through
certificates having the same rating as the Certificates rated by the Rating
Agencies as of the Closing Date.
Rating Agencies: Moody's and S&P.
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Realized Loss: Any (i) Bankruptcy Loss or (ii) as to any Liquidated
Mortgage Loan, (x) the Outstanding Principal Balance of such Liquidated Mortgage
Loan plus accrued and unpaid interest thereon at the Mortgage Interest Rate
through the last day of the month of such liquidation, less (y) the related Net
Liquidation Proceeds with respect to such Mortgage Loan and the related Mortgage
Property. In addition, to the extent the Master Servicer receives Subsequent
Recoveries with respect to any Mortgage Loan, the amount of the Realized Loss
with respect to that Mortgage Loan will be reduced to the extent such recoveries
are applied to reduce the Current Principal Amount of any Class of Certificates
on any Distribution Date.
Realized Losses on the Mortgage Loans shall be allocated to the REMIC I
Regular Interests as follows: (1) The interest portion of Realized Losses and
Net Interest Shortfalls on the Group I Loans, if any, shall be allocated between
the Class Y-1 and Class Z-1 Regular Interests pro rata according to the amount
of interest accrued but unpaid thereon, in reduction thereof; (2) the interest
portion of Realized Losses and Net Interest Shortfalls on the Group II Loans, if
any, shall be allocated between the Class Y-2 and Class Z-2 Regular Interests
pro rata according to the amount of interest accrued but unpaid thereon, in
reduction thereof; (3) the interest portion of Realized Losses and Net Interest
Shortfalls on the Group III Loans, if any, shall be allocated between the Class
Y-3 and Class Z-3 Regular Interests pro rata according to the amount of interest
accrued but unpaid thereon, in reduction thereof; (4) the interest portion of
Realized Losses and Net Interest Shortfalls on the Group IV Loans, if any, shall
be allocated between the Class Y-4 and Class Z-4 Regular Interests pro rata
according to the amount of interest accrued but unpaid thereon, in reduction
thereof; (5) the interest portion of Realized Losses and Net Interest Shortfalls
on the Group V Loans, if any, shall be allocated between the Class Y-5 and Class
Z-5 Regular Interests pro rata according to the amount of interest accrued but
unpaid thereon, in reduction thereof; (6) the interest portion of Realized
Losses and Net Interest Shortfalls on the Group VI Loans, if any, shall be
allocated between the Class Y-6 and Class Z-6 Regular Interests pro rata
according to the amount of interest accrued but unpaid thereon, in reduction
thereof; and (7) the interest portion of Realized Losses and Net Interest
Shortfalls on the Group VII Loans, if any, shall be allocated between the Class
Y-7 and Class Z-7 Regular Interests pro rata according to the amount of interest
accrued but unpaid thereon, in reduction thereof. Any interest portion of such
Realized Losses in excess of the amount allocated pursuant to the preceding
sentence shall be treated as a principal portion of Realized Losses not
attributable to any specific Mortgage Loan in such Group and allocated pursuant
to the succeeding sentences. The principal portion of Realized Losses with
respect to the Mortgage Loans shall be allocated to the REMIC I Regular
Interests as follows: (1) the principal portion of Realized Losses on the Group
I Loans shall be allocated, first, to the Class Y-1 Regular Interest to the
extent of the Class Y-1 Principal Reduction Amount in reduction of the
Uncertificated Principal Balance of such Regular Interest and, second, the
remainder, if any, of such principal portion of such Realized Losses shall be
allocated to the Class Z-1 Regular Interest in reduction of the Uncertificated
Principal Balance thereof; (2) the principal portion of Realized Losses on the
Group II Loans shall be allocated, first, to the Class Y-2 Regular Interest to
the extent of the Class Y-2 Principal Reduction Amount in reduction of the
Uncertificated Principal Balance of such Regular Interest and, second, the
remainder, if any, of such principal portion of such Realized Losses shall be
allocated to the Class Z-2 Regular Interest in reduction of the Uncertificated
Principal Balance thereof; (3) the principal portion of Realized Losses on the
Group III Loans shall be allocated, first, to the Class Y-3 Regular Interest to
the extent of the Class Y-3 Principal Reduction Amount in reduction of the
Uncertificated Principal Balance of
23
such Regular Interest and, second, the remainder, if any, of such principal
portion of such Realized Losses shall be allocated to the Class Z-3 Regular
Interest in reduction of the Uncertificated Principal Balance thereof; (4) the
principal portion of Realized Losses on the Group III Loans shall be allocated,
first, to the Class Y-4 Regular Interest to the extent of the Class Y-3
Principal Reduction Amount in reduction of the Uncertificated Principal Balance
of such Regular Interest and, second, the remainder, if any, of such principal
portion of such Realized Losses shall be allocated to the Class Z-4 Regular
Interest in reduction of the Uncertificated Principal Balance thereof; (5) the
principal portion of Realized Losses on the Group III Loans shall be allocated,
first, to the Class Y-5 Regular Interest to the extent of the Class Y-3
Principal Reduction Amount in reduction of the Uncertificated Principal Balance
of such Regular Interest and, second, the remainder, if any, of such principal
portion of such Realized Losses shall be allocated to the Class Z-5 Regular
Interest in reduction of the Uncertificated Principal Balance thereof; (6) the
principal portion of Realized Losses on the Group III Loans shall be allocated,
first, to the Class Y-6 Regular Interest to the extent of the Class Y-3
Principal Reduction Amount in reduction of the Uncertificated Principal Balance
of such Regular Interest and, second, the remainder, if any, of such principal
portion of such Realized Losses shall be allocated to the Class Z-6 Regular
Interest in reduction of the Uncertificated Principal Balance thereof; and (7)
the principal portion of Realized Losses on the Group III Loans shall be
allocated, first, to the Class Y-7 Regular Interest to the extent of the Class
Y-3 Principal Reduction Amount in reduction of the Uncertificated Principal
Balance of such Regular Interest and, second, the remainder, if any, of such
principal portion of such Realized Losses shall be allocated to the Class Z-7
Regular Interest in reduction of the Uncertificated Principal Balance thereof.
For any Distribution Date, reductions in the Uncertificated Principal Balances
of the Class Y and Class Z Regular Interest pursuant to this definition of
Realized Loss shall be determined, and shall be deemed to occur, prior to any
reductions of such Uncertificated Principal Balances by distributions on such
Distribution Date.
Record Date: For each Class of Certificates, the close of business on the
last Business Day of the month immediately preceding the month of such
Distribution Date.
Reinvestment Agreements: One or more reinvestment agreements, acceptable
to the Rating Agencies, from a bank, insurance company or other corporation or
entity (including the Trustee).
Relief Act: The Servicemembers Civil Relief Act, as amended, or similar
state law.
Relief Act Mortgage Loan: Any Mortgage Loan as to which the Scheduled
Payment thereof has been reduced due to the application of the Relief Act.
REMIC: A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
REMIC Administrator: The Trustee; provided that if the REMIC Administrator
is found by a court of competent jurisdiction to no longer be able to fulfill
its obligations as REMIC Administrator under this Agreement the Servicer or
Trustee acting as Servicer shall appoint a successor REMIC Administrator,
subject to assumption of the REMIC Administrator obligations under this
Agreement.
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REMIC Interest: Any of REMIC I Interests and REMIC II Interests.
REMIC Opinion: An Opinion of Independent Counsel, to the effect that the
proposed action described therein would not, under the REMIC Provisions, (i)
cause any 2004-9 REMIC to fail to qualify as a REMIC while any regular interest
in such 2004-9 REMIC is outstanding, (ii) result in a tax on prohibited
transactions with respect to any 2004-9 REMIC or (iii) constitute a taxable
contribution to any 2004-9 REMIC after the Startup Day.
REMIC Provisions: The provisions of the federal income tax law relating to
REMICs, which appear at Sections 860A through 860G of the Code, and related
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.
REMIC Regular Interest: Any of REMIC I Regular Interests and REMIC II
Regular Interests.
REMIC I: The segregated pool of assets, with respect to which a REMIC
election is made pursuant to this Agreement, consisting of:
(a) the Mortgage Loans and the related Mortgage Files and collateral
securing such Mortgage Loans,
(b) all payments on and collections in respect of the Mortgage Loans due
after the Cut-off Date as shall be on deposit in the Master Servicer Collection
Account or in the Distribution Account and identified as belonging to the Trust
Fund,
(c) property that secured a Mortgage Loan and that has been acquired for
the benefit of the Certificateholders by foreclosure or deed in lieu of
foreclosure,
(d) the hazard insurance policies and Primary Mortgage Insurance Policy,
if any, and
(e) all proceeds of clauses (a) through (d) above.
REMIC I Available Distribution Amount: For each Loan Group for any
Distribution Date, the Available Funds for such Loan Group.
REMIC I Distribution Amount: For any Distribution Date, the REMIC I
Available Distribution Amount shall be distributed to the REMIC I Regular
Interests and the Class R Residual Interest in the following amounts and
priority:
(a) To the extent of the REMIC I Available Distribution Amount for Loan
Group I:
(i) first, to Class Y-1 and Class Z-1 Regular Interests and
Component I of the Class R Certificates, concurrently, the Uncertificated
Interest for such Classes remaining unpaid from previous Distribution
Dates, pro rata according to their respective shares of such unpaid
amounts;
(ii) second, to the Class Y-1 and Class Z-1 Regular Interests and
Component I of the Class R Certificates, concurrently, the Uncertificated
Interest for such Classes for
25
the current Distribution Date, pro rata according to their respective
Uncertificated Interest;
(iii) third, to Component I of the Class R Certificates, until the
Uncertificated Principal Balance thereof has been reduced to zero; and
(iv) fourth, to the Class Y-1 and Class Z-1 Regular Interests, the
Class Y-1 Principal Distribution Amount and the Class Z-1 Principal
Distribution Amount, respectively.
(b) To the extent of the REMIC I Available Distribution Amount for Loan
Group II:
(i) first, to the Class Y-2 and Class Z-2 Regular Interests,
concurrently, the Uncertificated Interest for such Classes remaining
unpaid from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts;
(ii) second, to the Class Y-2 and Class Z-2 Regular Interests,
concurrently, the Uncertificated Interest for such Classes for the current
Distribution Date, pro rata according to their respective Uncertificated
Interest; and
(iii) third, to the Class Y-2 and Class Z-2 Regular Interests, the
Class Y-2 Principal Distribution Amount and the Class Z-2 Principal
Distribution Amount, respectively.
(c) To the extent of the REMIC I Available Distribution Amount for Loan
Group III:
(i) first, to the Class Y-3 and Class Z-3 Regular Interests,
concurrently, the Uncertificated Interest for such Classes remaining
unpaid from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts;
(ii) second, to the Class Y-3 and Class Z-3 Regular Interests,
concurrently, the Uncertificated Interest for such Classes for the current
Distribution Date, pro rata according to their respective Uncertificated
Interest; and
(iii) third, to the Class Y-3 and Class Z-3 Regular Interests, the
Class Y-3 Principal Distribution Amount and the Class Z-3 Principal
Distribution Amount, respectively.
(d) To the extent of the REMIC I Available Distribution Amount for Loan
Group IV:
(i) first, to the Class Y-4 and Class Z-4 Regular Interests,
concurrently, the Uncertificated Interest for such Classes remaining
unpaid from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts;
(ii) second, to the Class Y-4 and Class Z-4 Regular Interests,
concurrently, the Uncertificated Interest for such Classes for the current
Distribution Date, pro rata according to their respective Uncertificated
Interest; and
26
(iii) third, to the Class Y-4 and Class Z-4 Regular Interests, the
Class Y-4 Principal Distribution Amount and the Class Z-4 Principal
Distribution Amount, respectively.
(e) To the extent of the REMIC I Available Distribution Amount for Loan
Group V:
(i) first, to the Class Y-5 and Class Z-5 Regular Interests,
concurrently, the Uncertificated Interest for such Classes remaining
unpaid from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts;
(ii) second, to the Class Y-5 and Class Z-5 Regular Interests,
concurrently, the Uncertificated Interest for such Classes for the current
Distribution Date, pro rata according to their respective Uncertificated
Interest; and
(iii) third, to the Class Y-5 and Class Z-5 Regular Interests, the
Class Y-5 Principal Distribution Amount and the Class Z-5 Principal
Distribution Amount, respectively.
(f) To the extent of the REMIC I Available Distribution Amount for Loan
Group VI:
(i) first, to the Class Y-6 and Class Z-6 Regular Interests,
concurrently, the Uncertificated Interest for such Classes remaining
unpaid from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts;
(ii) second, to the Class Y-6 and Class Z-6 Regular Interests,
concurrently, the Uncertificated Interest for such Classes for the current
Distribution Date, pro rata according to their respective Uncertificated
Interest; and
(iii) third, to the Class Y-6 and Class Z-6 Regular Interests, the
Class Y-6 Principal Distribution Amount and the Class Z-6 Principal
Distribution Amount, respectively.
(g) To the extent of the REMIC I Available Distribution Amount for Loan
Group VII:
(i) first, to the Class Y-7 and Class Z-7 Regular Interests,
concurrently, the Uncertificated Interest for such Classes remaining
unpaid from previous Distribution Dates, pro rata according to their
respective shares of such unpaid amounts;
(ii) second, to the Class Y-7 and Class Z-7 Regular Interests,
concurrently, the Uncertificated Interest for such Classes for the current
Distribution Date, pro rata according to their respective Uncertificated
Interest; and
(iii) third, to the Class Y-7 and Class Z-7 Regular Interests, the
Class Y-7 Principal Distribution Amount and the Class Z-7 Principal
Distribution Amount, respectively.
(h) To the extent of the REMIC I Available Distribution Amounts for Loan
Group I, Loan Group II and Loan Group III for such Distribution Date remaining
after payment of the amounts pursuant to paragraphs (a), (b), (c), (d), (e), (f)
and (g) of this definition of "REMIC I Distribution Amount":
27
(i) first, to each Class of Class Y and Class Z Regular Interests,
pro rata according to the amount of unreimbursed Realized Losses allocable
to principal previously allocated to each such Class; provided, however,
that any amounts distributed pursuant to this paragraph (d)(i) of this
definition of "REMIC I Distribution Amount" shall not cause a reduction in
the Uncertificated Principal Balances of any of the Class Y and Class Z
Regular Interests; and
(ii) second, to the Component I of the Class R Certificates, the
Residual Distribution Amount for Component I of the Class R Certificates
for such Distribution Date.
REMIC I Interest: The REMIC I Regular Interests and Component I of the
Class R Certificates.
REMIC I Regular Interest: Any of the separate non-certificated beneficial
ownership interests in REMIC I set forth in Section 5.01(c) and issued hereunder
and designated as a "regular interest" in REMIC I. Each REMIC I Regular Interest
shall accrue interest at the Uncertificated Pass-Through Rate specified for such
REMIC I Interest in Section 5.01(c), and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in Section
5.01(c). The designations for the respective REMIC I Regular Interests are set
forth in Section 5.01(c).
REMIC II: That group of assets contained in the Trust Fund designated as a
REMIC consisting of the REMIC I Regular Interests and any proceeds thereof.
REMIC II Interests: The REMIC II Regular Interests.
REMIC II Regular Interests: As defined in Section 5.01(c).
REO Property: A Mortgaged Property acquired in the name of the Trustee,
for the benefit of Certificateholders, by foreclosure or deed-in-lieu of
foreclosure in connection with a defaulted Mortgage Loan.
Repurchase Price: With respect to any Mortgage Loan (or any property
acquired with respect thereto) required to be repurchased by the Seller pursuant
to the Mortgage Loan Purchase Agreement or Article II of this Agreement, an
amount equal to the sum of (i)(a) 100% of the Outstanding Principal Balance of
such Mortgage Loan as of the date of repurchase (or if the related Mortgaged
Property was acquired with respect thereto, 100% of the Outstanding Principal
Balance at the date of the acquisition), plus (b) accrued but unpaid interest on
the Outstanding Principal Balance at the related Mortgage Interest Rate, through
and including the last day of the month of repurchase, plus (c) any unreimbursed
Monthly Advances and servicing advances payable to the Servicer of the Mortgage
Loan or to the Master Servicer and (ii) any costs and damages (if any) incurred
by the Trust in connection with any violation of such Mortgage Loan of any
predatory or abusive lending laws.
28
Repurchase Proceeds: the Repurchase Price in connection with any
repurchase of a Mortgage Loan by the Seller and any cash deposit in connection
with the substitution of a Mortgage Loan.
Request for Release: A request for release in the form attached hereto as
Exhibit D.
Required Insurance Policy: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement with respect to such Mortgage Loan.
Residual Certificates: The Class R Certificates.
Responsible Officer: Any officer assigned to the Corporate Trust Office
(or any successor thereto), including any Vice President, Assistant Vice
President, Trust Officer, any Assistant Secretary, any trust officer or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and having direct
responsibility for the administration of this Agreement, and any other officer
of the Trustee to whom a matter arising hereunder may be referred.
Rule 144A Certificate: The certificate to be furnished by each purchaser
of a Private Certificate (which is also a Physical Certificate) which is a
Qualified Institutional Buyer as defined under Rule 144A promulgated under the
Securities Act, substantially in the form set forth as Exhibit F-2 hereto.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc., and
its successors in interest.
Scheduled Payment: With respect to any Mortgage Loan and any Due Period,
the scheduled payment or payments of principal and interest due during such Due
Period on such Mortgage Loan which either is payable by a Mortgagor in such Due
Period under the related Mortgage Note or, in the case of REO Property, would
otherwise have been payable under the related Mortgage Note.
Scheduled Principal: The principal portion of any Scheduled Payment.
Scheduled Principal Balance: With respect to any Mortgage Loan on any
Distribution Date, (i) the unpaid principal balance of such Mortgage Loan as of
the close of business on the related Due Date (taking account of the principal
payment to be made on such Due Date and irrespective of any delinquency in its
payment), as specified in the amortization schedule at the time relating thereto
(before any adjustment to such amortization schedule by reason of any bankruptcy
or similar proceeding occurring after the Cut-off Date (other than a Deficient
Valuation) or any moratorium or similar waiver or grace period) and less (ii)
any Principal Prepayments (including the principal portion of Net Liquidation
Proceeds) received during or prior to the related Prepayment Period; provided
that the Scheduled Principal Balance of a Liquidated Mortgage Loan is zero.
Securities Act: The Securities Act of 1933, as amended.
29
Securities Administrator: Xxxxx Fargo Bank, National Association, or its
successor in interest, or any successor securities administrator appointed as
herein provided.
Securities Legend: "THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A OR (2) IN CERTIFICATED FORM TO AN
"INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT OR ANY ENTITY IN WHICH
ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO (A) THE RECEIPT BY
THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND
(B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE TRUSTEE
THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION. THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR
ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT (A
"PLAN") THAT IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), or by a person using "PLAN assets" of a Plan,
UNLESS THE PROPOSED TRANSFEREE PROVIDES THE TRUSTEE WITH AN OPINION OF COUNSEL
FOR THE BENEFIT OF THE TRUSTEE, MASTER SERVICER AND THE SECURITIES ADMINISTRATOR
AND ON WHICH THEY MAY RELY WHICH IS SATISFACTORY TO THE TRUSTEE THAT THE
PURCHASE OF THIS CERTIFICATE IS PERMISSIBLE UNDER APPLICABLE LAW, WILL NOT
CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975
OF THE CODE AND WILL NOT SUBJECT THE MASTER SERVICER, THE TRUSTEE OR THE
SECURITIES ADMINISTRATOR TO ANY OBLIGATION OR LIABILITY IN ADDITION TO THOSE
UNDERTAKEN IN THE AGREEMENT.
Security Instrument: A written instrument creating a valid first lien on a
Mortgaged Property securing a Mortgage Note, which may be any applicable form of
mortgage, deed of trust, deed to secure debt or security deed, including any
riders or addenda thereto.
30
Seller: EMC, as mortgage loan seller under the Mortgage Loan Purchase
Agreement.
Senior Certificates: The Class I-A-1, Class I-A-2, Class II-A-1, Class
II-A-2, Class III-A-1, Class IV-A-1, Class V-A-1, Class VI-A-1 and Class VII-A-1
Certificates.
Senior Optimal Principal Amount: With respect to each Distribution Date
and a Certificate Group, an amount equal to the sum, without duplication, of the
following (but in no event greater than the aggregate Current Principal Amounts
of the related Certificate Group immediately prior to such Distribution Date):
(i) the related Senior Percentage of the principal portion of all
Scheduled Payments due on each Outstanding Mortgage Loan in the related Loan
Group on the related Due Date as specified in the amortization schedule at the
time applicable thereto (after adjustments for previous Principal Prepayments
but before any adjustment to such amortization schedule by reason of any
bankruptcy or similar proceeding or any moratorium or similar waiver or grace
period if the related Distribution Date occurs prior to the Cross-over Date);
(ii) the related Senior Prepayment Percentage of the Scheduled
Principal Balance of Mortgage Loan in the related Loan Group which was the
subject of a Principal Prepayment in full received by the Master Servicer during
the related Prepayment Period;
(iii) the related Senior Prepayment Percentage of amount of all
Principal Prepayments in part allocated to principal received by the Master
Servicer during the related Prepayment Period in respect to each Mortgage Loan
in the related Loan Group;
(iv) the lesser of (a) the related Senior Prepayment Percentage of
the sum of (A) all Net Liquidation Proceeds allocable to principal received in
respect of each Mortgage Loan in the related Loan Group that became a Liquidated
Mortgage Loan during the related Prepayment Period (other than Mortgage Loans
described in the immediately following clause (B)) and all Subsequent Recoveries
received in respect of each Liquidated Mortgage Loan in the related Loan Group
during the related Due Period and (B) the Scheduled Principal Balance of each
such Mortgage Loan purchased by an insurer from the Trust during the related
Prepayment Period pursuant to the related Primary Mortgage Insurance Policy, if
any, or otherwise and (b) the related Senior Percentage of the sum of (A) the
Scheduled Principal Balance of each Mortgage Loan in the related Loan Group
which became a Liquidated Mortgage Loan during the related Prepayment Period
(other than the Mortgage Loans described in the immediately following clause
(B)) and all Subsequent Recoveries received in respect of each Liquidated
Mortgage Loan in the related Loan Group during the related Due Period and (B)
the Scheduled Principal Balance of each such Mortgage Loan that was purchased by
an insurer from the Trust during the related Prepayment Period pursuant to the
related Primary Mortgage Insurance Policy, if any or otherwise;
(v) any amount allocated to the Available Funds of the related Loan
Group pursuant to Section 6.01(a)(i)(G); and
(vi) the related Senior Prepayment Percentage of the sum of (a) the
Scheduled Principal Balance of each Mortgage Loan in the related Loan Group that
was repurchased by the Seller in connection with such Distribution Date and (b)
the excess, if any, of the Scheduled
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Principal Balance of a Mortgage Loan in the related Loan Group that has been
replaced by the Seller with a substitute Mortgage Loan pursuant to the Mortgage
Loan Purchase Agreement in connection with such Distribution Date over the
Scheduled Principal Balance of such substitute Mortgage Loan.
Senior Percentage: With respect to each Certificate Group, initially
93.75%. With respect to any Distribution Date and a Certificate Group, the
lesser of (i) 100% and (ii) the percentage obtained by dividing the aggregate
Current Principal Amount of the Senior Certificates in such Certificate Group
immediately preceding such Distribution Date by the aggregate Scheduled
Principal Balance of the Mortgage Loans in the related Loan Group as of the
beginning of the related Due Period.
Senior Prepayment Percentage: With respect to a Certificate Group and any
Distribution Date occurring during the periods set forth below, as follows:
Period (dates inclusive) Senior Prepayment Percentage
------------------------ ----------------------------
August 2004 - July 2011 100%
August 2011 - July 2012 Senior Percentage for the related
Certificate Group plus 70% of the
Subordinate Percentage for the related
Loan Group.
August 2012 - July 2013 Senior Percentage for the related
Certificate Group plus 60% of the
Subordinate Percentage for the related
Loan Group.
August 2013 - July 2014 Senior Percentage for the related
Certificate Group plus 40% of the
Subordinate Percentage for the related
Loan Group.
August 2014 - July 2015 Senior Percentage for the related
Certificate Group plus 20% of the
Subordinate Percentage for the related
Loan Group.
August 2015 and thereafter Senior Percentage for the related
Certificate Group
In addition, no reduction of the Senior Prepayment Percentage shall occur
on any Distribution Date unless, as of the last day of the month preceding such
Distribution Date, (A) the aggregate Scheduled Principal Balance of the Mortgage
Loans in all Loan Groups delinquent 60 days or more (including for this purpose
any such Mortgage Loans in foreclosure and Mortgage Loans with respect to which
the related Mortgaged Property has been acquired by the Trust), averaged over
the last six months, as a percentage of the sum of the aggregate Current
Principal Amount of the Subordinate Certificates does not exceed 50%; and (B)
cumulative Realized Losses on the Mortgage Loans in all Loan Groups do not
exceed (a) 30% of the Original Subordinate Principal Balance if such
Distribution Date occurs between and including August 2011 and July 2012, (b)
35% of the Original Subordinate Principal Balance if such Distribution Date
occurs between and including August 2012 and July 2013, (c) 40% of the Original
Subordinate Principal Balance if such Distribution Date occurs between and
including August 2013 and July 2014, (d) 45% of the Original Subordinate
Principal Balance if such Distribution Date occurs between and including August
2014 and July 2015, and (e) 50% of the
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Original Subordinate Principal Balance if such Distribution Date occurs during
or after August 2015.
In addition, if on any Distribution Date the weighted average of the
Subordinate Percentages is equal to or greater than two times the weighted
average of the initial Subordinate Percentages, and (a) the aggregate Scheduled
Principal Balance of the Mortgage Loans for all Loan Groups delinquent 60 days
or more (including for this purpose any such Mortgage Loans in foreclosure and
such Mortgage Loans with respect to which the related Mortgaged Property has
been acquired by the Trust), averaged over the last six months, as a percentage
of the aggregate Current Principal Amount of the Subordinate Certificates does
not exceed 50% and (b)(i) on or prior to the Distribution Date in July 2007,
cumulative Realized Losses on the Mortgage Loans for all Loan Groups as of the
end of the related Prepayment Period do not exceed 20% of the Original
Subordinate Principal Balance and (ii) after the Distribution Date in July 2007
cumulative Realized Losses on the Mortgage Loans for all Loan Groups as of the
end of the related Prepayment Period do not exceed 30% of the Original
Subordinate Principal Balance, then, the Senior Prepayment Percentage for such
Distribution Date will equal the Senior Percentage for the related Loan Group;
provided, however, if on such Distribution Date the Subordinate Percentage is
equal to or greater than two times the initial Subordinate Percentage on or
prior to the Distribution Date occurring in July 2007 and the above delinquency
and loss tests are met, then the Senior Prepayment Percentage for the related
Loan Group for such Distribution Date will equal the related Senior Percentage
plus 50% of the related Subordinate Percentage.
Notwithstanding the foregoing, if on any Distribution Date the percentage,
the numerator of which is the aggregate Current Principal Amount of the Senior
Certificates immediately preceding such Distribution Date, and the denominator
of which is the Scheduled Principal Balance of the Mortgage Loans as of the
beginning of the related Due Period, exceeds such percentage as of the Cut-Off
Date, the Senior Prepayment Percentage for the Senior Certificates will equal
100%.
Servicers: Chevy Chase, Countrywide Servicing, EMC, EverHome, GreenPoint,
SouthTrust, Xxxxxxxxxx and Xxxxx Fargo and their respective permitted successors
and assigns.
Servicer Remittance Date: With respect to each Mortgage Loan, the date set
forth in the Servicing Agreement.
Servicing Agreement: Each of the Chevy Chase Servicing Agreement,
Countrywide Servicing Agreement, EMC Servicing Agreement, EverHome Servicing
Agreement, GreenPoint Servicing Agreement, SouthTrust Servicing Agreement,
Xxxxxxxxxx Servicing Agreement and Xxxxx Fargo Servicing Agreement.
Servicing Fee: As to any Mortgage Loan and Distribution Date, an amount
equal to the product of (i) the Scheduled Principal Balance of such Mortgage
Loan as of the Due Date in the preceding calendar month and (ii) the Servicing
Fee Rate.
Servicing Fee Rate: As to any Mortgage Loan, a per annum rate as set forth
in the Mortgage Loan Schedule.
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Servicing Officer: The President or a Vice President or Assistant Vice
President or other authorized officer of the Master Servicer having direct
responsibility for the administration of this Agreement, and any other
authorized officer of the Master Servicer to whom a matter arising hereunder may
be referred.
SouthTrust: SouthTrust Mortgage Corporation, and its successor in
interest.
SouthTrust Servicing Agreement: The Purchase, Warranties and Servicing
Agreement dated as of November 1, 2002, between EMC and SouthTrust, attached
hereto as Exhibit H-6.
Startup Day: July 30, 2004.
Subordinate Certificate Writedown Amount: With respect to the Subordinate
Certificates and as to any Distribution Date, the amount by which (i) the sum of
the Current Principal Amounts of the Certificates (after giving effect to the
distribution of principal and the allocation of applicable Realized Losses in
reduction of the Current Principal Amounts of the Certificates on such
Distribution Date) exceeds (y) the aggregate Scheduled Principal Balances of the
Mortgage Loans on the Due Date related to such Distribution Date.
Subordinate Certificates: The Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates.
Subordinate Optimal Principal Amount: With respect to any Distribution
Date and any Loan Group, an amount equal to the sum, without duplication, of the
following (but in no event greater than the aggregate Current Principal Amount
of the Subordinate Certificates immediately prior to such Distribution Date):
(i) the related Subordinate Percentage of the principal portion of all
Scheduled Payments due on each Outstanding Mortgage Loan in the related Loan
Group on the related Due Date as specified in the amortization schedule at the
time applicable thereto (after adjustment for previous Principal Prepayments but
before any adjustment to such amortization schedule by reason of any bankruptcy
or similar proceeding or any moratorium or similar waiver or grace period);
(ii) the related Subordinate Prepayment Percentage of the Scheduled
Principal Balance of each Mortgage Loan in the related Loan Group that was the
subject of a Principal Prepayment in full received by the Master Servicer during
the related Prepayment Period;
(iii) the related Subordinate Prepayment Percentage of the amount of all
Principal Prepayments in part received by the Master Servicer in respect to the
Mortgage Loan in the related Loan Group during the related Prepayment Period;
(iv) the excess, if any, of (a) all Net Liquidation Proceeds allocable to
principal received during the related Prepayment Period in respect of each
Liquidated Mortgage Loan in the related Loan Group and all Subsequent Recoveries
received in respect of each Liquidated Mortgage Loan during the related Due
Period over (b) the sum of the amounts distributable to the Senior Certificates
in the related Certificate Group pursuant to clause (iv) of the definition of
Senior Optimal Principal Amount on such Distribution Date;
34
(v) the related Subordinate Prepayment Percentage of the sum of (a) the
Scheduled Principal Balance of each Mortgage Loan in the related Loan Group that
was purchased by the Seller in connection with such Distribution Date and (b)
the difference, if any, between the Scheduled Principal Balance of a Mortgage
Loan in the related Loan Group that has been replaced by the Seller with a
Substitute Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement in
connection with such Distribution Date over the Scheduled Principal Balance of
such Substitute Mortgage Loan; and
(vi) on the Distribution Date on which the Current Principal Amounts of
the Senior Certificates in the related Certificate Group have all been reduced
to zero, 100% of the Senior Optimal Principal Amount for the related Loan Group.
After the aggregate Current Principal Amount of the Subordinate Certificates has
been reduced to zero, the Subordinate Optimal Principal Amount shall be zero.
Subordinate Percentage: With respect to a Loan Group on any Distribution
Date, 100% minus the Senior Percentage for the related Certificate Group.
Subordinate Prepayment Percentage: With respect to a Loan Group on any
Distribution Date, 100% minus the Senior Prepayment Percentage for the related
Certificate Group.
Subsequent Recoveries: As of any Distribution Date, amounts received
during the related Due Period by the Master Servicer or surplus amounts held by
the Master Servicer to cover estimated expenses (including, but not limited to,
recoveries in respect of the representations and warranties made by the Seller
pursuant to the Mortgage Loan Purchase Agreement) specifically related to a
Liquidated Mortgage Loan or disposition of an REO Property prior to the related
Prepayment Period that resulted in a Realized Loss, after liquidation or
disposition of such Mortgage Loan.
Substitute Mortgage Loan: A mortgage loan tendered to the Trustee pursuant
to the Servicing Agreement, the Mortgage Loan Purchase Agreement or Section 2.04
of this Agreement, as applicable, in each case, (i) which has an Outstanding
Principal Balance not greater nor materially less than the Mortgage Loan for
which it is to be substituted; (ii) which has a Mortgage Interest Rate and Net
Rate not less than, and not materially greater than, such Mortgage Loan; (iii)
which has a maturity date not materially earlier or later than such Mortgage
Loan and not later than the latest maturity date of any Mortgage Loan; (iv)
which is of the same property type and occupancy type as such Mortgage Loan; (v)
which has a Loan-to-Value Ratio not greater than the Loan-to-Value Ratio of such
Mortgage Loan; (vi) which is current in payment of principal and interest as of
the date of substitution; (vii) as to which the payment terms do not vary in any
material respect from the payment terms of the Mortgage Loan for which it is to
be substituted and (viii) which has a Gross Margin, Periodic Rate Cap and
Maximum Lifetime Mortgage Rate no less than those of such Mortgage Loan, has the
same Index and interval between Interest Adjustment Dates as such Mortgage Loan,
and a Minimum Lifetime Mortgage Rate no lower than that of such Mortgage Loan.
Substitution Adjustment Amount: The amount, if any, required to be paid by
the Mortgage Loan Seller to the Trustee for deposit in the Distribution Account
pursuant to Section 2.04 in connection with the substitution of a Mortgage Loan.
35
Tax Administration and Tax Matters Person: The Securities Administrator
and any successor thereto or assignee thereof shall serve as tax administrator
hereunder and as agent for the Tax Matters Person. The Holder of the largest
percentage interest of each Class of Residual Certificates shall be the Tax
Matters Person for the related REMIC, as more particularly set forth in Section
9.12 hereof.
Termination Purchase Price: The price, calculated as set forth in Section
10.01, to be paid in connection with the repurchase of the Mortgage Loans
pursuant to Section 10.01.
Trust Fund or Trust: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans and the other assets described in Section
2.01(a).
Trustee: JPMorgan Chase Bank, or its successor in interest, or any
successor trustee appointed as herein provided.
2004-9 REMIC: Any of REMIC I and REMIC II.
Uncertificated Interest: With respect to each REMIC Regular Interest on
each Distribution Date, an amount equal to one month's interest at the related
Uncertificated Pass-Through Rate on the Uncertificated Principal Balance of such
REMIC Regular Interest. In each case, for purposes of the distributions,
Uncertificated Interest will be reduced by the interest portion of any Realized
Losses and Net Interest Shortfalls allocated, with respect to the REMIC I
Regular Interests, to such REMIC Regular Interests pursuant to the definition of
Realized Losses and, with respect to the REMIC II Regular Interests, to the
Related Classes of Certificates.
Uncertificated Pass-Through Rate: With respect to any Distribution Date
and REMIC Interest, the Pass-Through Rate of each such REMIC Interest set forth
in Section 5.01(c).
Uncertificated Principal Balance: The amount of any REMIC I Regular
Interest or REMIC II Regular Interest outstanding as of any date of
determination. As of the Closing Date, the Uncertificated Principal Balance of
each REMIC I Regular Interest shall equal the amount set forth in Section
5.01(c)(i) as its Initial Uncertificated Principal Balance. On each Distribution
Date, the Uncertificated Principal Balance of each REMIC I Regular Interest
shall be reduced by the sum of (i) the principal portion of Realized Losses
allocated to the REMIC I Regular Interests in accordance with the definition of
Realized Loss and (ii) the amounts deemed distributed on each Distribution Date
in respect of principal on the REMIC I Regular Interests pursuant to Section
6.07. As of the Closing Date, the Uncertificated Principal Balance of each REMIC
II Regular Interest shall equal the amount set forth in the Section 5.01(c)
hereto as its Initial Uncertificated Principal Balance. On each Distribution
Date, the Uncertificated Principal Balance of each REMIC II Regular Interest
shall be reduced, first, by the portion of Realized Losses allocated in
reduction of the Current Principal Balances of the Related Classes of
Certificates on such Distribution Date and, second, by all distributions of
principal made on such Related Classes of Certificates on such Distribution
Date.
Undercollateralized Amount: With respect any Certificate Group and
Distribution Date, the excess of (i) the aggregate Current Principal Balance of
such Certificate Group over (ii) the aggregate Scheduled Principal Balance of
the Mortgage Loans in the related Loan Group.
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Undercollateralized Certificate Group: With respect any Distribution Date,
a Certificate Group for which the related Undercollateralized Amount (calculated
on such Distribution Date after giving effect to distributions to be made
thereon (other than amounts to be distributed pursuant to Section 6.01(a)(i)(H)
on such Distribution Date)) exceeds zero.
Uninsured Cause: Any cause of damage to a Mortgaged Property or related
REO Property such that the complete restoration of such Mortgaged Property or
related REO Property is not fully reimbursable by the hazard insurance policies
required to be maintained pursuant the Servicing Agreement, without regard to
whether or not such policy is maintained.
United States Person: A citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for federal income tax purposes) created or organized in, or under
the laws of, the United States or any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in regulations),
provided that, for purposes solely of the Class R Certificates, no partnership
or other entity treated as a partnership for United States federal income tax
purposes shall be treated as a United States Person unless all persons that own
an interest in such partnership either directly or through any entity that is
not a corporation for United States federal income tax purposes are United
States Persons, or an estate whose income is subject to United States federal
income tax regardless of its source, or 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 such United States Persons have the authority to control
all substantial decisions of the trust. To the extent prescribed in regulations
by the Secretary of the Treasury, which have not yet been issued, a trust which
was in existence on August 20, 1996 (other than a trust treated as owned by the
grantor under subpart E of part I of subchapter J of chapter 1 of the Code), and
which was treated as a United States person on August 20, 1996 may elect to
continue to be treated as a United States person notwithstanding the previous
sentence.
Xxxxxxxxxx: Union Federal Bank of Indianaopolis and its successor in
interest.
Xxxxxxxxxx Servicing Agreement: Mortgage Origination Services and
Servicing Agreement, dated as of November 13, 1003, between Xxxxxxxxxx and EMC
as attached hereto as Exhibit H-7.
Xxxxx Fargo: Xxxxx Fargo Bank, N.A., as successor by merger to Xxxxx Fargo
Home Mortgage, Inc., and its successor in interest.
Xxxxx Fargo Servicing Agreement: The Master Seller's Warranties and
Servicing Agreement, dated as of April 1, 2003, as amended by the First
Amendment to the Master Seller's Warranties and Servicing Agreement, dated May
10, 2004, between Xxxxx Fargo and EMC as attached hereto as Exhibit H-8.
37
ARTICLE II
Conveyance of Mortgage Loans;
Original Issuance of Certificates
Section 2.01 Conveyance of Mortgage Loans to Trustee. (a) The Depositor
concurrently with the execution and delivery of this Agreement, sells, transfers
and assigns to the Trust without recourse all its right, title and interest in
and to (i) the Mortgage Loans identified in the Mortgage Loan Schedule,
including all interest and principal due with respect to the Mortgage Loans
after the Cut-off Date, but excluding any payments of principal and interest due
on or prior to the Cut-off Date; (ii) such assets as shall from time to time be
credited or are required by the terms of this Agreement to be credited to the
Master Servicer Collection Account, (iii) such assets relating to the Mortgage
Loans as from time to time may be held by the Servicers in Protected Accounts,
the Master Servicer in the Master Servicer Collection Account and the Trustee in
the Distribution Account, (iv) any REO Property, (v) the Required Insurance
Policies and any amounts paid or payable by the insurer under any Insurance
Policy (to the extent the mortgagee has a claim thereto), (vi) the Mortgage Loan
Purchase Agreement to the extent provided in Section 2.03(a), (vii) the rights
with respect to the Servicing Agreements as assigned to the Trustee on behalf of
the Certificateholders by the Assignment Agreement, (viii) the Class R Deposit
and (ix) any proceeds of the foregoing. Although it is the intent of the parties
to this Agreement that the conveyance of the Depositor's right, title and
interest in and to the Mortgage Loans and other assets in the Trust Fund
pursuant to this Agreement shall constitute a purchase and sale and not a loan,
in the event that such conveyance is deemed to be a loan, it is the intent of
the parties to this Agreement that the Depositor shall be deemed to have granted
to the Trustee a first priority perfected security interest in all of the
Depositor's right, title and interest in, to and under the Mortgage Loans and
other assets in the Trust Fund, and that this Agreement shall constitute a
security agreement under applicable law.
(b) In connection with the above transfer and assignment, the Seller
hereby deposits with the Trustee or the Custodian, as its agent, with respect to
each Mortgage Loan:
(i) the original Mortgage Note, endorsed without recourse to the
order of the Trustee and showing an unbroken chain of endorsements from the
originator thereof to the Person endorsing it to the Trustee, or lost note
affidavit together with a copy of the related Mortgage Note,
(ii) the original Mortgage and, if the related Mortgage Loan is a
MOM Loan, noting the presence of the MIN and language indicating that such
Mortgage Loan is a MOM Loan, which shall have been recorded (or if the original
is not available, a copy), with evidence of such recording indicated thereon (or
if clause (w) in the proviso below applies, shall be in recordable form),
(iii) unless the Mortgage Loan is a MOM Loan, a certified copy of
the assignment (which may be in the form of a blanket assignment if permitted in
the jurisdiction in which the Mortgaged Property is located) to "JPMorgan Chase
Bank, as Trustee", with evidence of recording with respect to each Mortgage Loan
in the name of the Trustee thereon (or if clause (w) in the proviso below
applies or for Mortgage Loans with respect to which the related Mortgaged
Property is located in a state other than Maryland, Tennessee, South Carolina,
38
Mississippi and Florida, or an Opinion of Counsel has been provided as set forth
in this Section 2.01(b), shall be in recordable form),
(iv) all intervening assignments of the Security Instrument, if
applicable and only to the extent available to the Depositor with evidence of
recording thereon,
(v) the original or a copy of the policy or certificate of primary
mortgage guaranty insurance, to the extent available, if any,
(vi) the original policy of title insurance or mortgagee's
certificate of title insurance or commitment or binder for title insurance, and
(vii) originals of all modification agreements, if applicable and
available.
provided, however, that in lieu of the foregoing, the Depositor may deliver the
following documents, under the circumstances set forth below: (w) in lieu of the
original Security Instrument, assignments to the Trustee or intervening
assignments thereof which have been delivered, are being delivered or will, upon
receipt of recording information relating to the Security Instrument required to
be included thereon, be delivered to recording offices for recording and have
not been returned to the Depositor in time to permit their delivery as specified
above, the Depositor may deliver a true copy thereof with a certification by the
Depositor, on the face of such copy, substantially as follows: "Certified to be
a true and correct copy of the original, which has been transmitted for
recording"; (x) in lieu of the Security Instrument, assignment to the Trustee or
intervening assignments thereof, if the applicable jurisdiction retains the
originals of such documents (as evidenced by a certification from the Depositor
to such effect) the Depositor may deliver photocopies of such documents
containing an original certification by the judicial or other governmental
authority of the jurisdiction where such documents were recorded; and (y) the
Depositor shall not be required to deliver intervening assignments or Mortgage
Note endorsements between the Seller and the Depositor, and between the
Depositor and the Trustee; and provided, further, however, that in the case of
Mortgage Loans which 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,
may deliver to the Trustee or the Custodian, as its agent, a certification to
such effect and shall deposit all amounts paid in respect of such Mortgage Loans
in the Master Servicer Collection Account on the Closing Date. The Depositor
shall deliver such original documents (including any original documents as to
which certified copies had previously been delivered) to the Trustee or the
Custodian, as its agent, promptly after they are received. The Depositor shall
cause the Seller, at its expense, to cause each assignment of the Security
Instrument to the Trustee to be recorded not later than 180 days after the
Closing Date, unless (a) such recordation is not required by the Rating Agencies
or an Opinion of Counsel addressed to the Trustee has been provided to the
Trustee (with a copy to the Custodian) which states that recordation of such
Security Instrument is not required to protect the interests of the
Certificateholders in the related Mortgage Loans or (b) MERS is identified on
the Mortgage or on a properly recorded assignment of the Mortgage as the
mortgagee of record solely as nominee for the Seller and its successor and
assigns; provided, however, that each assignment shall be submitted for
recording by the Seller in the manner described above, at no expense to the
Trust or the Trustee or the Custodian, as its agent, upon the earliest to occur
of: (i) reasonable direction by the Holders of Certificates evidencing
Fractional Undivided Interests
39
aggregating not less than 25% of the Trust, (ii) the occurrence of an Event of
Default, (iii) the occurrence of a bankruptcy, insolvency or foreclosure
relating to the Seller and (iv) the occurrence of a servicing transfer as
described in Section 8.02 hereof. Notwithstanding the foregoing, if the Seller
fails to pay the cost of recording the assignments, such expense will be paid by
the Trustee and the Trustee shall be reimbursed for such expenses by the Trust
in accordance with Section 9.05.
Section 2.02 Acceptance of Mortgage Loans by Trustee. (a) The Trustee
acknowledges the sale, transfer and assignment of the Trust Fund to it by the
Depositor and receipt of, subject to further review and the exceptions which may
be noted pursuant to the procedures described below, and declares that it holds,
the documents (or certified copies thereof) delivered to it or the Custodian, as
its agent, pursuant to Section 2.01, and declares that it will continue to hold
those documents and any amendments, replacements or supplements thereto and all
other assets of the Trust Fund delivered to it as Trustee in trust for the use
and benefit of all present and future Holders of the Certificates. On the
Closing Date, the Custodian, with respect to the Mortgage Loans, shall
acknowledge with respect to each Mortgage Loan by delivery to the Depositor and
the Trustee of an Initial Certification receipt of the Mortgage File, but
without review of such Mortgage File, except to the extent necessary to confirm
that such Mortgage File contains the related Mortgage Note or lost note
affidavit. No later than 90 days after the Closing Date (or, with respect to any
Substitute Mortgage Loan, within five Business Days after the receipt by the
Trustee or Custodian thereof), the Trustee agrees, for the benefit of the
Certificateholders, to review or cause to be reviewed by the Custodian on its
behalf (under the Custodial Agreement), each Mortgage File delivered to it and
to execute and deliver, or cause to be executed and delivered, to the Depositor
and the Trustee an Interim Certification. In conducting such review, the Trustee
or Custodian will ascertain whether all required documents have been executed
and received, and based on the Mortgage Loan Schedule, whether those documents
relate, determined on the basis of the Mortgagor name, original principal
balance and loan number, to the Mortgage Loans it has received, as identified in
the Mortgage Loan Schedule. In performing any such review, the Trustee or the
Custodian, as its agent, may conclusively rely on the purported due execution
and genuineness of any such document and on the purported genuineness of any
signature thereon. If the Trustee or the Custodian, as its agent, finds any
document constituting part of the Mortgage File has not been executed or
received, or to be unrelated, determined on the basis of the Mortgagor name,
original principal balance and loan number, to the Mortgage Loans identified in
Exhibit B or to appear defective on its face (a "Material Defect"), the Trustee
or the Custodian, as its agent, shall promptly notify the Seller. In accordance
with the Mortgage Loan Purchase Agreement, the Seller shall correct or cure any
such defect within ninety (90) days from the date of notice from the Trustee or
the Custodian, as its agent, of the defect and if the Seller fails to correct or
cure the defect within such period, and such defect materially and adversely
affects the interests of the Certificateholders in the related Mortgage Loan,
the Trustee or the Custodian, as its agent, shall enforce the Seller's
obligation pursuant to the Mortgage Loan Purchase Agreement, within 90 days from
the Trustee's or the Custodian's notification, to purchase such Mortgage Loan at
the Repurchase Price; provided that, if such defect would cause the Mortgage
Loan to be other than a "qualified mortgage" as defined in Section 860G(a)(3) of
the Code, any such cure or repurchase must occur within 90 days from the date
such breach was discovered; provided, however, that if such defect relates
solely to the inability of the Seller to deliver the original Security
Instrument or intervening assignments thereof, or a certified copy because the
originals of such documents, or a certified copy have not
40
been returned by the applicable jurisdiction, the Seller shall not be required
to purchase such Mortgage Loan if the Seller delivers such original documents or
certified copy promptly upon receipt, but in no event later than 360 days after
the Closing Date. The foregoing repurchase obligation shall not apply in the
event that the Seller cannot deliver such original or copy of any document
submitted for recording to the appropriate recording office in the applicable
jurisdiction because such document has not been returned by such office;
provided that the Seller shall instead deliver a recording receipt of such
recording office or, if such receipt is not available, a certificate confirming
that such documents have been accepted for recording, and delivery to the
Trustee or the Custodian, as its agent, shall be effected by the Seller within
thirty days of its receipt of the original recorded document.
(b) No later than 180 days after the Closing Date, the Trustee or the
Custodian, as its agent, will review, for the benefit of the Certificateholders,
the Mortgage Files delivered to it and will execute and deliver or cause to be
executed and delivered to the Depositor and the Trustee a Final Certification.
In conducting such review, the Trustee or the Custodian, as its agent, will
ascertain whether an original of each document required to be recorded has been
returned from the recording office with evidence of recording thereon or a
certified copy has been obtained from the recording office. If the Trustee or
the Custodian, as its agent, finds a Material Defect, the Trustee or the
Custodian, as its agent, shall promptly notify the Seller (provided, however,
that with respect to those documents described in Sections 2.01(b)(iv), (v) and
(vii), the Trustee's and Custodian's obligations shall extend only to the
documents actually delivered to the Trustee or the Custodian pursuant to such
Sections). In accordance with the Mortgage Loan Purchase Agreement, the Seller
shall correct or cure any such defect within 90 days from the date of notice
from the Trustee or the Custodian, as its agent, of the Material Defect and if
the Seller is unable to cure such defect within such period, and if such defect
materially and adversely affects the interests of the Certificateholders in the
related Mortgage Loan, the Trustee shall enforce the Seller's obligation under
the Mortgage Loan Purchase Agreement to provide a Substitute Mortgage Loan (if
within two years of the Closing Date) or purchase such Mortgage Loan at the
Repurchase Price; provided, however, that if such defect would cause the
Mortgage Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure, repurchase or substitution must occur
within 90 days from the date such breach was discovered; provided, further, that
if such defect relates solely to the inability of the Seller to deliver the
original Security Instrument or intervening assignments thereof, or a certified
copy, because the originals of such documents or a certified copy, have not been
returned by the applicable jurisdiction, the Seller shall not be required to
purchase such Mortgage Loan, if the Seller delivers such original documents or
certified copy promptly upon receipt, but in no event later than 360 days after
the Closing Date. The foregoing repurchase obligation shall not apply in the
event that the Seller cannot deliver such original or copy of any document
submitted for recording to the appropriate recording office in the applicable
jurisdiction because such document has not been returned by such office;
provided that the Seller shall instead deliver a recording receipt of such
recording office or, if such receipt is not available, a certificate confirming
that such documents have been accepted for recording, and delivery to the
Trustee or the Custodian, as its agent, shall be effected by the Seller within
thirty days of its receipt of the original recorded document.
(c) In the event that a Mortgage Loan is purchased by the Seller in
accordance with Sections 2.02(a) or (b) above, the Seller shall remit to the
Master Servicer the Repurchase Price
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for deposit in the Master Servicer Collection Account and the Seller shall
provide to the Securities Administrator and the Trustee written notification
detailing the components of the Repurchase Price. Upon deposit of the Repurchase
Price in the Master Servicer Collection Account, the Depositor shall notify the
Trustee and the Custodian, as agent of the Trustee (upon receipt of a Request
for Release in the form of Exhibit D attached hereto with respect to such
Mortgage Loan), shall release to the Seller the related Mortgage File and the
Trustee shall execute and deliver all instruments of transfer or assignment,
without recourse, representation or warranty, furnished to it by the Seller, as
are necessary to vest in the Seller title to and rights under the Mortgage Loan.
Such purchase shall be deemed to have occurred on the date on which the
Repurchase Price in available funds is received by the Trustee. The Trustee
shall amend the Mortgage Loan Schedule, which was previously delivered to it by
the Depositor in a form agreed to between the Depositor and the Trustee, to
reflect such repurchase and shall promptly notify the Rating Agencies and the
Master Servicer of such amendment. The obligation of the Seller to repurchase
any Mortgage Loan as to which such a defect in a constituent document exists
shall be the sole remedy respecting such defect available to the
Certificateholders or to the Trustee on their behalf.
Section 2.03 Assignment of Interest in the Mortgage Loan Purchase
Agreement. (a) The Depositor hereby assigns to the Trustee, on behalf of the
Certificateholders, all of its right, title and interest in the Mortgage Loan
Purchase Agreement, including but not limited to the Depositor's rights and
obligations pursuant to the Servicing Agreements (noting that the Seller has
retained the right in the event of breach of the representations, warranties and
covenants, if any, with respect to the related Mortgage Loans of the related
Servicer under the related Servicing Agreement to enforce the provisions thereof
and to seek all or any available remedies). The obligations of the Seller to
substitute or repurchase, as applicable, a Mortgage Loan shall be the Trustee's
and the Certificateholders' sole remedy for any breach thereof. At the request
of the Trustee, the Depositor shall take such actions as may be necessary to
enforce the above right, title and interest on behalf of the Trustee and the
Certificateholders or shall execute such further documents as the Trustee may
reasonably require in order to enable the Trustee to carry out such enforcement.
(b) If the Depositor, the Master Servicer, or the Trustee discovers a
breach of any of the representations and warranties set forth in the Mortgage
Loan Purchase Agreement, which breach materially and adversely affects the value
of the interests of Certificateholders or the Trustee in the related Mortgage
Loan, the party discovering the breach shall give prompt written notice of the
breach to the other parties. The Seller, within 90 days of its discovery or
receipt of notice that such breach has occurred (whichever occurs earlier),
shall cure the breach in all material respects or, subject to the Mortgage Loan
Purchase Agreement or Section 2.04 of this Agreement, as applicable, shall
purchase the Mortgage Loan or any property acquired with respect thereto from
the Trustee; provided, however, that if there is a breach of any representation
set forth in the Mortgage Loan Purchase Agreement or Section 2.04 of this
Agreement, as applicable, and the Mortgage Loan or the related property acquired
with respect thereto has been sold, then the Seller shall pay, in lieu of the
Repurchase Price, any excess of the Repurchase Price over the Net Liquidation
Proceeds received upon such sale. (If the Net Liquidation Proceeds exceed the
Repurchase Price, any excess shall be paid to the Seller to the extent not
required by law to be paid to the borrower.) Any such purchase by the Seller
shall be made by providing an amount equal to the Repurchase Price to the Master
Servicer for deposit in the
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Master Servicer Collection Account and written notification detailing the
components of such Repurchase Price. The Depositor shall notify the Trustee and
submit to the Trustee or the Custodian, as its agent, a Request for Release, and
the Trustee shall release, or the Trustee shall cause the Custodian to release,
to the Seller the related Mortgage File and the Trustee shall execute and
deliver all instruments of transfer or assignment furnished to it by the Seller,
without recourse, representation or warranty as are necessary to vest in the
Seller title to and rights under the Mortgage Loan or any property acquired with
respect thereto. Such purchase shall be deemed to have occurred on the date on
which the Repurchase Price in available funds is received by the Trustee. The
Securities Administrator shall amend the Mortgage Loan Schedule to reflect such
repurchase and shall promptly notify the Trustee and the Rating Agencies of such
amendment. Enforcement of the obligation of the Seller to purchase (or
substitute a Substitute Mortgage Loan for) any Mortgage Loan or any property
acquired with respect thereto (or pay the Repurchase Price as set forth in the
above proviso) as to which a breach has occurred and is continuing shall
constitute the sole remedy respecting such breach available to the
Certificateholders or the Trustee on their behalf.
Section 2.04 Substitution of Mortgage Loans. Notwithstanding anything to
the contrary in this Agreement, in lieu of purchasing a Mortgage Loan pursuant
to the Mortgage Loan Purchase Agreement or Sections 2.02 or 2.03 of this
Agreement, the Seller may, no later than the date by which such purchase by the
Seller would otherwise be required, tender to the Trustee a Substitute Mortgage
Loan accompanied by a certificate of an authorized officer of the Seller that
such Substitute Mortgage Loan conforms to the requirements set forth in the
definition of "Substitute Mortgage Loan" in the Mortgage Loan Purchase Agreement
or this Agreement, as applicable; provided, however, that substitution pursuant
to the Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable, in lieu of purchase shall not be permitted after the termination of
the two-year period beginning on the Startup Day; provided, further, that if the
breach would cause the Mortgage Loan to be other than a "qualified mortgage" as
defined in Section 860G(a)(3) of the Code, any such cure or substitution must
occur within 90 days from the date the breach was discovered. The Trustee or the
Custodian, as its agent, shall examine the Mortgage File for any Substitute
Mortgage Loan in the manner set forth in Section 2.02(a) and the Trustee or the
Custodian, as its agent, shall notify the Seller, in writing, within five
Business Days after receipt, whether or not the documents relating to the
Substitute Mortgage Loan satisfy the requirements of the fourth sentence of
Section 2.02(a). Within two Business Days after such notification, the Seller
shall provide to the Trustee for deposit in the Distribution Account the amount,
if any, by which the Outstanding Principal Balance as of the next preceding Due
Date of the Mortgage Loan for which substitution is being made, after giving
effect to the Scheduled Principal due on such date, exceeds the Outstanding
Principal Balance as of such date of the Substitute Mortgage Loan, after giving
effect to Scheduled Principal due on such date, which amount shall be treated
for the purposes of this Agreement as if it were the payment by the Seller of
the Repurchase Price for the purchase of a Mortgage Loan by the Seller. After
such notification to the Seller and, if any such excess exists, upon receipt of
such deposit, the Trustee shall accept such Substitute Mortgage Loan which shall
thereafter be deemed to be a Mortgage Loan hereunder. In the event of such a
substitution, accrued interest on the Substitute Mortgage Loan for the month in
which the substitution occurs and any Principal Prepayments made thereon during
such month shall be the property of the Trust Fund and accrued interest for such
month on the Mortgage Loan for which the substitution is made and any Principal
Prepayments made thereon during such month shall be the property of
43
the Seller. The Scheduled Principal on a Substitute Mortgage Loan due on the Due
Date in the month of substitution shall be the property of the Seller and the
Scheduled Principal on the Mortgage Loan for which the substitution is made due
on such Due Date shall be the property of the Trust Fund. Upon acceptance of the
Substitute Mortgage Loan (and delivery to the Trustee or the Custodian as agent
of the Trustee, as applicable, of a Request for Release for such Mortgage Loan),
the Trustee or the Custodian, as agent for the Trustee, shall release to the
Seller the related Mortgage File related to any Mortgage Loan released pursuant
to the Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable, and shall execute and deliver all instruments of transfer or
assignment, without recourse, representation or warranty in form as provided to
it as are necessary to vest in the Seller title to and rights under any Mortgage
Loan released pursuant to the Mortgage Loan Purchase Agreement or Section 2.04
of this Agreement, as applicable. The Seller shall deliver the documents related
to the Substitute Mortgage Loan in accordance with the provisions of the
Mortgage Loan Purchase Agreement or Sections 2.01(b) and 2.02(b) of this
Agreement, as applicable, with the date of acceptance of the Substitute Mortgage
Loan deemed to be the Closing Date for purposes of the time periods set forth in
those Sections. The representations and warranties set forth in the Mortgage
Loan Purchase Agreement shall be deemed to have been made by the Seller with
respect to each Substitute Mortgage Loan as of the date of acceptance of such
Mortgage Loan by the Trustee. The Master Servicer shall amend the Mortgage Loan
Schedule to reflect such substitution and shall provide a copy of such amended
Mortgage Loan Schedule to the Trustee and the Rating Agencies.
Section 2.05 Issuance of Certificates.
(a) The Trustee acknowledges the assignment to it of the Mortgage Loans
and the other assets comprising the Trust Fund and, concurrently therewith, has
signed, and countersigned and delivered to the Depositor, in exchange therefor,
Certificates in such authorized denominations representing such Fractional
Undivided Interests as the Depositor has requested. The Trustee agrees that it
will hold the Mortgage Loans and such other assets as may from time to time be
delivered to it segregated on the books of the Trustee in trust for the benefit
of the Certificateholders.
(b) The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Depositor in
and to the REMIC I Regular Interests, and the other assets of REMIC II for the
benefit of the holders of the REMIC II Certificates. The Trustee acknowledges
receipt of the REMIC I Regular Interests (which are uncertificated) and the
other assets of REMIC II and declares that it holds and will hold the same in
trust for the exclusive use and benefit of the holders of the REMIC II
Certificates.
Section 2.06 Representations and Warranties Concerning the Depositor. The
Depositor hereby represents and warrants to the Trustee, the Master Servicer and
the Securities Administrator as follows:
(i) the Depositor (a) is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and (b) is
qualified and in good standing as a foreign corporation to do business in each
jurisdiction where such qualification is necessary,
44
except where the failure so to qualify would not reasonably be expected to have
a material adverse effect on the Depositor's business as presently conducted or
on the Depositor's ability to enter into this Agreement and to consummate the
transactions contemplated hereby;
(ii) the Depositor has full corporate power to own its property, to
carry on its business as presently conducted and to enter into and perform its
obligations under this Agreement;
(iii) 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; and 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
articles of incorporation or by-laws of the Depositor, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on the Depositor's ability to enter into this Agreement and to
consummate the transactions contemplated hereby;
(iv) 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 those consents,
approvals, notices, registrations or other actions as have already been
obtained, given or made;
(v) this Agreement has been duly executed and delivered by the
Depositor and, assuming due authorization, execution and delivery by the other
parties hereto, constitutes a valid and binding obligation of the Depositor
enforceable against it in accordance with its terms (subject to applicable
bankruptcy and insolvency laws and other similar laws affecting the enforcement
of the rights of creditors generally);
(vi) there are no actions, suits or proceedings pending or, to the
knowledge of the Depositor, threatened against the Depositor, before or by any
court, administrative agency, arbitrator or governmental body (i) with respect
to any of the transactions contemplated by this Agreement or (ii) 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 the Depositor's ability to enter into this
Agreement or perform its obligations under this Agreement; and the Depositor is
not in default with respect to any order of any court, administrative agency,
arbitrator or governmental body so as to materially and adversely affect the
transactions contemplated by this Agreement; and
(vii) immediately prior to the transfer and assignment to the
Trustee, each Mortgage Note and each Mortgage were not subject to an assignment
or pledge, and the Depositor had good and marketable title to and was the sole
owner thereof and had full right to transfer and sell such Mortgage Loan to the
Trustee free and clear of any encumbrance, equity, lien, pledge, charge, claim
or security interest.
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ARTICLE III
Administration and Servicing of Mortgage Loans
Section 3.01 Master Servicer. The Master Servicer shall supervise, monitor
and oversee the obligation of the Servicers to service and administer their
respective Mortgage Loans in accordance with the terms of the applicable
Servicing Agreements and shall have full power and authority to do any and all
things which it may deem necessary or desirable in connection with such master
servicing and administration. In performing its obligations hereunder, the
Master Servicer shall act in a manner consistent with Accepted Master Servicing
Practices. Furthermore, the Master Servicer shall oversee and consult with each
Servicer as necessary from time-to-time to carry out the Master Servicer's
obligations hereunder, shall receive, review and evaluate all reports,
information and other data provided to the Master Servicer by each Servicer and
shall cause each Servicer to perform and observe the covenants, obligations and
conditions to be performed or observed by such Servicer under its applicable
Servicing Agreement. The Master Servicer shall independently and separately
monitor each Servicer's servicing activities with respect to each related
Mortgage Loan, reconcile the results of such monitoring with such information
provided in the previous sentence on a monthly basis and coordinate corrective
adjustments to the Servicers' and Master Servicer's records, and based on such
reconciled and corrected information, the Master Servicer shall provide such
information to the Securities Administrator as shall be necessary in order for
it to prepare the statements specified in Section 6.04, and prepare any other
information and statements required to be forwarded by the Master Servicer
hereunder. The Master Servicer shall reconcile the results of its Mortgage Loan
monitoring with the actual remittances of the Servicers pursuant to the
applicable Servicing Agreements.
The Trustee shall furnish the Servicers and the Master Servicer with any
powers of attorney, in substantially the form attached hereto as Exhibit K, and
other documents in form as provided to it necessary or appropriate to enable the
Servicers and the Master Servicer to service and administer the related Mortgage
Loans and REO Property.
The Trustee shall provide access to the records and documentation in
possession of the Trustee regarding the related Mortgage Loans and REO Property
and the servicing thereof to the Certificateholders, the FDIC, and the
supervisory agents and examiners of the FDIC, such access being afforded only
upon reasonable prior written request and during normal business hours at the
office of the Trustee; provided, however, that, unless otherwise required by
law, the Trustee shall not be required to provide access to such records and
documentation if the provision thereof would violate the legal right to privacy
of any Mortgagor. The Trustee shall allow representatives of the above entities
to photocopy any of the records and documentation and shall provide equipment
for that purpose at a charge that covers the Trustee's actual costs.
The Trustee shall execute and deliver to the Servicer and the Master
Servicer any court pleadings, requests for trustee's sale or other documents
necessary or desirable to (i) the foreclosure or trustee's sale with respect to
a Mortgaged Property; (ii) any legal action brought to obtain judgment against
any Mortgagor on the Mortgage Note or Security Instrument; (iii) obtain
46
a deficiency judgment against the Mortgagor; or (iv) enforce any other rights or
remedies provided by the Mortgage Note or Security Instrument or otherwise
available at law or equity.
Section 3.02 REMIC-Related Covenants. For as long as each 2004-9 REMIC
shall exist, the Trustee and the Securities Administrator shall act in
accordance herewith to assure continuing treatment of such 2004-9 REMIC as a
REMIC, and the Trustee and the Securities Administrator shall comply with any
directions of the Depositor, the related Servicer or the Master Servicer to
assure such continuing treatment. In particular, the Trustee shall not (a) sell
or permit the sale of all or any portion of the Mortgage Loans or of any
investment of deposits in an Account unless such sale is as a result of a
repurchase of the Mortgage Loans pursuant to this Agreement or the Trustee has
received a REMIC Opinion addressed to the Trustee prepared at the expense of the
Trust Fund; and (b) other than with respect to a substitution pursuant to the
Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable, accept any contribution to any 2004-9 REMIC after the Startup Day
without receipt of a REMIC Opinion addressed to the Trustee.
Section 3.03 Monitoring of Servicers. (a) The Master Servicer shall be
responsible for reporting to the Trustee and the Depositor the compliance by
each Servicer with its duties under the related Servicing Agreement. In the
review of each Servicer's activities, the Master Servicer may rely upon an
officer's certificate of the Servicer (or similar document signed by an officer
of the Servicer) with regard to such Servicer's compliance with the terms of its
Servicing Agreement. In the event that the Master Servicer, in its judgment,
determines that a Servicer should be terminated in accordance with its Servicing
Agreement, or that a notice should be sent pursuant to such Servicing Agreement
with respect to the occurrence of an event that, unless cured, would constitute
grounds for such termination, the Master Servicer shall notify the Depositor and
the Trustee thereof and the Master Servicer shall issue such notice or take such
other action as it deems appropriate.
(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 with the related Servicing Agreement,
subject to the preceding paragraph, terminate the rights and obligations of such
Servicer thereunder and act as servicer of the related Mortgage Loans or cause
the Trustee to enter in to a new Servicing Agreement with a successor Servicer
selected by the Master Servicer; provided, however, it is understood and
acknowledged by the parties hereto that there will be a period of transition
(not to exceed 90 days) before the actual servicing functions can be fully
transferred to such 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, provided that the Master Servicer shall not be required to prosecute or
defend any legal action except to the extent that the Master Servicer shall have
received reasonable indemnity for its costs and expenses in pursuing such
action.
(c) To the extent that the costs and expenses of the Master Servicer
related to any termination of a Servicer, appointment of a successor Servicer or
the transfer and assumption of
47
servicing by the Master Servicer with respect to any Servicing Agreement
(including, without limitation, (i) all legal costs and expenses and all due
diligence costs and expenses associated with an evaluation of the potential
termination of the Servicer as a result of an event of default by such Servicer
and (ii) all costs and expenses associated with the complete transfer of
servicing, including, but not limited to, all servicing files and all servicing
data and the completion, correction or manipulation of such servicing data as
may be required by the successor servicer to correct any errors or
insufficiencies in the servicing data or otherwise to enable the successor
service to service the Mortgage Loans in accordance with the related Servicing
Agreement) are not fully and timely reimbursed by the terminated Servicer, the
Master Servicer shall be entitled to reimbursement of such costs and expenses
from the Master Servicer Collection Account.
(d) The Master Servicer shall require each Servicer to comply with the
remittance requirements and other obligations set forth in the related Servicing
Agreement.
(e) If the Master Servicer acts as Servicer, it will not assume liability
for the representations and warranties of the Servicer, if any, that it
replaces.
Section 3.04 Fidelity Bond. The Master Servicer, at its expense, shall
maintain in effect a blanket fidelity bond and an errors and omissions insurance
policy, affording coverage with respect to all directors, officers, employees
and other Persons acting on such Master Servicer's behalf, and covering errors
and omissions in the performance of the Master Servicer's obligations hereunder.
The errors and omissions insurance policy and the fidelity bond shall be in such
form and amount generally acceptable for entities serving as master servicers or
trustees.
Section 3.05 Power to Act; Procedures. 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, to do any and all
things that it may deem necessary or desirable in connection with the master
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 Servicing Agreement, as applicable; provided, however,
that the Master Servicer shall not (and, consistent with its responsibilities
under Section 3.03, shall not permit any Servicer to) knowingly or intentionally
take any action, or fail to take (or fail to cause to be taken) any action
reasonably within its control and the scope of duties more specifically set
forth herein, that, under the REMIC Provisions, if taken or not taken, as the
case may be, would cause any 2004-9 REMIC to fail to qualify as a REMIC or
result in the imposition of a tax upon the Trust Fund (including but not limited
to the tax on prohibited transactions as defined in Section 860F(a)(2) of the
Code and the tax on contributions to a REMIC set forth in Section 860G(d) of the
Code) unless the Master Servicer has received an Opinion of Counsel (but not at
the expense of the Master Servicer) to the effect that the contemplated action
would not cause any 2004-9 REMIC to fail to qualify as a REMIC or result in the
imposition of a tax upon any 2004-9 REMIC. The Trustee shall furnish the Master
Servicer, upon written request from a Servicing Officer, with any powers of
attorney
48
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, 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 Master 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, the
Master Servicer shall join with the Trustee in the appointment of a co-trustee
pursuant to Section 9.11 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.
Section 3.06 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
Servicers 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 3.07 Release of Mortgage Files. (a) Upon becoming aware of the
payment in full of any Mortgage Loan, or the receipt by any Servicer of a
notification that payment in full has been escrowed in a manner customary for
such purposes for payment to Certificateholders on the next Distribution Date,
the Servicer will, if required under the applicable Servicing Agreement (or if
the Servicer does not, the Master Servicer may), promptly furnish to the
Custodian, on behalf of the Trustee, two copies of a certification substantially
in the form of Exhibit D hereto signed by a Servicing Officer or in a mutually
agreeable electronic format which will, in lieu of a signature on its face,
originate from a Servicing Officer (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 Protected Account maintained by
the applicable Servicer pursuant to Section 4.01 or by the applicable Servicer
pursuant to its Servicing Agreement have been or will be so deposited) and shall
request that the Custodian, on behalf of the Trustee, deliver to the applicable
Servicer the related Mortgage File. Upon receipt of such certification and
request, the Custodian, on behalf of the Trustee, shall promptly release the
related Mortgage File to the applicable Servicer and the Trustee and Custodian
shall have no further responsibility with regard to such Mortgage File. Upon any
such payment in full, each Servicer 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
49
expenses incurred in connection with such instrument of satisfaction or
assignment, as the case may be, shall be chargeable to the Protected Account.
(b) From time to time and as appropriate for the servicing or foreclosure
of any Mortgage Loan and in accordance with the applicable Servicing Agreement,
the Trustee shall execute such documents as shall be prepared and furnished to
the Trustee by a Servicer or the Master Servicer (in form reasonably acceptable
to the Trustee) and as are necessary to the prosecution of any such proceedings.
The Custodian, on behalf of the Trustee, shall, upon the request of a Servicer
or the Master Servicer, and delivery to the Custodian, on behalf of the Trustee,
of two copies of a request for release signed by a Servicing Officer
substantially in the form of Exhibit D (or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from a
Servicing Officer), release the related Mortgage File held in its possession or
control to the Servicer or the Master Servicer, as applicable. Such trust
receipt shall obligate the Servicer or the Master Servicer to return the
Mortgage File to the Custodian on behalf of the Trustee, when the need therefor
by the Servicer or the Master 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 Mortgage File shall be
released by the Custodian, on behalf of the Trustee, to the Servicer or the
Master Servicer.
Section 3.08 Documents, Records and Funds in Possession of Master Servicer
To Be Held for Trustee.
(a) The Master Servicer shall transmit and each Servicer (to the extent
required by the related Servicing Agreement) shall transmit to the Trustee or
Custodian 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 in the case of the Servicers, the applicable Servicing Agreement, to
be delivered to the Trustee or 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 by 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 Master Servicer Collection Account the Master
Servicing Compensation 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 applicable Servicing Agreement. The Master Servicer shall, and (to the
extent provided in the applicable Servicing Agreement) shall 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, 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 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.
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Section 3.09 Standard Hazard Insurance and Flood Insurance Policies.
(a) For each Mortgage Loan, the Master Servicer shall enforce any
obligation of the Servicers under the related Servicing Agreements to maintain
or cause to be maintained standard fire and casualty insurance and, where
applicable, flood insurance, all in accordance with the provisions of the
related Servicing Agreements. 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.
(b) Pursuant to Section 4.01 and 4.02, any amounts collected by the
Servicers or the Master Servicer, under any insurance policies (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 Master Servicer
Collection Account, subject to withdrawal pursuant to Section 4.02 and 4.03. 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 and 4.03.
Section 3.10 Presentment of Claims and Collection of Proceeds. The Master
Servicer shall (to the extent provided in the applicable Servicing Agreement)
cause the related Servicer to, prepare and present on behalf of the Trustee and
the Certificateholders all claims under the Insurance Policies 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, bonds or contracts
shall be promptly deposited in the Master Servicer Collection 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 precedent 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).
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Section 3.11 Maintenance of the Primary Mortgage Insurance Policies.
(a) The Master Servicer shall not take, or permit any Servicer (to the
extent such action is prohibited under 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 the Master
Servicer or such Servicer, would have been covered thereunder. The Master
Servicer shall use its best reasonable efforts to cause each Servicer (to the
extent required under the related Servicing Agreement) 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 permit
any Servicer (to the extent required under the related Servicing Agreement) 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 Mortgage Note 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 present, or to cause each Servicer (to
the extent required under the related Servicing Agreement) 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
and 4.02, any amounts collected by the Master Servicer or any Servicer under any
Primary Mortgage Insurance Policies shall be deposited in the Master Servicer
Collection Account, subject to withdrawal pursuant to Section 4.03.
Section 3.12 Trustee to Retain Possession of Certain Insurance Policies
and Documents.
The Trustee (or the Custodian, as directed by the Trustee), shall retain
possession and custody of the originals (to the extent available) of any 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 its
Custodian, if any, as directed by the Trustee) 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 to be delivered to the Trustee (or the Custodian, as directed by the
Trustee), upon the execution or receipt thereof the originals of any Primary
Mortgage Insurance Policies, any certificates of renewal, and such other
documents or instruments that constitute portions of the Mortgage File that come
into the possession of the Master Servicer from time to time.
Section 3.13 Realization Upon Defaulted Mortgage Loans. The Master
Servicer shall cause each Servicer (to the extent required under the related
Servicing Agreement) to foreclose upon, repossess or otherwise comparably
convert the ownership of Mortgaged Properties securing such of the Mortgage
Loans as come into and continue in default and as to which no
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satisfactory arrangements can be made for collection of delinquent payments, all
in accordance with the applicable Servicing Agreement.
Section 3.14 Compensation for the Master Servicer. The Master Servicer
will be entitled to all income and gain realized from any investment of funds in
the Distribution Account and the Master Servicer Collection Account, pursuant to
Article IV, for the performance of its activities hereunder. 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 or
penalty) shall be retained by the applicable Servicer and shall not be deposited
in the Protected Account. The Master Servicer will be entitled to retain, as
additional compensation, any interest remitted by a Servicer in connection with
a Principal Prepayment in full or otherwise in excess of amounts required to be
remitted to the Distribution Account (such amounts together with the amounts
specified in the first sentence of this Section 3.14, the "Master Servicing
Compensation"). 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.
Section 3.15 REO Property.
(a) In the event the Trust Fund acquires ownership of any REO Property in
respect of any related Mortgage Loan, the deed or certificate of sale shall be
issued to the Trustee, or to its nominee, on behalf of the related
Certificateholders. The Master Servicer shall, to the extent provided in the
applicable Servicing Agreement, cause the applicable Servicer to sell, any REO
Property as expeditiously as possible and in accordance with the provisions of
this Agreement and the related Servicing Agreement, as applicable. Pursuant to
its efforts to sell such REO Property, the Master Servicer shall cause the
applicable Servicer to protect and conserve, such REO Property in the manner and
to the extent required by the applicable Servicing Agreement, in accordance with
the REMIC Provisions and in a manner that does not result in a tax on "net
income from foreclosure property" (unless such result would maximize the Trust
Fund's after-tax return on such property) or cause such REO Property to fail to
qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code.
(b) The Master Servicer shall, to the extent required by the related
Servicing Agreement, cause the applicable Servicer to deposit all funds
collected and received in connection with the operation of any REO Property in
the Protected Account.
(c) The Master Servicer and the applicable Servicer, upon the final
disposition of any REO Property, shall be entitled to reimbursement for any
related unreimbursed Monthly Advances and other unreimbursed advances as well as
any unpaid Servicing Fees from Liquidation Proceeds received in connection with
the final disposition of such REO Property; provided, that any such unreimbursed
Monthly Advances as well as any unpaid 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) To the extent provided in the related Servicing Agreement, the
Liquidation Proceeds from the final disposition of the REO Property, net of any
payment to the Master
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Servicer and the applicable Servicer as provided above shall be deposited in the
Protected Account on or prior to the Determination Date in the month following
receipt thereof and be remitted by wire transfer in immediately available funds
to the Master Servicer for deposit into the related Master Servicer Collection
Account on the next succeeding Servicer Remittance Date.
Section 3.16 Annual Officer's Certificate as to Compliance.
(a) The Master Servicer shall deliver to the Trustee and the Rating
Agencies on or before March 1 of each year, commencing on March 1, 2005, an
Officer's Certificate, certifying that with respect to the period ending
December 31 of the prior year: (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.
(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 3.17 Annual Independent Accountant's Servicing Report. If the
Master Servicer has, during the course of any fiscal year, directly serviced 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, the Rating Agencies and the Depositor on or
before March 1 of each year, commencing on March 1, 2005 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 Xxxxxxx Mac 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 Xxxxxxx Mac requires it
to report. Copies of such statements shall be provided to any Certificateholder
upon request by the Master Servicer, or by
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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 3.18 Reports Filed with Securities and Exchange Commission. Within
15 days after each Distribution Date, the Securities Administrator shall, in
accordance with industry standards, file with the Commission via the Electronic
Data Gathering and Retrieval System ("XXXXX"), a Form 8-K (or other comparable
form containing the same or comparable information or other information mutually
agreed upon) with a copy of the statement to the Certificateholders for such
Distribution Date as an exhibit thereto. Prior to January 30 of each year, the
Securities Administrator shall, in accordance with industry standards and only
if instructed by the Depositor, file a Form 15 Suspension Notice with respect to
the Trust Fund, if applicable. Prior to (i) March 15, 2005 and (ii) unless and
until a Form 15 Suspension Notice shall have been filed, prior to March 15 of
each year thereafter, the Master Servicer shall provide the Securities
Administrator with a Master Servicer Certification, together with a copy of the
annual independent accountant's servicing report and annual statement of
compliance of each Servicer, in each case, required to be delivered pursuant to
the related Servicing Agreement, and, if applicable, the annual independent
accountant's servicing report and annual statement of compliance to be delivered
by the Master Servicer pursuant to Sections 3.16 and 3.17. Prior to (i) March
31, 2005, or such earlier filing date as may be required by the Commission, and
(ii) unless and until a Form 15 Suspension Notice shall have been filed, March
31 of each year thereafter, or such earlier filing date as may be required by
the Commission, the Securities Administrator shall prepare and file a Form 10-K,
in substance conforming to industry standards, with respect to the Trust. Such
Form 10-K shall include the Master Servicer Certification and other
documentation provided by the Master Servicer pursuant to the second preceding
sentence. The Depositor hereby grants to the Securities Administrator 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 Securities Administrator 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 Securities Administrator,
from time to time upon request, such further information, reports and financial
statements within its control related to this Agreement and the Mortgage Loans
as the Securities Administrator reasonably deems appropriate to prepare and file
all necessary reports with the Commission. The Securities Administrator shall
have no responsibility to file any items other than those specified in this
Section 3.18; provided, however, the Securities Administrator will cooperate
with the Depositor in connection with any additional filings with respect to the
Trust Fund as the Depositor deems necessary under the Securities Exchange Act of
1934, as amended (the "Exchange Act"). Fees and expenses incurred by the
Securities Administrator in connection with this Section 3.18 shall not be
reimbursable from the Trust Fund.
Section 3.19 The Company. On the Closing Date, the Company will receive
from the Depositor a payment of $5,000.
Section 3.20 UCC. The Depositor shall inform the Trustee in writing of any
Uniform Commercial Code financing statements that were filed on the Closing Date
in connection with the Trust with stamped recorded copies of such financing
statements to be delivered to the
55
Trustee promptly upon receipt by the Depositor. The Trustee agrees to monitor
and notify the Depositor if any continuation statements for such Uniform
Commercial Code financing statements need to be filed. If directed by the
Depositor in writing, the Trustee will file any such continuation statements
solely at the expense of the Depositor. The Depositor shall file any financing
statements or amendments thereto required by any change in the Uniform
Commercial Code.
Section 3.21 Optional Purchase of Defaulted Mortgage Loans.
(a) With respect to any Mortgage Loan which as of the first day of a
Calendar Quarter is delinquent in payment by 90 days or more or is an REO
Property, the Company shall have the right to purchase such Mortgage Loan from
the Trust at a price equal to the Repurchase Price; provided however (i) that
such Mortgage Loan is still 90 days or more delinquent or is an REO Property as
of the date of such purchase and (ii) this purchase option, if not theretofore
exercised, shall terminate on the date prior to the last day of the related
Calendar Quarter. This purchase option, if not exercised, shall not be
thereafter reinstated unless the delinquency is cured and the Mortgage Loan
thereafter again becomes 90 days or more delinquent or becomes an REO Property,
in which case the option shall again become exercisable as of the first day of
the related Calendar Quarter.
(b) If at any time the Company remits to the Master Servicer a payment for
deposit in the Master Servicer Collection Account covering the amount of the
Repurchase Price for such a Mortgage Loan, and the Company provides to the
Trustee a certification signed by a Servicing Officer stating that the amount of
such payment has been deposited in the Master Servicer Collection Account, then
the Trustee shall execute the assignment of such Mortgage Loan to the Company at
the request of the Company without recourse, representation or warranty and the
Company shall succeed to all of the Trustee's right, title and interest in and
to such Mortgage Loan, and all security and documents relative thereto. Such
assignment shall be an assignment outright and not for security. The Company
will thereupon own such Mortgage, and all such security and documents, free of
any further obligation to the Trustee or the Certificateholders with respect
thereto.
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ARTICLE IV
Accounts
Section 4.01 Protected Accounts. (a) The Master Servicer shall enforce the
obligation of each Servicer to establish and maintain a Protected Account in
accordance with the applicable Servicing Agreement, with records to be kept with
respect thereto on a Mortgage Loan by Mortgage Loan basis, into which accounts
shall be deposited within 48 hours (or as of such other time specified in the
related Servicing Agreement) of receipt, all collections of principal and
interest on any Mortgage Loan and with respect to any REO Property received by a
Servicer, including Principal Prepayments, Insurance Proceeds, Liquidation
Proceeds and advances made from the Servicer's own funds (less servicing
compensation as permitted by the applicable Servicing Agreement in the case of
any Servicer) and all other amounts to be deposited in the Protected Account.
The Servicer is hereby authorized to make withdrawals from and deposits to the
related Protected Account for purposes required or permitted by this Agreement.
To the extent provided in the related Servicing Agreement, the Protected Account
shall be held by a Designated Depository Institution and segregated on the books
of such institution in the name of the Trustee for the benefit of
Certificateholders.
(b) To the extent provided in the related Servicing Agreement, amounts on
deposit in a Protected Account may be invested in Permitted Investments in the
name of the Trustee for the benefit of Certificateholders and, except as
provided in the preceding paragraph, not commingled with any other funds. Such
Permitted Investments shall mature, or shall be subject to redemption or
withdrawal, no later than the date on which such funds are required to be
withdrawn for deposit in the Master Servicer Collection Account, and shall be
held until required for such deposit. The income earned from Permitted
Investments made pursuant to this Section 4.01 shall be paid to the related
Servicer under the applicable Servicing Agreement, and the risk of loss of
moneys required to be distributed to the Certificateholders resulting from such
investments shall be borne by and be the risk of the related Servicer. The
related Servicer (to the extent provided in the Servicing Agreement) shall
deposit the amount of any such loss in the Protected Account within two Business
Days of receipt of notification of such loss but not later than the second
Business Day prior to the Distribution Date on which the moneys so invested are
required to be distributed to the Certificateholders.
(c) To the extent provided in the related Servicing Agreement and subject
to this Article IV, on or before each Servicer Remittance Date, the related
Servicer shall withdraw or shall cause to be withdrawn from its Protected
Accounts and shall immediately deposit or cause to be deposited in the Master
Servicer Collection Account amounts representing the following collections and
payments (other than with respect to principal of or interest on the Mortgage
Loans due on or before the Cut-off Date) with respect to each Loan Group:
(i) Scheduled Payments on the Mortgage Loans received or any related
portion thereof advanced by such Servicer pursuant to its Servicing Agreement
which were due during or before the related Due Period, net of the amount
thereof comprising its Servicing Fee or any fees with respect to any lender-paid
primary mortgage insurance policy;
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(ii) Full Principal Prepayments and any Liquidation Proceeds
received by such Servicer with respect to the Mortgage Loans in the related
Prepayment Period, with interest to the date of prepayment or liquidation, net
of the amount thereof comprising its Servicing Fee;
(iii) Partial Principal Prepayments received by such Servicer for
the Mortgage Loans in the related Prepayment Period; and
(iv) Any amount to be used as a Monthly Advance.
(d) Withdrawals may be made from an Account only to make remittances as
provided in Section 4.01(c), 4.02 and 4.03; to reimburse the Master Servicer or
a Servicer for Monthly Advances which have been recovered by subsequent
collections from the related Mortgagor; to remove amounts deposited in error; to
remove fees, charges or other such amounts deposited on a temporary basis; or to
clear and terminate the account at the termination of this Agreement in
accordance with Section 10.01. As provided in Sections 4.01(c) and 4.02(b)
certain amounts otherwise due to the Servicers may be retained by them and need
not be deposited in the Master Servicer Collection Account.
Section 4.02 Master Servicer Collection Account. (a) The Master Servicer
shall establish and maintain in the name of the Trustee, for the benefit of the
Certificateholders, the Master Servicer Collection Account as a segregated trust
account or accounts. The Master Servicer Collection Account shall be an Eligible
Account. The Master Servicer will deposit in the Master Servicer Collection
Account as identified by the Master Servicer and as received by the Master
Servicer, the following amounts:
(i) Any amounts withdrawn from a Protected Account;
(ii) Any Monthly Advance and any Compensating Interest Payments;
(iii) Any Insurance Proceeds or Net Liquidation Proceeds received by
or on behalf of the Master Servicer or which were not deposited in a Protected
Account;
(iv) The Repurchase Price with respect to any Mortgage Loans
purchased by the Seller pursuant to the Mortgage Loan Purchase Agreement or
Sections 2.02 or 2.03 hereof, any amounts which are to be treated pursuant to
Section 2.04 of this Agreement as the payment of a Repurchase Price in
connection with the tender of a Substitute Mortgage Loan by the Seller, the
Repurchase Price with respect to any Mortgage Loans purchased by the Company
pursuant to Section 3.21, and all proceeds of any Mortgage Loans or property
acquired with respect thereto repurchased by the Depositor or its designee
pursuant to Section 10.01;
(v) Any amounts required to be deposited with respect to losses on
investments of deposits in an Account; and
(vi) Any other amounts received by or on behalf of the Master
Servicer and required to be deposited in the Master Servicer Collection Account
pursuant to this Agreement.
(b) All amounts deposited to the Master Servicer Collection Account shall
be held by the Master Servicer in the name of the Trustee in trust for the
benefit of the Certificateholders in
58
accordance with the terms and provisions of this Agreement. The requirements for
crediting the Master Servicer Collection Account or the Distribution Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of (i) prepayment or late
payment charges or assumption, tax service, statement account or payoff,
substitution, satisfaction, release and other like fees and charges and (ii) the
items enumerated in Sections 4.05(a)(i) through (iv) and (vi) through (xii) with
respect to the Securities Administrator and the Master Servicer, need not be
credited by the Master Servicer or the Servicer to the Distribution Account or
the Master Servicer Collection Account, as applicable. In the event that the
Master Servicer shall deposit or cause to be deposited to the Distribution
Account any amount not required to be credited thereto, the Trustee, upon
receipt of a written request therefor signed by a Servicing Officer of the
Master Servicer, shall promptly transfer such amount to the Master Servicer, any
provision herein to the contrary notwithstanding.
(c) The amount at any time credited to the Master Servicer Collection
Account may be invested, in the name of the Trustee, or its nominee, for the
benefit of the Certificateholders, in Permitted Investments as directed by
Master Servicer. All Permitted Investments shall mature or be subject to
redemption or withdrawal on or before, and shall be held until, the next
succeeding Distribution Account Deposit Date. Any and all investment earnings on
amounts on deposit in the Master Servicer Account from time to time shall be for
the account of the Master Servicer. The Master Servicer from time to time shall
be permitted to withdraw or receive distribution of any and all investment
earnings from the Master Servicer Account. The risk of loss of moneys required
to be distributed to the Certificateholders resulting from such investments
shall be borne by and be the risk of the Master Servicer. The Master Servicer
shall deposit the amount of any such loss in the Master Servicer Collection
Account within two Business Days of receipt of notification of such loss but not
later than the second Business Day prior to the Distribution Date on which the
moneys so invested are required to be distributed to the Certificateholders.
Section 4.03 Permitted Withdrawals and Transfers from the Master Servicer
Collection Account. (a) The Master Servicer will, from time to time on demand of
a Servicer or the Securities Administrator, make or cause to be made such
withdrawals or transfers from the Master Servicer Collection Account as the
Master Servicer has designated for such transfer or withdrawal pursuant to this
Agreement and the related Servicing Agreement. The Master Servicer may clear and
terminate the Master Servicer Collection Account pursuant to Section 10.01 and
remove amounts from time to time deposited in error.
(b) On an ongoing basis, the Master Servicer shall withdraw from the
Master Servicer Collection Account (i) any expenses recoverable by the Trustee,
the Master Servicer or the Securities Administrator or the Custodian pursuant to
Sections 3.03, 7.04 and 9.05 and (ii) any amounts payable to the Master Servicer
as set forth in Section 3.14.
(c) In addition, on or before each Distribution Account Deposit Date, the
Master Servicer shall deposit in the Distribution Account (or remit to the
Trustee for deposit therein) any Monthly Advances required to be made by the
Master Servicer with respect to the Mortgage Loans.
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(d) No later than 3:00 p.m. New York time on each Distribution Account
Deposit Date, the Master Servicer will transfer all Available Funds on deposit
in the Master Servicer Collection Account with respect to the related
Distribution Date to the Trustee for deposit in the Distribution Account.
Section 4.04 Distribution Account. (a) The Trustee shall establish and
maintain in the name of the Trustee, for the benefit of the Certificateholders,
the Distribution Account as a segregated trust account or accounts.
(b) All amounts deposited to the Distribution Account shall be held by the
Trustee in the name of the Trustee in trust for the benefit of the
Certificateholders in accordance with the terms and provisions of this
Agreement.
(c) The Distribution Account shall constitute a trust account of the Trust
Fund segregated on the books of the Trustee and held by the Trustee in trust in
its Corporate Trust Office, and the Distribution Account and the funds deposited
therein shall not be subject to, and shall be protected from, all claims, liens,
and encumbrances of any creditors or depositors of the Trustee or the Master
Servicer (whether made directly, or indirectly through a liquidator or receiver
of the Trustee or the Master Servicer). The Distribution Account shall be an
Eligible Account. The amount at any time credited to the Distribution Account
shall be (i) held in cash and fully insured by the FDIC to the maximum coverage
provided thereby or (ii) invested in the name of the Trustee, in such Permitted
Investments selected by the Master Servicer or deposited in demand deposits with
such depository institutions as selected by the Master Servicer, provided that
time deposits of such depository institutions would be a Permitted Investment.
All Permitted Investments shall mature or be subject to redemption or withdrawal
on or before, and shall be held until, the next succeeding Distribution Date if
the obligor for such Permitted Investment is the Trustee or, if such obligor is
any other Person, the Business Day preceding such Distribution Date. All
investment earnings on amounts on deposit in the Distribution Account or benefit
from funds uninvested therein from time to time shall be for the account of the
Master Servicer. The Master Servicer shall be permitted to withdraw or receive
distribution of any and all investment earnings from the Distribution Account on
each Distribution Date. If there is any loss on a Permitted Investment or demand
deposit, the Master Servicer shall remit the amount of the loss to the Trustee
who shall deposit such amount in the Distribution Account. With respect to the
Distribution Account and the funds deposited therein, the Master Servicer shall
take such action as may be necessary to ensure that the Certificateholders shall
be entitled to the priorities afforded to such a trust account (in addition to a
claim against the estate of the Trustee) as provided by 12 U.S.C. ss. 92a(e),
and applicable regulations pursuant thereto, if applicable, or any applicable
comparable state statute applicable to state chartered banking corporations.
Section 4.05 Permitted Withdrawals and Transfers from the Distribution
Account. (a) The Trustee will, from time to time on demand of the Master
Servicer or the Securities Administrator, make or cause to be made such
withdrawals or transfers from the Distribution Account as the Master Servicer
has designated for such transfer or withdrawal pursuant to this Agreement and
the Servicing Agreements or as the Securities Administrator has instructed
hereunder for the following purposes (limited in the case of amounts due the
Master Servicer to
60
those not withdrawn from the Master Servicer Collection Account in accordance
with the terms of this Agreement):
(i) to reimburse the Master Servicer or any Servicer for any Monthly
Advance of its own funds, the right of the Master Servicer or a Servicer to
reimbursement pursuant to this subclause (i) being limited to amounts received
on a particular Mortgage Loan (including, for this purpose, the Repurchase Price
therefor, Insurance Proceeds and Liquidation Proceeds) which represent late
payments or recoveries of the principal of or interest on such Mortgage Loan
with respect to which such Monthly Advance was made;
(ii) to reimburse the Master Servicer or any Servicer from Insurance
Proceeds or Liquidation Proceeds relating to a particular Mortgage Loan for
amounts expended by the Master Servicer or such Servicer in good faith in
connection with the restoration of the related Mortgaged Property which was
damaged by an Uninsured Cause or in connection with the liquidation of such
Mortgage Loan;
(iii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds relating to a particular Mortgage Loan for insured expenses
incurred with respect to such Mortgage Loan and to reimburse the Master Servicer
or such Servicer from Liquidation Proceeds from a particular Mortgage Loan for
Liquidation Expenses incurred with respect to such Mortgage Loan; provided that
the Master Servicer shall not be entitled to reimbursement for Liquidation
Expenses with respect to a Mortgage Loan to the extent that (i) any amounts with
respect to such Mortgage Loan were paid as Excess Liquidation Proceeds pursuant
to clause (xi) of this Section 4.05(a) to the Master Servicer; and (ii) such
Liquidation Expenses were not included in the computation of such Excess
Liquidation Proceeds;
(iv) to pay the Master Servicer or any Servicer, as appropriate,
from Liquidation Proceeds or Insurance Proceeds received in connection with the
liquidation of any Mortgage Loan, the amount which the Master Servicer or such
Servicer would have been entitled to receive under clause (ix) of this Section
4.05(a) as servicing compensation on account of each defaulted scheduled payment
on such Mortgage Loan if paid in a timely manner by the related Mortgagor;
(v) to pay the Master Servicer or any Servicer from the Repurchase
Price for any Mortgage Loan, the amount which the Master Servicer or such
Servicer would have been entitled to receive under clause (ix) of this Section
4.05(a) as servicing compensation;
(vi) to reimburse the Master Servicer or any Servicer for advances
of funds (other than Monthly Advances) made with respect to the Mortgage Loans,
and the right to reimbursement pursuant to this clause being limited to amounts
received on the related Mortgage Loan (including, for this purpose, the
Repurchase Price therefor, Insurance Proceeds and Liquidation Proceeds) which
represent late recoveries of the payments for which such advances were made;
(vii) to reimburse the Master Servicer or any Servicer for any
Monthly Advance or advance, after a Realized Loss has been allocated with
respect to the related
61
Mortgage Loan if the Monthly Advance or advance has not been reimbursed pursuant
to clauses (i) and (vi);
(viii) to pay the Master Servicer as set forth in Section 3.14;
(ix) to reimburse the Master Servicer for expenses, costs and
liabilities incurred by and reimbursable to it pursuant to Sections 3.03,
7.04(c) and (d);
(x) to pay to the Master Servicer, as additional servicing
compensation, any Excess Liquidation Proceeds to the extent not retained by the
Servicer;
(xi) to reimburse or pay any Servicer any such amounts as are due
thereto under the Servicing Agreement and have not been retained by or paid to
the Servicer, to the extent provided in the Servicing Agreement;
(xii) to reimburse the Trustee, the Securities Administrator or the
Custodian for expenses, costs and liabilities incurred by or reimbursable to it
pursuant to this Agreement;
(xiii) to remove amounts deposited in error; and
(xiv) to clear and terminate the Distribution Account pursuant to
Section 10.01.
(b) The Master Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
reimbursement from the Distribution Account pursuant to clauses (i) through (vi)
and (viii) or with respect to any such amounts which would have been covered by
such clauses had the amounts not been retained by the Master Servicer without
being deposited in the Distribution Account under Section 4.02(b).
Reimbursements made pursuant to clauses (vii), (ix), (xi) and (xii) will be
allocated between the Loan Groups pro rata based on the aggregate Stated
Principal Balances of the Mortgage Loans in each Loan Group.
(c) On each Distribution Date, the Trustee shall distribute the Available
Funds to the extent on deposit in the Distribution Account for each Loan Group
to the Holders of the Certificates in accordance with distribution instructions
provided to it by the Securities Administrator no later than two Business Days
prior to such Distribution Date and determined by the Securities Administrator
in accordance with Section 6.01.
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ARTICLE V
Certificates
Section 5.01 Certificates. (a) The Depository, the Depositor and the
Trustee have entered into a Depository Agreement dated as of the Closing Date
(the "Depository Agreement"). Except for the Residual Certificates, the Private
Certificates and the Individual Certificates and as provided in Section 5.01(b),
the Certificates shall at all times remain registered in the name of the
Depository or its nominee and at all times: (i) registration of such
Certificates may not be transferred by the Trustee except to a successor to the
Depository; (ii) ownership and transfers of registration of such Certificates on
the books of the Depository shall be governed by applicable rules established by
the Depository; (iii) the Depository may collect its usual and customary fees,
charges and expenses from its Depository Participants; (iv) the Trustee shall
deal with the Depository as representative of such Certificate Owners of the
respective Class of Certificates for purposes of exercising the rights of
Certificateholders under this Agreement, and requests and directions for and
votes of such representative shall not be deemed to be inconsistent if they are
made with respect to different Certificate Owners; and (v) the Trustee may rely
and shall be fully protected in relying upon information furnished by the
Depository with respect to its Depository Participants.
The Residual Certificates and the Private Certificates are initially
Physical Certificates. If at any time the Holders of all of the Certificates of
one or more such Classes request that the Trustee cause such Class to become
Global Certificates, the Trustee and the Depositor will take such action as may
be reasonably required to cause the Depository to accept such Class or Classes
for trading if it may legally be so traded.
All transfers by Certificate Owners of such respective Classes of
Book-Entry Certificates and any Global Certificates shall be made in accordance
with the procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer Book-Entry Certificates of Certificate Owners it represents or of
brokerage firms for which it acts as agent in accordance with the Depository's
normal procedures.
(b) If (i)(A) the Depositor advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository and (B) the Depositor is unable to locate a
qualified successor within 30 days or (ii) the Depositor at its option advises
the Trustee in writing that it elects to terminate the book-entry system through
the Depository, the Trustee shall request that the Depository notify all
Certificate Owners of the occurrence of any such event and of the availability
of definitive, fully registered Certificates to Certificate Owners requesting
the same. Upon surrender to the Trustee of the Certificates by the Depository,
accompanied by registration instructions from the Depository for registration,
the Trustee shall issue the definitive Certificates.
In addition, if an Event of Default has occurred and is continuing, each
Certificate Owner materially adversely affected thereby may at its option
request a definitive Certificate evidencing such Certificate Owner's interest in
the related Class of Certificates. In order to make such request, such
Certificate Owner shall, subject to the rules and procedures of the Depository,
provide the Depository or the related Depository Participant with directions for
the Trustee to
63
exchange or cause the exchange of the Certificate Owner's interest in such Class
of Certificates for an equivalent interest in fully registered definitive form.
Upon receipt by the Trustee of instructions from the Depository directing the
Trustee to effect such exchange (such instructions to contain information
regarding the Class of Certificates and the Current Principal Balance being
exchanged, the Depository Participant account to be debited with the decrease,
the registered holder of and delivery instructions for the definitive
Certificate, and any other information reasonably required by the Trustee), (i)
the Trustee shall instruct the Depository to reduce the related Depository
Participant's account by the aggregate Current Principal Balance of the
definitive Certificate, (ii) the Trustee shall execute and deliver, in
accordance with the registration and delivery instructions provided by the
Depository, a Definitive Certificate evidencing such Certificate Owner's
interest in such Class of Certificates and (iii) the Trustee shall execute a new
Book-Entry Certificate reflecting the reduction in the aggregate Current
Principal Balance of such Class of Certificates by the amount of the definitive
Certificates.
Neither the Depositor nor the Trustee shall be liable for any delay in the
delivery of any instructions required pursuant to this Section 5.01(b) and may
conclusively rely on, and shall be protected in relying on, such instructions.
(c) (i) As provided herein, the REMIC Administrator will make an election
to treat the segregated pool of assets consisting of the Mortgage Loans and
certain other related assets subject to this Agreement as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC I." Component I of the Class R Certificates will represent the sole Class
of "residual interests" in REMIC I for purposes of the REMIC Provisions (as
defined herein) under federal income tax law. The following table irrevocably
sets forth the designation, pass-through rate (the "Uncertificated Pass-Through
Rate") and initial Uncertificated Principal Balance for each of the "regular
interests" in REMIC I (the "REMIC I Regular Interests"). The "latest possible
maturity date" (determined solely for purposes of satisfying Treasury regulation
Section 1.860G-1(a)(4)(iii)) for each REMIC I Regular Interest shall be the
Maturity Date. None of the REMIC I Regular Interests will be certificated. The
REMIC I Regular Interests and the REMIC I Residual Interest will have the
following designations, initial balances and pass-through rates:
64
Class
Designation for
each REMIC I
Regular
Interest and Initial
Component I of Type Uncertificated
the Class R of Pass-Through Principal Final Maturity
Certificates Interest Rate Balance Date*
----------------------------------------------------------------------
Class Y-1 Regular Variable(1) $27,244.27 September 2034
Class Y-2 Regular Variable(2) $100,088.60 September 2034
Class Y-3 Regular Variable(3) $59,081.85 September 2034
Class Y-4 Regular Variable(4) $7,209.40 September 2034
Class Y-5 Regular Variable(5) $22,609.32 September 2034
Class Y-6 Regular Variable(6) $21,582.08 September 2034
Class Y-7 Regular Variable(7) $96,565.90 September 2034
Class Z-1 Regular Variable(1) $54,494,622.73 September 2034
Class Z-2 Regular Variable(2) $200,213,559.40 September 2034
Class Z-3 Regular Variable(3) $118,179,210.15 September 2034
Class Z-4 Regular Variable(4) $14,411,582.60 September 2034
Class Z-5 Regular Variable(5) $45,215,492.68 September 2034
Class Z-6 Regular Variable(6) $43,165,025.92 September 2034
Class Z-7 Regular Variable(7) $193,167,442.10 September 2034
Component I of
the Class R Residual $100 August 2034
* The Distribution Date in the specified month, which is the month following
the month the latest maturing Mortgage Loan in the related Loan Group
matures. For federal income tax purposes, for each Class of REMIC I Regular
and Residual Interests, the "latest possible maturity date" shall be the
Final Maturity Date.
(1)Interest distributed to the REMIC I Regular Interests Y-1 and Z-1 on each
Distribution Date will have accrued at the weighted average of the Net Rates
for the Group I Loans on the applicable Uncertificated Principal Balance
outstanding immediately before such Distribution Date.
(2)Interest distributed to the REMIC I Regular Interests Y-2 and Z-2 on each
Distribution Date will have accrued at the weighted average of the Net Rates
for the Group II Loans on the applicable Uncertificated Principal Balance
outstanding immediately before such Distribution Date.
(3)Interest distributed to the REMIC I Regular Interests Y-3 and Z-3 on each
Distribution Date will have accrued at the weighted average of the Net Rates
for the Group III Loans on the applicable Uncertificated Principal Balance
outstanding immediately before such Distribution Date.
(4)Interest distributed to the REMIC I Regular Interests Y-4 and Z-4 on each
Distribution Date will have accrued at the weighted average of the Net Rates
for the Group IV Loans on the applicable Uncertificated Principal Balance
outstanding immediately before such Distribution Date.
(5)Interest distributed to the REMIC I Regular Interests Y-5 and Z-5 on each
Distribution Date will have accrued at the weighted average of the Net Rates
for the Group V Loans on the applicable Uncertificated Principal Balance
outstanding immediately before such Distribution Date.
(6)Interest distributed to the REMIC I Regular Interests Y-6 and Z-6 on each
Distribution Date will have accrued at the weighted average of the Net Rates
for the Group VI Loans on the applicable Uncertificated Principal Balance
outstanding immediately before such Distribution Date.
(7)Interest distributed to the REMIC I Regular Interests Y-7 and Z-7 on each
Distribution Date will have accrued at the weighted average of the Net Rates
for the Group VII Loans on the applicable Uncertificated Principal Balance
outstanding immediately before such Distribution Date.
(ii) REMIC II will be evidenced by (x) the REMIC II Regular
Interests (designated below), which will be uncertificated and non-transferable
and are hereby designated as the "regular interests" in REMIC II and have the
principal balances and accrue interest at the Pass-Through Rates equal to those
set forth in this Section 5.01(c)(iii) and (y) an interest in the
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Class R Certificates ("REMIC II Residual Interest"), which is hereby designated
as the single "residual interest" in REMIC II.
The Classes of the Certificates shall have the following designations,
initial principal amounts and Pass-Through Rates:
Designation Initial Principal Pass-Through Rate
----------- ----------------- -----------------
I-A-1 $50,023,000 (1)
I-A-2 $1,091,000 (2)
II-A-1 $180,282,000 (3)
II-A-2 $7,512,000 (4)
III-A-1 $110,848,000 (5)
IV-A-1 $13,517,000 (6)
V-A-1 $42,410,000 (7)
VI-A-1 $40,487,000 (8)
VII-A-1 $181,185,000 (9)
B-1 $13,718,000 (10)
B-2 $10,707,000 (10)
B-3 $7,361,000 (10)
B-4 $5,018,000 (10)
B-5 $3,012,000 (10)
B-6 $2,010,317 (10)
R $100 (11)
--------------------
(1)The Class I-A-1 Certificates will bear interest at a variable rate equal to
the weighted average of the Net Rates of the Group I Loans.
(2)The Class I-A-2 Certificates will bear interest at a variable rate equal to
the weighted average of the Net Rates of the Group I Loans.
(3)The Class II-A-1 Certificates will bear interest at a variable rate equal to
the weighted average of the Net Rates of the Group II Loans.
(4)The Class II-A-2 Certificates will bear interest at a variable rate equal to
the weighted average of the Net Rates of the Group II Loans.
(5)The Class III-A-1 Certificates will bear interest at a variable rate equal
to the weighted average of the Net Rates of the Group III Mortgage Loans.
(6)The Class IV-A-1 Certificates will bear interest at a variable rate equal to
the weighted average of the Net Rates of the Group IV Mortgage Loans.
(7)The Class V-A-1 Certificates will bear interest at a variable rate equal to
the weighted average of the Net Rates of the Group V Mortgage Loans.
(8)The Class VI-A-1 Certificates will bear interest at a variable rate equal to
the weighted average of the Net Rates of the Group VI Mortgage Loans.
(9)The Class VII-A-1 Certificates will bear interest at a variable rate equal
to the weighted average of the Net Rates of the Group VII Mortgage Loans.
(10) The Class B Certificates will bear interest at a variable rate equal to the
weighted average of the Net Rate of the Mortgage Loans in each Mortgage Loan
Group weighted in proportion to the results of subtracting from the aggregate
principal balance of each Mortgage Loan Group, the Current Principal Balance
of the related Classes of Senior Certificates.
(11) The Class R Certificates will not bear interest.
66
(d)Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date for
the Mortgage Loan with the latest maturity date in the Trust Fund has been
designated as the "latest possible maturity date" for the REMIC I Regular
Interests, REMIC II Regular Interests and the Certificates.
(e)With respect to each Distribution Date, each Class of Certificates
shall accrue interest during the related Interest Accrual Period. With respect
to each Distribution Date and each such Class of Certificates (other than the
Class R Certificates), interest shall be calculated, on the basis of a 360-day
year comprised of twelve 30-day months, based upon the respective Pass-Through
Rate set forth, or determined as provided, above and the Current Principal
Amount of such Class applicable to such Distribution Date.
(f)The Certificates shall be substantially in the forms set forth in
Exhibits X-0, X-0, X-0 and A-4. On original issuance, the Trustee shall sign,
countersign and shall deliver them at the direction of the Depositor. Pending
the preparation of definitive Certificates of any Class, the Trustee may sign
and countersign temporary Certificates that are printed, lithographed or
typewritten, in authorized denominations for Certificates of such Class,
substantially of the tenor of the definitive Certificates in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers or authorized signatories executing such
Certificates may determine, as evidenced by their execution of such
Certificates. 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 of the Trustee, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Certificates, the
Trustee shall sign and countersign and deliver in exchange therefor a like
aggregate principal amount, in authorized denominations for such Class, of
definitive Certificates of the same Class. Until so exchanged, such temporary
Certificates shall in all respects be entitled to the same benefits as
definitive Certificates.
(g)Each Class of Book-Entry Certificates will be registered as a single
Certificate of such Class held by a nominee of the Depository or the DTC
Custodian, and beneficial interests will be held by investors through the
book-entry facilities of the Depository in minimum denominations of (i) in the
case of the Senior Certificates (other than the Residual Certificates), $1,000
and in each case increments of $1.00 in excess thereof, and (ii) in the case of
the Offered Subordinate Certificates, $25,000 and increments of $1.00 in excess
thereof, except that one Certificate of each such Class may be issued in a
different amount so that the sum of the denominations of all outstanding
Certificates of such Class shall equal the Current Principal Amount of such
Class on the Closing Date. On the Closing Date, the Trustee shall execute and
countersign Physical Certificates all in an aggregate principal amount that
shall equal the Current Principal Amount of such Class on the Closing Date. The
Private Certificates shall be issued in certificated fully-registered form in
minimum dollar denominations of $25,000 and integral multiples of $1.00 in
excess thereof, except that one Private Certificate of each Class may be issued
in a different amount so that the sum of the denominations of all outstanding
Private Certificates of such Class shall equal the Current Principal Amount of
such Class on the Closing Date. The Residual Certificates shall each be issued
in certificated fully-registered form in the denomination of $100. Each Class of
Global Certificates, if any, shall be issued in fully registered form in minimum
dollar denominations of $50,000 and integral multiples of $1.00 in
67
excess thereof, except that one Certificate of each Class may be in a different
denomination so that the sum of the denominations of all outstanding
Certificates of such Class shall equal the Current Principal Amount of such
Class on the Closing Date. On the Closing Date, the Trustee shall execute and
countersign (i) in the case of each Class of Offered Certificates, the
Certificate in the entire Current Principal Amount of the respective Class and
(ii) in the case of each Class of Private Certificates, Individual Certificates
all in an aggregate principal amount that shall equal the Current Principal
Amount of each such respective Class on the Closing Date. The Certificates
referred to in clause (i) and if at any time there are to be Global
Certificates, the Global Certificates shall be delivered by the Depositor to the
Depository or pursuant to the Depository's instructions, shall be delivered by
the Depositor on behalf of the Depository to and deposited with the DTC
Custodian. The Trustee shall sign the Certificates by facsimile or manual
signature and countersign them by manual signature on behalf of the Trustee by
one or more authorized signatories, each of whom shall be Responsible Officers
of the Trustee or its agent. A Certificate bearing the manual and facsimile
signatures of individuals who were the authorized signatories of the Trustee or
its agent at the time of issuance shall bind the Trustee, notwithstanding that
such individuals or any of them have ceased to hold such positions prior to the
delivery of such Certificate.
(h)No Certificate shall be entitled to any benefit under this Agreement,
or be valid for any purpose, unless there appears on such Certificate the
manually executed countersignature of the Trustee or its agent, and such
countersignature upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly executed and delivered hereunder.
All Certificates issued on the Closing Date shall be dated the Closing Date. All
Certificates issued thereafter shall be dated the date of their
countersignature.
(i)The Closing Date is hereby designated as the "startup" day of each
2004-9 REMIC within the meaning of Section 860G(a)(9) of the Code.
(j)For federal income tax purposes, each 2004-9 REMIC shall have a tax
year that is a calendar year and shall report income on an accrual basis.
(k)The Trustee on behalf of the Trust shall cause each 2004-9 REMIC to
timely elect to be treated as a REMIC under Section 860D of the Code. Any
inconsistencies or ambiguities in this Agreement or in the administration of any
Trust established hereby shall be resolved in a manner that preserves the
validity of such elections.
(l)The following legend shall be placed on the Residual Certificates,
whether upon original issuance or upon issuance of any other Certificate of any
such Class in exchange therefor or upon transfer thereof:
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE
ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE
MASTER SERVICER AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE
UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY POSSESSION
OF THE UNITED STATES, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING (OTHER THAN AN INSTRUMENTALITY WHICH IS A
68
CORPORATION IF ALL OF ITS ACTIVITIES ARE SUBJECT TO TAX AND EXCEPT FOR
XXXXXXX MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT SELECTED BY SUCH
GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING,
(C) ANY ORGANIZATION (OTHER THAN CERTAIN FARMERS' COOPERATIVES 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 (INCLUDING THE TAX IMPOSED BY SECTION
511 OF THE CODE ON UNRELATED BUSINESS TAXABLE INCOME), (D) RURAL ELECTRIC
AND TELEPHONE COOPERATIVES DESCRIBED IN SECTION 1381(a)(2)(C) OF THE CODE,
(E) AN ELECTING LARGE PARTNERSHIP UNDER SECTION 775(a) OF THE CODE (ANY
SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B), (C), (D) OR (E)
BEING HEREIN REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (F) AN
AGENT OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER IS
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE
SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL
CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN
THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF
THIS CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A
DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO
LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE
A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED
TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS
CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE
CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.
Section 5.02 Registration of Transfer and Exchange of Certificates. (a)
The Trustee shall maintain at its Corporate Trust Office a Certificate Register
in which, subject to such reasonable regulations as it may prescribe, the
Trustee shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided.
(b) Subject to Section 5.01(a) and, in the case of any Global Certificate
or Physical Certificate upon the satisfaction of the conditions set forth below,
upon surrender for registration of transfer of any Certificate at any office or
agency of the Trustee maintained for such purpose, the Trustee shall sign,
countersign and shall deliver, in the name of the designated transferee or
transferees, a new Certificate of a like Class and aggregate Fractional
Undivided Interest, but bearing a different number.
(c) By acceptance of a Private Certificate or a Residual Certificate,
whether upon original issuance or subsequent transfer, each holder of such
Certificate acknowledges the restrictions on the transfer of such Certificate
set forth in the Securities Legend and agrees that it will transfer such a
Certificate only as provided herein. In addition to the provisions of Section
5.02(h), the following restrictions shall apply with respect to the transfer and
registration of
69
transfer of an Private Certificate or a Residual Certificate to a transferee
that takes delivery in the form of an Individual Certificate:
(i) The Trustee shall register the transfer of an Individual
Certificate if the requested transfer is being made to a transferee who has
provided the Trustee with a Rule 144A Certificate or comparable evidence as to
its QIB status.
(ii) The Trustee shall register the transfer of any Individual
Certificate if (x) the transferor has advised the Trustee in writing that the
Certificate is being transferred to an Institutional Accredited Investor along
with facts surrounding the transfer as set forth in Exhibit F-1 hereto; and (y)
prior to the transfer the transferee furnishes to the Trustee an Investment
Letter (and the Trustee shall be fully protected in so doing), provided that, if
based upon an Opinion of Counsel addressed to the Trustee to the effect that the
delivery of (x) and (y) above are not sufficient to confirm that the proposed
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act and other
applicable laws, the Trustee shall as a condition of the registration of any
such transfer require the transferor to furnish such other certifications, legal
opinions or other information prior to registering the transfer of an Individual
Certificate as shall be set forth in such Opinion of Counsel.
(d) So long as a Global Certificate of such Class is outstanding and is
held by or on behalf of the Depository, transfers of beneficial interests in
such Global Certificate, or transfers by holders of Individual Certificates of
such Class to transferees that take delivery in the form of beneficial interests
in the Global Certificate, may be made only in accordance with Section 5.02(h),
the rules of the Depository and the following:
(i) In the case of a beneficial interest in the Global Certificate
being transferred to an Institutional Accredited Investor, such transferee shall
be required to take delivery in the form of an Individual Certificate or
Certificates and the Trustee shall register such transfer only upon compliance
with the provisions of Section 5.02(c)(ii).
(ii) In the case of a beneficial interest in a Class of Global
Certificates being transferred to a transferee that takes delivery in the form
of an Individual Certificate or Certificates of such Class, except as set forth
in clause (i) above, the Trustee shall register such transfer only upon
compliance with the provisions of Section 5.02(c)(i).
(iii) In the case of an Individual Certificate of a Class being
transferred to a transferee that takes delivery in the form of a beneficial
interest in a Global Certificate of such Class, the Trustee shall register such
transfer if the transferee has provided the Trustee with a Rule 144A Certificate
or comparable evidence as to its QIB status.
(iv) No restrictions shall apply with respect to the transfer or
registration of transfer of a beneficial interest in the Global Certificate of a
Class to a transferee that takes delivery in the form of a beneficial interest
in the Global Certificate of such Class; provided that each such transferee
shall be deemed to have made such representations and warranties contained in
the Rule 144A Certificate as are sufficient to establish that it is a QIB.
70
(e) Subject to Section 5.02(h), an exchange of a beneficial interest in a
Global Certificate of a Class for an Individual Certificate or Certificates of
such Class, an exchange of an Individual Certificate or Certificates of a Class
for a beneficial interest in the Global Certificate of such Class and an
exchange of an Individual Certificate or Certificates of a Class for another
Individual Certificate or Certificates of such Class (in each case, whether or
not such exchange is made in anticipation of subsequent transfer, and, in the
case of the Global Certificate of such Class, so long as such Certificate is
outstanding and is held by or on behalf of the Depository) may be made only in
accordance with Section 5.02(h), the rules of the Depository and the following:
(i) A holder of a beneficial interest in a Global Certificate of a
Class may at any time exchange such beneficial interest for an Individual
Certificate or Certificates of such Class.
(ii) A holder of an Individual Certificate or Certificates of a
Class may exchange such Certificate or Certificates for a beneficial interest in
the Global Certificate of such Class if such holder furnishes to the Trustee a
Rule 144A Certificate or comparable evidence as to its QIB status.
(iii) A holder of an Individual Certificate of a Class may exchange
such Certificate for an equal aggregate principal amount of Individual
Certificates of such Class in different authorized denominations without any
certification.
(f) (i) Upon acceptance for exchange or transfer of an Individual
Certificate of a Class for a beneficial interest in a Global Certificate of such
Class as provided herein, the Trustee shall cancel such Individual Certificate
and shall (or shall request the Depository to) endorse on the schedule affixed
to the applicable Global Certificate (or on a continuation of such schedule
affixed to the Global Certificate and made a part thereof) or otherwise make in
its books and records an appropriate notation evidencing the date of such
exchange or transfer and an increase in the certificate balance of the Global
Certificate equal to the certificate balance of such Individual Certificate
exchanged or transferred therefor.
(ii) Upon acceptance for exchange or transfer of a beneficial
interest in a Global Certificate of a Class for an Individual Certificate of
such Class as provided herein, the Trustee shall (or shall request the
Depository to) endorse on the schedule affixed to such Global Certificate (or on
a continuation of such schedule affixed to such Global Certificate and made a
part thereof) or otherwise make in its books and records an appropriate notation
evidencing the date of such exchange or transfer and a decrease in the
certificate balance of such Global Certificate equal to the certificate balance
of such Individual Certificate issued in exchange therefor or upon transfer
thereof.
(g) The Securities Legend shall be placed on any Individual Certificate
issued in exchange for or upon transfer of another Individual Certificate or of
a beneficial interest in a Global Certificate.
(h) Subject to the restrictions on transfer and exchange set forth in this
Section 5.02, the holder of any Individual Certificate may transfer or exchange
the same in whole or in part (in
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an initial certificate balance equal to the minimum authorized denomination set
forth in Section 5.01(g) or any integral multiple of $1.00 in excess thereof) by
surrendering such Certificate at the Corporate Trust Office, or at the office of
any transfer agent, together with an executed instrument of assignment and
transfer satisfactory in form and substance to the Trustee in the case of
transfer and a written request for exchange in the case of exchange. The holder
of a beneficial interest in a Global Certificate may, subject to the rules and
procedures of the Depository, cause the Depository (or its nominee) to notify
the Trustee in writing of a request for transfer or exchange of such beneficial
interest for an Individual Certificate or Certificates. Following a proper
request for transfer or exchange, the Trustee shall, within five Business Days
of such request made at the Corporate Trust Office, sign, countersign and
deliver at the Corporate Trust Office, to the transferee (in the case of
transfer) or holder (in the case of exchange) or send by first class mail at the
risk of the transferee (in the case of transfer) or holder (in the case of
exchange) to such address as the transferee or holder, as applicable, may
request, an Individual Certificate or Certificates, as the case may require, for
a like aggregate Fractional Undivided Interest and in such authorized
denomination or denominations as may be requested. The presentation for transfer
or exchange of any Individual Certificate shall not be valid unless made at the
Corporate Trust Office by the registered holder in person, or by a duly
authorized attorney-in-fact.
(i) At the option of the Certificateholders, Certificates may be exchanged
for other Certificates of authorized denominations of a like Class and aggregate
Fractional Undivided Interest, upon surrender of the Certificates to be
exchanged at the Corporate Trust Office; provided, however, that no Certificate
may be exchanged for new Certificates unless the original Fractional Undivided
Interest represented by each such new Certificate (i) is at least equal to the
minimum authorized denomination or (ii) is acceptable to the Depositor as
indicated to the Trustee in writing. Whenever any Certificates are so
surrendered for exchange, the Trustee shall sign and countersign and the Trustee
shall deliver the Certificates which the Certificateholder making the exchange
is entitled to receive.
(j) If the Trustee so requires, every Certificate presented or surrendered
for transfer or exchange shall be duly endorsed by, or be accompanied by a
written instrument of transfer, with a signature guarantee, in form satisfactory
to the Trustee, duly executed by the holder thereof or his or her attorney duly
authorized in writing.
(k) No service charge shall be made for any transfer or exchange of
Certificates, but the Trustee may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.
(l) The Trustee shall cancel all Certificates surrendered for transfer or
exchange but shall retain such Certificates in accordance with its standard
retention policy or for such further time as is required by the record retention
requirements of the Securities Exchange Act of 1934, as amended, and thereafter
may destroy such Certificates.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates. (a) If (i)
any mutilated Certificate is surrendered to the Trustee, or the Trustee receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (ii) there is delivered to the Trustee such security or
indemnity as it may require to save it harmless, and (iii) the Trustee has not
received notice
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that such Certificate has been acquired by a third Person, the Trustee shall
sign, countersign and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like tenor and
Fractional Undivided Interest but in each case bearing a different number. The
mutilated, destroyed, lost or stolen Certificate shall thereupon be canceled of
record by the Trustee and shall be of no further effect and evidence no rights.
(b) Upon the issuance of any new Certificate under this Section 5.03, the
Trustee may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Any duplicate Certificate issued pursuant to this Section 5.03 shall constitute
complete and indefeasible evidence of ownership in the Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
Section 5.04 Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, the Depositor, the Trustee and any
agent of the Depositor or the Trustee may treat the Person in whose name any
Certificate is registered as the owner of such Certificate for the purpose of
receiving distributions pursuant to Section 6.01 and for all other purposes
whatsoever. Neither the Depositor, the Trustee nor any agent of the Depositor or
the Trustee shall be affected by notice to the contrary. No Certificate shall be
deemed duly presented for a transfer effective on any Record Date unless the
Certificate to be transferred is presented no later than the close of business
on the third Business Day preceding such Record Date.
Section 5.05 Transfer Restrictions on Residual Certificates. (a) Residual
Certificates, or interests therein, may not be transferred without the prior
express written consent of the Tax Matters Person and the Seller, which cannot
be unreasonably withheld. As a prerequisite to such consent, the proposed
transferee must provide the Tax Matters Person, the Seller and the Trustee with
an affidavit that the proposed transferee is a Permitted Transferee (and, unless
the Tax Matters Person and the Seller consent to the transfer to a person who is
not a U.S. Person, an affidavit that it is a U.S. Person) as provided in Section
5.05(b).
(b) No transfer, sale or other disposition of a Residual Certificate
(including a beneficial interest therein) may be made unless, prior to the
transfer, sale or other disposition of a Residual Certificate, the proposed
transferee (including the initial purchasers thereof) delivers to the Tax
Matters Person, the Trustee and the Depositor an affidavit in the form attached
hereto as Exhibit E stating, among other things, that as of the date of such
transfer (i) such transferee is a Permitted Transferee and that (ii) such
transferee is not acquiring such Residual Certificate for the account of any
person who is not a Permitted Transferee. The Tax Matters Person shall not
consent to a transfer of a Residual Certificate if it has actual knowledge that
any statement made in the affidavit issued pursuant to the preceding sentence is
not true. Notwithstanding any transfer, sale or other disposition of a Residual
Certificate to any Person who is not a Permitted Transferee, such transfer, sale
or other disposition shall be deemed to be of no legal force or effect
whatsoever and such Person shall not be deemed to be a Holder of a Residual
Certificate for any purpose hereunder, including, but not limited to, the
receipt of distributions thereon. If any purported transfer shall be in
violation of the provisions of this Section 5.05(b), then the prior Holder
thereof shall, upon discovery that the transfer of such Residual Certificate was
not in fact permitted by this Section 5.05(b), be restored to all rights as a
Holder thereof retroactive
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to the date of the purported transfer. None of the Trustee, the Tax Matters
Person or the Depositor shall be under any liability to any Person for any
registration or transfer of a Residual Certificate that is not permitted by this
Section 5.05(b) or for making payments due on such Residual Certificate to the
purported Holder thereof or taking any other action with respect to such
purported Holder under the provisions of this Agreement so long as the written
affidavit referred to above was received with respect to such transfer, and the
Tax Matters Person, the Trustee and the Depositor, as applicable, had no
knowledge that it was untrue. The prior Holder shall be entitled to recover from
any purported Holder of a Residual Certificate that was in fact not a permitted
transferee under this Section 5.05(b) at the time it became a Holder all
payments made on such Residual Certificate. Each Holder of a Residual
Certificate, by acceptance thereof, shall be deemed for all purposes to have
consented to the provisions of this Section 5.05(b) and to any amendment of this
Agreement deemed necessary (whether as a result of new legislation or otherwise)
by counsel of the Tax Matters Person or the Depositor to ensure that the
Residual Certificates are not transferred to any Person who is not a Permitted
Transferee and that any transfer of such Residual Certificates will not cause
the imposition of a tax upon the Trust or cause any REMIC to fail to qualify as
a REMIC.
(c) Unless the Tax Matters Person shall have consented in writing (which
consent may be withheld in the Tax Matters Person's sole discretion), the
Residual Certificates (including a beneficial interest therein) may not be
purchased by or transferred to any person who is not a United States Person.
(d) By accepting a Residual Certificate, the purchaser thereof agrees to
be a Tax Matters Person if it is the Holder of the largest percentage interest
of such Certificate, and appoints the Securities Administrator to act as its
agent with respect to all matters concerning the tax obligations of the Trust.
Section 5.06 Restrictions on Transferability of Certificates. (a) No
offer, sale, transfer or other disposition (including pledge) of any Certificate
shall be made by any Holder thereof unless registered under the Securities Act,
or an exemption from the registration requirements of the Securities Act and any
applicable state securities or "Blue Sky" laws is available and the prospective
transferee (other than the Depositor) of such Certificate signs and delivers to
the Trustee an Investment Letter, if the transferee is an Institutional
Accredited Investor, in the form set forth as Exhibit F-l hereto, or a Rule 144A
Certificate, if the transferee is a QIB, in the form set forth as Exhibit F-2
hereto. Notwithstanding the provisions of the immediately preceding sentence, no
restrictions shall apply with respect to the transfer or registration of
transfer of a beneficial interest in any Certificate that is a Global
Certificate of a Class to a transferee that takes delivery in the form of a
beneficial interest in the Global Certificate of such Class provided that each
such transferee shall be deemed to have made such representations and warranties
contained in the Rule 144A Certificate as are sufficient to establish that it is
a QIB. In the case of a proposed transfer of any Certificate to a transferee
other than a QIB, the Trustee may require an Opinion of Counsel addressed to the
Trustee that such transaction is exempt from the registration requirements of
the Securities Act. The cost of such opinion shall not be an expense of the
Trustee or the Trust Fund.
(b) The Private Certificates shall each bear a Securities Legend.
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Section 5.07 ERISA Restrictions. (a) Subject to the provisions of
subsection (b), no Residual Certificates or Private Certificates may be acquired
directly or indirectly by, or on behalf of, an employee benefit plan or other
retirement arrangement (a "Plan") that is subject to Title I of ERISA or Section
4975 of the Code, or by a person using "plan assets" of a Plan, unless the
proposed transferee provides the Trustee, with an Opinion of Counsel addressed
to the Trustee, the Master Servicer and the Securities Administrator (upon which
they may rely) that is satisfactory to the Trustee, which opinion will not be at
the expense of the Trustee, the Master Servicer or the Securities Administrator,
that the purchase of such Certificates by or on behalf of such Plan is
permissible under applicable law, will not constitute or result in a nonexempt
prohibited transaction under ERISA or Section 4975 of the Code and will not
subject the Depositor, the Master Servicer, the Securities Administrator or the
Trustee to any obligation in addition to those undertaken in the Agreement.
(b) Unless such Person has provided an Opinion of Counsel in accordance
with Section 5.07(a), any Person acquiring an interest in a Global Certificate
which is a Private Certificate, by acquisition of such Certificate, shall be
deemed to have represented to the Trustee, and any Person acquiring an interest
in a Private Certificate in definitive form shall represent in writing to the
Trustee, that it is not acquiring an interest in such Certificate directly or
indirectly by, or on behalf of, or with "plan assets" of, an employee benefit
plan or other retirement arrangement which is subject to Title I of ERISA and/or
Section 4975 of the Code.
(c) Each beneficial owner of a Class B-1, Class B-2 or Class B-3
Certificate or any interest therein shall be deemed to have represented, by
virtue of its acquisition or holding of that certificate or any interest therein
shall be deemed to have represented, by virtue of its acquisition or holding of
that certificate or interest therein, that either (i) such Certificate is rated
at least "BBB-" or its equivalent by Fitch, S&P or Xxxxx'x, (ii) such beneficial
owner is not a Plan or investing with "plan assets" of any Plan, or (iii) (1) it
is an insurance company, (2) the source of funds used to acquire or hold the
certificate or interest therein is an "insurance company general account," as
such term is defined in Prohibited Transaction Class Exemption ("PTCE") 95-60,
and (3) the conditions in Sections I and III of PTCE 95-60 have been satisfied.
(d) None of the Trustee, the Master Servicer nor the Securities
Administrator will be required to monitor, determine or inquire as to compliance
with the transfer restrictions with respect to the Global Certificates. Any
attempted or purported transfer of any Certificate in violation of the
provisions of Section s (a), (b) or (c) above shall be void ab initio and such
Certificate shall be considered to have been held continuously by the prior
permitted Certificateholder. Any transferor of any Certificate in violation of
such provisions, shall indemnify and hold harmless the Trustee, the Securities
Administrator and the Master Servicer from and against any and all liabilities,
claims, costs or expenses incurred by the Trustee, the Securities Administrator
or the Master Servicer as a result of such attempted or purported transfer. The
Trustee shall have no liability for transfer of any such Global Certificates in
or through book-entry facilities of any Depository or between or among
Depository Participants or Certificate Owners made in violation of the transfer
restrictions set forth herein.
Section 5.08 Rule 144A Information. For so long as any Private
Certificates are outstanding, (1) the Seller will provide or cause to be
provided to any holder of such Private Certificates and any prospective
purchaser thereof designated by such a holder, upon the request
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of such holder or prospective purchaser, the information required to be provided
to such holder or prospective purchaser by Rule 144A(d)(4) under the Securities
Act; and (2) the Seller shall update such information from time to time in order
to prevent such information from becoming false and misleading and will take
such other actions as are necessary to ensure that the safe harbor exemption
from the registration requirements of the Securities Act under Rule 144A is and
will be available for resales of such Private Certificates conducted in
accordance with Rule 144A.
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ARTICLE VI
Payments to Certificateholders
Section 6.01 Distributions on the Certificates. (a) Interest and principal
(as applicable) on the Certificates (other than the Class R Certificates) of
each Certificate Group will be distributed monthly on each Distribution Date,
commencing in August 2004, in an amount equal to the Available Funds for the
related Loan Group on deposit in the Distribution Account for such Distribution
Date. In addition, on the Distribution Date occurring in August 2004, the Class
R Deposit will be distributed to the Holder of the Class R Certificates in
reduction of the Current Principal Amount thereof. On each Distribution Date,
the Available Funds for each Loan Group on deposit in the Distribution Account
shall be distributed as follows:
(A) on each Distribution Date, the Available Funds for Loan
Group I will be distributed to the Group I Certificates as
follows:
first, to the Class I-A-1 Certificates and Class I-A-2
Certificates, the Accrued Certificate Interest on such
Class for such Distribution Date, pro rata, based on the
Accrued Certificate Interest owed to each such Class;
second, to the Class I-A-1 Certificates and Class I-A-2
Certificates, any Accrued Certificate Interest thereon
remaining undistributed from previous Distribution
Dates, pro rata, based on the Accrued Certificate
Interest owed to each such Class, to the extent of
remaining Available Funds for Loan Group I; and
third, to the Class I-A-1 Certificates and Class I-A-2
Certificates, in reduction of the Current Principal
Amount thereof, the Senior Optimal Principal Amount with
respect to the Group I Certificates for such
Distribution Date, pro rata, based on their respective
Current Principal Amounts, to the extent of remaining
Available Funds for Loan Group I, until the Current
Principal Amount of each such Class has been reduced to
zero.
(B) on each Distribution Date, the Available Funds for Loan
Group II will be distributed to the Group II Certificates as
follows:
first, to the Class II-A-1 Certificates and Class II-A-2
Certificates, the Accrued Certificate Interest on such
Class for such Distribution Date, pro rata, based on the
Accrued Certificate Interest owed to each such Class;
second, to the Class II-A-1 Certificates and Class
II-A-2 Certificates, any Accrued Certificate Interest
thereon remaining undistributed from previous
Distribution Dates, pro rata, based on
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the Accrued Certificate Interest owed to each such
Class, to the extent of remaining Available Funds for
Loan Group II; and
third, to the Class II-A-1 Certificates and Class II-A-2
Certificates, in reduction of the Current Principal
Amount thereof, the Senior Optimal Principal Amount with
respect to the Group II Certificates for such
Distribution Date, pro rata, based on their respective
Current Principal Amounts, to the extent of remaining
Available Funds for Loan Group II, until the Current
Principal Amount of each such Class has been reduced to
zero.
(C) on each Distribution Date, the Available Funds for Loan
Group III will be distributed to the Group III Certificates as
follows:
first, to the Class III-A-1 Certificates, the Accrued
Certificate Interest on such Class for such
Distribution Date;
second, to the Class III-A-1 Certificates, any Accrued
Certificate Interest thereon remaining undistributed
from previous Distribution Dates, to the extent of
remaining Available Funds for Loan Group III; and
third, to the Class III-A-1 Certificates, in reduction
of the Current Principal Amount thereof, the Senior
Optimal Principal Amount with respect to the Class
III-A-1 Certificates for such Distribution Date, to the
extent of remaining Available Funds for Loan Group III,
until the Current Principal Amount of such Class has
been reduced to zero.
(D) on each Distribution Date, the Available Funds for Loan
Group IV will be distributed to the Group IV Certificates as
follows:
first, to the Class IV-A-1 Certificates, the Accrued
Certificate Interest on such Class for such
Distribution Date;
second, to the Class IV-A-1 Certificates, any Accrued
Certificate Interest thereon remaining undistributed
from previous Distribution Dates, to the extent of
remaining Available Funds for Loan Group IV; and
third, to the Class IV-A-1 Certificates, in reduction of
the Current Principal Amount thereof, the Senior Optimal
Principal Amount with respect to the Class IV-A-1
Certificates for such Distribution Date, to the extent
of remaining Available Funds for Loan Group IV, until
the Current Principal Amount of such Class has been
reduced to zero.
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(E) on each Distribution Date, the Available Funds for Loan
Group V will be distributed to the Group V Certificates as
follows:
first, to the Class V-A-1 Certificates, the Accrued
Certificate Interest on such Class for such
Distribution Date;
second, to the Class V-A-1 Certificates, any Accrued
Certificate Interest thereon remaining undistributed
from previous Distribution Dates, to the extent of
remaining Available Funds for Loan Group V; and
third, to the Class V-A-1 Certificates, in reduction of
the Current Principal Amount thereof, the Senior Optimal
Principal Amount with respect to the Class V-A-1
Certificates for such Distribution Date, to the extent
of remaining Available Funds for Loan Group V, until the
Current Principal Amount of such Class has been reduced
to zero.
(F) on each Distribution Date, the Available Funds for Loan
Group VI will be distributed to the Group VI Certificates as
follows:
first, to the Class VI-A-1 Certificates, the Accrued
Certificate Interest on such Class for such
Distribution Date;
second, to the Class VI-A-1 Certificates, any Accrued
Certificate Interest thereon remaining undistributed
from previous Distribution Dates, to the extent of
remaining Available Funds for Loan Group VI; and
third, to the Class VI-A-1 Certificates, in reduction of
the Current Principal Amount thereof, the Senior Optimal
Principal Amount with respect to the Class VI-A-1
Certificates for such Distribution Date, to the extent
of remaining Available Funds for Loan Group VI, until
the Current Principal Amount of such Class has been
reduced to zero.
(G) on each Distribution Date, the Available Funds for Loan
Group VII will be distributed to the Group VII Certificates as
follows:
first, to the Class VII-A-1 Certificates, the Accrued
Certificate Interest on such Class for such
Distribution Date;
second, to the Class VII-A-1 Certificates, any Accrued
Certificate Interest thereon remaining undistributed
from previous Distribution Dates, to the extent of
remaining Available Funds for Loan Group VII; and
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third, to the Class VII-A-1 Certificates, in
reduction of the Current Principal Amount thereof, the
Senior Optimal Principal Amount with respect to the
Class VII-A-1 Certificates for such Distribution Date,
to the extent of remaining Available Funds for Loan
Group VII, until the Current Principal Amount of such
Class has been reduced to zero.
(H) Except as provided in clauses (I) and (J) below, on each
Distribution Date on or prior to the Cross-Over Date, an
amount equal to the sum of any remaining Available Funds for
all Loan Groups after the distributions in clauses (A) through
(G) above will be distributed sequentially, in the following
order, to the Class B-1, Class B-2, Class B-3, Class B-4,
Class B-5 and Class B-6 Certificates, in each case up to an
amount equal to and in the following order: (a) the Accrued
Certificate Interest thereon for such Distribution Date, (b)
any Accrued Certificate Interest thereon remaining
undistributed from previous Distribution Dates and (c) such
Class's Allocable Share for such Distribution Date, in each
case, to the extent of remaining Available Funds for all Loan
Groups.
(I) On each Distribution Date prior to the Cross-Over Date,
but after the reduction of the aggregate Current Principal
Amount of all of the classes of any of the Group I, Group II,
Group III, Group IV, Group V, Group VI or Group VII
Certificates to zero, the remaining Certificate Groups will be
entitled to receive in reduction of their Current Principal
Amounts, pro rata based upon aggregate Current Principal
Amount of the Senior Certificates in each Certificate Group
immediately prior to such Distribution Date, in addition to
any Principal Prepayments related to such remaining Senior
Certificates' respective Loan Group allocated to such Senior
Certificates, 100% of the Principal Prepayments on any
Mortgage Loan in the Loan Group or Loan Groups relating to any
fully paid Certificate Group. Such amounts allocated to Senior
Certificates shall be treated as part of the Available Funds
for the related Loan Group and distributed as part of the
related Senior Optimal Distribution Amount in accordance with
priority third in clauses (A) through (G) above, as
applicable, in reduction of the Current Principal Amounts
thereof. Notwithstanding the foregoing, if (i) the weighted
average of the Subordinate Percentages on such Distribution
Date equals or exceeds two times the initial weighted average
of the Subordinate Percentages and (ii) the aggregate
Scheduled Principal Balance of the Mortgage Loans delinquent
60 days or more (including for this purpose any such Mortgage
Loans in foreclosure and Mortgage Loans with respect to which
the related Mortgaged Property has been acquired by the
Trust), averaged over the last six months, as a percentage of
the aggregate Current Principal Amount of the Subordinate
Certificates does not exceed 100%, then the additional
allocation of Principal Prepayments to the Certificates in
accordance with this clause (I) will not be made and 100% of
the Principal
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Prepayments on any Mortgage Loan in the Loan Group relating to
the fully paid Certificate Group or Certificate Groups will be
allocated to the Subordinate Certificates.
(J) For any Undercollateralized Certificate Group on any
Distribution Date prior to the Cross-Over Date, (i) 100% of
amounts otherwise allocable to the Subordinate Certificates in
respect of principal will be distributed to the Senior
Certificates of such Undercollateralized Certificate Group on
a pro rata basis in accordance with their respective Current
Principal Amounts in reduction of the Current Principal
Amounts thereof, until the aggregate Current Principal Amount
of such Senior Certificates is an amount equal to the
aggregate Scheduled Principal Balance of the Mortgage Loans in
the related Loan Group and (ii) the Accrued Certificate
Interest otherwise allocable to the Subordinate Certificates
on such Distribution Date will be reduced and distributed to
such Senior Certificates, to the extent of any amount due and
unpaid on such Senior Certificates, in an amount equal to one
month's interest at a rate equal to the related Pass-Through
Rate for such Distribution Date on the related
Undercollateralized Amount. Any such reduction in the Accrued
Certificate Interest on the Subordinate Certificates will be
allocated in reverse order of the Class B Certificates
numerical designations, commencing with the Class B-6
Certificates. If there exists more than one
Undercollateralized Certificate Group on a Distribution Date,
amounts distributable to such Undercollateralized Certificate
Groups pursuant to this clause will be allocated between such
Undercollateralized Certificate Groups, pro rata, based upon
their respective Undercollateralized Amounts.
(K) If, after distributions have been made pursuant to
priorities first and second of clauses (A) through (G) above
on any Distribution Date, the remaining Available Funds for
any Loan Group is less than the Senior Optimal Principal
Amount for that Loan Group, the Senior Optimal Principal
Amount for such Loan Group shall be reduced by that amount,
and the remaining Available Funds for such Loan Group will be
distributed as principal among the related Classes of Senior
Certificates on a pro rata basis in accordance with their
respective Current Principal Amounts.
(L) On each Distribution Date, any Available Funds remaining
after payment of interest and principal to the Classes of
Certificates entitled thereto, will be distributed to the
Class R Certificates; provided that if on any Distribution
Date there are any Available Funds for any Loan Group
remaining after payment of interest and principal to a Class
or Classes of Certificates entitled thereto, such amounts will
be distributed to the other Classes of Senior Certificates,
pro rata, based upon their Current Principal Amounts, until
all amounts due to all Classes of Senior Certificates have
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been paid in full, before any Available Funds are distributed
in accordance with this clause to the Class R Certificates.
(b) No Accrued Certificate Interest will be payable with respect to any
Class of Certificates after the Distribution Date on which the Current Principal
Amount of such Certificate has been reduced to zero.
(c) If on any Distribution Date the Available Funds for the Senior
Certificates in any Certificate Group is less than the Accrued Certificate
Interest on the related Senior Certificates for such Distribution Date prior to
reduction for Net Interest Shortfalls and the interest portion of Realized
Losses, the shortfall will be allocated to the holders of the Class of Senior
Certificates in such Certificate Group on a pro rata basis in accordance with
the amount of Accrued Certificate Interest for that Distribution Date absent
such shortfalls. In addition, the amount of any interest shortfalls will
constitute unpaid Accrued Certificate Interest and will be distributable to
holders of the Certificates of the related Classes entitled to such amounts on
subsequent Distribution Dates, to the extent of the applicable Available Funds
after current interest distributions as required herein. Any such amounts so
carried forward will not bear interest. Shortfalls in interest payments will not
be offset by a reduction in the servicing compensation of the Master Servicer or
otherwise, except to the extent of applicable Compensating Interest Payments.
(d) The expenses and fees of the Trust shall be paid by each of the 2004-9
REMICs, to the extent that such expenses relate to the assets of each of such
respective 2004-9 REMICs, and all other expenses and fees of the Trust shall be
paid pro rata by each of the 2004-9 REMICs.
Section 6.02 Allocation of Losses.(a) On or prior to each Determination
Date, the Master Servicer shall determine the amount of any Realized Loss in
respect of each Mortgage Loan that occurred during the immediately preceding
calendar month, based on information provided by the related Servicer.
(b) With respect to any Certificates any Distribution Date, the principal
portion of each Realized Loss on a Mortgage Loan in a Loan Group shall be
allocated as follows:
first, to the Class B-6 Certificates until the Current Principal
Amount thereof has been reduced to zero;
second, to the Class B-5 Certificates until the Current Principal
Amount thereof has been reduced to zero;
third, to the Class B-4 Certificates until the Current Principal
Amount thereof has been reduced to zero;
fourth, to the Class B-3 Certificates until the Current Principal
Amount thereof has been reduced to zero;
fifth, to the Class B-2 Certificates until the Current Principal
Amount thereof has been reduced to zero;
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sixth, to the Class B-1 Certificates until the Current Principal
Amount thereof has been reduced to zero; and
seventh, to the Class of Senior Certificates in the related
Certificate Group.
(c) Notwithstanding the foregoing clause (b), no such allocation of any
Realized Loss shall be made on a Distribution Date to any Class of (i)
Subordinated Certificates to the extent that such allocation would result in the
reduction of the aggregate Current Principal Amounts of all Certificates in as
of such Distribution Date, after giving effect to all distributions and prior
allocations of Realized Losses on the Mortgage Loans on such date, to an amount
less than the aggregate Scheduled Principal Balance of all of the Mortgage Loans
as of the first day of the month of such Distribution Date and (ii) Senior
Certificates in a Certificate Group to the extent that such allocation would
result in the reduction of the aggregate Current Principal Amounts of all the
Certificates in such Certificate Group as of such Distribution Date, after
giving effect to all distributions and prior allocations of Realized Losses on
the Mortgage Loans in the related Loan Group on such date, to an amount less
than the aggregate Scheduled Principal Balance of all of the Mortgage Loans in
such Loan Group as of the first day of the month of such Distribution Date (each
such limitation in clause (i) and (ii), the "Loss Allocation Limitation").
(d) The principal portion of any Realized Losses allocated to a Class of
Certificates shall be allocated among the Certificates of such Class in
proportion to their respective Current Principal Amounts. The principal portion
of any Realized Losses allocated to the Group I Certificates will be allocated
first to the Class I-A-2 Certificates until the Current Principal Amount of the
Class I-A-2 Certificates has been reduced to zero and then to the Class I-A-1
Certificates. The principal portion of any Realized Losses allocated to the
Group II Certificates will be allocated first to the Class II-A-2 Certificates
until the Current Principal Amount of the Class II-A-2 Certificates has been
reduced to zero and then to the Class II-A-1 Certificates. Once a Certificate
Group been reduced to zero, the principal portion of Realized Losses on the
mortgage loans in the related Certificate Group (if any) that are not allocated
to the Subordinate Certificates pursuant to Section 6.02(b) will be allocated
pro rata based upon their respective Current Principal Amounts to the remaining
Senior Certificates of the other Certificate Groups, pro rata based upon their
respective Current Principal Amounts. The principal portion of any allocation of
Realized Losses shall be accomplished by reducing the Current Principal Amount
of the related Certificates on the related Distribution Date.
(e) Realized Losses shall be allocated on the Distribution Date in the
month following the month in which such loss was incurred and, in the case of
the principal portion thereof, after giving effect to distributions made on such
Distribution Date.
(f) On each Distribution Date, the Securities Administrator shall
determine and notify the Trustee of the Subordinate Certificate Writedown
Amount. Any Subordinate Certificate Writedown Amount shall effect a
corresponding reduction in the Current Principal Amount of the Class B
Certificates in the reverse order of their numerical Class designations.
(g) The applicable Senior Percentage of Net Interest Shortfalls will be
allocated among the Senior Certificates in the related Certificate Group in
proportion to the amount of Accrued Certificate Interest that would have been
allocated thereto in the absence of such
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shortfalls. The applicable Subordinate Percentage of Net Interest Shortfall will
be allocated among the Subordinate Certificates in proportion to the amount of
Accrued Certificate Interest that would have been allocated thereto in the
absence of such shortfalls. The interest portion of any Realized Losses with
respect to the Mortgage Loans occurring on or prior to the Cross-Over Date will
be allocated to the Class B Certificates in inverse order of their numerical
Class designations. Following the Cross-Over Date, the interest portion of
Realized Losses on the Mortgage Loans will be allocated to the Senior
Certificates in the related Certificate Group on a pro rata basis in proportion
to the amount of Accrued Certificate Interest that would have been allocated
thereto in the absence of such Realized Losses.
(h) In addition, in the event that the Master Servicer receives any
Subsequent Recoveries from a Servicer, the Master Servicer shall deposit such
funds into the Master Servicer Collection Account pursuant to Section
4.01(c)(ii). If, after taking into account such Subsequent Recoveries, the
amount of a Realized Loss is reduced, the amount of such Subsequent Recoveries
will be applied to increase the Current Principal Amount of the Class of
Subordinate Certificates with the highest payment priority to which Realized
Losses have been allocated, but not by more than the amount of Realized Losses
previously allocated to that Class of Subordinate Certificates pursuant to this
Section 6.02. The amount of any remaining Subsequent Recoveries will be applied
to sequentially increase the Current Principal Amount of the Subordinate
Certificates, beginning with the Class of Subordinate Certificates with the next
highest payment priority, up to the amount of such Realized Losses previously
allocated to such Class or Classes of Certificates pursuant to this Section
6.02. Holders of such Certificates will not be entitled to any payments in
respect of current interest on the amount of such increases for any Interest
Accrual Period preceding the Distribution Date on which such increase occurs.
Any such increases shall be applied to the Current Principal Amount of each
Subordinate Certificate of such Class in accordance with its respective
Fractional Undivided Interest.
Section 6.03 Payments. (a) On each Distribution Date, other than the final
Distribution Date, the Trustee shall distribute to each Certificateholder of
record as of the immediately preceding Record Date the Certificateholder's pro
rata share of its Class (based on the aggregate Fractional Undivided Interest
represented by such Holder's Certificates) of all amounts required to be
distributed on such Distribution Date to such Class, based on information
provided to the Trustee by the Securities Administrator. The Securities
Administrator shall calculate the amount to be distributed to each Class and,
based on such amounts, the Securities Administrator shall determine the amount
to be distributed to each Certificateholder. All of the Securities
Administrator's calculations of payments shall be based solely on information
provided to the Securities Administrator by the Master Servicer. Neither the
Securities Administrator nor the Trustee shall be required to confirm, verify or
recompute any such information but shall be entitled to rely conclusively on
such information.
(b) Payment of the above amounts to each Certificateholder shall be made
(i) by check mailed to each Certificateholder entitled thereto at the address
appearing in the Certificate Register or (ii) upon receipt by the Trustee on or
before the fifth Business Day preceding the Record Date of written instructions
from a Certificateholder by wire transfer to a United States dollar account
maintained by the payee at any United States depository institution with
appropriate facilities for receiving such a wire transfer; provided, however,
that the final payment in respect of each Class of Certificates will be made
only upon presentation and
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surrender of such respective Certificates at the office or agency of the Trustee
specified in the notice to Certificateholders of such final payment.
Section 6.04 Statements to Certificateholders. (a) On each Distribution
Date, concurrently with each distribution to Certificateholders, the Securities
Administrator shall make available to the parties hereto and each
Certificateholder via the Securities Administrator's internet website as set
forth below, the following information, expressed with respect to clauses (i)
through (vii) in the aggregate and as a Fractional Undivided Interest
representing an initial Current Principal Amount of $1,000, or in the case of
the Residual Certificates, an initial Current Principal Amount of $100:
(i) the Current Principal Amount of each Class of Certificates
immediately prior to such Distribution Date;
(ii) the amount of the distribution allocable to principal on each
applicable Class of Certificates;
(iii) the aggregate amount of interest accrued at the related
Pass-Through Rate with respect to each Class during the related Interest Accrual
Period;
(iv) the Net Interest Shortfall and any other adjustments to
interest at the related Pass-Through Rate necessary to account for any
difference between interest accrued and aggregate interest distributed with
respect to each Class of Certificates;
(v) the amount of the distribution allocable to interest on each
Class of Certificates;
(vi) the Pass-Through Rates for each Class of Certificates with
respect to such Distribution Date;
(vii) the Current Principal Amount of each Class of Certificates
after such Distribution Date;
(viii) the amount of any Monthly Advances, Compensating Interest
Payments and outstanding unreimbursed advances by the Master Servicer or the
Servicer included in such distribution separately stated for each Loan Group;
(ix) the aggregate amount of any Realized Losses (listed separately
for each category of Realized Loss and for each Loan Group) during the related
Prepayment Period and cumulatively since the Cut-off Date and the amount and
source (separately identified) of any distribution in respect thereof included
in such distribution;
(x) with respect to each Mortgage Loan which incurred a Realized
Loss during the related Prepayment Period, (i) the loan number, (ii) the
Scheduled Principal Balance of such Mortgage Loan as of the Cut-off Date, (ii)
the Scheduled Principal Balance of such Mortgage Loan as of the beginning of the
related Due Period, (iii) the Net Liquidation Proceeds with respect to such
Mortgage Loan and (iv) the amount of the Realized Loss with respect to such
Mortgage Loan;
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(xi) with respect to each Loan Group, the amount of Scheduled
Principal and Principal Prepayments, (including but separately identifying the
principal amount of Principal Prepayments, Insurance Proceeds, the purchase
price in connection with the purchase of Mortgage Loans, cash deposits in
connection with substitutions of Mortgage Loans and Net Liquidation Proceeds)
and the number and principal balance of Mortgage Loans purchased or substituted
for during the relevant period and cumulatively since the Cut-off Date;
(xii) the number of Mortgage Loans (excluding REO Property) in each
Loan Group remaining in the Trust Fund as of the end of the related Prepayment
Period;
(xiii) information for each Loan Group and in the aggregate
regarding any Mortgage Loan delinquencies as of the end of the related
Prepayment Period, including the aggregate number and aggregate Outstanding
Principal Balance of Mortgage Loans (a) delinquent 30 to 59 days on a
contractual basis, (b) delinquent 60 to 89 days on a contractual basis, and (c)
delinquent 90 or more days on a contractual basis, in each case as of the close
of business on the last Business Day of the immediately preceding month;
(xiv) for each Loan Group, the number of Mortgage Loans in the
foreclosure process as of the end of the related Due Period and the aggregate
Outstanding Principal Balance of such Mortgage Loans;
(xv) for each Loan Group, the number and aggregate Outstanding
Principal Balance of all Mortgage Loans as to which the Mortgaged Property was
REO Property as of the end of the related Due Period;
(xvi) the book value (the sum of (A) the Outstanding Principal
Balance of the Mortgage Loan, (B) accrued interest through the date of
foreclosure and (C) foreclosure expenses) of any REO Property in each Loan
Group; provided that, in the event that such information is not available to the
Securities Administrator on the Distribution Date, such information shall be
furnished promptly after it becomes available;
(xvii) the amount of Realized Losses allocated to each Class of
Certificates since the prior Distribution Date and in the aggregate for all
prior Distribution Dates;
(xviii) the Average Loss Severity Percentage for each Loan Group;
and
(xix) the Senior Percentage, Senior Prepayment Percentage,
Subordinate Percentage and Subordinate Prepayment Percentage, in each case, for
such Distribution Date.
The information set forth above shall be calculated or reported, as the
case may be, by the Securities Administrator, based solely on, and to the extent
of, information provided to the Securities Administrator by the Master Servicer.
The Securities Administrator may conclusively rely on such information and shall
not be required to confirm, verify or recalculate any such information.
The Securities Administrator may make available each month, to any
interested party, the monthly statement to Certificateholders via the Securities
Administrator's website initially located at "xxx.xxxxxxx.xxx." Assistance in
using the website can be obtained by calling the
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Securities Administrator's customer service desk at (000) 000-0000. Parties that
are unable to use the above distribution option are entitled to have a paper
copy mailed to them via first class mail by calling the Securities
Administrator's customer service desk and indicating such. The Securities
Administrator shall have the right to change the way such reports are
distributed in order to make such distribution more convenient and/or more
accessible to the parties, and the Securities Administrator shall provide timely
and adequate notification to all parties regarding any such change.
To the extent timely received from the Securities Administrator, the
Trustee will also make monthly statements available each month to
Certificateholders via the Trustee's internet website. The Trustee's internet
website will initially be located at xxx.xxxxxxxx.xxx/xxx. Assistance in using
the Trustee's website service can be obtained by calling the Trustee's customer
service desk at (000) 000-0000.
(b) Within a reasonable period of time after the end of the preceding
calendar year beginning in 2005, the Trustee will furnish such report to each
Holder of the Certificates of record at any time during the prior calendar year
as to the aggregate of amounts reported pursuant to subclauses (a)(ii) and
(a)(v) above with respect to the Certificates, plus information with respect to
the amount of servicing compensation and such other customary information as the
Securities Administrator may determine and advises the Trustee to be necessary
and/or to be required by the Internal Revenue Service or by a federal or state
law or rules or regulations to enable such Holders to prepare their tax returns
for such calendar year. Such obligations shall be deemed to have been satisfied
to the extent that substantially comparable information shall be provided by the
Securities Administrator or the Trustee pursuant to the requirements of the
Code.
Section 6.05 Monthly Advances. If the Scheduled Payment on a Mortgage Loan
that was due on a related Due Date is delinquent other than as a result of
application of the Relief Act and for which the related Servicer was required to
make an advance pursuant to the related Servicing Agreement exceeds the amount
deposited in the Master Servicer Collection Account which will be used for an
advance with respect to such Mortgage Loan, the Master Servicer will deposit in
the Master Servicer Collection Account not later than the Distribution Account
Deposit Date immediately preceding the related Distribution Date an amount equal
to such deficiency, net of the Servicing Fee for such Mortgage Loan except to
the extent the Master Servicer determines any such advance to be a
Nonrecoverable Advance. Subject to the foregoing, the Master Servicer shall
continue to make such advances through the date that the related Servicer is
required to do so under its Servicing Agreement. If the Master Servicer deems an
advance to be a Nonrecoverable Advance, on the Distribution Account Deposit
Date, the Master Servicer shall present an Officer's Certificate to the Trustee
(i) stating that the Master Servicer elects not to make a Monthly Advance in a
stated amount and (ii) detailing the reason it deems the advance to be a
Nonrecoverable Advance.
Section 6.06 Compensating Interest Payments. The Master Servicer shall
deposit in the Master Servicer Collection Account not later than each
Distribution Account Deposit Date an amount equal to the lesser of (i) the sum
of the aggregate amounts required to be paid by the Servicers under the
Servicing Agreements with respect to subclauses (a) and (b) of the definition of
Interest Shortfall with respect to the Mortgage Loans for the related
Distribution Date, and not so paid by the related Servicers and (ii) the Master
Servicer Compensation for such Distribution
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Date (such amount, the "Compensating Interest Payment"). The Master Servicer
shall not be entitled to any reimbursement of any Compensating Interest Payment.
Section 6.07 Distributions on REMIC I Regular Interests and REMIC II
Regular Interests
(a) On each Distribution Date, the Trustee shall be deemed to distribute
to itself as the holder of the REMIC I Regular Interests, the following to the
extent of the Available Funds reduced by distributions made to the Class R
Certificateholders pursuant to Section 6.01(a): those portions of the REMIC I
Distribution Amount not designated to Component I of the Class R Certificate, in
the amounts and in accordance with the priorities set forth in the definition of
REMIC I Distribution Amount.
(b) On each Distribution Date the Trustee shall be deemed to distribute
from REMIC II, in the priority set forth in Sections 6.01(a), to the Holders of
each Class of Certificates (other than the Class R Certificates) the amounts
distributable thereon with respect to their interests in REMIC II.
(c) Notwithstanding the deemed distributions on the REMIC I Regular
Interests and REMIC II Regular Interests described in this Section 6.07,
distributions of funds from the Certificate Account shall be made only in
accordance with Section 6.01.
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ARTICLE VII
The Master Servicer
Section 7.01 Liabilities of the Master Servicer. The Master Servicer shall
be liable in accordance herewith only to the extent of the obligations
specifically imposed upon and undertaken by it herein.
Section 7.02 Merger or Consolidation of the Master Servicer.
(a) The Master Servicer will keep in full force and effect its existence,
rights and franchises as a corporation under the laws of the state of its
incorporation, and will obtain and preserve its qualification to do business as
a foreign corporation in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of this Agreement,
the Certificates or any of the Mortgage Loans and to perform its duties under
this Agreement.
(b) Any Person into which the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger 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 of the Master Servicer
hereunder, without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 7.03 Indemnification of the Trustee, the Master Servicer and the
Securities Administrator. (a) The Master Servicer agrees to indemnify the
Indemnified Persons for, and to hold them harmless against, any loss, liability
or expense (including reasonable legal fees and disbursements of counsel)
incurred on their part that may be sustained in connection with, arising out of,
or relating to, any claim or legal action (including any pending or threatened
claim or legal action) relating to this Agreement, the Servicing Agreements, the
Assignment Agreements or the Certificates or the powers of attorney delivered by
the Trustee hereunder (i) related to the Master Servicer's failure to perform
its duties in compliance with this Agreement (except as any such loss, liability
or expense shall be otherwise reimbursable pursuant to this Agreement) or (ii)
incurred by reason of the Master Servicer's willful misfeasance, bad faith or
gross negligence in the performance of duties hereunder or by reason of reckless
disregard of obligations and duties hereunder, provided, in each case, that with
respect to any such claim or legal action (or pending or threatened claim or
legal action), the Trustee shall have given the Master Servicer and the
Depositor written notice thereof promptly after the Trustee shall have with
respect to such claim or legal action knowledge thereof. The Trustee's failure
to give any such notice shall not affect the Trustee's right to indemnification
hereunder, except to the extent the Master Servicer is materially prejudiced by
such failure to give notice. This indemnity shall survive the resignation or
removal of the Trustee, Master Servicer or the Securities Administrator and the
termination of this Agreement.
(a) The Depositor will indemnify any Indemnified Person for any loss,
liability or expense of any Indemnified Person not otherwise covered by the
Master Servicer's indemnification pursuant to Section 7.03(a).
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Section 7.04 Limitations on Liability of the Master Servicer and Others.
Subject to the obligation of the Master Servicer to indemnify the Indemnified
Persons pursuant to Section 7.03:
(a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Indemnified Persons, the Depositor, the Trust Fund or the Certificateholders for
taking any action or for refraining from taking 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 breach of warranties or representations made herein or any liability which
would otherwise be imposed by reason of such Person's willful misfeasance, bad
faith or gross negligence in the performance of duties or by reason of reckless
disregard of obligations and duties hereunder.
(b) 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.
(c) The Master Servicer, the Custodian and any director, officer, employee
or agent of the Master Servicer or the Custodian shall be indemnified by the
Trust and held harmless thereby against any loss, liability or expense
(including reasonable legal fees and disbursements of counsel) incurred on their
part that may be sustained in connection with, arising out of, or related to,
any claim or legal action (including any pending or threatened claim or legal
action) relating to this Agreement, the Certificates or any Servicing Agreement
(except to the extent that the Master Servicer is indemnified by the Servicer
thereunder), other than (i) any such loss, liability or expense related to the
Master Servicer's failure to perform its duties in compliance with this
Agreement (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement), or to the Custodian's failure to
perform its duties under the Custodial Agreement, respectively, or (ii) any such
loss, liability or expense incurred by reason of the Master Servicer's or the
Custodian's willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or under the Custodial Agreement, as applicable,
or by reason of reckless disregard of obligations and duties hereunder or under
the Custodial Agreement, as applicable.
(d) The Master Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its duties under
this Agreement and that in its opinion may involve it in any expense or
liability; provided, however, the Master Servicer may in its discretion, with
the consent of the Trustee (which consent shall not be unreasonably withheld),
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto 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 Master Servicer Collection
Account as provided by Section 4.03. Nothing in this Section 7.04(d) shall
affect the Master Servicer's obligation to supervise, or to take such actions as
are necessary to ensure, the servicing and administration of the Mortgage Loans
pursuant to Section 3.01(a).
(e) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be
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required to investigate or make recommendations concerning potential liabilities
which the Trust might incur as a result of such course of action by reason of
the condition of the Mortgaged Properties but shall give notice to the Trustee
if it has notice of such potential liabilities.
(f) The Master Servicer shall not be liable for any acts or omissions of
any Servicer, except as otherwise expressly provided herein.
Section 7.05 Master Servicer Not to Resign. Except as provided in Section
7.07, the Master Servicer shall not resign from the obligations and duties
hereby imposed on it except upon a determination that any such duties hereunder
are no longer permissible under applicable law and such impermissibility cannot
be cured. Any such determination permitting the resignation of the Master
Servicer shall be evidenced by an Opinion of Independent Counsel addressed to
the Trustee to such effect delivered to the Trustee. No such resignation by the
Master Servicer shall become effective until the Company or the Trustee or a
successor to the Master Servicer reasonably satisfactory to the Trustee shall
have assumed the responsibilities and obligations of the Master Servicer in
accordance with Section 8.02 hereof. The Trustee shall notify the Rating
Agencies of the resignation of the Master Servicer.
Section 7.06 Successor Master Servicer. In connection with the appointment
of any successor master servicer or the assumption of the duties of the Master
Servicer, the Company or the Trustee may make such arrangements for the
compensation of such successor master servicer out of payments on the Mortgage
Loans as the Company or the Trustee and such successor master servicer shall
agree. If the successor master servicer does not agree that such market value is
a fair price, such successor master servicer shall obtain two quotations of
market value from third parties actively engaged in the servicing of
single-family mortgage loans. Notwithstanding the foregoing, the compensation
payable to a successor master servicer may not exceed the compensation which the
Master Servicer would have been entitled to retain if the Master Servicer had
continued to act as Master Servicer hereunder.
Section 7.07 Sale and Assignment of Master Servicing. The Master Servicer
may sell and assign its rights and delegate its duties and obligations in its
entirety as Master Servicer under this Agreement and the Company may terminate
the Master Servicer without cause and select a new Master Servicer; provided,
however, that: (i) the purchaser or transferee accepting such assignment and
delegation (a) shall be a Person which shall be qualified to service mortgage
loans for Xxxxxx Xxx or Xxxxxxx Mac; (b) shall have a net worth of not less than
$10,000,000 (unless otherwise approved by each Rating Agency pursuant to clause
(ii) below); (c) shall be reasonably satisfactory to the Trustee (as evidenced
in a writing signed by the Trustee); and (d) shall execute and deliver to the
Trustee an agreement, in form and substance reasonably satisfactory to the
Trustee, which contains an assumption by such Person of the due and punctual
performance and observance of each covenant and condition to be performed or
observed by it as master servicer under this Agreement, any custodial agreement
from and after the effective date of such agreement; (ii) each Rating Agency
shall be given prior written notice of the identity of the proposed successor to
the Master Servicer and each Rating Agency's rating of the Certificates in
effect immediately prior to such assignment, sale and delegation will not be
downgraded, qualified or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect delivered to the Master
Servicer and the Trustee; (iii) the Master Servicer assigning and selling the
master servicing shall deliver to the Trustee an
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Officer's Certificate and an Opinion of Independent Counsel addressed to the
Trustee, each stating that all conditions precedent to such action under this
Agreement have been completed and such action is permitted by and complies with
the terms of this Agreement; and (iv) in the event the Master Servicer is
terminated without cause by the Company, the Company shall pay the terminated
Master Servicer a termination fee equal to 0.25% of the aggregate Scheduled
Principal Balance of the Mortgage Loans at the time the master servicing of the
Mortgage Loans is transferred to the successor Master Servicer. No such
assignment or delegation shall affect any rights or liability of the Master
Servicer arising prior to the effective date thereof.
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ARTICLE VIII
Default
Section 8.01 Events of Default. "Event of Default," wherever used herein,
means any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) and
only with respect to the defaulting Master Servicer:
(i) The Master Servicer fails to cause to be deposited in the
Distribution Account any amount so required to be deposited pursuant to this
Agreement (other than a Monthly Advance), and such failure continues unremedied
for a period of three Business Days after the date upon which written notice of
such failure, requiring the same to be remedied, shall have been given to the
Master Servicer; or
(ii) The Master Servicer fails to observe or perform in any material
respect any other material covenants and agreements set forth in this Agreement
to be performed by it, which covenants and agreements materially affect the
rights of Certificateholders, and such failure continues unremedied for a period
of 60 days after the date on which written notice of such failure, properly
requiring the same to be remedied, shall have been given to the Master Servicer
by the Trustee or to the Master Servicer and the Trustee by the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not less than
25% of the Trust Fund; or
(iii) There is entered against the Master Servicer a decree or order
by a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator, receiver or liquidator in any
insolvency, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding up or liquidation of its affairs, and
the continuance of any such decree or order is unstayed and in effect for a
period of 60 consecutive days, or an involuntary case is commenced against the
Master Servicer under any applicable insolvency or reorganization statute and
the petition is not dismissed within 60 days after the commencement of the case;
or
(iv) The Master Servicer consents to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or relating to
the Master Servicer or substantially all of its property; or the Master Servicer
admits in writing its inability to pay its debts generally as they become due,
files a petition to take advantage of any applicable insolvency or
reorganization statute, makes an assignment for the benefit of its creditors, or
voluntarily suspends payment of its obligations;
(v) The Master Servicer assigns or delegates its duties or rights
under this Agreement in contravention of the provisions permitting such
assignment or delegation under Sections 7.05 or 7.07; or
(vi) The Master Servicer fails to deposit, or cause to be deposited,
in the Distribution Account any Monthly Advance (other than a Nonrecoverable
Advance) by 5:00 p.m. New York City time on the Distribution Account Deposit
Date.
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In each and every such case, so long as such Event of Default with respect to
the Master Servicer shall not have been remedied, either the Trustee or the
Holders of Certificates evidencing Fractional Undivided Interests aggregating
not less than 51% of the principal of the Trust Fund, by notice in writing to
the Master Servicer (and to the Trustee if given by such Certificateholders),
with a copy to the Rating Agencies, and with the consent of the Company, may
terminate all of the rights and obligations (but not the liabilities) of the
Master Servicer under this Agreement and in and to the Mortgage Loans and/or the
REO Property serviced by the Master Servicer and the proceeds thereof. Upon the
receipt by the Master Servicer of the written notice, all authority and power of
the Master Servicer under this Agreement, whether with respect to the
Certificates, the Mortgage Loans, REO Property or under any other related
agreements (but only to the extent that such other agreements relate to the
Mortgage Loans or related REO Property) shall, subject to Section 8.02,
automatically and without further action pass to and be vested in the Trustee
pursuant to this Section 8.01; and, without limitation, the Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the Master
Servicer as attorney-in-fact or otherwise, any and all documents and other
instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents, or otherwise. The Master Servicer agrees to cooperate with
the Trustee in effecting the termination of the Master Servicer's rights and
obligations hereunder, including, without limitation, the transfer to the
Trustee of (i) the property and amounts which are then or should be part of the
Trust or which thereafter become part of the Trust; and (ii) originals or copies
of all documents of the Master Servicer reasonably requested by the Trustee to
enable it to assume the Master Servicer's duties thereunder. In addition to any
other amounts which are then, or, notwithstanding the termination of its
activities under this Agreement, may become payable to the Master Servicer under
this Agreement, the Master Servicer shall be entitled to receive, out of any
amount received on account of a Mortgage Loan or related REO Property, that
portion of such payments which it would have received as reimbursement under
this Agreement if notice of termination had not been given. The termination of
the rights and obligations of the Master Servicer shall not affect any
obligations incurred by the Master Servicer prior to such termination.
Notwithstanding the foregoing, if an Event of Default described in clause
(vi) of this Section 8.01 shall occur, the Trustee shall, by notice in writing
to the Master Servicer, which may be delivered by telecopy, immediately
terminate all of the rights and obligations of the Master Servicer thereafter
arising under this Agreement, but without prejudice to any rights it may have as
a Certificateholder or to reimbursement of Monthly Advances and other advances
of its own funds, and the Trustee shall act as provided in Section 8.02 to carry
out the duties of the Master Servicer, including the obligation to make any
Monthly Advance the nonpayment of which was an Event of Default described in
clause (vi) of this Section 8.01. Any such action taken by the Trustee must be
prior to the distribution on the relevant Distribution Date.
Section 8.02 Trustee to Act; Appointment of Successor. (a) Upon the
receipt by the Master Servicer of a notice of termination pursuant to Section
8.01 or an Opinion of Independent Counsel pursuant to Section 7.05 to the effect
that the Master Servicer is legally unable to act or to delegate its duties to a
Person which is legally able to act, the Trustee shall automatically become the
successor in all respects to the Master Servicer in its capacity under this
Agreement and the transactions set forth or provided for herein and shall
thereafter be subject to all the
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responsibilities, duties, liabilities and limitations on liabilities relating
thereto placed on the Master Servicer by the terms and provisions hereof;
provided, however, that the Company shall have the right to either (a)
immediately assume the duties of the Master Servicer or (b) select a successor
Master Servicer; provided further, however, that the Trustee shall have no
obligation whatsoever with respect to any liability (other than advances deemed
recoverable and not previously made) incurred by the Master Servicer at or prior
to the time of termination. As compensation therefor, but subject to Section
7.06, the Trustee shall be entitled to compensation which the Master Servicer
would have been entitled to retain if the Master Servicer had continued to act
hereunder, except for those amounts due the Master Servicer as reimbursement
permitted under this Agreement for advances previously made or expenses
previously incurred. Notwithstanding the above, the Trustee may, if it shall be
unwilling so to act, or shall, if it is legally unable so to act, appoint or
petition a court of competent jurisdiction to appoint, any established housing
and home finance institution which is a Xxxxxx Mae- or Xxxxxxx Mac-approved
servicer, and with respect to a successor to the Master Servicer only, having a
net worth of not less than $10,000,000, as the successor to the Master Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Master Servicer hereunder; provided, that the Trustee
shall obtain a letter from each Rating Agency that the ratings, if any, on each
of the Certificates will not be lowered as a result of the selection of the
successor to the Master Servicer. Pending appointment of a successor to the
Master Servicer hereunder, the Trustee shall act in such capacity as hereinabove
provided. In connection with such appointment and assumption, the Trustee may
make such arrangements for the compensation of such successor out of payments on
the Mortgage Loans as it and such successor shall agree; provided, however, that
the provisions of Section 7.06 shall apply, the compensation shall not be in
excess of that which the Master Servicer would have been entitled to if the
Master Servicer had continued to act hereunder, and that such successor shall
undertake and assume the obligations of the Trustee to pay compensation to any
third Person acting as an agent or independent contractor in the performance of
master servicing responsibilities hereunder. The Trustee and such successor
shall take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession.
(a) If the Trustee shall succeed to any duties of the Master Servicer
respecting the Mortgage Loans as provided herein, it shall do so in a separate
capacity and not in its capacity as Trustee and, accordingly, the provisions of
Article IX shall be inapplicable to the Trustee in its duties as the successor
to the Master Servicer in the servicing of the Mortgage Loans (although such
provisions shall continue to apply to the Trustee in its capacity as Trustee);
the provisions of Article VII, however, shall apply to it in its capacity as
successor master servicer.
Section 8.03 Notification to Certificateholders. Upon any termination or
appointment of a successor to the Master Servicer, the Trustee shall give prompt
written notice thereof to Certificateholders at their respective addresses
appearing in the Certificate Register and to the Rating Agencies.
Section 8.04 Waiver of Defaults. The Trustee shall transmit by mail to all
Certificateholders, within 60 days after the occurrence of any Event of Default
actually known to a Responsible Officer of the Trustee, unless such Event of
Default shall have been cured, notice of each such Event of Default. The Holders
of Certificates evidencing Fractional Undivided Interests aggregating not less
than 51% of the Trust Fund may, on behalf of all
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Certificateholders, waive any default by the Master Servicer in the performance
of its obligations hereunder and the consequences thereof, except a default in
the making of or the causing to be made any required distribution on the
Certificates, which default may only be waived by Holders of Certificates
evidencing Fractional Undivided Interests aggregating 100% of the Trust Fund.
Upon any such waiver of a past default, such default shall be deemed to cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
timely 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. The Trustee shall give notice of any such
waiver to the Rating Agencies.
Section 8.05 List of Certificateholders. Upon written request of three or
more Certificateholders of record, for purposes of communicating with other
Certificateholders with respect to their rights under this Agreement, the
Trustee will afford such Certificateholders access during business hours to the
most recent list of Certificateholders held by the Trustee.
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ARTICLE IX
Concerning the Trustee and the Securities Administrator
Section 9.01 Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver of all Events of Default which may have occurred, and the
Securities Administrator each undertake to perform such duties and only such
duties as are specifically set forth in this Agreement as duties of the Trustee
and the Securities Administrator, respectively. If an Event of Default has
occurred and has not been cured or waived, the Trustee shall exercise such of
the rights and powers vested in it by this Agreement, and subject to Section
8.02(b) use the same degree of care and skill in their exercise, as a prudent
person would exercise under the circumstances in the conduct of his own affairs.
(b) Upon receipt of all resolutions, certificates, statements, opinions,
reports, documents, orders or other instruments which are specifically required
to be furnished to the Trustee and the Securities Administrator pursuant to any
provision of this Agreement, the Trustee and the Securities Administrator,
respectively, shall examine them to determine whether they are in the form
required by this Agreement; provided, however, that neither the Trustee nor the
Securities Administrator shall be responsible for the accuracy or content of any
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished hereunder; provided, further, that neither the Trustee nor
the Securities Administrator shall be responsible for the accuracy or
verification of any calculation provided to it pursuant to this Agreement.
(c) On each Distribution Date, the Trustee shall make monthly
distributions and the final distribution to the Certificateholders from funds in
the Distribution Account as provided in Sections 6.01 and 10.01 herein based
solely on the report of the Securities Administrator.
(d) No provision of this Agreement shall be construed to relieve the
Trustee or the Securities Administrator from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct;
provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the curing
or waiver of all such Events of Default which may have occurred, the duties and
obligations of the Trustee and the Securities Administrator shall be determined
solely by the express provisions of this Agreement, neither the Trustee nor the
Securities Administrator shall be liable except for the performance of their
respective duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this Agreement
against the Trustee or the Securities Administrator and, in the absence of bad
faith on the part of the Trustee or the Securities Administrator, respectively,
the Trustee or the Securities Administrator, respectively, may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to the Trustee or
the Securities Administrator, respectively, and conforming to the requirements
of this Agreement;
(ii) Neither the Trustee nor the Securities Administrator shall be liable
in its individual capacity for an error of judgment made in good faith by a
Responsible Officer or
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Responsible Officers of the Trustee or an officer of the Securities
Administrator, respectively, unless it shall be proved that the Trustee or the
Securities Administrator, respectively, was negligent in ascertaining the
pertinent facts;
(iii) Neither the Trustee nor the Securities Administrator shall be liable
with respect to any action taken, suffered or omitted to be taken by it in good
faith in accordance with the directions of the Holders of Certificates
evidencing Fractional Undivided Interests aggregating not less than 25% of the
Trust Fund, if such action or non-action relates to the time, method and place
of conducting any proceeding for any remedy available to the Trustee or the
Securities Administrator, respectively, or exercising any trust or other power
conferred upon the Trustee or the Securities Administrator, respectively, under
this Agreement;
(iv) The Trustee shall not be required to take notice or be deemed to have
notice or knowledge of any default or Event of Default unless a Responsible
Officer of the Trustee's Corporate Trust Office shall have actual knowledge
thereof. In the absence of such notice, the Trustee may conclusively assume
there is no such default or Event of Default;
(v) The Trustee shall not in any way be liable by reason of any
insufficiency in any Account held by or in the name of Trustee unless it is
determined by a court of competent jurisdiction that the Trustee's gross
negligence or willful misconduct was the primary cause of such insufficiency
(except to the extent that the Trustee is obligor and has defaulted thereon);
(vi) Anything in this Agreement to the contrary notwithstanding, in no
event shall the Trustee or the Securities Administrator be liable for special,
indirect or consequential loss or damage of any kind whatsoever (including but
not limited to lost profits), even if the Trustee or the Securities
Administrator, respectively, has been advised of the likelihood of such loss or
damage and regardless of the form of action;
(vii) None of the Securities Administrator, the Master Servicer, the
Depositor, the Company or the Trustee shall be responsible for the acts or
omissions of the other, it being understood that this Agreement shall not be
construed to render them partners, joint venturers or agents of one another and
(viii) Neither the Trustee nor the Securities Administrator shall be
required to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that 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 or the Securities Administrator
to perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under this Agreement, 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.
(e) All funds received by the Master Servicer and the Trustee and required
to be deposited in the Master Servicer Collection Account or Distribution
Account pursuant to this Agreement will be promptly so deposited by the Master
Servicer and the Trustee.
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(f) Except for those actions that the Trustee or the Securities
Administrator is required to take hereunder, neither the Trustee nor the
Securities Administrator shall have any obligation or liability to take any
action or to refrain from taking any action hereunder in the absence of written
direction as provided hereunder.
Section 9.02 Certain Matters Affecting the Trustee and the Securities
Administrator. Except as otherwise provided in Section 9.01:
(a) The Trustee and the Securities Administrator may rely and shall be
protected in acting or refraining from acting in reliance on any resolution,
certificate of the Depositor, the Master Servicer or a Servicer, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) The Trustee and the Securities Administrator may consult with counsel
and any advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection with respect to any action taken or
suffered or omitted by it hereunder in good faith and in accordance with such
advice or Opinion of Counsel;
(c) Neither the Trustee nor the Securities Administrator shall be under
any obligation to exercise any of the trusts or powers vested in it by this
Agreement, other than its obligation to give notices pursuant to this Agreement,
or to institute, conduct or defend any litigation hereunder or in relation
hereto at the request, order or direction of any of the Certificateholders
pursuant to the provisions of this Agreement, unless such Certificateholders
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which may be incurred therein or thereby.
Nothing contained herein shall, however, relieve the Trustee of the obligation,
upon the occurrence of an Event of Default of which a Responsible Officer of the
Trustee has actual knowledge (which has not been cured or waived), to exercise
such of the rights and powers vested in it by this Agreement, and to use the
same degree of care and skill in their exercise, as a prudent person would
exercise under the circumstances in the conduct of his own affairs;
(d) Prior to the occurrence of an Event of Default hereunder and after the
curing or waiver of all Events of Default which may have occurred, neither the
Trustee nor the Securities Administrator shall be liable in its individual
capacity for any action taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or powers
conferred upon it by this Agreement;
(e) Neither the Trustee nor the Securities Administrator shall be bound to
make any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other paper or document, unless requested in writing to
do so by Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 25% of the Trust Fund and provided that the payment
within a reasonable time to the Trustee or the Securities Administrator, as
applicable, of the costs, expenses or liabilities likely to be incurred by it in
the making of such investigation is, in the opinion of the Trustee or the
Securities Administrator, as applicable, reasonably assured to the
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Trustee or the Securities Administrator, as applicable, by the security afforded
to it by the terms of this Agreement. The Trustee or the Securities
Administrator may require reasonable indemnity against such expense or liability
as a condition to taking any such action. The reasonable expense of every such
examination shall be paid by the Certificateholders requesting the
investigation;
(f) The Trustee and the Securities Administrator may execute any of the
trusts or powers hereunder or perform any duties hereunder either directly or
through Affiliates, agents or attorneys; provided, however, that the Trustee may
not appoint any agent to perform its custodial functions with respect to the
Mortgage Files or paying agent functions under this Agreement without the
express written consent of the Master Servicer, which consent will not be
unreasonably withheld. Neither the Trustee nor the Securities Administrator
shall be liable or responsible for the misconduct or negligence of any of the
Trustee's or the Securities Administrator's agents or attorneys or a custodian
or paying agent appointed hereunder by the Trustee or the Securities
Administrator with due care and, when required, with the consent of the Master
Servicer;
(g) Should the Trustee or the Securities Administrator deem the nature of
any action required on its part, other than a payment or transfer under Section
4.01(b) or Section 4.02, to be unclear, the Trustee or the Securities
Administrator, respectively, may require prior to such action that it be
provided by the Depositor with reasonable further instructions;
(h) The right of the Trustee or the Securities Administrator to perform
any discretionary act enumerated in this Agreement shall not be construed as a
duty, and neither the Trustee nor the Securities Administrator shall be
accountable for other than its negligence or willful misconduct in the
performance of any such act;
(i) Neither the Trustee nor the Securities Administrator shall be required
to give any bond or surety with respect to the execution of the trust created
hereby or the powers granted hereunder, except as provided in Section 9.07; and
(j) Neither the Trustee nor the Securities Administrator shall have any
duty to conduct any affirmative investigation as to the occurrence of any
condition requiring the repurchase of any Mortgage Loan by the Seller pursuant
to this Agreement or the Mortgage Loan Purchase Agreement, as applicable, or the
eligibility of any Mortgage Loan for purposes of this Agreement.
Section 9.03 Trustee and Securities Administrator Not Liable for
Certificates or Mortgage Loans. The recitals contained herein and in the
Certificates (other than the signature and countersignature of the Trustee on
the Certificates) shall be taken as the statements of the Depositor, and neither
the Trustee nor the Securities Administrator shall have any responsibility for
their correctness. Neither the Trustee nor the Securities Administrator makes
any representation as to the validity or sufficiency of the Certificates (other
than the signature and countersignature of the Trustee on the Certificates) or
of any Mortgage Loan except as expressly provided in Sections 2.02 and 2.05
hereof; provided, however, that the foregoing shall not relieve the Trustee of
the obligation to review the Mortgage Files pursuant to Sections 2.02 and 2.04.
The Trustee's signature and countersignature (or countersignature of its agent)
on the Certificates
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shall be solely in its capacity as Trustee and shall not constitute the
Certificates an obligation of the Trustee in any other capacity. Neither the
Trustee nor the Securities Administrator shall be accountable for the use or
application by the Depositor of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Depositor with respect to the Mortgage Loans. Subject to the provisions of
Section 2.05, neither the Trustee nor the Securities Administrator shall be
responsible for the legality or validity of this Agreement or any document or
instrument relating to this Agreement, the validity of the execution of this
Agreement or of any supplement hereto or instrument of further assurance, or the
validity, priority, perfection or sufficiency of the security for the
Certificates issued hereunder or intended to be issued hereunder. Neither the
Trustee nor the Securities Administrator shall at any time have any
responsibility or liability for or with respect to the legality, validity and
enforceability of any Mortgage or any Mortgage Loan, or the perfection and
priority of any Mortgage or the maintenance of any such perfection and priority,
or for or with respect to the sufficiency of the Trust Fund or its ability to
generate the payments to be distributed to Certificateholders, under this
Agreement. Neither the Trustee nor the Securities Administrator shall have any
responsibility for filing any financing or continuation statement in any public
office at any time or to otherwise perfect or maintain the perfection of any
security interest or lien granted to it hereunder or to record this Agreement
other than any continuation statements filed by the Trustee pursuant to Section
3.20.
Section 9.04 Trustee and Securities Administrator May Own Certificates.
The Trustee and the Securities Administrator in their individual capacities or
in any capacity other than as Trustee or Securities Administrator hereunder may
become the owner or pledgee of any Certificates with the same rights it would
have if it were not Trustee or the Securities Administrator, as applicable, and
may otherwise deal with the parties hereto.
Section 9.05 Trustee's and Securities Administrator's Fees and Expenses.
The fees and expenses of the Trustee and the Securities Administrator shall be
paid in accordance with a side letter agreement between the Trustee and the
Master Servicer. In addition, the Trustee and the Securities Administrator will
be entitled to recover from the Master Servicer Collection Account pursuant to
Section 4.03(b) all reasonable out-of-pocket expenses, disbursements and
advances and the expenses of the Trustee and the Securities Administrator,
respectively, in connection with any Event of Default, any breach of this
Agreement or any claim or legal action (including any pending or threatened
claim or legal action) incurred or made by the Trustee or the Securities
Administrator, respectively, in the administration of the trusts hereunder
(including the reasonable compensation, expenses and disbursements of its
counsel) except any such expense, disbursement or advance as may arise from its
negligence or intentional misconduct or which is the responsibility of the
Certificateholders. If funds in the Master Servicer Collection Account are
insufficient therefor, the Trustee and the Securities Administrator shall
recover such expenses from the Depositor. Such compensation and reimbursement
obligation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust.
Section 9.06 Eligibility Requirements for Trustee and Securities
Administrator. The Trustee and any successor Trustee and the Securities
Administrator and any successor Securities Administrator shall during the entire
duration of this Agreement be a state bank or trust company or a national
banking association organized and doing business under the laws of such state or
the United States of America, authorized under such laws to exercise corporate
trust powers,
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having a combined capital and surplus and undivided profits of at least
$40,000,000 or, in the case of a successor Trustee, $50,000,000, subject to
supervision or examination by federal or state authority and, in the case of the
Trustee, rated "BBB" or higher by S&P with respect to their long-term rating and
rated "BBB" or higher by S&P and "Baa2" or higher by Xxxxx'x with respect to any
outstanding long-term unsecured unsubordinated debt, and, in the case of a
successor Trustee or successor Securities Administrator other than pursuant to
Section 9.10, rated in one of the two highest long-term debt categories of, or
otherwise acceptable to, each of the Rating Agencies. If the Trustee publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section 9.06 the combined capital and surplus of such corporation shall be
deemed to be its total equity capital (combined capital and surplus) as set
forth in its most recent report of condition so published. In case at any time
the Trustee or the Securities Administrator shall cease to be eligible in
accordance with the provisions of this Section 9.06, the Trustee or the
Securities Administrator shall resign immediately in the manner and with the
effect specified in Section 9.08.
Section 9.07 Insurance. The Trustee and the Securities Administrator, at
their own expense, shall at all times maintain and keep in full force and
effect: (i) fidelity insurance, (ii) theft of documents insurance and (iii)
forgery insurance (which may be collectively satisfied by a "Financial
Institution Bond" and/or a "Bankers' Blanket Bond"). All such insurance shall be
in amounts, with standard coverage and subject to deductibles, as are customary
for insurance typically maintained by banks or their affiliates which act as
custodians for investor-owned mortgage pools. A certificate of an officer of the
Trustee or the Securities Administrator as to the Trustee's or the Securities
Administrator's, respectively, compliance with this Section 9.07 shall be
furnished to any Certificateholder upon reasonable written request.
Section 9.08 Resignation and Removal of the Trustee and Securities
Administrator.
(a) The Trustee and the Securities Administrator 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, with a copy to the Rating Agencies.
Upon receiving such notice of resignation, the Depositor shall promptly appoint
a successor Trustee or successor Securities Administrator, as applicable, by
written instrument, in triplicate, one copy of which instrument shall be
delivered to each of the resigning Trustee or Securities Administrator, as
applicable, the successor Trustee or Securities Administrator, as applicable. If
no successor Trustee or Securities Administrator shall have been so appointed
and have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee or Securities Administrator may petition any
court of competent jurisdiction for the appointment of a successor Trustee or
Securities Administrator.
(b) If at any time the Trustee or the Securities Administrator shall cease
to be eligible in accordance with the provisions of Section 9.06 and shall fail
to resign after written request therefor by the Depositor or if at any time the
Trustee or the Securities Administrator shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or the
Securities Administrator, as applicable, or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or the
Securities Administrator, as applicable, or of its property or affairs for the
purpose of rehabilitation, conservation or
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liquidation, then the Depositor shall promptly remove the Trustee, or shall be
entitled to remove the Securities Administrator, as applicable, and appoint a
successor Trustee or Securities Administrator, as applicable, by written
instrument, in triplicate, one copy of which instrument shall be delivered to
each of the Trustee or Securities Administrator, as applicable, so removed, the
successor Trustee or Securities Administrator, as applicable.
(c) The Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust Fund may at any time remove the
Trustee or the Securities Administrator and appoint a successor Trustee or
Securities Administrator by written instrument or instruments, in quadruplicate,
signed by such Holders or their attorneys-in-fact duly authorized, one complete
set of which instruments shall be delivered to the Depositor, the Master
Servicer, the Securities Administrator (if the Trustee is removed), the Trustee
(if the Securities Administrator is removed), and the Trustee or Securities
Administrator so removed and the successor so appointed. In the event that the
Trustee or Securities Administrator is removed by the Holders of Certificates in
accordance with this Section 9.08(c), the Holders of such Certificates shall be
responsible for paying any compensation payable to a successor Trustee or
successor Securities Administrator, in excess of the amount paid to the
predecessor Trustee or predecessor Securities Administrator, as applicable.
(d) No resignation or removal of the Trustee or the Securities
Administrator and appointment of a successor Trustee or Securities Administrator
pursuant to any of the provisions of this Section 9.08 shall become effective
except upon appointment of and acceptance of such appointment by the successor
Trustee or Securities Administrator as provided in Section 9.09.
Section 9.09 Successor Trustee and Successor Securities Administrator.
(a) Any successor Trustee or Securities Administrator appointed as
provided in Section 9.08 shall execute, acknowledge and deliver to the Depositor
and to its predecessor Trustee or Securities Administrator an instrument
accepting such appointment hereunder. The resignation or removal of the
predecessor Trustee or Securities Administrator shall then become effective and
such successor Trustee or Securities Administrator, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with like effect as if
originally named as Trustee or Securities Administrator herein. The predecessor
Trustee or Securities Administrator shall after payment of its outstanding fees
and expenses promptly deliver to the successor Trustee or Securities
Administrator, as applicable, all assets and records of the Trust held by it
hereunder, and the Depositor and the predecessor Trustee or Securities
Administrator, as applicable, shall execute and deliver such instruments and do
such other things as may reasonably be required for more fully and certainly
vesting and confirming in the successor Trustee or Securities Administrator, as
applicable, all such rights, powers, duties and obligations.
(b) No successor Trustee or Securities Administrator shall accept
appointment as provided in this Section 9.09 unless at the time of such
acceptance such successor Trustee or Securities Administrator shall be eligible
under the provisions of Section 9.06.
(c) Upon acceptance of appointment by a successor Trustee or Securities
Administrator as provided in this Section 9.09, the successor Trustee or
Securities Administrator
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shall mail notice of the succession of such Trustee or Securities Administrator
hereunder to all Certificateholders at their addresses as shown in the
Certificate Register and to the Rating Agencies. The Company shall pay the cost
of any mailing by the successor Trustee or Securities Administrator.
Section 9.10 Merger or Consolidation of Trustee or Securities
Administrator. Any state bank or trust company or national banking association
into which the Trustee or the Securities Administrator may be merged or
converted or with which it may be consolidated or any state bank or trust
company or national banking association resulting from any merger, conversion or
consolidation to which the Trustee or the Securities Administrator,
respectively, shall be a party, or any state bank or trust company or national
banking association succeeding to all or substantially all of the corporate
trust business of the Trustee or the Securities Administrator, respectively,
shall be the successor of the Trustee or the Securities Administrator,
respectively, hereunder, provided such state bank or trust company or national
banking association shall be eligible under the provisions of Section 9.06. Such
succession shall be valid without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 9.11 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or property constituting the same may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee and the Depositor to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 9.11, such powers, duties, obligations, rights and trusts as the
Depositor and the Trustee may consider necessary or desirable.
(b) If the Depositor shall not have joined in such appointment within 15
days after the receipt by it of a written request so to do, the Trustee shall
have the power to make such appointment without the Depositor.
(c) No co-trustee or separate trustee hereunder shall be required to meet
the terms of eligibility as a successor Trustee under Section 9.06 hereunder and
no notice to Certificateholders of the appointment of co-trustee(s) or separate
trustee(s) shall be required under Section 9.08 hereof.
(d) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee and required to be conferred on such
co-trustee shall be conferred or imposed upon and exercised or performed by the
Trustee and such separate trustee or co-trustee jointly, except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed (whether as Trustee hereunder or as successor to the Master
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof
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in any such jurisdiction) shall be exercised and performed by such separate
trustee or co-trustee at the direction of the Trustee.
(e) 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 or co-trustee shall refer to this Agreement and the conditions
of this Article IX. 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.
(f) To the extent not prohibited by law, any separate trustee or
co-trustee may, at any time, request the Trustee, its agent or attorney-in-fact,
with full power and authority, to do any lawful act under or with respect to
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor Trustee.
(g) No trustee under this Agreement shall be personally liable by reason
of any act or omission of another trustee under this Agreement. The Depositor
and the Trustee acting jointly may at any time accept the resignation of or
remove any separate trustee or co-trustee.
Section 9.12 Federal Information Returns and Reports to
Certificateholders; REMIC Administration.
(a) For federal income tax purposes, the taxable year of each 2004-9 REMIC
shall be a calendar year and the Securities Administrator shall maintain or
cause the maintenance of the books of each such 2004-9 REMIC on the accrual
method of accounting.
(b) The Securities Administrator shall prepare and file or cause to be
filed with the Internal Revenue Service, and the Trustee shall sign, Federal tax
information returns or elections required to be made hereunder with respect to
each 2004-9 REMIC, the Trust Fund, if applicable, and the Certificates
containing such information and at the times and in the manner as may be
required by the Code or applicable Treasury regulations, and shall furnish to
each Holder of Certificates at any time during the calendar year for which such
returns or reports are made such statements or information at the times and in
the manner as may be required thereby, including, without limitation, reports
relating to mortgaged property that is abandoned or foreclosed, receipt of
mortgage interests in kind in a trade or business, a cancellation of
indebtedness, interest, original issue discount and market discount or premium
(using a constant prepayment assumption of 25% CPR). The Securities
Administrator will apply for an Employee Identification Number from the IRS
under Form SS-4 or any other acceptable method for all tax entities. In
connection with the foregoing, the Securities Administrator shall timely prepare
and file, and the Trustee shall sign, IRS Form 8811, which shall provide the
name and address of the person who can be contacted to obtain information
required to be reported to the holders of regular interests in each 2004-9 REMIC
(the "REMIC Reporting Agent"). The Trustee shall
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make elections to treat each 2004-9 REMIC as a REMIC (which elections shall
apply to the taxable period ending December 31, 2004 and each calendar year
thereafter) in such manner as the Code or applicable Treasury regulations may
prescribe, and as described by the Securities Administrator. The Trustee shall
sign all tax information returns filed pursuant to this Section and any other
returns as may be required by the Code. The Holder of the largest percentage
interest in the Class R Certificates is hereby designated as the "Tax Matters
Person" (within the meaning of Treas. Reg. ss.ss.1.860F-4(d)) for each 2004-9
REMIC. The Securities Administrator is hereby designated and appointed as the
agent of each such Tax Matters Person. Any Holder of a Residual Certificate will
by acceptance thereof appoint the Securities Administrator as agent and
attorney-in-fact for the purpose of acting as Tax Matters Person for each 2004-9
REMIC during such time as the Securities Administrator does not own any such
Residual Certificate. In the event that the Code or applicable Treasury
regulations prohibit the Trustee from signing tax or information returns or
other statements, or the Securities Administrator from acting as agent for the
Tax Matters Person, the Trustee and the Securities Administrator shall take
whatever action that in its sole good faith judgment is necessary for the proper
filing of such information returns or for the provision of a tax matters person,
including designation of the Holder of the largest percentage interest in a
Residual Certificate to sign such returns or act as tax matters person. Each
Holder of a Residual Certificate shall be bound by this Section.
(c) The Securities Administrator shall provide upon request and receipt of
reasonable compensation, such information as required in Section 860D(a)(6)(B)
of the Code to the Internal Revenue Service, to any Person purporting to
transfer a Residual Certificate to a Person other than a transferee permitted by
Section 5.05(b), and to any regulated investment company, real estate investment
trust, common trust fund, partnership, trust, estate, organization described in
Section 1381 of the Code, or nominee holding an interest in a pass-through
entity described in Section 860E(e)(6) of the Code, any record holder of which
is not a transferee permitted by Section 5.05(b) (or which is deemed by statute
to be an entity with a disqualified member).
(d) The Securities Administrator shall prepare and file or cause to be
filed, and the Trustee shall sign, any state income tax returns required under
Applicable State Law with respect to each REMIC or the Trust Fund.
(e) Notwithstanding any other provision of this Agreement, the Trustee and
the Securities Administrator shall comply with all federal withholding
requirements respecting payments to Certificateholders of interest or original
issue discount on the Mortgage Loans, that the Trustee or the Securities
Administrator reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee or the Securities Administrator withholds any amount from interest or
original issue discount payments or advances thereof to any Certificateholder
pursuant to federal withholding requirements, the Trustee or the Securities
Administrator shall, together with its monthly report to such
Certificateholders, indicate such amount withheld.
(f) The Trustee and the Securities Administrator agree to indemnify the
Trust Fund and the Depositor for any taxes and costs including, without
limitation, any reasonable attorneys fees imposed on or incurred by the Trust
Fund, the Depositor or the Master Servicer, as a result of a breach of the
Trustee's covenants and the Securities Administrator's covenants, respectively,
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set forth in this Section 9.12; provided, however, such liability and obligation
to indemnify in this paragraph shall be several and not joint and neither the
Trustee nor the Securities Administrator shall be liable or be obligated to
indemnify the Trust Fund for the failure by the other to perform any duty under
this Agreement or the breach by the other of any covenant in this Agreement.
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ARTICLE X
Termination
Section 10.01 Termination Upon Repurchase by the Depositor or its Designee
or Liquidation of the Mortgage Loans.
(a) Subject to Section 10.02, the respective obligations and
responsibilities of the Depositor, the Trustee, the Master Servicer and the
Securities Administrator created hereby, other than the obligation of the
Trustee to make payments to Certificateholders as hereinafter set forth shall
terminate:
(i) the repurchase by or at the direction of the Depositor or its
designee of all of the Mortgage Loans and all related REO Property remaining in
the Trust at a price (the "Termination Purchase Price") equal to the sum of (a)
100% of the Outstanding Principal Balance of each Mortgage Loan in such Loan
Group (other than a Mortgage Loan related to REO Property) as of the date of
repurchase, net of the principal portion of any unreimbursed Monthly Advances on
the Mortgage Loans unpaid to, but not including, the first day of the month of
repurchase, (b) the appraised value of any related REO Property, less the good
faith estimate of the Depositor of liquidation expenses to be incurred in
connection with its disposal thereof (but not more than the Outstanding
Principal Balance of the related Mortgage Loan, together with interest at the
applicable Mortgage Interest Rate accrued on that balance but unpaid to, but not
including, the first day of the month of repurchase), such appraisal to be
calculated by an appraiser mutually agreed upon by the Depositor and the Trustee
at the expense of the Depositor, (c) unreimbursed out-of pocket costs of the
Master Servicer, including unreimbursed servicing advances and the principal
portion of any unreimbursed Monthly Advances, made on the Mortgage Loans prior
to the exercise of such repurchase right and (d) any unreimbursed costs and
expenses of the Trustee and the Securities Administrator payable pursuant to
Section 9.05;
(ii) the later of the making of the final payment or other
liquidation, or any advance with respect thereto, of the last Mortgage Loan,
remaining in the Trust Fund or the disposition of all property acquired with
respect to any Mortgage Loan; provided, however, that in the event that an
advance has been made, but not yet recovered, at the time of such termination,
the Person having made such advance shall be entitled to receive,
notwithstanding such termination, any payments received subsequent thereto with
respect to which such advance was made; or
(iii) the payment to the Certificateholders of all amounts required
to be paid to them pursuant to this Agreement.
(b) In no event, however, shall the Trust created hereby continue beyond
the expiration of 21 years from the death of the last survivor of the
descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to
the Court of St. James's, living on the date of this Agreement.
(c) (i) The right of the Depositor or its designee to repurchase all the
assets of the Trust Fund described in Section 10.01(a)(i) above shall be
exercisable only if (i) the aggregate
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Stated Principal Balance of the Mortgage Loans at the time of any such
repurchase is less than 10% of the sum of the Cut-off Date Balance or (ii) the
Depositor, based upon an Opinion of Counsel addressed to the Depositor, the
Trustee and the Sercurities Administrator has determined that the REMIC status
of any 2004-9 REMIC has been lost or that a substantial risk exists that such
REMIC status will be lost for the then-current taxable year. At any time
thereafter, in the case of (i) or (ii) above, the Depositor may elect to
terminate any 2004-9 REMIC at any time, and upon such election, the Depositor or
its designee, shall purchase in accordance with Section 10.01(a)(i) above all
the assets of the Trust Fund.
(d) The Trustee shall give notice of any termination to the
Certificateholders, with a copy to the Master Servicer, the Securities
Administrator and the Rating Agencies, upon which the Certificateholders shall
surrender their Certificates to the Trustee for payment of the final
distribution and cancellation. Such notice shall be given by letter, mailed not
earlier than the l5th day and not later than the 25th day of the month next
preceding the month of such final distribution, and shall specify (i) the
Distribution Date upon which final payment of the Certificates will be made upon
presentation and surrender of the Certificates at the office of the Trustee
therein designated, (ii) the amount of any such final payment and (iii) that the
Record Date otherwise applicable to such Distribution Date is not applicable,
payments being made only upon presentation and surrender of the Certificates at
the office of the Trustee therein specified.
(e) If the option of the Depositor to repurchase or cause the repurchase
of all assets of the Trust Fund described in Section 10.01(a)(i) above is
exercised, the Depositor and/or its designee shall deliver to the Trustee for
deposit in the Distribution Account, by the Business Day prior to the applicable
Distribution Date, an amount equal to the Termination Purchase Price. Upon
presentation and surrender of the Certificates by the Certificateholders, the
Trustee shall distribute to the Certificateholders as directed by the Securities
Administrator in writing an amount determined as follows: with respect to each
Certificate (other than the Class R Certificates), the outstanding Current
Principal Amount, plus with respect to each Certificate (other than the Class R
Certificates), one month's interest thereon at the applicable Pass-Through Rate;
and with respect to the Class R Certificates, the percentage interest evidenced
thereby multiplied by the difference, if any, between the above described
repurchase price and the aggregate amount to be distributed to the Holders of
the Certificates (other than the Class R Certificates). If the proceeds with
respect to the Mortgage Loans are not sufficient to pay all of the Certificates
in full (other than the Class R Certificates), any such deficiency will be
allocated first, to the Class B Certificates, in inverse order of their
numerical designation, and then to the Senior Certificates, on a pro rata basis.
Upon deposit of the required repurchase price and following such final
Distribution Date, the Trustee shall release promptly (or cause the Custodian to
release) to Depositor and/or its designee the Mortgage Files for the remaining
applicable Mortgage Loans, and the Accounts with respect thereto shall
terminate, subject to the Trustee's obligation to hold any amounts payable to
the Certificateholders in trust without interest pending final distributions
pursuant to Section 10.01(g). Any other amounts remaining in the Accounts will
belong to the Depositor.
(f) In the event that this Agreement is terminated by reason of the
payment or liquidation of all Mortgage Loans or the disposition of all property
acquired with respect to all Mortgage Loans under Section 10.01(a)(ii) above,
the Master Servicer shall deliver to the Trustee for deposit in the Distribution
Account all distributable amounts remaining in the Master
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Servicer Collection Account. Upon the presentation and surrender of the
Certificates, the Trustee shall distribute to the remaining Certificateholders,
pursuant to the written direction of the Securities Administrator and in
accordance with their respective interests, all distributable amounts remaining
in the Distribution Account. Upon deposit by the Master Servicer of such
distributable amounts, and following such final Distribution Date, the Trustee
shall release promptly to the Depositor or its designee the Mortgage Files for
the remaining Mortgage Loans, and the Master Servicer Collection Account and the
Distribution Account shall terminate, subject to the Trustee's obligation to
hold any amounts payable to the Certificateholders in trust without interest
pending final distributions pursuant to this Section 10.01(f).
(g) If not all of the Certificateholders shall surrender their
Certificates for cancellation within six 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
six months after the second notice, not all the Certificates shall have been
surrendered for cancellation, the Trustee may take appropriate steps, or appoint
any agent to take appropriate steps, to contact the remaining Certificateholders
concerning surrender of their Certificates, and the cost thereof shall be paid
out of the funds and other assets which remain subject to this Agreement.
Section 10.02 Additional Termination Requirements. (a) If the option of
the Depositor to repurchase all the Mortgage Loans under Section 10.01(a)(i)
above is exercised, the Trust Fund and each 2004-9 REMIC shall be terminated in
accordance with the following additional requirements, unless the Trustee has
been furnished with an Opinion of Counsel addressed to the Trustee to the effect
that the failure of the Trust to comply with the requirements of this Section
10.02 will not (i) result in the imposition of taxes on "prohibited
transactions" as defined in Section 860F of the Code on each 2004-9 REMIC or
(ii) cause any 2004-9 REMIC to fail to qualify as a 2004-9 REMIC at any time
that any Regular Certificates are outstanding:
(i) within 90 days prior to the final Distribution Date, at the
written direction of Depositor, the Trustee, as agent for the respective
Tax Matters Persons, shall adopt a plan of complete liquidation of each
2004-9 REMIC in the case of a termination under Section 10.01(a)(i). Such
plan, which shall be provided to the Trustee by Depositor, shall meet the
requirements of a "qualified liquidation" under Section 860F of the Code
and any regulations thereunder.
(ii) the Depositor shall notify the Trustee at the commencement of
such 90-day liquidation period and, at or prior to the time of making of
the final payment on the Certificates, the Trustee shall sell or otherwise
dispose of all of the remaining assets of the Trust Fund in accordance
with the terms hereof; and
(iii) at or after the time of adoption of such a plan of complete
liquidation of any 2004-9 REMIC and at or prior to the final Distribution
Date, the Trustee shall sell for cash all of the assets of the Trust to or
at the direction of the Depositor, and each 2004-9 REMIC, shall terminate
at such time.
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(b) By their acceptance of the Residual Certificates, the Holders thereof
hereby (i) agree to adopt such a plan of complete liquidation of the related
2004-9 REMIC upon the written request of the Depositor, and to take such action
in connection therewith as may be reasonably requested by the Depositor and (ii)
appoint the Depositor as their attorney-in-fact, with full power of
substitution, for purposes of adopting such a plan of complete liquidation. The
Trustee shall adopt such plan of liquidation by filing the appropriate statement
on the final tax return of each 2004-9 REMIC. Upon complete liquidation or final
distribution of all of the assets of the Trust Fund, the Trust Fund and each
2004-9 REMIC shall terminate.
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ARTICLE XI
Miscellaneous Provisions
Section 11.01 Intent of Parties. The parties intend that each 2004-9 REMIC
shall be treated as a REMIC for federal income tax purposes and that the
provisions of this Agreement should be construed in furtherance of this intent.
Notwithstanding any other express or implied agreement to the contrary, the
Seller, the Master Servicer, the Securities Administrator, the Depositor, the
Trustee, each recipient of the related Prospectus Supplement and, by its
acceptance thereof, each holder of a Certificate, agrees and acknowledges that
each party hereto has agreed that each of them and their employees,
representatives and other agents may disclose, immediately upon commencement of
discussions, to any and all persons the tax treatment and tax structure of the
Certificates and the 2004-9 REMICs, the transactions described herein and all
materials of any kind (including opinions and other tax analyses) that are
provided to any of them relating to such tax treatment and tax structure except
where confidentiality is reasonably necessary to comply with the securities laws
of any applicable jurisdiction. For purposes of this paragraph, the terms "tax
treatment" and "tax structure" have the meanings set forth in Treasury
Regulation Sections 1.6011-4(c), 301.6111-2(c) and 301.6112-1(d).
Section 11.02 Amendment.
(a) This Agreement may be amended from time to time by the Company, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee,
without notice to or the consent of any of the Certificateholders, to (i) cure
any ambiguity, (ii) correct or supplement any provisions herein that may be
defective or inconsistent with any other provisions herein, (iii) conform any
provisions herein to the provisions in the Prospectus, (iv) comply with any
changes in the Code or (v) make any other provisions with respect to matters or
questions arising under this Agreement which shall not be inconsistent with the
provisions of this Agreement; provided, however, that with respect to clauses
(iv) and (v) of this Section 11.02(a), such action shall not, as evidenced by an
Opinion of Independent Counsel, addressed to the Trustee, adversely affect in
any material respect the interests of any Certificateholder.
(b) This Agreement may also be amended from time to time by the Company,
the Master Servicer, the Depositor, the Securities Administrator and the
Trustee, with the consent of the Holders of Certificates evidencing Fractional
Undivided Interests aggregating not less than 51% of the Trust Fund or of the
applicable Class or Classes, if such amendment affects only such Class or
Classes, 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 Certificateholders; provided, however, that no such
amendment shall (i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) reduce
the aforesaid percentage of Certificates the Holders of which are required to
consent to any such amendment, without the consent of the Holders of all
Certificates then outstanding, or (iii) cause any 2004-9 REMIC to fail to
qualify as a REMIC for federal income tax purposes, as evidenced by an Opinion
of Independent Counsel addressed to the Trustee which shall be provided to the
Trustee other than at the Trustee's expense. Notwithstanding any other provision
of this Agreement, for purposes of the giving or withholding of consents
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pursuant to this Section 11.02(b), Certificates registered in the name of or
held for the benefit of the Depositor, the Securities Administrator, the Master
Servicer, or the Trustee or any Affiliate thereof shall be entitled to vote
their Fractional Undivided Interests with respect to matters affecting such
Certificates.
(c) Promptly after the execution of any such amendment, the Trustee shall
furnish a copy of such amendment or written notification of the substance of
such amendment to each Certificateholder, with a copy to the Rating Agencies.
(d) In the case of an amendment under Section 11.02(b) above, it shall not
be necessary for the Certificateholders to approve the particular form of such
an amendment. Rather, it shall be sufficient if the Certificateholders approve
the substance of the amendment. The manner of obtaining such consents and of
evidencing the authorization of the execution thereof by Certificateholders
shall be subject to such reasonable regulations as the Trustee may prescribe.
(e) Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel addressed to
the Trustee stating that the execution of such amendment is authorized or
permitted by this Agreement. The Trustee and the Securities Administrator may,
but shall not be obligated to, enter into any such amendment which affects the
Trustee's or the Securities Administrator's own respective rights, duties or
immunities under this Agreement.
Section 11.03 Recordation of Agreement. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the Mortgaged Properties are situated, and
in any other appropriate public recording office or elsewhere. The Depositor
shall effect such recordation, at the expense of the Trust upon the request in
writing of a Certificateholder, but only if such direction is accompanied by an
Opinion of Counsel (provided at the expense of the Certificateholder requesting
recordation) to the effect that such recordation would materially and
beneficially affect the interests of the Certificateholders or is required by
law.
Section 11.04 Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not terminate
this Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
(b) Except as expressly provided in this Agreement, no Certificateholders
shall have any right to vote or in any manner otherwise control the operation
and management of the Trust, 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 establish the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholders be under
any liability
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to any third Person by reason of any action taken by the parties to this
Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any provision
of this Agreement to institute any suit, action or proceeding in equity or at
law upon, under or with respect to this Agreement against the Depositor, the
Securities Administrator, the Master Servicer or any successor to any such
parties unless (i) such Certificateholder previously shall have given to the
Trustee a written notice of a continuing default, as herein provided, (ii) the
Holders of Certificates evidencing Fractional Undivided Interests aggregating
not less than 51% of the Trust Fund 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 costs and expenses and liabilities to be incurred
therein or thereby, and (iii) the Trustee, for 60 days after its receipt of such
notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding.
(d) No one or more Certificateholders shall have any right by virtue of
any provision of this Agreement to affect the rights of any other
Certificateholders or to obtain or seek to obtain priority or preference over
any other such Certificateholder, or to enforce any right under this Agreement,
except in the manner herein provided and for the equal, ratable and common
benefit of all Certificateholders. For the protection and enforcement of the
provisions of this Section 11.04, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 11.05 Acts of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Agreement to be given or taken by
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
an agent duly appointed in writing. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is expressly required, to the
Depositor. Proof of execution of any such instrument or of a writing appointing
any such agent shall be sufficient for any purpose of this Agreement and
conclusive in favor of the Trustee and the Depositor, if made in the manner
provided in this Section 11.05.
(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 a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her 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.
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(c) The ownership of Certificates (notwithstanding any notation of
ownership or other writing on such Certificates, except an endorsement in
accordance with Section 5.02 made on a Certificate presented in accordance with
Section 5.04) shall be proved by the Certificate Register, and neither the
Trustee, the Securities Administrator, the Depositor, the Master Servicer nor
any successor to any such parties shall be affected by any notice to the
contrary.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action of 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 or exchange thereof, if applicable, or in lieu thereof
with respect to anything done, omitted or suffered to be done by the Trustee,
the Securities Administrator, the Depositor, the Master Servicer or any
successor to any such party in reliance thereon, whether or not notation of such
action is made upon such Certificates.
(e) In determining whether the Holders of the requisite percentage of
Certificates evidencing Fractional Undivided Interests have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
Certificates owned by the Trustee, the Securities Administrator, the Depositor,
the Master Servicer or any Affiliate thereof shall be disregarded, except as
otherwise provided in Section 11.02(b) and except that, in determining whether
the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates which a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Certificates which have been pledged in good faith to the Trustee,
the Securities Administrator, the Depositor, the Master Servicer or any
Affiliate thereof may be regarded as outstanding if the pledgor establishes to
the satisfaction of the Trustee the pledgor's right to act with respect to such
Certificates and that the pledgor is not an Affiliate of the Trustee, the
Securities Administrator, the Depositor, or the Master Servicer, as the case may
be.
Section 11.06 Governing Law. THIS AGREEMENT AND THE CERTIFICATES SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE
TO ITS CONFLICT OF LAWS RULES (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW, WHICH THE PARTIES HERETO EXPRESSLY RELY UPON IN THE CHOICE OF
SUCH LAW AS THE GOVERNING LAW HEREUNDER) AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
Section 11.07 Notices. All demands and notices hereunder shall be in
writing and shall be deemed given when delivered at (including delivery by
facsimile) or mailed by registered mail, return receipt requested, postage
prepaid, or by recognized overnight courier, to (i) in the case of the
Depositor, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Vice
President-Servicing, telecopier number: (000) 000-0000, or to such other address
as may hereafter be furnished to the other parties hereto in writing; (ii) in
the case of the Trustee, at its Corporate Trust Office, or such other address as
may hereafter be furnished to the other parties hereto in writing; (iii) in the
case of the Company, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Vice President-Servicing, telecopier number: (000) 000-0000, or to such other
address as may hereafter be furnished to the other parties hereto in writing;
(iv) in the case
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of the Master Servicer or Securities Administrator, Xxxxx Fargo Bank, National
Association, X.X. Xxx 00, Xxxxxxxx Xxxxxxxx 00000 (or, in the case of overnight
deliveries, 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 21045) (Attention:
Corporate Trust Services - BSALTA 2004-9), facsimile no.: (000) 000-0000, or
such other address as may hereafter be furnished to the other parties hereto in
writing; or (v) in the case of the Rating Agencies, Xxxxx'x Investors Service,
Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and Standard & Poor's, a
division of The XxXxxx-Xxxx Companies, Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000. Any notice delivered to the Depositor, the Master Servicer, the
Securities Administrator or the Trustee under this Agreement shall be effective
only upon receipt. Any notice required or permitted to be mailed to a
Certificateholder, unless otherwise provided herein, shall be given by
first-class mail, postage prepaid, at the address of such Certificateholder as
shown in the Certificate Register. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given when mailed, whether or not the Certificateholder receives such notice.
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 severed 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 Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the respective successors and
assigns of the parties hereto.
Section 11.10 Article and Section Headings. The article and section
headings herein are for convenience of reference only, and shall not limit or
otherwise affect the meaning hereof.
Section 11.11 Counterparts. This Agreement may be executed in two or more
counterparts each of which when so executed and delivered shall be an original
but all of which together shall constitute one and the same instrument.
Section 11.12 Notice to Rating Agencies. The article and section headings
herein are for convenience of reference only, and shall not limited or otherwise
affect the meaning hereof. The Trustee shall promptly provide notice to each
Rating Agency with respect to each of the following of which a Responsible
Officer of the Trustee has actual knowledge:
1. Any material change or amendment to this Agreement or the Servicing
Agreements;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of the Master Servicer, the Trustee or
the Securities Administrator;
4. The repurchase or substitution of Mortgage Loans;
5. The final payment to Certificateholders; and
116
6. Any change in the location of the Master Servicer Collection Account or
the Distribution Account.
117
IN WITNESS WHEREOF, the Depositor, the Trustee, the Master Servicer and
the Securities Administrator have caused their names to be signed hereto by
their respective officers thereunto duly authorized as of the day and year first
above written.
STRUCTURED ASSET MORTGAGE
INVESTMENTS II INC., as Depositor
By: /s/ Xxxxx Xxxxxxxxxxx
-------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Vice President
JPMORGAN CHASE BANK, as Trustee
By: /s/ Xxxxx X. Xxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxx
Title: Trust Officer
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, as Master Servicer
By: /s/ Xxxxxx Xxxxxx
----------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, as Securities
Administrator
By: /s/ Xxxxxx Xxxxxx
----------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
EMC MORTGAGE CORPORATION
By: /s/ Xxx Xxxxxxxx
----------------------------
Name: Xxx Xxxxxxxx
Title: Executive Vice President
Accepted and Agreed as to
Sections 2.01, 2.02, 2.03, 2.04 and 9.09(c)
in its capacity as Seller
EMC MORTGAGE CORPORATION
By: /x/ Xxx Xxxxxxxx
-------------------------------
Name: Xxx Xxxxxxxx
Title: Executive Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 30th day of July, 2004 before me, a notary public in and for said
State, personally appeared Xxxxx Xxxxxxxxxxx, known to me to be a Vice President
of Structured Asset Mortgage Investments II Inc., the corporation that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
Notary Public
/s/ Xxxxxxxx Xxxxxxxx
[Notarial Seal]
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 30th day of July, 2004 before me, a notary public in and for said
State, personally appeared Xxxxx Xxxxxxx, known to me to be a Trust Officer of
JPMorgan Chase Bank, the entity that executed the within instrument, and also
known to me to be the person who executed it on behalf of said entity, and
acknowledged to me that such entity executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
Notary Public
/s/ Xxxxxxxx X. Xxxxx
[Notarial Seal]
STATE OF MARYLAND )
) ss.:
COUNTY OF XXXXXX )
On the 30th day of July, 2004 before me, a notary public in and for said
State, personally appeared Xxxxxx Xxxxxx, known to me to be an Assistant Vice
President of Xxxxx Fargo Bank, National Association, the entity that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said entity, and acknowledged to me that such entity executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
Notary Public
/s/ Xxxxx X. Xxxxxx
[Notarial Seal]
STATE OF MARYLAND )
) ss.:
COUNTY OF XXXXXX )
On the 30th day of July, 2004 before me, a notary public in and for said
State, personally appeared Xxxxxx Xxxxxx, known to me to be a Assistant Vice
President of Xxxxx Fargo Bank, National Association, the entity that executed
the within instrument, and also known to me to be the person who executed it on
behalf of said entity, and acknowledged to me that such entity executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
Notary Public
/s/ Xxxxx X. Xxxxxx
[Notarial Seal]
STATE OF TEXAS )
) ss.:
COUNTY OF DALLAS )
On the 30th day of July, 2004 before me, a notary public in and for said
State, personally appeared Xxx Xxxxxxxx, known to me to be Executive Vice
President of EMC Mortgage Corporation, the corporation that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said corporation, and acknowledged to me that such corporation executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
Notary Public
/s/ Xxxxxxx Xxxxxx
[Notarial Seal]
STATE OF TEXAS )
) ss.:
COUNTY OF DALLAS )
On the 30th day of July, 2004 before me, a notary public in and for said
State, personally appeared Xxx Xxxxxxxx, known to me to be Executive Vice
President of EMC Mortgage Corporation, the corporation that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said corporation, and acknowledged to me that such corporation executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
Notary Public
/s/ Xxxxxxx Xxxxxx
[Notarial Seal]
APPENDIX 1
CALCULATION OF CLASS Y PRINCIPAL REDUCTION AMOUNTS
