EXHIBIT 4.1
IMPAC CMB TRUST SERIES 2002-5
Issuer
and
DEUTSCHE BANK NATIONAL TRUST COMPANY
Indenture Trustee
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INDENTURE
Dated as of August 28, 2002
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COLLATERALIZED ASSET-BACKED BONDS
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TABLE OF CONTENTS
Section Page
ARTICLE I
Definitions
Section 1.01 Definitions............................................................................3
Section 1.02 Incorporation by Reference of Trust Indenture Act......................................3
Section 1.03 Rules of Construction..................................................................3
Bonds
Section 2.01 Form...................................................................................5
Section 2.02 Execution, Authentication and Delivery.................................................5
Section 2.03 Acceptance of Mortgage Loans by Indenture Trustee......................................5
Section 2.04 Acceptance of Derivative Contracts and Special
Certificate Cap Contract by Indenture Trustee..........................................7
Section 2.05 Conveyance of the Subsequent Mortgage Loans............................................7
Covenants
Section 3.01 Collection of Payments with respect to the Mortgage Loans.............................10
Section 3.02 Maintenance of Office or Agency.......................................................10
Section 3.03 Money for Payments To Be Held in Trust; Paying Agent..................................10
Section 3.04 Existence.............................................................................11
Section 3.05 Payment of Principal and Interest.....................................................12
Section 3.06 Protection of Trust Estate............................................................14
Section 3.07 Opinions as to Trust Estate...........................................................15
Section 3.08 Performance of Obligations............................................................16
Section 3.09 Negative Covenants....................................................................16
Section 3.10 Annual Statement as to Compliance.....................................................17
Section 3.11 Reserved..............................................................................17
Section 3.12 Representations and Warranties Concerning the Mortgage Loans..........................18
Section 3.13 Amendments to Servicing Agreement.....................................................19
Section 3.14 Master Servicer as Agent and Bailee of the Indenture Trustee..........................19
Section 3.15 Investment Company Act................................................................19
Section 3.16 Issuer May Consolidate, etc...........................................................19
Section 3.17 Successor or Transferee...............................................................21
Section 3.18 No Other Business.....................................................................21
Section 3.19 No Borrowing..........................................................................22
Section 3.20 Guarantees, Loans, Advances and Other Liabilities.....................................22
Section 3.21 Capital Expenditures..................................................................22
Section 3.22 Determination of Bond Interest Rate...................................................22
Section 3.23 Restricted Payments...................................................................22
Section 3.24 Notice of Events of Default...........................................................22
Section 3.25 Further Instruments and Acts..........................................................22
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Section 3.26 Statements to Bondholders.............................................................23
Section 3.27 Grant of the Subsequent Mortgage Loans................................................23
Section 3.28 Certain Representations Regarding the Trust Estate....................................23
Section 3.29 Payments Under the Bond Insurance Policy..............................................24
Section 3.30 Replacement Bond Insurance Policy.....................................................25
Section 3.31 Replacement Derivative Contracts......................................................25
Section 3.32 Allocation of Realized Losses.........................................................25
The Bonds; Satisfaction and Discharge of Indenture
Section 4.01 The Bonds.............................................................................27
Section 4.02 Registration of and Limitations on Transfer
and Exchange of Bonds; Appointment of Bond
Registrar and Certificate Registrar...................................................27
Section 4.03 Mutilated, Destroyed, Lost or Stolen Bonds............................................28
Section 4.04 Persons Deemed Owners.................................................................29
Section 4.05 Cancellation..........................................................................29
Section 4.06 Book-Entry Bonds......................................................................29
Section 4.07 Notices to Depository.................................................................30
Section 4.08 Definitive Bonds......................................................................30
Section 4.09 Tax Treatment.........................................................................31
Section 4.10 Satisfaction and Discharge of Indenture...............................................31
Section 4.11 Application of Trust Money............................................................32
Section 4.12 Subrogation and Cooperation...........................................................32
Section 4.13 Repayment of Monies Held by Paying Agent..............................................33
Section 4.14 Temporary Bonds.......................................................................33
Section 4.15 Representation Regarding ERISA........................................................34
ARTICLE V
Default and Remedies
Section 5.01 Events of Default.....................................................................35
Section 5.02 Acceleration of Maturity; Rescission and Xxxxxxxxx....................................35
Section 5.03 Collection of Indebtedness and Suits for
Enforcement by Indenture Trustee......................................................36
Section 5.04 Remedies; Priorities..................................................................38
Section 5.05 Optional Preservation of the Trust Estate.............................................40
Section 5.06 Limitation of Suits...................................................................40
Section 5.07 Unconditional Rights of Bondholders To Receive
Principal and Interest................................................................41
Section 5.08 Restoration of Rights and Remedies....................................................41
Section 5.09 Rights and Remedies Cumulative........................................................41
Section 5.10 Delay or Omission Not a Waiver........................................................41
Section 5.11 Control By Bond Insurer...............................................................41
Section 5.12 Waiver of Past Defaults...............................................................42
Section 5.13 Undertaking for Costs.................................................................42
Section 5.14 Waiver of Stay or Extension Laws......................................................43
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Section 5.15 Sale of Trust Estate..................................................................43
Section 5.16 Action on Bonds.......................................................................45
Section 5.17 Performance and Enforcement of Certain Obligations....................................45
ARTICLE VI
The Indenture Trustee
Section 6.01 Duties of Indenture Trustee...........................................................47
Section 6.02 Rights of Indenture Trustee...........................................................48
Section 6.03 Individual Rights of Indenture Trustee................................................48
Section 6.04 Indenture Trustee's Disclaimer........................................................49
Section 6.05 Notice of Event of Default............................................................49
Section 6.06 Reports by Indenture Trustee to Holders and Tax Administration........................49
Section 6.07 Compensation and Indemnity............................................................49
Section 6.08 Replacement of Indenture Trustee......................................................50
Section 6.09 Successor Indenture Trustee by Merger.................................................51
Section 6.10 Appointment of Co-Indenture Trustee or Separate Indenture Trustee.....................51
Section 6.11 Eligibility; Disqualification.........................................................52
Section 6.12 Preferential Collection of Claims Against Issuer......................................52
Section 6.13 Representations and Warranties........................................................52
Section 6.14 Directions to Indenture Trustee.......................................................53
Section 6.15 The Agents............................................................................53
ARTICLE VII
Bondholders' Lists and Reports
Section 7.01 Issuer To Furnish Indenture Trustee Names and
Addresses of Bondholders..............................................................54
Section 7.02 Preservation of Information; Communications to Bondholders............................54
Section 7.03 Reports of Issuer.....................................................................54
Section 7.04 Reports by Indenture Trustee..........................................................55
Section 7.05 Statements to Bondholders.............................................................55
ARTICLE VIII
Accounts, Disbursements and Releases
Section 8.01 Collection of Money...................................................................58
Section 8.02 Trust Accounts........................................................................58
Section 8.03 Officer's Certificate.................................................................58
Section 8.04 Termination Upon Distribution to Bondholders..........................................59
Section 8.05 Release of Trust Estate...............................................................59
Section 8.06 Surrender of Bonds Upon Final Payment.................................................59
Section 8.07 Optional Redemption of the Bonds......................................................59
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ARTICLE IX
Supplemental Indentures
Section 9.01 Supplemental Indentures Without Consent of Bondholders................................61
Section 9.02 Supplemental Indentures With Consent of Bondholders...................................62
Section 9.03 Execution of Supplemental Indentures..................................................63
Section 9.04 Effect of Supplemental Indenture......................................................64
Section 9.05 Conformity with Trust Indenture Act...................................................64
Section 9.06 Reference in Bonds to Supplemental Indentures.........................................64
ARTICLE X
Miscellaneous
Compliance Certificates and Opinions, etc........................................................................65
Section 10.02 Form of Documents Delivered to Indenture Trustee......................................66
Section 10.03 Acts of Bondholders...................................................................67
Section 10.04 Notices etc., to Indenture Trustee Issuer and Rating Agencies.........................67
Section 10.05 Notices to Bondholders; Waiver........................................................68
Section 10.06 Conflict with Trust Indenture Act.....................................................69
Section 10.07 Effect of Headings....................................................................69
Section 10.09 Separability..........................................................................69
Section 10.10 Benefits of Indenture.................................................................69
Section 10.11 Legal Holidays........................................................................69
Section 10.12 GOVERNING LAW.........................................................................69
Section 10.13 Counterparts..........................................................................70
Section 10.14 Recording of Indenture................................................................70
Section 10.15 Issuer Obligation.....................................................................70
Section 10.16 No Petition...........................................................................70
Section 10.17 Inspection............................................................................70
EXHIBITS
Exhibit A-1 -- Form of Class A-1 Bonds
Exhibit A-2 -- Form of Class A-IO Bonds
Exhibit A-3 -- Form of Class B Bonds
Exhibit B -- Mortgage Loan Schedule
Exhibit C -- Form of Initial Certification
Exhibit D -- Form of Final Certification
Exhibit E -- Derivative Contracts
Exhibit F -- Special Certificate Cap Contract
Exhibit G -- Seller Guarantee
Appendix A -- Definitions
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This Indenture, dated as of August 28, 2002, is entered into
between Impac CMB Trust Series 2002-5, a Delaware business trust, as Issuer (the
"Issuer"), and Deutsche Bank National Trust Company, a national banking
association, as Indenture Trustee (the "Indenture Trustee").
WITNESSETH THAT:
Each party hereto agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the Holders of the Issuer's
Collateralized Asset-Backed Bonds, Series 2002-5 (the "Bonds")and the Bond
Insurer.
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the
Closing Date, as trustee for the benefit of the Holders of the Bonds and the
Bond Insurer, all of the Issuer's right, title and interest in and to whether
now existing or hereafter created by (a) the Mortgage Loans, Eligible Substitute
Mortgage Loans and the proceeds thereof and all rights under the Related
Documents; (b) all funds on deposit from time to time in the Collection Account
allocable to the Mortgage Loans excluding any investment income from such funds;
(c) all funds on deposit from time to time in the Payment Account and in all
proceeds thereof; (d) all rights under (i) the Mortgage Loan Sale and
Contribution Agreement as assigned to the Issuer, (ii) the Servicing Agreement
and any Subservicing Agreements, (iii) any title, hazard and primary insurance
policies with respect to the Mortgaged Properties and (iv) the rights with
respect to the Derivative Contracts and the Special Certificate Cap Contract as
assigned to the Issuer; (e) with respect to the Holders of the Class A-1 Bonds,
the Bond Insurance Policy; (f) the Seller Guarantee and (g) all present and
future claims, demands, causes and choses in action in respect of any or all of
the foregoing and all payments on or under, and all proceeds of every kind and
nature whatsoever in respect of, any or all of the foregoing and all payments on
or under, and all proceeds of every kind and nature whatsoever in the conversion
thereof, voluntary or involuntary, into cash or other liquid property, all cash
proceeds, accounts, accounts receivable, notes, drafts, acceptances, checks,
deposit accounts, rights to payment of any and every kind, and other forms of
obligations and receivables, instruments and other property which at any time
constitute all or part of or are included in the proceeds of any of the
foregoing (collectively, the "Trust Estate" or the "Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Bonds, equally and ratably without prejudice, priority or distinction, and to
secure compliance with the provisions of this Indenture, all as provided in this
Indenture.
The Indenture Trustee, as trustee on behalf of the Holders of
the Bonds and the Bond Insurer, acknowledges such Grant, accepts the trust under
this Indenture in accordance with the provisions hereof and agrees to perform
its duties as Indenture Trustee as required herein. The Indenture Trustee agrees
that it will hold the Bond Insurance Policy in trust and that it will hold any
proceeds of any claim made upon the Bond Insurance Policy solely for the use and
benefit of the Holders of the Class A-1 Bonds in accordance with the terms
hereof and the terms of the Bond Insurance Policy.
ARTICLE I
Definitions
Section 1.01 Definitions. For all purposes of this Indenture, except as
otherwise expressly provided herein or unless the context otherwise requires,
capitalized terms not otherwise defined herein shall have the meanings assigned
to such terms in the Definitions attached hereto as Appendix A which is
incorporated by reference herein. All other capitalized terms used herein shall
have the meanings specified herein.
Section 1.02 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the Trust Indenture Act (the
"TIA"), the provision is incorporated by reference in and made a part of this
Indenture. The following TIA terms used in this Indenture have the following
meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Bonds.
"indenture security holder" means a Bondholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Indenture Trustee.
"obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rules and
have the meanings assigned to them by such definitions.
Section 1.03 Rules of Construction. Unless the context otherwise
requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
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(v) words in the singular include the plural and
words in the plural include the singular; and
(vi) any agreement, instrument or statute defined or
referred to herein or in any instrument or certificate delivered in
connection herewith means such agreement, instrument or statute as from
time to time amended, modified or supplemented and includes (in the
case of agreements or instruments) references to all attachments
thereto and instruments incorporated therein; references to a Person
are also to its permitted successors and assigns.
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ARTICLE II
Original Issuance of Bonds
Section 2.01 Form. The Class A-1 Bonds, Class A-IO Bonds and Class B
Bonds, together with the Indenture Trustee's certificate of authentication,
shall be in substantially the form set forth in Exhibits A-1, A-2 and A-3 to
this Indenture, respectively, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture.
The Bonds shall be typewritten, printed, lithographed or engraved or
produced by any combination of these methods (with or without steel engraved
borders).
The terms of the Bonds set forth in Exhibits A-1, A-2 and A-3 to this
Indenture are part of the terms of this Indenture.
Section 2.02 Execution, Authentication and Delivery. The Bonds shall be
executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Bonds may be manual or
facsimile.
Bonds bearing the manual or facsimile signature of individuals who were
at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Bonds or did not hold
such offices at the date of such Bonds.
The Indenture Trustee shall upon Issuer Request authenticate and
deliver the Class A-1 and Class B Bonds for original issue in an aggregate
initial principal amount of $497,500,000. The Class A-1 Bonds shall be issued in
an aggregate initial principal amount of $466,875,000, the Class A-IO Bonds
shall be issued in an aggregate initial notional amount of $50,000,000 and the
Class B Bonds shall be issued in an aggregate initial principal amount of
$30,625,000.
Each of the Bonds shall be dated the date of its authentication. The
Bonds shall be issuable as registered Bonds and the Bonds shall be issuable in
the minimum initial Bond Principal Balances or Notional Amounts of $25,000 and
in integral multiples of $1 in excess thereof.
No Bond shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Bond a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Bond shall be conclusive
evidence, and the only evidence, that such Bond has been duly authenticated and
delivered hereunder.
Section 2.03 Acceptance of Mortgage Loans by Indenture Trustee. (a) The
Indenture Trustee acknowledges receipt of, subject to the exceptions it notes
pursuant to the procedures described below, the documents (or certified copies
thereof) referred to in Section 2.1(b) of the Mortgage Loan Sale and
Contribution Agreement, and declares that it holds and will continue to hold
those documents and any amendments, replacements or supplements thereto and all
other assets of the Trust Estate as Indenture Trustee in trust for the use and
benefit of all present and future Holders
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of the Bonds and the Bond Insurer. No later than 45 days after the Closing Date
(or, with respect to any Eligible Substitute Mortgage Loan, within 5 days after
the receipt by the Indenture Trustee thereof and, with respect to any documents
received beyond 45 days after the Closing Date, promptly thereafter), the
Indenture Trustee agrees, for the benefit of the Bondholders and the Bond
Insurer, to review each Mortgage File delivered to it and to execute and
deliver, or cause to be executed and delivered, to the Seller, the Bond Insurer
and the Master Servicer an Initial Certification in the form annexed hereto as
Exhibit C. In conducting such review, the Indenture Trustee will ascertain
whether all required documents described in Section 2.1(b) of the Mortgage Loan
Sale and Contribution Agreement have been executed and received and 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 Exhibit B to this Indenture, as supplemented (PROVIDED, HOWEVER,
that with respect to those documents described in subclause (b)(vii) of such
section, the Indenture Trustee's obligations shall extend only to documents
actually delivered pursuant to such subclause). In performing any such review,
the Indenture Trustee 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 Indenture Trustee finds any document constituting part
of the Mortgage File not to have been executed or received, or to be unrelated
to the Mortgage Loans identified in Exhibit B to this Indenture or to appear to
be defective on its face, the Indenture Trustee shall promptly notify the Seller
and the Bond Insurer of such finding and the Seller's obligation to cure such
defect or repurchase or substitute for the related Mortgage Loan. To the extent
the Indenture Trustee has not received a Mortgage File with respect to any of
the Mortgage Loans, the Indenture Trustee shall not require the deposit of cash
into the Payment Account or any other account to cover the amount of that
Mortgage Loan and shall solely treat such Mortgage Loan as if it were in breach
of a representation or warranty; provided that the aggregate Stated Principal
Balance of such Mortgage Loans does not exceed 1% of the Cut-off Date Balance.
(b) No later than 180 days after the Closing Date, the Indenture
Trustee will review, for the benefit of the Bondholders and the Bond Insurer,
the Mortgage Files and will execute and deliver or cause to be executed and
delivered to the Seller and the Bond Insurer, a Final Certification in the form
annexed hereto as Exhibit D. In conducting such review, the Indenture Trustee
will ascertain whether an original of each document described in subclauses
(b)(ii)-(iv) of Section 2.1 of the Mortgage Loan Sale and Contribution
Agreement, 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 Indenture Trustee finds any document constituting
part of the Mortgage File has not been 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 to this Indenture or to appear
defective on its face, the Indenture Trustee shall promptly notify the Seller
and the Bond Insurer.
(c) Upon deposit of the Repurchase Price in the Payment Account, the
Indenture Trustee shall release to the Seller the related Mortgage File and
shall execute and deliver all instruments of transfer or assignment, without
recourse, furnished to it by the Seller as are necessary to vest in the Seller
title to and rights under the related Mortgage Loan. Such purchase shall be
deemed to have occurred on the date on which certification of the deposit of the
Repurchase Price in the Payment Account was received by the Indenture Trustee.
The Indenture Trustee shall amend the applicable
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Mortgage Loan Schedule to reflect such repurchase and shall promptly notify the
Master Servicer, the Bond Insurer and the Rating Agencies of such amendment.
Section 2.04 Acceptance of Derivative Contracts and Special Certificate
Cap Contract by Indenture Trustee. (a) The Indenture Trustee acknowledges
receipt of the Derivative Contracts and the Special Certificate Cap Contract and
declares that it holds and will continue to hold these documents and any
amendments, replacements or supplements thereto and all other assets of the
Trust Estate as Indenture Trustee in trust for the use and benefit of all
present and future Holders of the Bonds. The Indenture Trustee shall enforce the
Derivative Contracts and the Special Certificate Cap Contract in accordance with
their terms.
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ARTICLE III
Covenants
Section 3.01 Collection of Payments with respect to the Mortgage Loans.
The Indenture Trustee shall establish and maintain an Eligible Account (the
"Payment Account") in which the Indenture Trustee shall, subject to the terms of
this paragraph, deposit, on the same day as it is received from the Master
Servicer, each remittance received by the Indenture Trustee with respect to the
Mortgage Loans. The Indenture Trustee shall make all payments of principal of
and interest on the Bonds, subject to Section 3.03 as provided in Section 3.05
herein from monies on deposit in the Payment Account.
Section 3.02 Maintenance of Office or Agency. The Issuer will maintain
an office or agency where, subject to satisfaction of conditions set forth
herein, Bonds may be surrendered for registration of transfer or exchange, and
where notices and demands to or upon the Issuer in respect of the Bonds and this
Indenture may be served. The Issuer hereby initially appoints the Indenture
Trustee to serve as its agent for the foregoing purposes. If at any time the
Issuer shall fail to maintain any such office or agency or shall fail to furnish
the Indenture Trustee with the address thereof, such surrenders may be made at
the office of the Indenture Trustee located at c/o DTC Transfer Services, 00
Xxxxx Xxxxxx, Xxxxxxxx Xxxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, and notices and
demands may be made or served at the Corporate Trust Office, and the Issuer
hereby appoints the Indenture Trustee as its agent to receive all such
surrenders, notices and demands.
Section 3.03 Money for Payments To Be Held in Trust; Paying Agent. (a)
As provided in Section 3.01, all payments of amounts due and payable with
respect to any Bonds that are to be made from amounts withdrawn from the Payment
Account pursuant to Section 3.01 shall be made on behalf of the Issuer by the
Indenture Trustee or by the Paying Agent, and no amounts so withdrawn from the
Payment Account for payments of Bonds shall be paid over to the Issuer except as
provided in this Section 3.03. The Issuer hereby appoints the Indenture Trustee
as its Paying Agent.
The Issuer will cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent it hereby so agrees), subject to the provisions of
this Section 3.03, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts
due with respect to the Bonds in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Indenture Trustee and the Bond Insurer
notice of any default by the Issuer of which it has actual knowledge in
the making of any payment required to be made with respect to the
Bonds;
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(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee, forthwith
pay to the Indenture Trustee all sums so held in trust by such Paying
Agent;
(iv) immediately resign as Paying Agent and forthwith pay
to the Indenture Trustee all sums held by it in trust for the payment
of Bonds if at any time it ceases to meet the standards required to be
met by a Paying Agent at the time of its appointment;
(v) comply with all requirements of the Code with
respect to the withholding from any payments made by it on any Bonds of
any applicable withholding taxes imposed thereon and with respect to
any applicable reporting requirements in connection therewith; and
(vi) not commence a bankruptcy proceeding against the
Issuer in connection with this Indenture.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Request direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any money
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Bond (other than amounts paid under the Bond
Insurance Policy) and remaining unclaimed for one year after such amount has
become due and payable shall be discharged from such trust and be paid to the
Issuer on Issuer Request; and the Holder of such Bond shall thereafter, as an
unsecured general creditor, look only to the Issuer for payment thereof (but
only to the extent of the amounts so paid to the Issuer), and all liability of
the Indenture Trustee or such Paying Agent with respect to such trust money
shall thereupon cease; PROVIDED, HOWEVER, that the Indenture Trustee or such
Paying Agent, before being required to make any such repayment, shall at the
expense and direction of the Issuer cause to be published once, in an Authorized
Newspaper published in the English language, notice that such money remains
unclaimed and that, after a date specified therein which shall not be less than
30 days from the date of such publication, any unclaimed balance of such money
then remaining will be repaid to the Issuer. The Indenture Trustee, with the
written consent of the Bond Insurer, so long as no Bond Insurer Default exists,
may also adopt and employ, at the expense and direction of the Issuer, any other
reasonable means of notification of such repayment (including, but not limited
to, mailing notice of such repayment to Holders whose Bonds have been called but
have not been surrendered for redemption or whose right to or interest in monies
due and payable but not claimed is determinable from the records of the
Indenture Trustee or of any Paying Agent, at the last address of record for each
such Holder).
Section 3.04 Existence. The Issuer will keep in full effect its
existence, rights and franchises as a business trust under the laws of the State
of Delaware (unless it becomes, or any successor Issuer hereunder is or becomes,
organized under the laws of any other state or of the
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United States of America, in which case the Issuer will keep in full effect its
existence, rights and franchises under the laws of such other jurisdiction) and
will obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Bonds, the Mortgage Loans and each other
instrument or agreement included in the Trust Estate.
Section 3.05 Payment of Principal and Interest. (a) On each Payment
Date from amounts on deposit in the Payment Account in accordance with Section
8.02 hereof, the Indenture Trustee shall pay to the Persons specified in clauses
(b) and (c) below, to the extent provided therein, the Available Funds and any
Insured Amount for such Payment Date; PROVIDED, HOWEVER, that any amounts
representing payments from the Bond Insurer shall only be used to pay interest
and principal to the Class A-1 Bondholders pursuant to clauses (b)(i), (c) and
(j) below.
(b) On each Payment Date, the Available Funds shall be distributed in
the following order of priority, in each case to the extent of the Available
Funds remaining for such Payment Date:
(i) to the Holders of the Class A-IO Bonds and Class
A-1 Bonds, pro rata, the related Accrued Bond Interest for such Classes
for such Payment Date; provided that the amount of Accrued Bond
Interest payable to the Class A-IO Bonds from Available Funds pursuant
to this clause shall be limited to the interest portion of Available
Funds; and
(ii) from the remaining Available Funds, to the
Holders of the Class B Bonds, the related Accrued Bond Interest for
such Class for such Payment Date;
(c) On each Payment Date, the Holders of each Class of Bonds, other
than the Class A-IO Bonds, shall be entitled to receive distributions in respect
of principal equal the Principal Distribution Amount for that Payment Date,
allocated on a pro rata basis, based on the Bond Principal Balance thereof, in
reduction of the Bond Principal Balance thereof, until the Bond Principal
Balances thereof have been reduced to zero; provided, however, that the
aggregate of all unreimbursed payments, if any, made by the Bond Insurer under
the Bond Insurance Policy, including interest thereon, shall be paid to the Bond
Insurer prior to any distribution of principal to the holders of the Class B
Bonds; and provided further, that on each Payment Date, the Principal Available
Funds Shortfall, if any, will be subtracted from the Principal Distribution
Amount payable to the Class B Bonds and shall be paid instead first to the Class
A-1 Bonds and then to the Class B Bonds, in each case in reduction of the Bond
Principal Balance thereof, until reduced to zero.
(d) On each Payment Date, any Net Monthly Excess Cashflow shall be
paid as follows:
(i) to the Bond Insurer, the aggregate of all
payments, if any, made by the Bond Insurer under the Bond Insurance
Policy with respect to the Class A-1 Bonds, including interest thereon,
and any other amounts due to the Bond Insurer pursuant to the Insurance
Agreement, to the extent not previously paid or reimbursed;
(ii) to the Holders of the Class or Classes of Bonds
then entitled to receive distributions in respect of principal, in an
amount equal to any Extra Principal Distribution
9
Amount, payable to such Holders as part of the Principal Distribution
Amount as described in clause (c) above;
(iii) first, to the Holders of the Class A-IO Bonds
and Class A-1 Bonds, pro rata, and then the Class B Bonds, in that
order, any Unpaid Interest Shortfall for such Bonds on such Payment
Date, to the extent not previously reimbursed;
(iv) to the Holders of the Class B Bonds, in an
amount equal to the Allocated Realized Loss Amount for the Class B
Bonds;
(v) to the holders of the Class A-1 Bonds and then
the Class B Bonds, in that order, any Basis Risk Shortfall
Carry-Forward Amount for such payment date, to the extent not covered
by the Derivative Contracts;
(vi) to the Indenture Trustee for amounts owing the
Indenture Trustee hereunder (other than the Indenture Trustee Fee)
remaining unpaid; and
(vii) any remaining amounts will be distributed to
the Certificate Paying Agent, as designee of the Issuer, for the
benefit of the Holders of the Trust Certificates.
(e) On each Payment Date, the Net Derivative Contract Payment Amount
with respect to such Payment Date shall be distributed in the following order of
priority, in each case to the extent of amounts available:
(i) first, to the Class A-1 Bondholders any Basis
Risk Shortfall Carry- Forward Amount for such Payment Date;
(ii) second, to the Class B Bondholders, any Basis
Risk Shortfall Carry- Forward Amount for such Payment Date; and
(iii) third, any remaining amounts will be
distributed to the Certificate Paying Agent, as designee of the Issuer,
for the benefit of the Holders of the Trust Certificates.
(f) On each Payment Date any amounts received in respect of the Special
Certificate Cap Contract shall be distributed to the Certificate Paying Agent,
as designee of the Issuer, for the benefit of the Holders of the Trust
Certificates.
(g) Each distribution with respect to a Book-Entry Bond shall be paid
to the Depository, as Holder thereof, and the Depository shall be responsible
for crediting the amount of such distribution to the accounts of its Depository
Participants in accordance with its normal procedures. Each Depository
Participant shall be responsible for disbursing such distribution to the Bond
Owners that it represents and to each indirect participating brokerage firm (a
"brokerage firm" or "indirect participating firm") for which it acts as agent.
Each brokerage firm shall be responsible for disbursing funds to the Bond Owners
that it represents. None of the Indenture Trustee, the Bond
10
Registrar, the Paying Agent, the Depositor or the Master Servicer shall have any
responsibility therefor except as otherwise provided by this Indenture or
applicable law.
(h) On each Payment Date, the Certificate Paying Agent shall deposit in
the Certificate Distribution Account all amounts it received pursuant to this
Section 3.05 for the purpose of distributing such funds to the
Certificateholders.
(i) Any installment of interest or principal, if any, payable on any
Bond that is punctually paid or duly provided for by the Issuer on the
applicable Payment Date shall, if such Holder shall have so requested at least
five Business Days prior to the related Record Date, be paid to each Holder of
record on the preceding Record Date, by wire transfer to an account specified in
writing by such Holder reasonably satisfactory to the Indenture Trustee as of
the preceding Record Date or in all other cases or if no such instructions have
been delivered to the Indenture Trustee, by check to such Bondholder mailed to
such Holder's address as it appears in the Bond Register in the amount required
to be distributed to such Holder on such Payment Date pursuant to such Holder's
Bonds; PROVIDED, HOWEVER, that the Indenture Trustee shall not pay to such
Holders any amount required to be withheld from a payment to such Holder by the
Code.
(j) The principal of each Bond shall be due and payable in full on the
Final Scheduled Payment Date for such Bond as provided in the forms of Bond set
forth in Exhibits A-1 and A-3 to this Indenture. All principal payments on the
Bonds shall be made to the Bondholders entitled thereto in accordance with the
Percentage Interests represented by such Bonds. Upon notice to the Indenture
Trustee by the Issuer, the Indenture Trustee shall notify the Person in whose
name a Bond is registered at the close of business on the Record Date preceding
the Final Scheduled Payment Date or other final Payment Date (including any
final Payment Date resulting from any redemption pursuant to Section 8.07
hereof). Such notice shall to the extent practicable be mailed no later than
five Business Days prior to such Final Scheduled Payment Date or other final
Payment Date and shall specify that payment of the principal amount and any
interest due with respect to such Bond at the Final Scheduled Payment Date or
other final Payment Date will be payable only upon presentation and surrender of
such Bond and shall specify the place where such Bond may be presented and
surrendered for such final payment. No interest shall accrue on the Bonds on or
after the Final Scheduled Payment Date or any such other final Payment Date.
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to sign any financing statement, continuation statement or
other instrument required to be signed pursuant to this Section 3.05 upon the
Issuer's preparation thereof and delivery to the Indenture Trustee.
Section 3.06 Protection of Trust Estate. (a) The Issuer will from time
to time prepare, execute and deliver all such supplements and amendments hereto
and all such financing statements, continuation statements, instruments of
further assurance and other instruments, and will take such other action
necessary or advisable to:
(i) maintain or preserve the lien and security
interest (and the priority thereof) of this Indenture or carry out more
effectively the purposes hereof;
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(ii) perfect, publish notice of or protect the
validity of any Grant made or to be made by this Indenture;
(iii) cause the Issuer or Master Servicer to enforce
any of the rights to the Mortgage Loans; or
(iv) preserve and defend title to the Trust Estate
and the rights of the Indenture Trustee, the Bond Insurer and the
Bondholders in such Trust Estate against the claims of all persons and
parties.
(b) Except as otherwise provided in this Indenture, the Indenture
Trustee shall not remove any portion of the Trust Estate that consists of money
or is evidenced by an instrument, certificate or other writing from the
jurisdiction in which it was held at the date of the most recent Opinion of
Counsel delivered pursuant to Section 3.07 hereof (or from the jurisdiction in
which it was held as described in the Opinion of Counsel delivered on the
Closing Date pursuant to Section 3.07(a) hereof, or if no Opinion of Counsel has
yet been delivered pursuant to Section 3.07(b) hereof, unless the Indenture
Trustee shall have first received an Opinion of Counsel to the effect that the
lien and security interest created by this Indenture with respect to such
property will continue to be maintained after giving effect to such action or
actions).
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to sign any financing statement, continuation statement or
other instrument required to be signed pursuant to this Section 3.06 upon the
Issuer's preparation thereof and delivery to the Indenture Trustee.
Section 3.07 Opinions as to Trust Estate. (a) On the Closing Date, the
Issuer shall furnish to the Indenture Trustee, the Bond Insurer and the Owner
Trustee an Opinion of Counsel either stating that, in the opinion of such
counsel, such action has been taken with respect to the recording and filing of
this Indenture, any indentures supplemental hereto, and any other requisite
documents, and with respect to the execution and filing of any financing
statements and continuation statements, as are necessary to perfect and make
effective the lien and first priority security interest in the Collateral and
reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such lien and first priority
security interest effective.
(b) On or before April 15 in each calendar year, beginning in 2003, the
Issuer shall furnish to the Indenture Trustee and the Bond Insurer an Opinion of
Counsel at the expense of the Issuer either stating that, in the opinion of such
counsel, such action has been taken with respect to the recording, filing,
re-recording and refiling of this Indenture, any indentures supplemental hereto
and any other requisite documents and with respect to the execution and filing
of any financing statements and continuation statements as is necessary to
maintain the lien and first priority security interest in the Collateral and
reciting the details of such action or stating that in the opinion of such
counsel no such action is necessary to maintain such lien and security interest.
Such Opinion of Counsel shall also describe the recording, filing, re-recording
and refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be required
to maintain the lien and security interest in the Collateral until December 31
in the following calendar year.
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Section 3.08 Performance of Obligations. (a) The Issuer will punctually
perform and observe all of its obligations and agreements contained in this
Indenture, the Basic Documents and in the instruments and agreements included in
the Trust Estate.
(b) The Issuer, with the consent of the Bond Insurer so long as no Bond
Insurer Default exists, may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Issuer shall be deemed to be action taken by the Issuer.
(c) The Issuer will not take any action or permit any action to be
taken by others which would release any Person from any of such Person's
covenants or obligations under any of the documents relating to the Mortgage
Loans or under any instrument included in the Trust Estate, or which would
result in the amendment, hypothecation, subordination, termination or discharge
of, or impair the validity or effectiveness of, any of the documents relating to
the Mortgage Loans or any such instrument, except such actions as the Master
Servicer is expressly permitted to take in the Servicing Agreement. The
Indenture Trustee, as pledgee of the Mortgage Loans, shall with the consent of,
or direction of, the Bond Insurer, so long as no Bond Insurer Default exists, be
able to exercise the rights of the Issuer to direct the actions of the Master
Servicer pursuant to the Servicing Agreement.
(d) The Issuer may retain an administrator and may enter into contracts
acceptable to the Bond Insurer with other Persons for the performance of the
Issuer's obligations hereunder, and performance of such obligations by such
Persons shall be deemed to be performance of such obligations by the Issuer.
Section 3.09 Negative Covenants. So long as any Bonds are Outstanding,
the Issuer shall not:
(i) except as expressly permitted by this Indenture,
sell, transfer, exchange or otherwise dispose of the Trust Estate,
unless directed to do so by the Indenture Trustee, unless directed to
do so by the Bond Insurer or the Indenture Trustee with the consent of
the Bond Insurer, so long as no Bond Insurer Default exists;
(ii) claim any credit on, or make any deduction from
the principal or interest payable in respect of, the Bonds (other than
amounts properly withheld from such payments under the Code) or assert
any claim against any present or former Bondholder by reason of the
payment of the taxes levied or assessed upon any part of the Trust
Estate;
(iii) (A) permit the validity or effectiveness of
this Indenture to be impaired, or permit the lien of this Indenture to
be amended, hypothecated, subordinated, terminated or discharged, or
permit any Person to be released from any covenants or obligations with
respect to the Bonds under this Indenture except as may be expressly
permitted hereby, (B) permit any lien, charge, excise, claim, security
interest, mortgage or other encumbrance (other than the lien of this
Indenture) to be created on or extend to or otherwise arise upon or
burden the Trust Estate or any part thereof or any interest therein or
13
the proceeds thereof or (C) permit the lien of this Indenture not to
constitute a valid first priority security interest in the Trust
Estate; or
(iv) waive or impair, or fail to assert rights under,
the Mortgage Loans, or impair or cause to be impaired the Issuer's
interest in the Mortgage Loans, the Mortgage Loan Sale and Contribution
Agreement or in any Basic Document, if any such action would materially
and adversely affect the interests of the Bondholders or the Bond
Insurer.
Section 3.10 Annual Statement as to Compliance. The Issuer will deliver
to the Indenture Trustee and the Bond Insurer, within 120 days after the end of
each fiscal year (which, for the Issuer, is the calendar year) of the Issuer
(commencing with the fiscal year 2002), an Officer's Certificate stating, as to
the Authorized Officer signing such Officer's Certificate, that:
(i) a review of the activities of the Issuer during
such year and of its performance under this Indenture has been made
under such Authorized Officer's supervision; and
(ii) to the best of such Authorized Officer's
knowledge, based on such review, the Issuer has complied with all
conditions and covenants under this Indenture throughout such year, or,
if there has been a default in its compliance with any such condition
or covenant, specifying each such default known to such Authorized
Officer and the nature and status thereof.
Section 3.11 Reserved.
Section 3.12 Representations and Warranties Concerning the Mortgage
Loans. The Indenture Trustee, as pledgee of the Mortgage Loans, has the benefit
of the representations and warranties made by the Seller in the Mortgage Loan
Sale and Contribution Agreement concerning the Seller and the Mortgage Loans to
the same extent as though such representations and warranties were made directly
to the Indenture Trustee. If a Responsible Officer of the Indenture Trustee has
actual knowledge of any breach of any representation or warranty made by the
Seller in the Mortgage Loan Sale and Contribution Agreement, the Indenture
Trustee shall promptly notify the Seller and the Bond Insurer of such finding
and the Seller's obligation to cure such defect or repurchase or substitute for
the related Mortgage Loan.
Section 3.13 Amendments to Servicing Agreement. The Issuer covenants
with the Indenture Trustee and the Bond Insurer that it will not enter into any
amendment or supplement to the Servicing Agreement without the prior written
consent of the Indenture Trustee and, so long as no Bond Insurer Default exists,
the Bond Insurer.
Section 3.14 Master Servicer as Agent and Bailee of the Indenture
Trustee. Solely for purposes of perfection under Section 9-305 of the Uniform
Commercial Code or other similar applicable law, rule or regulation of the state
in which such property is held by the Master Servicer, the Issuer and the
Indenture Trustee hereby acknowledge that the Master Servicer is acting as
bailee of the Indenture Trustee in holding amounts on deposit in the Collection
Account, as well as its bailee in holding any Related Documents released to the
Master Servicer, and any other items
14
constituting a part of the Trust Estate which from time to time come into the
possession of the Master Servicer. It is intended that, by the Master Servicer's
acceptance of such bailee arrangement, the Indenture Trustee, as a secured party
of the Mortgage Loans, will be deemed to have possession of such Related
Documents, such monies and such other items for purposes of Section 9-305 of the
Uniform Commercial Code of the state in which such property is held by the
Master Servicer. The Indenture Trustee shall not be liable with respect to such
documents, monies or items while in possession of the Master Servicer.
Section 3.15 Investment Company Act. The Issuer shall not become an
"investment company" or be under the "control" of an "investment company" as
such terms are defined in the Investment Company Act of 1940, as amended (or any
successor or amendatory statute), and the rules and regulations thereunder
(taking into account not only the general definition of the term "investment
company" but also any available exceptions to such general definition);
PROVIDED, HOWEVER, that the Issuer shall be in compliance with this Section 3.15
if it shall have obtained an order exempting it from regulation as an
"investment company" so long as it is in compliance with the conditions imposed
in such order.
Section 3.16 Issuer May Consolidate, etc. (a) The Issuer shall not
consolidate or merge with or into any other Person, unless:
(i) the Person (if other than the Issuer) formed by
or surviving such consolidation or merger shall be a Person organized
and existing under the laws of the United States of America or any
state or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee, in form reasonably satisfactory to the Indenture Trustee and
the Bond Insurer, the due and punctual payment of the principal of and
interest on all Bonds, and the payment of the Bond Insurance Premium
and all other amounts payable to the Bond Insurer and the Indenture
Trustee, the payment to the Certificate Paying Agent of all amounts due
to the Certificateholders, and the performance or observance of every
agreement and covenant of this Indenture on the part of the Issuer to
be performed or observed, all as provided herein;
(ii) immediately after giving effect to such
transaction, no Event of Default shall have occurred and be continuing;
(iii) the Rating Agencies shall have notified the
Issuer that such transaction shall not cause the rating of the Class
A-1 Bonds without regard to the Bond Insurance Policy or the Class A-IO
Bonds or Class B Bonds to be reduced, suspended or withdrawn or to be
considered by either Rating Agency to be below investment grade;
(iv) the Issuer and the Bond Insurer shall have
received an Opinion of Counsel (and shall have delivered a copy thereof
to the Indenture Trustee) to the effect that such transaction will not
(A) result in a "substantial modification" of the Bonds under Treasury
Regulation section 1.1001-3, or adversely affect the status of the
Bonds as indebtedness for federal income tax purposes, or (B) if 100%
of the Certificates are not owned by IMH Assets Corp., cause the Trust
to be subject to an entity level tax for federal income tax purposes;
15
(v) any action that is necessary to maintain the lien
and security interest created by this Indenture shall have been taken;
(vi) the Issuer shall have delivered to the Indenture
Trustee and the Bond Insurer an Officer's Certificate and an Opinion of
Counsel each stating that such consolidation or merger and such
supplemental indenture comply with this Article III and that all
conditions precedent herein provided for or relating to such
transaction have been complied with (including any filing required by
the Exchange Act), and that such supplemental indenture is enforceable;
and
(vii) the Bond Insurer, so long as no Bond Insurer
Default exists, shall have given its prior written consent.
(b) The Issuer shall not convey or transfer any of its properties or
assets, including those included in the Trust Estate, to any Person, unless:
(i) the Person that acquires by conveyance or
transfer the properties and assets of the Issuer, the conveyance or
transfer of which is hereby restricted, shall (A) be a United States
citizen or a Person organized and existing under the laws of the United
States of America or any state thereof, (B) expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee, in form satisfactory to the Indenture Trustee, the due and
punctual payment of the principal of and interest on all Bonds and the
payment of the Bond Insurance Premium and all other amounts payable to
the Bond Insurer and the performance or observance of every agreement
and covenant of this Indenture on the part of the Issuer to be
performed or observed, all as provided herein, (C) expressly agree by
means of such supplemental indenture that all right, title and interest
so conveyed or transferred shall be subject and subordinate to the
rights of the Holders of the Bonds and the Bond Insurer, (D) unless
otherwise provided in such supplemental indenture, expressly agree to
indemnify, defend and hold harmless the Issuer, the Indenture Trustee
and the Bond Insurer against and from any loss, liability or expense
arising under or related to this Indenture and the Bonds and (E)
expressly agree by means of such supplemental indenture that such
Person (or if a group of Persons, then one specified Person) shall make
all filings with the Commission (and any other appropriate Person)
required by the Exchange Act in connection with the Bonds;
(ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing;
(iii) the Rating Agencies shall have notified the
Issuer that such transaction shall not cause the rating of the Class
A-1 Bonds without regard to the Bond Insurance Policy or the Class A-IO
Bonds or Class B Bonds, to be reduced, suspended or withdrawn;
(iv) the Issuer and the Bond Insurer shall have
received an Opinion of Counsel (and shall have delivered a copy thereof
to the Indenture Trustee) to the effect that such transaction will not
(A) result in a "substantial modification" of the Bonds under Treasury
Regulation section 1.1001-3, or adversely affect the status of the
Bonds as
16
indebtedness for federal income tax purposes, or (B) if 100% of the
Certificates are not owned by IMH Assets Corp., cause the Trust to be
subject to an entity level tax for federal income tax purposes;
(v) any action that is necessary to maintain the lien
and security interest created by this Indenture shall have been taken;
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each stating
that such conveyance or transfer and such supplemental indenture comply
with this Article III and that all conditions precedent herein provided
for relating to such transaction have been complied with (including any
filing required by the Exchange Act); and
(vii) the Bond Insurer, so long as no Bond Insurer
Default exists, shall have given its prior written consent.
Section 3.17 Successor or Transferee. (a) Upon any consolidation or
merger of the Issuer in accordance with Section 3.16(a), the Person formed by or
surviving such consolidation or merger (if other than the Issuer) shall succeed
to, and be substituted for, and may exercise every right and power of, the
Issuer under this Indenture with the same effect as if such Person had been
named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of
the Issuer pursuant to Section 3.16(b), the Issuer will be released from every
covenant and agreement of this Indenture to be observed or performed on the part
of the Issuer with respect to the Bonds immediately upon the delivery of written
notice to the Indenture Trustee and the Bond Insurer of such conveyance or
transfer and approval of such transaction given by the Bond Insurer to the
Indenture Trustee.
Section 3.18 No Other Business. The Issuer shall not engage in any
business other than financing, purchasing, owning and selling and managing the
Mortgage Loans and the issuance of the Bonds and Certificates in the manner
contemplated by this Indenture and the Basic Documents and all activities
incidental thereto.
Section 3.19 No Borrowing. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Bonds and amounts due to the Bond Insurer under this
Indenture and the Insurance Agreement.
Section 3.20 Guarantees, Loans, Advances and Other Liabilities. Except
as contemplated by this Indenture or the Basic Documents, the Issuer shall not
make any loan or advance or credit to, or guarantee (directly or indirectly or
by an instrument having the effect of assuring another's payment or performance
on any obligation or capability of so doing or otherwise), endorse or otherwise
become contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or
agree contingently to do so) any stock, obligations, assets or securities of, or
any other interest in, or make any capital contribution to, any other Person.
17
Section 3.21 Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
Section 3.22 Determination of Bond Interest Rate. On each Interest
Determination Date the Indenture Trustee shall determine One-Month LIBOR and the
related Bond Interest Rate for each Class of Bonds for the following Accrual
Period and shall inform the Issuer, the Bond Insurer, the Master Servicer, and
the Depositor at their respective facsimile numbers given to the Indenture
Trustee in writing thereof. The establishment of One-Month LIBOR on each
Interest Determination Date by the Indenture Trustee and the Indenture Trustee's
calculation of the rate of interest applicable to each Class of Bonds for the
related Accrual Period shall (in the absence of manifest error) be final and
binding.
Section 3.23 Restricted Payments. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or otherwise with respect to any ownership or equity interest or security
in or of the Issuer, (ii) redeem, purchase, retire or otherwise acquire for
value any such ownership or equity interest or security or (iii) set aside or
otherwise segregate any amounts for any such purpose; PROVIDED, HOWEVER, that
the Issuer may make, or cause to be made, (x) distributions and payments to the
Owner Trustee, the Indenture Trustee, Bondholders and the Certificateholders as
contemplated by, and to the extent funds are available for such purpose under
this Indenture and the Trust Agreement and (y) payments to the Master Servicer
and the Subservicers pursuant to the terms of the Servicing Agreement. The
Issuer will not, directly or indirectly, make payments to or distributions from
the Collection Account except in accordance with this Indenture and the Basic
Documents.
Section 3.24 Notice of Events of Default. The Issuer shall give the
Indenture Trustee, the Bond Insurer and the Rating Agencies prompt written
notice of each Event of Default hereunder and under the Trust Agreement.
Section 3.25 Further Instruments and Acts. Upon request of the
Indenture Trustee or the Bond Insurer, the Issuer will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purpose of this Indenture.
Section 3.26 Statements to Bondholders. On each Payment Date, the
Indenture Trustee and the Certificate Registrar shall prepare and make available
on the Indenture Trustee's website, xxxx://xxx-xxxx.xxx.xxxxxxxx-xxxx.xxx/xxxx
(or deliver at the recipient's option), to the Bond Insurer and to each
Bondholder and Certificateholder the most recent statement prepared by the
Master Servicer pursuant to Section 4.01 of the Servicing Agreement.
Section 3.27 Certain Representations Regarding the Trust Estate.
(a) With respect to that portion of the Collateral described in clauses
(a) through (d) of the definition of Trust Estate, the Issuer represents to the
Indenture Trustee that:
(i) This Indenture creates a valid and continuing security
interest (as defined in the applicable UCC) in the Collateral in favor of the
Indenture Trustee, which security interest is
18
prior to all other liens, and is enforceable as such as against creditors of and
purchasers from the Issuer.
(ii) The Collateral constitutes "deposit accounts" or
"instruments," as applicable, within the meaning of the applicable UCC.
(iii) The Issuer owns and has good and marketable title to the
Collateral, free and clear of any lien, claim or encumbrance of any Person.
(iv) The Issuer has taken all steps necessary to cause the
Indenture Trustee to become the account holder of the Collateral.
(v) Other than the security interest granted to the Indenture
Trustee pursuant to this Indenture, the Issuer has not pledged, assigned, sold,
granted a security interest in, or otherwise conveyed any of the Collateral.
(vi) The Collateral is not in the name of any Person other
than the Issuer or the Indenture Trustee. The Issuer has not consented to the
bank maintaining the Collateral to comply with instructions of any Person other
than the Indenture Trustee.
(b) With respect to that portion of the Collateral described in clauses
(e) and (f), the Issuer represents to the Indenture Trustee that:
(i) This Indenture creates a valid and continuing security
interest (as defined in the applicable UCC) in the Collateral in favor of the
Indenture Trustee, which security interest is prior to all other liens, and is
enforceable as such as against creditors of and purchasers from the Issuer.
(ii) The Collateral constitutes "general intangibles"
within the meaning of the applicable UCC.
(iii) The Issuer owns and has good and marketable title to the
Collateral, free and clear of any lien, claim or encumbrance of any Person.
(iv) The Issuer has caused or will have caused, within ten
days, the filing of all appropriate financing statements in the proper filing
office in the appropriate jurisdictions under applicable law in order to perfect
the security interest in the Collateral granted to the Indenture Trustee
hereunder.
(v) Other than the security interest granted to the Indenture
Trustee pursuant to this Indenture, the Issuer has not pledged, assigned, sold,
granted a security interest in, or otherwise conveyed any of the Collateral. The
Issuer has not authorized the filing of, and is not aware of any financing
statements against, the Issuer, that include a description of collateral
covering the Collateral, other than any financing statement relating to the
security interest granted to the Indenture Trustee hereunder or that has been
terminated. The Issuer is not aware of any judgment or tax lien filings against
the Issuer.
19
(d) The foregoing representations may not be waived and shall
survive the issuance of the Bonds.
Section 3.28 Payments Under the Bond Insurance Policy. (a) On the
second Business Day prior to any Payment Date and at such time as it shall
deliver an acceleration notice to the Bondholders pursuant to Section 5.02, the
Indenture Trustee on behalf of the Class A-1 Bondholders shall make a draw on
the Bond Insurance Policy in an amount, if any, equal to the Deficiency Amount.
(b) If the Indenture Trustee determines that a Deficiency Amount will
exist for the following Payment Date, then the Indenture Trustee shall submit a
Notice (as defined in the Bond Insurance Policy) for payment in the amount of
the Deficiency Amount to the Bond Insurer no later than 12:00 Noon, New York
City time, on the second Business Day prior to the applicable Payment Date. Upon
receipt of such Deficiency Amount in accordance with the terms of the Bond
Insurance Policy, the Indenture Trustee shall deposit such Deficiency Amount in
the Payment Account for distribution to the Class A-1 Bondholders pursuant to
Section 3.05 hereof or with respect to an acceleration pursuant to Section 5.02
hereof.
In addition, a draw may be made under the Bond Insurance Policy in
respect of any Preference Amount applicable to any of the Class A-1 Bonds (as
defined in and pursuant to the terms and conditions of the such Bond Insurance
Policy) and the Indenture Trustee shall submit a Notice (as defined in such Bond
Insurance Policy) for payment with respect thereto together with the other
documents required to be delivered to the Bond Insurer pursuant to the Bond
Insurance Policy in connection with a draw in respect of any Preference Amount.
Section 3.29 Replacement Bond Insurance Policy. In the event of a Bond
Insurer Default (a "Replacement Event"), the Issuer, at its expense, in
accordance with and upon satisfaction of the conditions set forth in the Bond
Insurance Policy, including, without limitation, payment in full of all amounts
owed to the Bond Insurer, may, but shall not be required to, substitute a new
surety bond or surety bonds for the existing Bond Insurance Policy or may
arrange for any other form of credit enhancement; PROVIDED, HOWEVER, that in
each case after giving effect to such substitute or other form of credit
enhancement the Class A Bonds and Class B Bonds shall be rated no lower than the
rating assigned by each Rating Agency to the Class A Bonds and Class B Bonds,
respectively, immediately prior to such Replacement Event and the timing and
mechanism for drawing on such new credit enhancement shall be reasonably
acceptable to the Indenture Trustee and provided further that the premiums under
the proposed credit enhancement shall not exceed such premiums under the
existing Bond Insurance Policy. It shall be a condition to substitution of any
new credit enhancement that there be delivered to the Indenture Trustee (i) an
Opinion of Counsel, acceptable in form to the Indenture Trustee and the Rating
Agencies, from counsel to the provider of such new credit enhancement with
respect to the enforceability thereof and such other matters as the Indenture
Trustee and the Rating Agencies may require and (ii) an Opinion of Counsel to
the effect that such substitution would not (a) result in a "substantial
modification" of the Bonds under Treasury Regulation section 1.1001-3, or
adversely affect the status of the Bonds as indebtedness for federal income tax
purposes, or (b) if 100% of the Certificates are not owned by IMH Assets Corp.,
cause the Trust to be subject to an entity level tax for federal income tax
purposes. Upon receipt of the items referred to above and payment of all amounts
owing to the Bond Insurer and the taking of
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physical possession of the new credit enhancement, the Indenture Trustee shall,
within five Business Days following receipt of such items and such taking of
physical possession, deliver the replaced Bond Insurance Policy to the Bond
Insurer. In the event of any such replacement the Issuer shall give written
notice thereof to the Rating Agencies.
Section 3.30 Replacement Derivative Contracts. In the event of a
default by a Derivative Contract Counterparty with respect to the related
Derivative Contracts (a "Derivative Contract Default"), the Issuer, at its
expense, may, but shall not be required to, substitute a new derivative contract
for the existing Derivative Contracts or any other form of similar coverage for
basis risk shortfalls; PROVIDED, HOWEVER, that the timing and mechanism for
receiving payments under such new derivative contracts shall be reasonably
acceptable to the Indenture Trustee. It shall be a condition to substitution of
any new derivative contracts that there be delivered to the Indenture Trustee an
Opinion of Counsel to the effect that such substitution would not (a) result in
a "substantial modification" of the Bonds under Treasury Regulation section
1.1001-3, or adversely affect the status of the Bonds as indebtedness for
federal income tax purposes, or (b) if 100% of the Certificates are not owned by
IMH Assets Corp., cause the Trust to be subject to an entity level tax for
federal income tax purposes.
Section 3.31 Allocation of Realized Losses. (a) Prior to each Payment
Date, the Master Servicer shall determine the total amount of Realized Losses
that occurred during the related Prepayment Period. The amount of each Realized
Loss shall be evidenced by an Officer's Certificate delivered to the Indenture
Trustee with the related Remittance Report.
(b) On each Payment Date following the application of all amounts
distributable on such date, to the extent the aggregate Stated Principal Balance
of the Mortgage Loans is less than the aggregate Bond Principal Balances of the
Bonds due to Realized Losses on the Mortgage Loans, the Bond Principal Balances
of the Class B Bonds shall be reduced, until the Bond Principal Balance thereof
has been reduced to zero. Any further losses will be covered by the Bond
Insurance Policy in accordance with the terms thereof, however, to the extent
such Realized Losses are not covered by the Bond Insurance Policy, the Bond
Principal Balance of the Class A-1 Bonds will not be reduced by the amount of
such Realized Losses. All Realized Losses allocated to a Class of Bonds will be
allocated in proportion to the Percentage Interests evidenced thereby.
Section 3.32 The Seller Guarantee; Payment under the Seller Guarantee..
On the Closing Date, the Seller Guarantee shall be assigned to the Trust. The
Indenture Trustee shall enforce the Seller Guarantee in accordance with its
terms. On each Determination Date, the Indenture Trustee shall calculate the
Guaranteed Amount, if any, and shall make any claim on behalf of the Issuer
under the Seller Guarantee at least two Business Days prior to the related
Payment Date, for payment to the Indenture Trustee of the amount of any such
claim no later than the Business Day prior to the next Payment Date. Upon
receipt of such Guaranteed Amount in accordance with the terms of the Seller
Guarantee, such payment shall be deposited by the Indenture Trustee into the
Payment Account for distribution to the Class A-IO Bondholders pursuant to
Section 3.05 hereof. On each Payment Date, any payments received by the
Indenture Trustee in respect of the Seller Guarantee shall be paid to the
Holders of the Class A-IO Bonds.
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ARTICLE IV
The Bonds; Satisfaction and Discharge of Indenture
Section 4.01 The Bonds. Each Class of Bonds shall be registered in the
name of a nominee designated by the Depository. Beneficial Owners will hold
interests in the Bonds through the book- entry facilities of the Depository in
minimum initial Bond Principal Balances or Notional Amounts of $25,000 and
integral multiples of $1 in excess thereof.
The Indenture Trustee may for all purposes (including the making of
payments due on the Bonds) deal with the Depository as the authorized
representative of the Beneficial Owners with respect to the Bonds for the
purposes of exercising the rights of Holders of the Bonds hereunder. Except as
provided in the next succeeding paragraph of this Section 4.01, the rights of
Beneficial Owners with respect to the Bonds shall be limited to those
established by law and agreements between such Beneficial Owners and the
Depository and Depository Participants. Except as provided in Section 4.08
hereof, Beneficial Owners shall not be entitled to definitive certificates for
the Bonds as to which they are the Beneficial Owners. Requests and directions
from, and votes of, the Depository as Holder of the Bonds shall not be deemed
inconsistent if they are made with respect to different Beneficial Owners. The
Indenture Trustee may establish a reasonable record date in connection with
solicitations of consents from or voting by Bondholders and give notice to the
Depository of such record date. Without the consent of the Issuer and the
Indenture Trustee, no Bond may be transferred by the Depository except to a
successor Depository that agrees to hold such Xxxx for the account of the
Beneficial Owners.
In the event the Depository Trust Company resigns or is removed as
Depository, the Indenture Trustee with the approval of the Issuer may appoint a
successor Depository. If no successor Depository has been appointed within 30
days of the effective date of the Depository's resignation or removal, each
Beneficial Owner shall be entitled to certificates representing the Bonds it
beneficially owns in the manner prescribed in Section 4.08.
The Bonds shall, on original issue, be executed on behalf of the Issuer
by the Owner Trustee, not in its individual capacity but solely as Owner
Trustee, authenticated by the Indenture Trustee and delivered by the Indenture
Trustee to or upon the order of the Issuer.
Section 4.02 Registration of and Limitations on Transfer and Exchange
of Bonds; Appointment of Bond Registrar and Certificate Registrar. The Issuer
shall cause to be kept at the Corporate Trust Office a Bond Register in which,
subject to such reasonable regulations as it may prescribe, the Bond Registrar
shall provide for the registration of Bonds and of transfers and exchanges of
Bonds as herein provided.
Subject to the restrictions and limitations set forth below, upon
surrender for registration of transfer of any Bond at the Corporate Trust
Office, the Issuer shall execute and the Bond Registrar shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Bonds in authorized initial Bond Principal Balances or Notional Amounts
evidencing the same Class and aggregate Percentage Interests.
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Subject to the foregoing, at the option of the Bondholders, Bonds may
be exchanged for other Bonds of like tenor and in authorized initial Bond
Principal Balances or Notional Amounts evidencing the same Class and aggregate
Percentage Interests upon surrender of the Bonds to be exchanged at the
Corporate Trust Office of the Bond Registrar. Whenever any Bonds are so
surrendered for exchange, the Issuer shall execute and the Indenture Trustee
shall authenticate and deliver the Bonds which the Bondholder making the
exchange is entitled to receive. Each Bond presented or surrendered for
registration of transfer or exchange shall (if so required by the Bond
Registrar) be duly endorsed by, or be accompanied by a written instrument of
transfer in form reasonably satisfactory to the Bond Registrar duly executed by
the Holder thereof or his attorney duly authorized in writing with such
signature guaranteed by a commercial bank or trust company located or having a
correspondent located in the city of New York. Bonds delivered upon any such
transfer or exchange will evidence the same obligations, and will be entitled to
the same rights and privileges, as the Bonds surrendered.
No service charge shall be made for any registration of transfer or
exchange of Bonds, but the Bond Registrar shall require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any registration of transfer or exchange of Bonds.
The Issuer hereby appoints the Indenture Trustee as (i) Certificate
Registrar to keep at its Corporate Trust Office a Certificate Register pursuant
to Section 3.09 of the Trust Agreement in which, subject to such reasonable
regulations as it may prescribe, the Certificate Registrar shall provide for the
registration of Certificates and of transfers and exchanges thereof pursuant to
Section 3.05 of the Trust Agreement and (ii) Bond Registrar under this
Indenture. The Indenture Trustee hereby accepts such appointments.
Section 4.03 Mutilated, Destroyed, Lost or Stolen Bonds. If (i) any
mutilated Bond is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Bond, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer, the Bond Insurer and the
Indenture Trustee harmless, then, in the absence of notice to the Issuer, the
Bond Registrar or the Indenture Trustee that such Bond has been acquired by a
bona fide purchaser, and provided that the requirements of Section 8-405 of the
UCC are met, the Issuer shall execute, and upon its request the Indenture
Trustee shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Bond, a replacement Bond; PROVIDED,
HOWEVER, that if any such destroyed, lost or stolen Bond, but not a mutilated
Bond, shall have become or within seven days shall be due and payable, instead
of issuing a replacement Bond, the Issuer may pay such destroyed, lost or stolen
Xxxx when so due or payable without surrender thereof. If, after the delivery of
such replacement Bond or payment of a destroyed, lost or stolen Bond pursuant to
the proviso to the preceding sentence, a bona fide purchaser of the original
Bond in lieu of which such replacement Bond was issued presents for payment such
original Bond, the Issuer, the Bond Insurer and the Indenture Trustee shall be
entitled to recover such replacement Bond (or such payment) from the Person to
whom it was delivered or any Person taking such replacement Bond from such
Person to whom such replacement Bond was delivered or any assignee of such
Person, except a bona fide purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage, cost
or expense incurred by the Issuer, the Bond Insurer or the Indenture Trustee in
connection therewith.
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Upon the issuance of any replacement Bond under this Section 4.03, the
Issuer may require the payment by the Holder of such Bond of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Bond issued pursuant to this Section 4.03 in
replacement of any mutilated, destroyed, lost or stolen Bond shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Bond shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Bonds duly issued hereunder.
The provisions of this Section 4.03 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Bonds.
Section 4.04 Persons Deemed Owners. Prior to due presentment for
registration of transfer of any Bond, the Issuer, the Bond Insurer, the
Indenture Trustee, the Paying Agent and any agent of the Issuer, the Bond
Insurer or the Indenture Trustee may treat the Person in whose name any Bond is
registered (as of the day of determination) as the owner of such Bond for the
purpose of receiving payments of principal of and interest, if any, on such Bond
and for all other purposes whatsoever, whether or not such Bond be overdue, and
neither the Issuer, the Bond Insurer, the Indenture Trustee, the Paying Agent
nor any agent of the Issuer, the Bond Insurer or the Indenture Trustee shall be
affected by notice to the contrary.
Section 4.05 Cancellation. All Bonds surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Bonds previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever, and all Bonds so delivered shall be promptly cancelled by the
Indenture Trustee. No Bonds shall be authenticated in lieu of or in exchange for
any Bonds cancelled as provided in this Section 4.05, except as expressly
permitted by this Indenture. All cancelled Bonds may be held or disposed of by
the Indenture Trustee in accordance with its standard retention or disposal
policy as in effect at the time unless the Issuer shall direct by an Issuer
Request that they be destroyed or returned to it; PROVIDED, HOWEVER, that such
Issuer Request is timely and the Bonds have not been previously disposed of by
the Indenture Trustee.
Section 4.06 Book-Entry Bonds. The Bonds, upon original issuance, will
be issued in the form of typewritten Bonds representing the Book-Entry Bonds, to
be delivered to The Depository Trust Company, the initial Depository, by, or on
behalf of, the Issuer. The Bonds shall initially be registered on the Bond
Register in the name of Cede & Co., the nominee of the initial Depository, and
no Beneficial Owner will receive a Definitive Bond representing such Beneficial
Owner's interest in such Bond, except as provided in Section 4.08. With respect
to such Bonds, unless and until definitive, fully registered Bonds (the
"Definitive Bonds") have been issued to Beneficial Owners pursuant to Section
4.08:
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(i) the provisions of this Section 4.06 shall be in
full force and effect;
(ii) the Bond Registrar, the Paying Agent and the
Indenture Trustee shall be entitled to deal with the Depository for all
purposes of this Indenture (including the payment of principal of and
interest on the Bonds and the giving of instructions or directions
hereunder) as the sole holder of the Bonds, and shall have no
obligation to the Beneficial Owners of the Bonds;
(iii) to the extent that the provisions of this
Section 4.06 conflict with any other provisions of this Indenture, the
provisions of this Section 4.06 shall control;
(iv) the rights of Beneficial Owners shall be
exercised only through the Depository and shall be limited to those
established by law and agreements between such Owners of Bonds and the
Depository and/or the Depository Participants. Unless and until
Definitive Bonds are issued pursuant to Section 4.08, the initial
Depository will make book- entry transfers among the Depository
Participants and receive and transmit payments of principal of and
interest on the Bonds to such Depository Participants; and
(v) whenever this Indenture requires or permits
actions to be taken based upon instructions or directions of Holders of
Bonds evidencing a specified percentage of the Bond Principal Balances
of the Bonds (for which purpose the Class A-IO Bonds will be deemed to
have a Bond Principal Balance equal to 5% of the aggregate Bond
Principal Balance of the other Classes of Bonds), the Depository shall
be deemed to represent such percentage with respect to the Bonds only
to the extent that it has received instructions to such effect from
Beneficial Owners and/or Depository Participants owning or
representing, respectively, such required percentage of the beneficial
interest in the Bonds and has delivered such instructions to the
Indenture Trustee.
Section 4.07 Notices to Depository. Whenever a notice or other
communication to the Bond Holders is required under this Indenture, unless and
until Definitive Bonds shall have been issued to Beneficial Owners pursuant to
Section 4.08, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Holders of the Bonds to the
Depository, and shall have no obligation to the Beneficial Owners.
Section 4.08 Definitive Bonds. If (i) the Indenture Trustee determines
that the Depository is no longer willing or able to properly discharge its
responsibilities with respect to the Bonds and the Indenture Trustee is unable
to locate a qualified successor, (ii) the Indenture Trustee elects to terminate
the book-entry system through the Depository or (iii) after the occurrence of an
Event of Default, Beneficial Owners of Bonds representing beneficial interests
aggregating at least a majority of the Bond Principal Balances of the Bonds (for
which purpose the Class A-IO Bonds will be deemed to have a Bond Principal
Balance equal to 5% of the aggregate Bond Principal Balance of the other Classes
of Bonds) advise the Depository in writing that the continuation of a book-entry
system through the Depository is no longer in the best interests of the
Beneficial Owners, then the Depository shall notify all Beneficial Owners and
the Indenture Trustee of the occurrence of any such event and of the
availability of Definitive Bonds to Beneficial Owners requesting the same. Upon
surrender to the Indenture Trustee of the typewritten Bonds representing the
Book-Entry Bonds
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by the Depository, accompanied by registration instructions, the Issuer shall
execute and the Indenture Trustee shall authenticate the Definitive Bonds in
accordance with the instructions of the Depository. None of the Issuer, the Bond
Registrar or the Indenture Trustee shall be liable for any delay in delivery of
such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Bonds, the
Indenture Trustee shall recognize the Holders of the Definitive Bonds as
Bondholders.
Section 4.09 Tax Treatment. The Issuer has entered into this Indenture,
and the Bonds will be issued with the intention that, for federal, state and
local income, single business and franchise tax purposes, the Bonds will qualify
as indebtedness. The Issuer and the Indenture Trustee (in accordance with
Section 6.06 hereof), by entering into this Indenture, and each Bondholder, by
its acceptance of its Bond (and each Beneficial Owner by its acceptance of an
interest in the applicable Book-Entry Bond), agree to treat the Bonds for
federal, state and local income, single business and franchise tax purposes as
indebtedness.
Section 4.10 Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect with respect to the Bonds except as to (i)
rights of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Bonds, (iii) rights of Bondholders (and the Bond
Insurer, as subrogee of the Bondholders) to receive payments of principal
thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.06, 3.09, 3.16, 3.18
and 3.19, (v) the rights, obligations and immunities of the Indenture Trustee
hereunder (including the rights of the Indenture Trustee under Section 6.07 and
the obligations of the Indenture Trustee under Section 4.11) and (vi) the rights
of Bondholders as beneficiaries hereof with respect to the property so deposited
with the Indenture Trustee payable to all or any of them, and the Indenture
Trustee, on demand of and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to the Bonds and shall release and deliver the Collateral to or upon the
order of the Issuer, when
(A) either
(1) all Bonds theretofore authenticated and delivered (other
than (i) Bonds that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 4.03 hereof and (ii) Bonds
for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Issuer and thereafter repaid to the
Issuer or discharged from such trust, as provided in Section 3.03) have
been delivered to the Indenture Trustee for cancellation; or
(2) all Bonds not theretofore delivered to the
Indenture Trustee for cancellation
a. have become due and payable,
b. will become due and payable at the Final
Scheduled Payment Date within one year, or
c. have been called for early redemption and
the Trust has been terminated pursuant to
Section 8.07 hereof,
26
and the Issuer, in the case of a. or b. above, has irrevocably deposited or
caused to be irrevocably deposited with the Indenture Trustee cash or direct
obligations of or obligations guaranteed by the United States of America (which
will mature prior to the date such amounts are payable), in trust for such
purpose, in an amount sufficient to pay and discharge the entire indebtedness on
such Bonds then outstanding not theretofore delivered to the Indenture Trustee
for cancellation when due on the Final Scheduled Payment Date or other final
Payment Date and has delivered to the Indenture Trustee and the Bond Insurer a
verification report from a nationally recognized accounting firm certifying that
the amounts deposited with the Indenture Trustee are sufficient to pay and
discharge the entire indebtedness of such Bonds, or, in the case of c. above,
the Issuer shall have complied with all requirements of Section 8.07 hereof,
(B) the Issuer has paid or caused to be paid all other sums
payable hereunder and under the Insurance Agreement by the Issuer as
evidenced by the written consent of the Bond Insurer; and
(C) the Issuer has delivered to the Indenture Trustee and the
Bond Insurer an Officer's Certificate and an Opinion of Counsel, each
meeting the applicable requirements of Section 10.01 hereof, each
stating that all conditions precedent herein provided for relating to
the satisfaction and discharge of this Indenture have been complied
with and, if the Opinion of Counsel relates to a deposit made in
connection with Section 4.10(A)(2)b. above, such opinion shall further
be to the effect that such deposit will constitute an "in-substance
defeasance" within the meaning of Revenue Ruling 85-42, 1985-1 C.B. 36,
and in accordance therewith, the Issuer will be the owner of the assets
deposited in trust for federal income tax purposes.
Section 4.11 Application of Trust Money. All monies deposited with the
Indenture Trustee pursuant to Section 4.10 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Bonds and this
Indenture, to the payment, either directly or through any Paying Agent or the
Issuer, Certificate Paying Agent as designee of the Issuer or the Bond Insurer,
as the Indenture Trustee may determine, to the Holders of Securities, of all
sums due and to become due thereon for principal and interest or otherwise; but
such monies need not be segregated from other funds except to the extent
required herein or required by law.
Section 4.12 Subrogation and Cooperation. (a) The Issuer and the
Indenture Trustee acknowledge that (i) to the extent the Bond Insurer makes
payments under the Bond Insurance Policy on account of principal of or interest
on the Class A-1 Bonds, the Bond Insurer will be fully subrogated to the rights
of such Holders to receive such principal and interest from the Issuer, and (ii)
the Bond Insurer shall be paid such principal and interest but only from the
sources and in the manner provided herein and in the Insurance Agreement for the
payment of such principal and interest.
The Indenture Trustee shall, so long as it is indemnified to its
satisfaction, cooperate in all respects with any reasonable written request by
the Bond Insurer (unless a Bond Insurer Default exists) for action to preserve
or enforce the Bond Insurer's rights or interest under this Indenture or the
Insurance Agreement, consistent with this Indenture and without limiting the
rights of the Bondholders as otherwise set forth in the Indenture, including,
without limitation, upon the
27
occurrence and continuance of a default under the Insurance Agreement, a request
to take any one or more of the following actions:
(i) institute Proceedings for the collection of all
amounts then payable on the Class A-1 Bonds, or under this Indenture in
respect of the Class A-1 Bonds and all amounts payable under the
Insurance Agreement, enforce any judgment obtained and collect from the
Issuer monies adjudged due;
(ii) sell or cause to be sold the Trust Estate or any
portion thereof or rights or interest therein, at one or more public or
private Sales (as defined in Section 5.15 (a) hereof) called and
conducted in any manner permitted by law;
(iii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture; and
(iv) exercise any remedies of a secured party under
the UCC and take any other appropriate action to protect and enforce
the rights and remedies of the Bond Insurer hereunder;
provided, however, action shall be taken pursuant to this Section 4.12 by the
Indenture Trustee to preserve the Bond Insurer's rights or interest under this
Agreement or the Insurance Agreement only to the extent such action is available
to the Class A-1 Bondholders or the Bond Insurer under other provisions of this
Indenture.
Notwithstanding any provision of this Indenture to the contrary, so
long as no Bond Insurer Default exists, the Bond Insurer shall at all times be
treated as if it were the exclusive owner of all Class A-1 Bonds Outstanding for
the purposes of all approvals, consents, waivers and the institution of any
action and the written direction of all remedies, and the Indenture Trustee
shall act in accordance with the written directions of the Bond Insurer so long
as it is indemnified therefor to its reasonable satisfaction.
Section 4.13 Repayment of Monies Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to the Bonds,
all monies then held by any Person other than the Indenture Trustee under the
provisions of this Indenture with respect to such Bonds shall, upon demand of
the Issuer, be paid to the Indenture Trustee to be held and applied according to
Section 3.05 and thereupon such Person shall be released from all further
liability with respect to such monies.
Section 4.14 Temporary Bonds. Pending the preparation of any Definitive
Bonds, the Issuer may execute and upon its written direction, the Indenture
Trustee may authenticate and make available for delivery, temporary Bonds that
are printed, lithographed, typewritten, photocopied or otherwise produced, in
any denomination, substantially of the tenor of the Definitive Bonds in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other
28
variations as the officers executing such Bonds may determine, as evidenced by
their execution of such Bonds.
If temporary Bonds are issued, the Issuer will cause Definitive Bonds
to be prepared without unreasonable delay. After the preparation of the
Definitive Bonds, the temporary Bonds shall be exchangeable for Definitive Bonds
upon surrender of the temporary Bonds at the office of the Indenture Trustee
located at 000 Xxxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, without charge to
the Holder. Upon surrender for cancellation of any one or more temporary Bonds,
the Issuer shall execute and the Indenture Trustee shall authenticate and make
available for delivery, in exchange therefor, Definitive Bonds of authorized
denominations and of like tenor, class and aggregate principal amount. Until so
exchanged, such temporary Bonds shall in all respects be entitled to the same
benefits under this Indenture as Definitive Bonds.
Section 4.15 Representation Regarding ERISA. By acquiring a Bond or
interest therein, each Holder of such Bond or Beneficial Owner of any such
interest will be deemed to represent that either (1) it is not acquiring the
Bond with the assets of a Plan or (2) the acquisition and holding of such Bond
will not give rise to a nonexempt prohibited transaction under Section 406 of
ERISA or Section 4975 of the Code as a result of the Issuer, the Seller, the
Depositor, the Underwriters, the Owner Trustee, the Indenture Trustee, the
Master Servicer, any Subservicer, any other servicer, any administrator, any
provider of credit support, including the Derivative Contract Counterparties,
any owner of the Certificates, or any of their Affiliates being a "Party in
Interest" (within the meaning of ERISA) or Disqualified Person (within the
meaning of the Code) with respect to such Holder or Beneficial Owner that is a
Plan.
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ARTICLE V
Default and Remedies
Section 5.01 Events of Default. The Issuer shall deliver to the
Indenture Trustee and the Bond Insurer, within five days after learning of the
occurrence of an Event of Default, written notice in the form of an Officer's
Certificate of any event which with the giving of notice and the lapse of time
would become an Event of Default under clause (iii) or (iv) of the definition of
"Event of Default", its status and what action the Issuer is taking or proposes
to take with respect thereto. The Indenture Trustee shall not be deemed to have
knowledge of any Event of Default unless a Responsible Officer has actual
knowledge thereof or unless written notice of such Event of Default is received
by a Responsible Officer and such notice references the Bonds, the Trust Estate
or this Indenture.
Section 5.02 Acceleration of Maturity; Rescission and Annulment. If an
Event of Default should occur and be continuing, then and in every such case the
Indenture Trustee at the written direction of the Holders of Bonds representing
not less than a majority of the aggregate Bond Principal Balance of the Bonds
and not less than a majority of the aggregate Notional Amount of the Class A-IO
Bonds may declare the Bonds to be immediately due and payable, by a notice in
writing to the Issuer (and to the Indenture Trustee if such notice is given by
Bondholders), and upon any such declaration the unpaid Bond Principal Balance of
the Class A-1 Bonds and Class B Bonds, together with accrued and unpaid interest
thereon through the date of acceleration, and the Class A-IO Adjusted Issue
Price, shall become immediately due and payable; provided, however, that for
purposes of this sentence and for purposes of this Article V, unless a Bond
Insurer Default exists, the Bond Insurer may exercise the rights of all of the
Holders of the Class A-1 Bonds.
At any time after such declaration of acceleration of maturity with
respect to an Event of Default has been made and before a judgment or decree for
payment of the money due has been obtained by the Indenture Trustee as
hereinafter in this Article V provided, Holders of Bonds representing not less
than a majority of the aggregate Bond Principal Balance of the Bonds and not
less than a majority of the Notional Amount of the Class A-IO Bonds, by written
notice to the Issuer and the Indenture Trustee, may waive the related Event of
Default and rescind and annul such declaration and its consequences if
(i) the Issuer or the Bond Insurer has paid or
deposited with the Indenture Trustee a sum sufficient to pay:
(A) all payments of principal of and interest on the
Bonds and all other amounts that would then be due hereunder
or upon the Bonds if the Event of Default giving rise to such
acceleration had not occurred; and
(B) all sums paid or advanced by the Indenture
Trustee hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and its
agents and counsel; and
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(ii) all Events of Default, other than the nonpayment
of the principal of the Bonds that has become due solely by such
acceleration, have been cured or waived as provided in Section 5.12;
provided, however, the Bond Insurer, so long as no Bond Insurer Default
exists, may waive an Event of Default regardless of Section 5.02(i)
above.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
Section 5.03 Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee.
(a) The Issuer covenants that if (i) default is made in the payment of
any interest on any Bond when the same becomes due and payable, and such default
continues for a period of five days, or (ii) default is made in the payment of
the principal of or any installment of the principal of any Bond when the same
becomes due and payable, the Issuer shall, upon demand of the Indenture Trustee,
at the direction of the Bond Insurer, so long as no Bond Insurer Default exists,
or if a Bond Insurer Default does exist, at the direction of the Holders of a
majority of the aggregate Bond Principal Balances of the Bonds and a majority of
the Notional Amount of the Class A-IO Bonds, pay to the Indenture Trustee, for
the benefit of the Holders of Bonds, the whole amount then due and payable on
the Bonds for principal and interest, with interest at the applicable Bond
Interest Rate upon the overdue principal, and in addition thereto such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Indenture Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee, in its own name and as trustee of an express
trust, and at the direction of the Bond Insurer, so long as no Bond Insurer
Default exists, subject to the provisions of Section 10.16 hereof may institute
a Proceeding for the collection of the sums so due and unpaid, and may prosecute
such Proceeding to judgment or final decree, and may enforce the same against
the Issuer or other obligor upon the Bonds and collect in the manner provided by
law out of the property of the Issuer or other obligor the Bonds, wherever
situated, the monies adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the Indenture
Trustee, at the direction of the Bond Insurer, so long as no Bond Insurer
Default exists subject to the provisions of Section 10.16 hereof may, as more
particularly provided in Section 5.04 hereof, in its discretion, proceed to
protect and enforce its rights and the rights of the Bondholders and the Bond
Insurer, by such appropriate Proceedings as the Indenture Trustee shall be
directed by the Bond Insurer, so long as no Bond Insurer Default exists, to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy or legal or equitable
right vested in the Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any other
obligor upon the Bonds or any Person having or claiming an ownership interest in
the Trust Estate, Proceedings under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or other similar law,
or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other comparable judicial
31
Proceedings relative to the Issuer or other obligor upon the Bonds, or to the
creditors or property of the Issuer or such other obligor, the Indenture
Trustee, at the direction of the Bond Insurer, so long as no Bond Insurer
Default exists, irrespective of whether the principal of any Bonds shall then be
due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Indenture Trustee shall have made any demand
pursuant to the provisions of this Section, shall be entitled and empowered, by
intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of the
Bonds and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the Indenture
Trustee and each predecessor Indenture Trustee, and their respective
agents, attorneys and counsel, and for reimbursement of all expenses
and liabilities incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee, except as a result of
negligence or bad faith), the Bond Insurer and of the Bondholders
allowed in such Proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of Bonds in any election
of a trustee, a standby trustee or Person performing similar functions
in any such Proceedings;
(iii) to collect and receive any monies or other
property payable or deliverable on any such claims and to distribute
all amounts received with respect to the claims of the Bondholders, the
Bond Insurer and of the Indenture Trustee on their behalf, and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Indenture Trustee, the Bond Insurer or the Holders of Bonds
allowed in any judicial proceedings relative to the Issuer, its
creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Bondholders to make
payments to the Indenture Trustee, with the consent of the Bond Insurer so long
as no Bond Insurer Default exists, and, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Bondholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee and all amounts due to the Bond Insurer.
(e) Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Bondholder any plan of reorganization, arrangement, adjustment or
composition affecting the Bonds or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Bondholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.
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(f) All rights of action and of asserting claims under this Indenture,
or under any of the Bonds, may be enforced by the Indenture Trustee without the
possession of any of the Bonds or the production thereof in any trial or other
Proceedings relative thereto, and any such action or proceedings instituted by
the Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Bonds, subject to Section 5.05 hereof.
(g) In any Proceedings brought by the Indenture Trustee with the
consent of the Bond Insurer so long as no Bond Insurer Default exists (and also
any Proceedings involving the interpretation of any provision of this Indenture
to which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Holders of the Bonds, and it shall not be necessary to
make any Bondholder a party to any such Proceedings.
Section 5.04 Remedies; Priorities. (a) If an Event of Default shall
have occurred and be continuing and if an acceleration has been declared and not
rescinded pursuant to Section 5.02 hereof, the Indenture Trustee subject to the
provisions of Section 10.16 hereof may with the consent of the Bond Insurer, so
long as a Bond Insurer Default does not exist, and shall at the direction of the
Bond Insurer so long as no Bond Insurer Default exists, do one or more of the
following (subject to Section 5.05 hereof):
(i) institute Proceedings in its own name and as
trustee of an express trust for the collection of all amounts then
payable on the Bonds or under this Indenture with respect thereto,
whether by declaration or otherwise, and all amounts payable under the
Insurance Agreement, enforce any judgment obtained, and collect from
the Issuer and any other obligor upon such Bonds monies adjudged due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to the
Trust Estate;
(iii) exercise any remedies of a secured party under
the UCC and take any other appropriate action to protect and enforce
the rights and remedies of the Indenture Trustee and the Holders of the
Bonds and the Bond Insurer; and
(iv) sell the Trust Estate or any portion thereof or
rights or interest therein, at one or more public or private sales
called and conducted in any manner permitted by law;
PROVIDED, HOWEVER, that so long as a Bond Insurer Default exists the Indenture
Trustee may not sell or otherwise liquidate the Trust Estate following an Event
of Default, unless (A) the Indenture Trustee obtains the consent of the Holders
of 100% of the aggregate Bond Principal Balance of the Class A-1 Bonds and Class
B Bonds and 50% of the Notional Amount of the Class A- IO Bonds, (B) the
proceeds of such sale or liquidation distributable to the Holders of the Bonds
are sufficient to discharge in full all amounts then due and unpaid upon the
Bonds for principal and interest and to reimburse the Bond Insurer for any
amounts drawn under the Bond Insurance Policy and any other amounts due to the
Bond Insurer under the Insurance Agreement or (C) the Indenture Trustee
33
determines that the Mortgage Loans will not continue to provide sufficient funds
for the payment of principal of and interest on the Bonds as they would have
become due if the Bonds had not been declared due and payable, and the Indenture
Trustee obtains the consent of the Holders of a majority of the aggregate Bond
Principal Balance of the Class A-1 Bonds and Class B Bonds and a majority of the
Notional Amount of the Class A-IO Bonds. In determining such sufficiency or
insufficiency with respect to clause (B) and (C), the Indenture Trustee may, but
need not, obtain and rely upon an opinion (obtained at the expense of the Trust)
of an Independent investment banking or accounting firm of national reputation
as to the feasibility of such proposed action and as to the sufficiency of the
Trust Estate for such purpose. Notwithstanding the foregoing, so long as an
Event of Servicer Termination has not occurred, any Sale of the Trust Estate
shall be made subject to the continued servicing of the Mortgage Loans by the
Master Servicer as provided in the Servicing Agreement.
(b) If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out the money or property in the following order;
PROVIDED, HOWEVER, that any amounts representing payments from the Bond Insurer
shall only be used to pay interest and principal to the Class A-1 Bondholders
pursuant to clauses THIRD and FOURTH below:
FIRST: to the Indenture Trustee for amounts due under
Section 6.07 hereof;
SECOND: to the Bond Insurer, provided no Bond Insurer
Default exists, with respect to any Premium Amount then due to the
extent unpaid pursuant to the Servicing Agreement;
THIRD: to the Bondholders for amounts due and unpaid on the
Bonds (other than Unpaid Interest Shortfalls and Basis Risk Shortfall
Carry-Forward Amounts) with respect to interest, first, to the Class
A-1 Bondholders and Class A-IO Bondholders, on a pro rata basis, and
second, to the Class B Bondholders, according to the amounts due and
payable on the Bonds for interest;
FOURTH: to Bondholders for amounts due and unpaid on the Class
A-1 Bonds and Class B Bonds with respect to principal, and to each
Bondholder ratably, without preference or priority of any kind,
according to the amounts due and payable on such Bonds for principal,
until the Bond Principal Balance of each such Class is reduced to zero;
FIFTH: to the payment of all amounts due and owing to
the Bond Insurer under the Insurance Agreement (including any Premium
Amount not paid pursuant to clause SECOND above);
SIXTH: to the Bondholders for amounts due and unpaid on the
Bonds with respect to any related Basis Risk Shortfall Carry-Forward
Amounts, first, to the Class A-1 Bondholders, and second, to the Class
B Bondholders, according to the amounts due and payable on the Bonds
with respect thereto, from amounts available in the Trust Estate for
the Bondholders;
SEVENTH: to the Bondholders for amounts due and
unpaid on the Bonds with respect to any related Unpaid Interest
Shortfall, first, to the Class A-1 Bondholders and Class A-IO
Bondholders, on a pro rata basis, and second, to the Class B
Bondholders, according
34
to the amounts due and payable on the Bonds with respect thereto, from
amounts available in the Trust Estate for the Bondholders; and
EIGHTH: to the payment of the remainder, if any to
the Certificate Paying Agent on behalf of the Issuer or to any other
person legally entitled thereto.
The Indenture Trustee may fix a record date and payment date for any
payment to Bondholders pursuant to this Section 5.04. With respect to any
acceleration at the direction of the Bond Insurer, the first payment date after
the acceleration shall be the first Payment Date after the acceleration. At
least 15 days before such record date, the Indenture Trustee shall mail to each
Bondholder a notice that states the record date, the payment date and the amount
to be paid.
Section 5.05 Optional Preservation of the Trust Estate. If the Bonds
have been declared to be due and payable under Section 5.02 following an Event
of Default and such declaration and its consequences have not been rescinded and
annulled, the Indenture Trustee may, with the consent of the Bond Insurer (which
consent shall not be required if a Bond Insurer Default exists), and shall, at
the direction of the Bond Insurer so long as no Bond Insurer Default exists,
elect to take and maintain possession of the Trust Estate. It is the desire of
the parties hereto and the Bondholders that there be at all times sufficient
funds for the payment of principal of and interest on the Bonds and other
obligations of the Issuer including payment to the Bond Insurer, and the
Indenture Trustee, unless directed otherwise by the Bond Insurer, shall take
such desire into account when determining whether or not to take and maintain
possession of the Trust Estate. In determining whether to take and maintain
possession of the Trust Estate, the Indenture Trustee may, but need not, obtain
and rely upon an opinion of an Independent investment banking or accounting firm
of national reputation as to the feasibility of such proposed action and as to
the sufficiency of the Trust Estate for such purpose.
Section 5.06 Limitation of Suits. No Holder of any Bond shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless and subject to the provisions of Section 10.16 hereof
(i) such Holder has previously given written notice
to the Indenture Trustee of a continuing Event of Default;
(ii) the Holders of not less than 25% of the
aggregate Bond Principal Balances of the Bonds (for which purpose the
Class A-IO Bonds will be deemed to have a Bond Principal Balance equal
to 5% of the aggregate Bond Principal Balance of the other Classes of
Bonds) have made a written request to the Indenture Trustee to
institute such Proceeding in respect of such Event of Default in its
own name as Indenture Trustee hereunder;
(iii) such Holder or Holders have offered to the
Indenture Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in complying with such request;
35
(iv) the Indenture Trustee for 60 days after its
receipt of such notice of request and offer of indemnity has failed to
institute such Proceedings;
(v) no direction inconsistent with such written
request has been given to the Indenture Trustee during such 60-day
period by the Holders of a majority of the Bond Principal Balances of
the Bonds and a majority of the Notional Amount of the Class A-IO
Bonds.
(vi) such Holder or Holders have the written consent
of the Bond Insurer, unless a Bond Insurer Default exists.
It is understood and intended that no one or more Holders of Bonds shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other
Holders of Bonds or to obtain or to seek to obtain priority or preference over
any other Holders or to enforce any right under this Indenture, except in the
manner herein provided.
Subject to the last paragraph of Section 5.11 herein, in the event the
Indenture Trustee shall receive conflicting or inconsistent requests and
indemnity from two or more groups of Holders of Bonds, each representing less
than a majority of the Bond Principal Balances of the Bonds (for which purpose
the Class A-IO Bonds will be deemed to have a Bond Principal Balance equal to 5%
of the aggregate Bond Principal Balance of the other Classes of Bonds), the
Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.
Section 5.07 Unconditional Rights of Bondholders To Receive Principal
and Interest. Notwithstanding any other provisions in this Indenture, the Holder
of any Bond shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest, if any, on such Bond on or
after the respective due dates thereof expressed in such Bond or in this
Indenture and to institute suit for the enforcement of any such payment, and
such right shall not be impaired without the consent of such Holder.
Section 5.08 Restoration of Rights and Remedies. If the Indenture
Trustee or any Bondholder has instituted any Proceeding to enforce any right or
remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee, the Bond Insurer or to such Bondholder, then and in every such case the
Issuer, the Indenture Trustee, the Bond Insurer and the Bondholders shall,
subject to any determination in such Proceeding, be restored severally and
respectively to their former positions hereunder, and thereafter all rights and
remedies of the Indenture Trustee, the Bond Insurer and the Bondholders shall
continue as though no such Proceeding had been instituted.
Section 5.09 Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee, to the Bond Insurer or to
the Bondholders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or
36
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.10 Delay or Omission Not a Waiver. No delay or omission of
the Indenture Trustee, the Bond Insurer or any Holder of any Bond to exercise
any right or remedy accruing upon any Event of Default shall impair any such
right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Indenture Trustee, the Bond Insurer or to the Bondholders may be
exercised from time to time, and as often as may be deemed expedient, by the
Indenture Trustee, the Bond Insurer or by the Bondholders, as the case may be.
Section 5.11 Control By Bond Insurer. The Bond Insurer, unless a Bond
Insurer Default exists, or the Holders of a majority of the aggregate Bond
Principal Balances of Bonds, if a Bond Insurer Default exists (for which purpose
the Class A-IO Bonds will be deemed to have a Bond Principal Balance equal to 5%
of the aggregate Bond Principal Balance of the other Classes of Bonds), shall
have the right (subject to the provisions of Section 5.06) to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Bonds or exercising any trust or power
conferred on the Indenture Trustee; provided that:
(i) such direction shall not be in conflict with any
rule of law or with this Indenture;
(ii) if a Bond Insurer Default exists, any direction
to the Indenture Trustee to sell or liquidate the Trust Estate shall be
by Holders of Bonds representing not less than 100% of the Bond
Principal Balances of the Class A-1 Bonds and Class B Bonds and 100% of
the Notional Amount of the Class A-IO Bonds;
(iii) if the conditions set forth in Section 5.05
hereof have been satisfied and the Indenture Trustee, with the consent
of the Bond Insurer (which consent shall not be required if a Bond
Insurer Default exists), elects to retain the Trust Estate pursuant to
such Section, then any direction to the Indenture Trustee by Holders of
Bonds representing less than 100% of the Bond Principal Balances of the
Class A-1 Bonds and Class B Bonds and 100% of the Notional Amount of
the Class A-IO Bonds to sell or liquidate the Trust Estate shall be of
no force and effect; and
(iv) if a Bond Insurer Default exists, the Indenture
Trustee may take any other action deemed proper by the Indenture
Trustee that is not inconsistent with such direction of the Holders of
Bonds representing a majority of the Bond Principal Balances of the
Bonds (for which purpose the Class A-IO Bonds will be deemed to have a
Bond Principal Balance equal to 5% of the aggregate Bond Principal
Balance of the other Classes of Bonds).
Notwithstanding the rights of Bondholders set forth in this Section, subject to
Section 6.01, the Indenture Trustee need not take any action that it determines
might involve it in liability.
37
Section 5.12 Waiver of Past Defaults. Prior to the declaration of the
acceleration of the maturity of the Bonds as provided in Section 5.02 hereof,
the Holders of Bonds representing not less than a majority of the aggregate Bond
Principal Balance of the Bonds and a majority of the Notional Amount of the
Class A-IO Bonds may waive any past Event of Default and its consequences except
an Event of Default (a) with respect to payment of principal of or interest on
any of the Bonds, (b) in respect of a covenant or provision hereof which cannot
be modified or amended without the consent of the Holder of each Bond or (c) the
waiver of which would materially and adversely affect the interests of the Bond
Insurer or modify its obligation under the Bond Insurance Policy. In the case of
any such waiver, the Issuer, the Indenture Trustee and the Holders of the Bonds
shall be restored to their former positions and rights hereunder, respectively,
but no such waiver shall extend to any subsequent or other Event of Default or
impair any right consequent thereto.
Upon any such waiver, any Event of Default arising therefrom shall be
deemed to have been cured and not to have occurred, for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Event of
Default or impair any right consequent thereto.
Section 5.13 Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any Bond and each Beneficial Owner of any interest
therein by such Xxxxxx's or Beneficial Owner's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.13 shall not apply to (a) any suit instituted by
the Indenture Trustee, (b) any suit instituted by any Bondholder, or group of
Bondholders, in each case holding in the aggregate more than 10% of the Bond
Principal Balances of the Bonds (for which purpose the Class A-IO Bonds will be
deemed to have a Bond Principal Balance equal to 5% of the aggregate Bond
Principal Balance of the other Classes of Bonds) or (c) any suit instituted by
any Bondholder for the enforcement of the payment of principal of or interest on
any Bond on or after the respective due dates expressed in such Bond and in this
Indenture.
Section 5.14 Waiver of Stay or Extension Laws. The Issuer covenants (to
the extent that it may lawfully do so) that it will not at any time insist upon,
or plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Issuer (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it shall not
hinder, delay or impede the execution of any power herein granted to the
Indenture Trustee, but will suffer and permit the execution of every such power
as though no such law had been enacted.
Section 5.15 Sale of Trust Estate. (a) The power to effect any sale or
other disposition (a "Sale") of any portion of the Trust Estate pursuant to
Section 5.04 hereof is expressly subject to the provisions of Section 5.05
hereof and this Section 5.15. The power to effect any such Sale shall not be
exhausted by any one or more Sales as to any portion of the Trust Estate
remaining unsold, but shall continue unimpaired until the entire Trust Estate
shall have been sold or all amounts payable
38
on the Bonds and under this Indenture and under the Insurance Agreement shall
have been paid. The Indenture Trustee with the consent of the Bond Insurer
(which consent shall not be required if a Bond Insurer Default exists), may from
time to time postpone any public Sale by public announcement made at the time
and place of such Sale. The Indenture Trustee hereby expressly waives its right
to any amount fixed by law as compensation for any Sale.
(b) The Indenture Trustee shall not in any private Sale sell the Trust
Estate, or any portion thereof, unless
(1) the Bond Insurer, unless a Bond Insurer Default exists, or
the Holders of all Bonds if a Bond Insurer Default exists, consent to
or direct the Indenture Trustee to make, such Sale, or
(2) the proceeds of such Sale would be not less than the
entire amount which would be payable to the Bondholders under the Bonds
and the Bond Insurer in respect of amounts drawn under the Bond
Insurance Policy and any other amounts due to the Bond Insurer under
the Insurance Agreement, in full payment thereof in accordance with
Section 5.02 hereof, on the Payment Date next succeeding the date of
such Sale, or
(3) the Indenture Trustee determines that the conditions for
retention of the Trust Estate set forth in Section 5.05 hereof cannot
be satisfied (in making any such determination, the Indenture Trustee
may rely upon an opinion of an Independent investment banking firm
obtained and delivered as provided in Section 5.05 hereof), and the
Bond Insurer consents to such Sale, or if a Bond Insurer Default
exists, the Holders of Bonds representing at least 100% of the Bond
Principal Balances of the Class A-1 Bonds and Class B Bonds and 100% of
the Notional Amount of the Class A-IO Bonds consent to such Sale.
The purchase by the Indenture Trustee of all or any portion of the Trust Estate
at a private Sale shall not be deemed a Sale or other disposition thereof for
purposes of this Section 5.15(b).
(c) Unless the Bond Insurer, or if a Bond Insurer Default exists, the
Holders representing at least 66-2/3% of the Bond Principal Balances of the
Bonds (for which purpose the Class A-IO Bonds will be deemed to have a Bond
Principal Balance equal to 5% of the aggregate Bond Principal Balance of the
other Classes of Bonds) have otherwise consented or directed the Indenture
Trustee, at any public Sale of all or any portion of the Trust Estate at which a
minimum bid equal to or greater than the amount described in paragraph (2) of
subsection (b) of this Section 5.15 has not been established by the Indenture
Trustee and no Person bids an amount equal to or greater than such amount, the
Indenture Trustee, as trustee for the benefit of the Holders of the Bonds, shall
bid an amount at least $1.00 more than the highest other bid.
(d) In connection with a Sale of all or any portion of the Trust
Estate,
(1) any Holder or Holders of Bonds may bid for and purchase
the property offered for sale, and upon compliance with the terms of
sale may hold, retain and possess and dispose of such property, without
further accountability, and may, in paying the purchase money therefor,
deliver any Bonds or claims for interest thereon in lieu of cash up to
the
39
amount which shall, upon distribution of the net proceeds of such sale,
be payable thereon, and such Bonds, in case the amounts so payable
thereon shall be less than the amount due thereon, shall be returned to
the Holders thereof after being appropriately stamped to show such
partial payment;
(2) the Indenture Trustee, with the consent of the Bond
Insurer so long as no Bond Insurer Default exists, may bid for and
acquire the property offered for Sale in connection with any Sale
thereof, and, subject to any requirements of, and to the extent
permitted by, applicable law in connection therewith, may purchase all
or any portion of the Trust Estate in a private sale, and, in lieu of
paying cash therefor, may make settlement for the purchase price by
crediting the gross Sale price against the sum of (A) the amount which
would be distributable to the Holders of the Bonds and Holders of
Certificates and amounts distributable to the Bond Insurer as a result
of such Sale in accordance with Section 5.04(b) hereof on the Payment
Date next succeeding the date of such Sale and (B) the expenses of the
Sale and of any Proceedings in connection therewith which are
reimbursable to it, without being required to produce the Bonds in
order to complete any such Sale or in order for the net Sale price to
be credited against such Bonds, and any property so acquired by the
Indenture Trustee shall be held and dealt with by it in accordance with
the provisions of this Indenture;
(3) the Indenture Trustee shall execute and deliver an
appropriate instrument of conveyance, prepared by the Issuer and
satisfactory to the Indenture Trustee, transferring its interest in any
portion of the Trust Estate in connection with a Sale thereof;
(4) the Indenture Trustee is hereby irrevocably appointed the
agent and attorney- in-fact of the Issuer to transfer and convey its
interest in any portion of the Trust Estate in connection with a Sale
thereof, and to take all action necessary to effect such Sale; and
(5) no purchaser or transferee at such a Sale shall be bound
to ascertain the Indenture Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of
any monies.
Section 5.16 Action on Bonds. The Indenture Trustee's right to seek and
recover judgment on the Bonds or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the lien of this Indenture nor any rights or remedies
of the Indenture Trustee or the Bondholders shall be impaired by the recovery of
any judgment by the Indenture Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Trust Estate or upon any
of the assets of the Issuer. Any money or property collected by the Indenture
Trustee shall be applied in accordance with Section 5.04(b) hereof.
Section 5.17 Performance and Enforcement of Certain Obligations. (a)
Promptly following a request from the Indenture Trustee to do so, the Issuer in
its capacity as holder of the Mortgage Loans, shall take all such lawful action
as the Indenture Trustee or the Bond Insurer may request to cause the Issuer to
compel or secure the performance and observance by the Seller and the Master
Servicer, as applicable, of each of their obligations to the Issuer under or in
connection with the
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Mortgage Loan Sale and Contribution Agreement and the Servicing Agreement, and
to exercise any and all rights, remedies, powers and privileges lawfully
available to the Issuer under or in connection with the Mortgage Loan Sale and
Contribution Agreement and the Servicing Agreement to the extent and in the
manner directed by the Indenture Trustee, with the consent of the Bond Insurer
so long as no Bond Insurer Default exists, as pledgee of the Mortgage Loans,
including the transmission of notices of default on the part of the Seller or
the Master Servicer thereunder and the institution of legal or administrative
actions or proceedings to compel or secure performance by the Seller or the
Master Servicer of each of their obligations under the Mortgage Loan Sale and
Contribution Agreement and the Servicing Agreement. So long as no Bond Insurer
Default exists, the Bond Insurer shall have the right to approve or reject any
proposed successor to the Master Servicer (other than the Indenture Trustee)
under the Servicing Agreement.
(b) The Indenture Trustee, as pledgee of the Mortgage Loans, subject to
the rights of the Bond Insurer under this Agreement and the Servicing Agreement,
may, and at the direction (which direction shall be in writing or by telephone
(confirmed in writing promptly thereafter)) of the Bond Insurer or if a Bond
Insurer Default exists, of the Holders of 66-2/3% of the Bond Principal Balances
of the Bonds (for which purpose the Class A-IO Bonds will be deemed to have a
Bond Principal Balance equal to 5% of the aggregate Bond Principal Balance of
the other Classes of Bonds), shall exercise all rights, remedies, powers,
privileges and claims of the Issuer against the Seller or the Master Servicer
under or in connection with the Mortgage Loan Sale and Contribution Agreement
and the Servicing Agreement, including the right or power to take any action to
compel or secure performance or observance by the Seller or the Master Servicer,
as the case may be, of each of their obligations to the Issuer thereunder and to
give any consent, request, notice, direction, approval, extension or waiver
under the Mortgage Loan Sale and Contribution Agreement and the Servicing
Agreement, as the case may be, and any right of the Issuer to take such action
shall not be suspended.
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ARTICLE VI
The Indenture Trustee
Section 6.01 Duties of Indenture Trustee. (a) If an Event of Default
has occurred and is continuing, the Indenture Trustee shall exercise the rights
and powers vested in it by this Indenture and use the same degree of care and
skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture and no implied covenants or obligations shall be read into
this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Indenture Trustee and
conforming to the requirements of this Indenture; however, the
Indenture Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Indenture Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section 6.01;
(ii) the Indenture Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer
unless it is proved that the Indenture Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Indenture Trustee shall not be liable with
respect to any action it takes or omits to take in good faith in
accordance with a direction received by it (A) from Bondholders or from
the Issuer, which they are entitled to give under the Basic Documents
or (B) from the Bond Insurer, which it is entitled to give under the
Basic Documents.
(d) The Indenture Trustee shall not be liable for interest on any money
received by it except as the Indenture Trustee may agree in writing with the
Issuer.
(e) Money held in trust by the Indenture Trustee need not be segregated
from other trust funds except to the extent required by law or the terms of this
Indenture or the Trust Agreement.
(f) No provision of this Indenture shall require the Indenture Trustee
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 it shall have reasonable grounds to believe that
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repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of the
TIA.
(h) The Indenture Trustee shall act in accordance with Sections 6.03
and 6.04 of the Servicing Agreement and shall act as successor to the Master
Servicer or appoint a successor Master Servicer in accordance with Section 6.02
of the Servicing Agreement.
Section 6.02 Rights of Indenture Trustee. (a) The Indenture Trustee may
rely on any document believed by it to be genuine and to have been signed or
presented by the proper person. The Indenture Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Indenture Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on an Officer's Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee.
(d) The Indenture Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized or within its
rights or powers; PROVIDED, HOWEVER, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice or
Opinion of Counsel with respect to legal matters relating to this Indenture and
the Bonds shall be full and complete authorization and protection from liability
in respect to any action taken, omitted or suffered by it hereunder in good
faith and in accordance with the advice or opinion of such counsel.
(f) For the limited purpose of effecting any action to be undertaken by
the Indenture Trustee, but not specifically as a duty of the Indenture Trustee
in the Indenture, the Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder, either directly or by or through
agents, attorneys, custodians or nominees appointed with due care, and shall not
be responsible for any willful misconduct or negligence on the part of any
agent, attorney, custodian or nominee so appointed.
Section 6.03 Individual Rights of Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the owner or pledgee
of Bonds and may otherwise deal with the Issuer or its Affiliates with the same
rights it would have if it were not Indenture Trustee, subject to the
requirements of the Trust Indenture Act. Any Bond Registrar, co-registrar or
co-paying agent may do the same with like rights. However, the Indenture Trustee
must comply with Sections 6.11 and 6.12 hereof.
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Section 6.04 Indenture Trustee's Disclaimer. The Indenture Trustee
shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture or the Bonds, it shall not be accountable for the
Issuer's use of the proceeds from the Bonds, and it shall not be responsible for
any statement of the Issuer in the Indenture or in any document issued in
connection with the sale of the Bonds or in the Bonds other than the Indenture
Trustee's certificate of authentication.
Section 6.05 Notice of Event of Default. Subject to Section 5.01, the
Indenture Trustee shall promptly mail to each Bondholder and the Bond Insurer
notice of the Event of Default after it is known to a Responsible Officer of the
Indenture Trustee, unless such Event of Default shall have been waived or cured.
Except in the case of an Event of Default in payment of principal of or interest
on any Bond, the Indenture Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of Bondholders.
Section 6.06 Reports by Indenture Trustee to Holders and Tax
Administration. The Indenture Trustee shall deliver to each Bondholder such
information as may be required to enable such holder to prepare its federal and
state income tax returns.
The Indenture Trustee shall prepare and file (or cause to be prepared
and filed), on behalf of the Owner Trustee, all tax returns (if any) and
information reports, tax elections and such annual or other reports of the
Issuer as are necessary for preparation of tax returns and information reports
as provided in Section 5.03 of the Trust Agreement, including without limitation
Form 1099. All tax returns and information reports shall be signed by the Owner
Trustee as provided in Section 5.03 of the Trust Agreement.
Section 6.07 Compensation and Indemnity. The Issuer shall pay to the
Indenture Trustee on each Payment Date reasonable compensation for its services.
The amount of the Indenture Trustee Fee shall be paid by the Master Servicer to
the Indenture Trustee on each Payment Date pursuant to Section 3.07(a)(x) of the
Servicing Agreement and all amounts owing to the Indenture Trustee hereunder
(including amounts owing from the Issuer for indemnification and otherwise) in
excess of such amount shall be paid solely as provided in Section 3.05(d)(vi)
and Section 5.04(b) hereof. The Indenture Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Issuer
shall reimburse the Indenture Trustee for all reasonable out-of-pocket expenses
incurred or made by it, including costs of collection, in addition to
compensation for its services. Such expenses shall include reasonable
compensation and expenses, disbursements and advances of the Indenture Trustee's
agents, counsel, accountants and experts. The Issuer shall indemnify the
Indenture Trustee against any and all loss, liability or expense (including
attorneys' fees) incurred by it in connection with the administration of this
Trust and the performance of its duties hereunder. The Indenture Trustee shall
notify the Issuer promptly of any claim for which it may seek indemnity. Failure
by the Indenture Trustee to so notify the Issuer shall not relieve the Issuer of
its obligations hereunder. The Issuer shall defend any such claim, and the
Indenture Trustee may have separate counsel and the Issuer shall pay the fees
and expenses of such counsel. The Issuer is not obligated to reimburse any
expense or indemnify against any loss, liability or expense incurred by the
Indenture Trustee through the Indenture Trustee's own willful misconduct,
negligence or bad faith.
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The Issuer's payment obligations to the Indenture Trustee pursuant to
this Section 6.07 shall survive the discharge of this Indenture and the
termination or resignation of the Indenture Trustee. When the Indenture Trustee
incurs expenses after the occurrence of an Event of Default with respect to the
Issuer, the expenses are intended to constitute expenses of administration under
Title 11 of the United States Code or any other applicable federal or state
bankruptcy, insolvency or similar law.
Section 6.08 Replacement of Indenture Trustee. No resignation or
removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.08. The Indenture Trustee
may resign at any time by so notifying the Issuer and the Bond Insurer. The Bond
Insurer or, if a Bond Insurer Default exists, the Holders of a majority of Bond
Principal Balances of the Bonds (for which purpose the Class A-IO Bonds will be
deemed to have a Bond Principal Balance equal to 5% of the aggregate Bond
Principal Balance of the other Classes of Bonds) may remove the Indenture
Trustee by so notifying the Indenture Trustee and the Bond Insurer and may
appoint a successor Indenture Trustee. The Issuer shall, with the consent of the
Bond Insurer so long as no Bond Insurer Default exists, remove the Indenture
Trustee if:
(i) the Indenture Trustee fails to comply with
Section 6.11 hereof;
(ii) the Indenture Trustee is adjudged a bankrupt or
insolvent;
(iii) a receiver or other public officer takes charge
of the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes
incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists
in the office of the Indenture Trustee for any reason (the Indenture Trustee in
such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall, with the consent of the Bond Insurer so long as no Bond Insurer
Default exists, promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee, to the Bond Insurer and to the
Issuer. Thereupon, the resignation or removal of the retiring Indenture Trustee
shall become effective, and the successor Indenture Trustee shall have all the
rights, powers and duties of the Indenture Trustee under this Indenture. The
successor Indenture Trustee shall mail a notice of its succession to
Bondholders. The retiring Indenture Trustee shall promptly transfer all property
held by it as Indenture Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer, the Bond Insurer or the Holders of a majority of
Bond Principal Balances of the Bonds (for which purpose the Class A-IO Bonds
will be deemed to have a Bond Principal Balance equal to 5% of the aggregate
Bond Principal Balance of the other Classes of Bonds) may petition any court of
competent jurisdiction for the appointment of a successor Indenture Trustee.
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Notwithstanding the replacement of the Indenture Trustee pursuant to
this Section, the Issuer's obligations under Section 6.07 shall continue for the
benefit of the retiring Indenture Trustee.
Section 6.09 Successor Indenture Trustee by Xxxxxx. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation, without any further act, shall be the successor Indenture Trustee;
provided, that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11 hereof. The Indenture Trustee shall
provide the Rating Agencies and the Bond Insurer with prior written notice of
any such transaction.
If at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture and any of the Bonds shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee and deliver such Bonds so
authenticated; and if at that time any of the Bonds shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Bonds either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is in the Bonds or in this Indenture provided
that the certificate of the Indenture Trustee shall have.
Section 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee. (a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Trust Estate may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Trust Estate, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Bondholders and the Bond Insurer, such title to the Trust Estate, or any part
hereof, and, subject to the other provisions of this Section, such powers,
duties, obligations, rights and trusts as the Indenture Trustee or the Bond
Insurer may consider necessary or desirable. No co-trustee or separate trustee
hereunder shall be required to meet the terms of eligibility as a successor
trustee under Section 6.11 hereof and notice to the Bond Insurer but not to the
Bondholders (unless a Bond Insurer Default exists, in which case notice will be
sent to the Bondholders) of the appointment of any co-trustee or separate
trustee shall be required under Section 6.08 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations
conferred or imposed upon the Indenture Trustee shall be conferred or
imposed upon and exercised or performed by the Indenture Trustee and
such separate trustee or co-trustee jointly (it being understood that
such separate trustee or co-trustee is not authorized to act separately
without the Indenture Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Indenture Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers,
46
duties and obligations (including the holding of title to the Trust
Estate or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable
by reason of any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept
the resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture 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 Indenture and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. Every such instrument shall be filed with
the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of
this Indenture 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 Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 6.11 Eligibility; Disqualification. The Indenture Trustee shall
at all times satisfy the requirements of TIA ss. 310(a). The Indenture Trustee
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition and it or its parent
shall have a long-term debt rating of Baa3 or better by Xxxxx'x and BBB or
better by Standard & Poor's. The Indenture Trustee shall comply with TIA ss.
310(b), including the optional provision permitted by the second sentence of TIA
ss. 310(b)(9); PROVIDED, HOWEVER, that there shall be excluded from the
operation of TIA ss. 310(b)(1) any indenture or indentures under which other
securities of the Issuer are outstanding if the requirements for such exclusion
set forth in TIA ss. 310(b)(1) are met.
Section 6.12 Preferential Collection of Claims Against Issuer. The
Indenture Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). An Indenture Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated.
Section 6.13 Representations and Warranties. The Indenture Trustee
hereby represents that:
(i) The Indenture Trustee is duly organized and
validly existing as an association in good standing under the laws of
the United States with power and authority
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to own its properties and to conduct its business as such properties
are currently owned and such business is presently conducted;
(ii) The Indenture Trustee has the power and
authority to execute and deliver this Indenture and to carry out its
terms; and the execution, delivery and performance of this Indenture
have been duly authorized by the Indenture Trustee by all necessary
corporate action;
(iii) The consummation of the transactions
contemplated by this Indenture and the fulfillment of the terms hereof
do not conflict with, result in any breach of any of the terms and
provisions of, or constitute (with or without notice or lapse of time)
a default under, the articles of incorporation or bylaws of the
Indenture Trustee or any agreement or other instrument to which the
Indenture Trustee is a party or by which it is bound; and
(iv) To the Indenture Trustee's knowledge, there are
no proceedings or investigations pending or threatened before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Indenture Trustee or its
properties: (A) asserting the invalidity of this Indenture (B) seeking
to prevent the consummation of any of the transactions contemplated by
this Indenture or (C) seeking any determination or ruling that might
materially and adversely affect the performance by the Indenture
Trustee of its obligations under, or the validity or enforceability of,
this Indenture.
Section 6.14 Directions to Indenture Trustee. The Indenture
Trustee is hereby directed:
(a) to accept the pledge of the Mortgage Loans and hold the assets of
the Trust Estate in trust for the Bondholders and the Bond Insurer;
(b) to authenticate and deliver the Bonds substantially in the form
prescribed by Exhibits A-1, A-2 and A-3 to this Indenture in accordance with the
terms of this Indenture; and
(c) to take all other actions as shall be required to be taken by the
terms of this Indenture.
Section 6.15 The Agents. The provisions of this Indenture relating to
the limitations of the Indenture Trustee's liability and to its indemnity,
rights and protections shall inure also to the Paying Agent and Bond Registrar.
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ARTICLE VII
Bondholders' Lists and Reports
Section 7.01 Issuer To Furnish Indenture Trustee Names and Addresses of
Bondholders. The Issuer will furnish or cause to be furnished to the Indenture
Trustee (a) not more than five days after each Record Date, a list, in such form
as the Indenture Trustee may reasonably require, of the names and addresses of
the Holders of Bonds as of such Record Date, (b) at such other times as the
Indenture Trustee and the Bond Insurer may request in writing, within 30 days
after receipt by the Issuer of any such request, a list of similar form and
content as of a date not more than 10 days prior to the time such list is
furnished; PROVIDED, HOWEVER, that so long as the Indenture Trustee is the Bond
Registrar, no such list shall be required to be furnished to the Indenture
Trustee.
Section 7.02 Preservation of Information; Communications to
Bondholders. (a) The Indenture Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of the Holders of Bonds
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 hereof and the names and addresses of Holders of Bonds received
by the Indenture Trustee in its capacity as Bond Registrar. The Indenture
Trustee may destroy any list furnished to it as provided in such Section 7.01
upon receipt of a new list so furnished.
(b) Bondholders may communicate pursuant to TIA ss. 312(b) with other
Bondholders with respect to their rights under this Indenture or under the
Bonds.
(c) The Issuer, the Indenture Trustee and the Bond Registrar shall have
the protection of TIAss.312(c).
Section 7.03 Reports of Issuer. (a) (i) The Indenture Trustee shall
file with the Commission on behalf of the Issuer, with a copy to the Issuer and
the Bond Insurer within 15 days before the Issuer is required to file the same
with the Commission, the annual reports and the information, documents and other
reports (or such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) that the Issuer may be required
to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act;
(ii) The Indenture Trustee shall file with the
Commission, on behalf of the Issuer, in accordance with rules and
regulations prescribed from time to time by the Commission such
additional information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this
Indenture as may be required from time to time by such rules and
regulations; and
(iii) The Indenture Trustee shall supply (and the
Indenture Trustee shall transmit by mail to all Bondholders described
in TIA ss. 313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (i) and
(ii) of this Section 7.03(a) and by rules and regulations prescribed
from time to time by the Commission.
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(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
Section 7.04 Reports by Indenture Trustee. If required by TIA ss.
313(a), within 60 days after each August 28 beginning with August 28, 2003, the
Indenture Trustee shall mail to each Bondholder as required by TIA ss. 313(c)
and the Bond Insurer a brief report dated as of such date that complies with TIA
ss. 313(a). The Indenture Trustee also shall comply with TIA ss. 313(b).
A copy of each report at the time of its mailing to Bondholders shall
be filed by the Indenture Trustee with the Commission via XXXXX and each stock
exchange, if any, on which the Bonds are listed. The Issuer shall notify the
Indenture Trustee if and when the Bonds are listed on any stock exchange.
Section 7.05 Statements to Bondholders. (a) With respect to each
Payment Date, the Indenture Trustee shall make available via the Indenture
Trustee's website xxxx://xxx- xxxx.xxx.xxxxxxxx-xxxx.xxx/xxxx or deliver at the
recipient's option to each Bondholder and each Certificateholder, the Bond
Insurer, the Depositor, the Owner Trustee, the Certificate Paying Agent and each
Rating Agency, a statement setting forth the following information as to the
Bonds, to the extent applicable:
(i) the aggregate amount of collections with respect
to the Mortgage Loans;
(ii) the Available Funds and Net Monthly Excess Cash
Flow payable to each Class of Bondholders for such Payment Date, the
Basis Risk Shortfall Carry-Forward Amount on each Class of Bonds for
such Payment Date and the aggregate Unpaid Interest Shortfall on each
Class of Bonds for such Payment Date;
(iii) (a) the amount of such distribution to each
Class of Class A-1 Bonds and Class B Bonds applied to reduce the Bond
Principal Balance thereof, and (b) the aggregate amount included
therein representing Principal Prepayments;
(iv) the Insured Amount, if any, paid by the Bond
Insurer under the Bond Insurance Policy for such Payment Date and the
aggregate Insured Amounts for all prior Payment Dates paid by the Bond
Insurer under the Bond Insurance Policy and not yet reimbursed;
(v) the amount of such distribution to Holders of
each Class of Bonds allocable to interest;
(vi) the amount of such distribution to the
Certificates;
(vii) if the distribution to the Holders of any Class
of Bonds is less than the full amount that would be distributable to
such Holders if there were sufficient funds available therefor, the
amount of the shortfall;
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(viii) the number and the aggregate Stated Principal
Balance of the Mortgage Loans as of the end of the related Due Period;
(ix) the aggregate Bond Principal Balance or Notional
Amount of each Class of Bonds, after giving effect to the amounts
distributed on such Payment Date, separately identifying any reduction
thereof due to Realized Losses other than pursuant to an actual
distribution of principal and the aggregate Bond Principal Balance of
all of the Class A-1 Bonds and Class B Bonds after giving effect to the
distribution of principal on such Payment Date;
(x) the amount of any Principal Available Funds
Shortfalls for such Payment Date;
(xi) the number and aggregate Stated Principal
Balances of Mortgage Loans (a) as to which the Monthly Payment is
delinquent for 31-60 days, 61-90 days, 91 or more days, respectively,
(b) in foreclosure and (c) that have become REO Property, in each case
as of the end of the preceding calendar month;
(xii) the Net Derivative Contract Payment Amount;
(xiii) the Overcollateralization Increase Amount,
Overcollateralization Release Amount, Overcollateralization Target
Amount and Overcollateralized Amount, if any, in each case as the end
of the related Payment Date;
(xiv) the amount of any Advances and Compensating
Interest payments;
(xv) the aggregate Realized Losses with respect to
the related Payment Date and cumulative Realized Losses since the
Closing Date;
(xvi) the number and aggregate Stated Principal
Balance of Mortgage Loans repurchased pursuant to the Mortgage Loan
Sale and Contribution Agreement for the related Payment Date and
cumulatively since the Closing Date;
(xvii) the Sixty Day Rolling Delinquency Percentage,
Ninety Day Rolling Delinquency Percentage and Cumulative Losses for
such Payment Date;
(xviii) the book value of any REO Property;
(xix) the amount of any Prepayment Interest
Shortfalls or Relief Act Shortfalls for such Payment Date; and
(xx) the aggregate Stated Principal Balance of
Mortgage Loans purchased pursuant to Section 3.18 of the Servicing
Agreement for the related Payment Date and cumulatively since the
Closing Date.
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Items (iii) and (v) above shall be presented on the basis of a Bond
having a $1,000 denomination. In addition, by January 31 of each calendar year
following any year during which the Bonds are outstanding, the Indenture Trustee
shall furnish a report to each Bondholder of record if so requested in writing
at any time during each calendar year as to the aggregate of amounts reported
pursuant to (iii), (iv) and (v) with respect to the Bonds for such calendar
year.
The Indenture Trustee may conclusively rely upon the Remittance Report
provided by the Master Servicer pursuant to Section 4.01 of the Servicing
Agreement and on the amount of the Net Derivative Contract Payment Amount
furnished to the Indenture Trustee pursuant to the Derivative Contracts in its
preparation of its Statement to Bondholders.
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ARTICLE VIII
Accounts, Disbursements and Releases
Section 8.01 Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default occurs
in the making of any payment or performance under any agreement or instrument
that is part of the Trust Estate, the Indenture Trustee may take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.
Section 8.02 Trust Accounts. (a) On or prior to the Closing Date, the
Issuer shall cause the Indenture Trustee to establish and maintain, in the name
of the Indenture Trustee, for the benefit of the Bondholders and the Bond
Insurer, the Payment Account as provided in Section 3.01 hereof.
(b) All monies deposited from time to time in the Payment Account and
all deposits therein pursuant to this Indenture (other than deposits of any gain
or income on investments thereof) are for the benefit of the Bondholders and the
Bond Insurer. Any loss on any investment made by the Indenture Trustee with
funds in the Payment Account shall be reimbursed immediately to the Trust Estate
by the Master Servicer. All investments made with monies in the Payment Account
and the Certificate Distribution Account including all income or other gain from
such investments shall be for the benefit of and the risk of the Master
Servicer.
(c) On each Payment Date, the Indenture Trustee shall pay itself the
Indenture Trustee Fee for such Payment Date and shall pay the Derivative
Contract Counterparties any amounts owed under the Derivative Contracts, and
then the Indenture Trustee shall distribute all remaining amounts on deposit in
the Payment Account to the Bondholders in respect of the Bonds and to such other
persons in the order of priority set forth in Section 3.05 hereof (except as
otherwise provided in Section 5.04(b) hereof).
(d) The Indenture Trustee shall invest any funds in the Payment
Account, but only in Eligible Investments, as directed by the Master Servicer,
maturing no later than the Business Day preceding each Payment Date and such
Eligible Investments shall not be sold or disposed of prior to their maturity.
Section 8.03 Officer's Certificate. The Indenture Trustee shall receive
at least seven Business Days' notice when requested by the Issuer to take any
action pursuant to Section 8.05(a) hereof, accompanied by copies of any
instruments to be executed, and the Indenture Trustee shall also require, as a
condition to such action, an Officer's Certificate, in form and substance
satisfactory to the Indenture Trustee, stating the legal effect of any such
action, outlining the steps required to
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complete the same, and concluding that all conditions precedent to the taking of
such action have been complied with.
Section 8.04 Termination Upon Distribution to Bondholders. This
Indenture and the respective obligations and responsibilities of the Issuer and
the Indenture Trustee created hereby shall terminate upon the distribution to
Bondholders, the Bond Insurer, the Certificate Paying Agent on behalf of the
Certificateholders and the Indenture Trustee of all amounts required to be
distributed pursuant to Article III; PROVIDED, HOWEVER, that in no event shall
the trust created hereby continue beyond the expiration of 21 years from the
death of the survivor of the descendants of Xxxxxx X. Xxxxxxx, the late
ambassador of the United States to the Court of St. Xxxxx, living on the date
hereof.
Section 8.05 Release of Trust Estate. (a) Subject to the payment of its
fees and expenses, the Indenture Trustee may, and when required by the
provisions of this Indenture shall, execute instruments to release property from
the lien of this Indenture, or convey the Indenture Trustee's interest in the
same, in a manner and under circumstances that are not inconsistent with the
provisions of this Indenture, including for the purposes of any repurchase by
the Master Servicer of a Mortgage Loan pursuant to Section 3.18 of the Servicing
Agreement. No party relying upon an instrument executed by the Indenture Trustee
as provided in Article VIII hereunder shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent,
or see to the application of any monies.
(b) The Indenture Trustee shall, at such time as (i) there are no Bonds
Outstanding, (ii) all sums due to the Indenture Trustee pursuant to this
Indenture have been paid and (iii) all sums due to the Bond Insurer have been
paid, release any remaining portion of the Trust Estate that secured the Bonds
from the lien of this Indenture.
(c) The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.05 only upon receipt of a request from the
Issuer accompanied by an Officers' Certificate and an Opinion of Counsel stating
that all applicable requirements have been satisfied, and a letter from the Bond
Insurer stating that the Bond Insurer has no objection to such request from the
Issuer, except as otherwise provided in clause (a).
Section 8.06 Surrender of Bonds Upon Final Payment. By acceptance of
any Xxxx, the Holder thereof agrees to surrender such Xxxx to the Indenture
Trustee promptly, prior to such Bondholder's receipt of the final payment
thereon.
Section 8.07 Optional Redemption of the Bonds. (a) The Holder of the
Certificates shall have the option to redeem the Bonds in whole, but not in
part, on any Payment Date on or after the earlier of (i) the Payment Date on
which the aggregate Stated Principal Balance of the Mortgage Loans as of the end
of the prior Due Period is less than or equal to 25% of the aggregate Stated
Principal Balance of the Mortgage Loans as of Cut-off Date, but not earlier than
the Payment Date occurring in February 2005 and (ii) the Payment Date in
September 2012. The aggregate redemption price for the Bonds will be equal to
the sum of (i) the unpaid Bond Principal Balance of the Bonds as of the Payment
Date on which the proposed redemption will take place in accordance with the
foregoing, together with accrued and unpaid interest thereon at the applicable
Bond Interest Rate
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through such Payment Date (including any related Unpaid Interest Shortfall and
Basis Risk Shortfall Carry-Forward Amount), (ii) the Class A-IO Adjusted Issue
Price for the Class A-IO Bonds and (iii) an amount sufficient to pay in full all
amounts owing to the Bond Insurer and the Indenture Trustee under this Indenture
and the Insurance Agreement (which amounts shall be specified in writing upon
request of the Issuer by the Indenture Trustee and the Bond Insurer).
(b) In order to exercise the foregoing option, the Issuer shall provide
written notice of its exercise of such option to the Indenture Trustee, the Bond
Insurer, the Owner Trustee and the Master Servicer at least 15 days prior to its
exercise. Following receipt of the notice, the Indenture Trustee shall provide
notice to the Bondholders of the final payment on the Bonds. In addition, the
Issuer shall, not less than one Business Day prior to the proposed Payment Date
on which such redemption is to be made, deposit the aggregate redemption price
specified in (a) above with the Indenture Trustee, who shall deposit the
aggregate redemption price into the Payment Account and shall, on the Payment
Date after receipt of the funds, apply such funds to make final payments of
principal and interest on the Bonds in accordance with Section 3.05(b) and (c)
hereof and payment in full to the Bond Insurer for all amounts owing under the
Insurance Agreement and the Indenture Trustee, and this Indenture shall be
discharged subject to the provisions of Section 4.10 hereof. If for any reason
the amount deposited by the Issuer is not sufficient to make such redemption or
such redemption cannot be completed for any reason, the amount so deposited by
the Issuer with the Indenture Trustee shall be immediately returned to the
Issuer in full and shall not be used for any other purpose or be deemed to be
part of the Trust Estate.
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ARTICLE IX
Supplemental Indentures
Section 9.01 Supplemental Indentures Without Consent of Bondholders.
(a) Without the consent of the Holders of any Bonds but with the prior written
consent of the Bond Insurer and prior notice to the Rating Agencies and the Bond
Insurer, the Issuer and the Indenture Trustee, when authorized by an Issuer
Request, at any time and from time to time, may enter into one or more
indentures supplemental hereto (which shall conform to the provisions of the TIA
as in force at the date of the execution thereof), in form satisfactory to the
Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any
property at any time subject to the lien of this Indenture, or better
to assure, convey and confirm unto the Indenture Trustee any property
subject or required to be subjected to the lien of this Indenture, or
to subject to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with
the applicable provisions hereof, of another person to the Issuer, and
the assumption by any such successor of the covenants of the Issuer
herein and in the Bonds contained;
(iii) to add to the covenants of the Issuer, for the
benefit of the Holders of the Bonds, or to surrender any right or power
herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge
any property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement
any provision herein or in any supplemental indenture that may be
inconsistent with any other provision herein or in any supplemental
indenture;
(vi) to make any other provisions with respect to
matters or questions arising under this Indenture or in any
supplemental indenture; provided, that such action shall not materially
and adversely affect the interests of the Holders of the Bonds;
(vii) to evidence and provide for the acceptance of
the appointment hereunder by a successor trustee with respect to the
Bonds and to add to or change any of the provisions of this Indenture
as shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article VI hereof; or
(viii) to modify, eliminate or add to the provisions
of this Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA;
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PROVIDED, HOWEVER, that no such indenture supplements shall be entered into
unless the Indenture Trustee shall have received an Opinion of Counsel as to the
enforceability of any such indenture supplement and to the effect that (i) such
indenture supplement is permitted hereunder and (ii) entering into such
indenture supplement will not result in a "substantial modification" of the
Bonds under Treasury Regulation Section 1.1001-3 or adversely affect the status
of the Bonds as indebtedness for federal income tax purposes.
The Indenture Trustee is hereby authorized to join in the execution of
any such supplemental indenture and to make any further appropriate agreements
and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Request, may, also without the consent of any of the Holders of the Bonds but
with the prior written consent of the Bond Insurer and prior notice to the
Rating Agencies and the Bond Insurer, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Holders of the Bonds under this
Indenture; PROVIDED, HOWEVER, that such action as evidenced by an Opinion of
Counsel, (i) is permitted by this Indenture, and shall not (ii) adversely affect
in any material respect the interests of any Bondholder or (iii) if 100% of the
Certificates are not owned by IMH Assets Corp., cause the Issuer to be subject
to an entity level tax for federal income tax purposes.
Section 9.02 Supplemental Indentures With Consent of Bondholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Request, also
may, with prior notice to the Rating Agencies and, with the prior written
consent of the Bond Insurer and with the consent of the Holders of not less than
a majority of the Bond Principal Balance of each Class of Bonds (for which
purpose the Class A-IO Bonds will be deemed to have a Bond Principal Balance
equal to 5% of the aggregate Bond Principal Balance of the other Classes of
Bonds) affected thereby, by Act (as defined in Section 10.03 hereof) of such
Holders delivered to the Issuer and the Indenture Trustee, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of the Holders of
the Bonds under this Indenture; PROVIDED, HOWEVER, that no such supplemental
indenture shall, without the consent of the Holder of each Bond affected
thereby:
(i) change the date of payment of any installment of
principal of or interest on any Bond, or reduce the principal amount
thereof or the interest rate thereon, change the provisions of this
Indenture relating to the application of collections on, or the
proceeds of the sale of, the Trust Estate to payment of principal of or
interest on the Bonds, or change any place of payment where, or the
coin or currency in which, any Bond or the interest thereon is payable,
or impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds
available therefor, as provided in Article V, to the payment of any
such amount due on the Bonds on or after the respective due dates
thereof;
(ii) reduce the percentage of the Bond Principal
Balances of the Bonds (or equivalent percentage for the Class A-IO
Bonds), the consent of the Holders of which is
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required for any such supplemental indenture, or the consent of the
Holders of which is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences provided for in this Indenture;
(iii) modify or alter the provisions of the proviso
to the definition of the term "Outstanding" or modify or alter the
exception in the definition of the term "Holder";
(iv) reduce the percentage of the Bond Principal
Balances of the Bonds (or equivalent percentage of the Class A-IO
Bonds) required to direct the Indenture Trustee to direct the Issuer to
sell or liquidate the Trust Estate pursuant to Section 5.04 hereof;
(v) modify any provision of this Section 9.02 except
to increase any percentage specified herein or to provide that certain
additional provisions of this Indenture or the Basic Documents cannot
be modified or waived without the consent of the Holder of each Bond
affected thereby;
(vi) modify any of the provisions of this Indenture
in such manner as to affect the calculation of the amount of any
payment of interest or principal due on any Bond on any Payment Date
(including the calculation of any of the individual components of such
calculation); or
(vii) permit the creation of any lien ranking prior
to or on a parity with the lien of this Indenture with respect to any
part of the Trust Estate or, except as otherwise permitted or
contemplated herein, terminate the lien of this Indenture on any
property at any time subject hereto or deprive the Holder of any Bond
of the security provided by the lien of this Indenture; and PROVIDED,
FURTHER, that such action shall not, as evidenced by an Opinion of
Counsel, cause the Issuer (if 100% of the Certificates are not owned by
IMH Assets Corp.) to be subject to an entity level tax.
Any such action shall not adversely affect in any material respect the
interest of any Holder (other than a Holder who shall consent to such
supplemental indenture) as evidenced by an Opinion of Counsel (provided by the
Person requesting such supplemental indenture) delivered to the Indenture
Trustee.
It shall not be necessary for any Act of Bondholders under this Section
9.02 to approve the particular form of any proposed supplemental indenture, but
it shall be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee of
any supplemental indenture pursuant to this Section 9.02, the Indenture Trustee
shall mail to the Holders of the Bonds to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of such
supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
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Section 9.03 Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modification thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive, and
subject to Sections 6.01 and 6.02 hereof, shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Indenture Trustee
may, but shall not be obligated to, enter into any such supplemental indenture
that affects the Indenture Trustee's own rights, duties, liabilities or
immunities under this Indenture or otherwise.
Section 9.04 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and shall be deemed to be modified and amended in accordance therewith
with respect to the Bonds affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Holders of the Bonds
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
Section 9.05 Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as then
in effect so long as this Indenture shall then be qualified under the Trust
Indenture Act.
Section 9.06 Reference in Bonds to Supplemental Indentures. Bonds
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Bonds so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Bonds.
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ARTICLE X
Miscellaneous
Section 10.01 Compliance Certificates and Opinions, etc. (a) Upon any
application or request by the Issuer to the Indenture Trustee to take any action
under any provision of this Indenture, the Issuer shall furnish to the Indenture
Trustee and to the Bond Insurer (i) an Officer's Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and (ii) an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that, in the case of any such application or request
as to which the furnishing of such documents is specifically required by any
provision of this Indenture, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to
whether or not such covenant or condition has been complied with;
(4) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with; and
(5) if the signatory of such certificate or opinion is
required to be Independent, the statement required by the definition
of the term "Independent".
(b) (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture, the
Issuer shall, in addition to any obligation imposed in Section 10.01 (a) or
elsewhere in this Indenture, furnish to the Indenture Trustee and the Bond
Insurer an Officer's Certificate certifying or stating the opinion of each
person signing such certificate as to the fair value (within 90 days prior to
such deposit) to the Issuer of the Collateral or other property or securities to
be so deposited and a report from a nationally recognized accounting firm
verifying such value.
(ii) Whenever the Issuer is required to furnish to
the Indenture Trustee and the Bond Insurer an Officer's Certificate
certifying or stating the opinion of any signer thereof as to the
matters described in clause (i) above, the Issuer shall also deliver to
the Indenture Trustee an Independent Certificate from a nationally
recognized accounting firm as to the same matters, if the fair value of
the securities to be so deposited and of all other
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such securities made the basis of any such withdrawal or release since
the commencement of the then current fiscal year of the Issuer, as set
forth in the certificates delivered pursuant to clause (i) above and
this clause (ii), is 10% or more of the Bond Principal Balances of the
Bonds, but such a certificate need not be furnished with respect to any
securities so deposited, if the fair value thereof as set forth in the
related Officer's Certificate is less than $25,000 or less than one
percent of the Bond Principal Balances of the Bonds.
(iii) Whenever any property or securities are to be
released from the lien of this Indenture, the Issuer shall also furnish
to the Indenture Trustee and the Bond Insurer an Officer's Certificate
certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days prior to such release)
of the property or securities proposed to be released and stating that
in the opinion of such person the proposed release will not impair the
security under this Indenture in contravention of the provisions
hereof.
(iv) Whenever the Issuer is required to furnish to
the Indenture Trustee and the Bond Insurer an Officer's Certificate
certifying or stating the opinion of any signer thereof as to the
matters described in clause (iii) above, the Issuer shall also furnish
to the Indenture Trustee an Independent Certificate as to the same
matters if the fair value of the property or securities and of all
other property or securities released from the lien of this Indenture
since the commencement of the then-current calendar year, as set forth
in the certificates required by clause (iii) above and this clause
(iv), equals 10% or more of the Bond Principal Balances of the Bonds,
but such certificate need not be furnished in the case of any release
of property or securities if the fair value thereof as set forth in the
related Officer's Certificate is less than $25,000 or less than one
percent of the then Bond Principal Balances of the Bonds.
Section 10.02 Form of Documents Delivered to Indenture Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Seller or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Seller or the Issuer, unless such
counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
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Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.
Section 10.03 Acts of Bondholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Bondholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Bondholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Indenture Trustee, and,
where it is hereby expressly required, to the Issuer. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the "Act" of the Bondholders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 6.01 hereof) conclusive in favor of the Indenture
Trustee and the Issuer, if made in the manner provided in this Section 10.03
hereof.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Bonds shall be proved by the Bond Registrar.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Bonds shall bind the Holder of every
Bond issued upon the registration thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Bond.
Section 10.04 Notices etc., to Indenture Trustee Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Bondholders or other documents provided or permitted by this Indenture
shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or act of Bondholders is to be made upon, given or
furnished to or filed with:
(i) the Indenture Trustee by any Bondholder or by the
Issuer shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with
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the Indenture Trustee at the Corporate Trust Office. The Indenture
Trustee shall promptly transmit any notice received by it from the
Bondholders to the Issuer; or
(ii) the Issuer by the Indenture Trustee or by any
Bondholder shall be sufficient for every purpose hereunder if in
writing and mailed first-class, postage prepaid to the Issuer addressed
to: Impac CMB Trust Series 2002-5, in care of Wilmington Trust Company,
Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
00000- 0000, Attention: Corporate Trust Administration, or at any other
address previously furnished in writing to the Indenture Trustee by the
Issuer. The Issuer shall promptly transmit any notice received by it
from the Bondholders to the Indenture Trustee; or
(iii) the Bond Insurer by the Issuer, the Indenture
Trustee or by any Bondholders shall be sufficient for every purpose
hereunder if in writing and mailed, first- class postage pre-paid, or
personally delivered or telecopied to: Ambac Assurance Corporation, Xxx
Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Consumer
Asset-Backed Securities Group, Telephone: (000) 000-0000, Telecopier:
(000) 000-0000. The Bond Insurer shall promptly transmit any notice
received by it from the Issuer, the Indenture Trustee or the
Bondholders to the Issuer or Indenture Trustee, as the case may be.
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, mailed first-class
postage pre-paid, to (i) in the case of Moody's, at the following address:
Xxxxx'x Investors Service, Inc., Residential Mortgage Monitoring Department, 00
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, and (ii) in the case of Standard &
Poor's, at the following address: Standard & Poor's, 00 Xxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Asset Backed Surveillance
Department; or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
Section 10.05 Notices to Bondholders; Waiver. Where this Indenture
provides for notice to Bondholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Bondholder affected by such
event, at such Person's address as it appears on the Bond Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Bondholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Bondholder shall affect the sufficiency of such notice with
respect to other Bondholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given regardless of
whether such notice is in fact actually received.
Where this Indenture provides for notice in any manner, such notice may
be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Bondholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Bondholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of
63
giving such notice as shall be satisfactory to the Indenture Trustee shall be
deemed to be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute an Event of
Default.
Section 10.06 Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.
The provisions of TIA xx.xx. 310 through 317 that impose duties on any
Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
Section 10.07 Effect of Headings. The Article and Section headings
herein are for convenience only and shall not affect the construction hereof.
Section 10.08 Successors and Assigns. All covenants and agreements in
this Indenture and the Bonds by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee in
this Indenture shall bind its successors, co-trustees and agents.
Section 10.09 Separability. In case any provision in this Indenture or
in the Bonds shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 10.10 Benefits of Indenture. The Bond Insurer and its
successors and assigns shall be a third-party beneficiary to the provisions of
this Indenture. To the extent that this Indenture confers upon or gives or
grants to the Bond Insurer any right, remedy or claim under or by reason of this
Indenture, the Bond Insurer may enforce any such right, remedy or claim
conferred, given or granted hereunder. Nothing in this Indenture or in the
Bonds, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, and the Bondholders and the Bond Insurer,
any benefit or any legal or equitable right, remedy or claim under this
Indenture.
Section 10.11 Legal Holidays. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Bonds or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
Section 10.12 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
64
Section 10.13 Counterparts. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
Section 10.14 Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
at its expense (which may be counsel to the Indenture Trustee or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Bondholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Indenture Trustee under this Indenture.
Section 10.15 Issuer Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Bonds or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or
of any successor or assign of the Indenture Trustee or the Owner Trustee in its
individual capacity, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their individual capacity) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by applicable
law, for any unpaid consideration for stock, unpaid capital contribution or
failure to pay any installment or call owing to such entity. For all purposes of
this Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Owner Trustee shall be subject to, and entitled to the benefits
of, the terms and provisions of Article VI, VII and VIII of the Trust Agreement.
Section 10.16 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Bondholder, by accepting a Bond, hereby covenant and agree
that they will not at any time prior to one year from the date of termination
hereof, institute against the Depositor or the Issuer, or join in any
institution against the Depositor or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law
in connection with any obligations relating to the Bonds, this Indenture or any
of the Basic Documents.
Section 10.17 Inspection. The Issuer agrees that, at its expense, on
reasonable prior notice, it shall permit any representative of the Indenture
Trustee and the Bond Insurer, during the Issuer's normal business hours, to
examine all the books of account, records, reports and other papers of the
Issuer, to make copies and extracts therefrom, to cause such books to be audited
by Independent certified public accountants, and to discuss the Issuer's
affairs, finances and accounts with the Issuer's officers, employees, and
Independent certified public accountants, all at such reasonable times and as
often as may be reasonably requested. The Indenture Trustee and the Bond Insurer
shall cause its representatives to hold in confidence all such information
except to the extent disclosure may be required by law (and all reasonable
applications for confidential treatment are unavailing)
65
and except to the extent that the Indenture Trustee or the Bond Insurer may
reasonably determine that such disclosure is consistent with its obligations
hereunder.
66
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused
their names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.
IMPAC CMB TRUST SERIES 2002-5, as
Issuer
Wilmington Trust Company, not in
its individual capacity but solely
as Owner Trustee
By:
-------------------------------
Name:
Title:
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Indenture Trustee
By:
-------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Associate
By:
-------------------------------
Name:
Title:
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On this 28th day of August 2002, before me personally appeared Xxxxx X.
Xxxxxxx to me known, who being by me duly sworn, did depose and say, that he is
the Associate of the Indenture Trustee, one of the corporations described in and
which executed the above instrument; and that he signed his name thereto by like
order.
Notary Public
-------------------------------
NOTARY PUBLIC
[NOTARIAL SEAL]
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On this 28th day of August 2002, before me personally appeared
_________________ to me known, who being by me duly sworn, did depose and say,
that he/she is the _______________ of the Indenture Trustee, one of the
corporations described in and which executed the above instrument; and that
he/she signed his/her name thereto by like order.
Notary Public
-------------------------------
NOTARY PUBLIC
[NOTARIAL SEAL]
STATE OF DELAWARE )
) ss.:
COUNTY OF NEW CASTLE )
On this 28th day of August, 2002, before me personally appeared
__________________ to me known, who being by me duly sworn, did depose and say,
that he/she resides at Wilmington Trust Company and is a
__________________________ of the Owner Trustee, one of the corporations
described in and which executed the above instrument; and that he/she signed
his/her name thereto by like order.
Notary Public
-------------------------------
NOTARY PUBLIC
[NOTARIAL SEAL]
EXHIBIT A-1
FORM OF CLASS A-1 BONDS
UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY BOND ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS BOND IS A NON-RECOURSE OBLIGATION OF THE ISSUER, AND IS LIMITED IN RIGHT OF
PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST AND THE BOND INSURANCE POLICY AS
PROVIDED IN THE INDENTURE REFERRED TO BELOW. THE ISSUER IS NOT OTHERWISE
PERSONALLY LIABLE FOR PAYMENTS ON THIS BOND.
PRINCIPAL OF THIS BOND IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING PRINCIPAL OF THIS BOND AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ON THE FACE HEREOF.
A-1-1
IMPAC CMB TRUST SERIES 2002-5
COLLATERALIZED ASSET-BACKED BONDS
CLASS A-1
Aggregate Bond Principal Bond Interest
Balance: Rate: Adjustable Rate
$_________________
Initial Bond Principal Bond No. ___
Balance of this Bond: $_______________
Percentage Interest: ______% CUSIP No. ___________
Impac CMB Trust Series 2002-5 (the "Issuer"), a Delaware business
trust, for value received, hereby promises to pay to Cede & Co. or registered
assigns, the principal sum of ($_________________) in monthly installments on
the twenty-fifth day of each month or, if such day is not a Business Day, the
next succeeding Business Day (each a "Payment Date"), commencing in September
2002 and ending on or before the Payment Date occurring in September 2032 (the
"Final Scheduled Payment Date") and to pay interest on the Bond Principal
Balance of this Bond (this "Bond") outstanding from time to time as provided
below.
This Bond is one of a duly authorized issue of the Issuer's
Collateralized Asset-Backed Bonds, Series 2002-5 (the "Bonds"), issued under an
Indenture dated as of August 28, 2002 (the "Indenture"), between the Issuer and
Deutsche Bank National Trust Company, as indenture trustee (the "Indenture
Trustee", which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights thereunder of the
Issuer, the Indenture Trustee, and the Holders of the Bonds and the terms upon
which the Bonds are to be authenticated and delivered. All terms used in this
Bond which are defined in the Indenture shall have the meanings assigned to them
in the Indenture.
Ambac Assurance Corporation (the "Bond Insurer"), in consideration of
the payment of the premium and subject to the terms of the bond insurance policy
(the "Bond Insurance Policy") issued thereby, has unconditionally and
irrevocably guaranteed the payment of the Insured Amount with respect to the
Class A-1 Bonds with respect to each Payment Date. Such Bond Insurance Policy
will not cover any Prepayment Interest Shortfalls, Relief Act Shortfalls or
Basis Risk Shortfall Carry- Forward Amount.
Payments of principal and interest on this Bond will be made on each
Payment Date to the Bondholder of record as of the related Record Date. The
"Bond Principal Balance" of a Bond as of any date of determination is equal to
the initial Bond Principal Balance thereof, reduced by the aggregate of all
amounts previously paid with respect to such Bond on account of principal and
the aggregate amount of cumulative Realized Losses allocated to such Bond on all
prior Payment Dates.
The principal of, and interest on, this Bond are due and payable as
described in the Indenture, in such coin or currency of the United States of
America as at the time of payment is legal tender for
A-1-2
payment of public and private debts. All payments made by the Issuer with
respect to this Bond shall be equal to this Bond's pro rata share of the
aggregate payments on all Class A-1 Bonds as described above, and shall be
applied as between interest and principal as provided in the Indenture.
All principal and interest accrued on the Bonds, if not previously
paid, will become finally due and payable at the Final Scheduled Payment Date.
The Bonds are subject to redemption in whole, but not in part, by the
Holder of the Certificates on any Payment Date on or after the earlier of (i)
the Payment Date on which the aggregate Stated Principal Balance of the Mortgage
Loans as of the end of the prior Due Period is less than or equal to 25% of the
aggregate Stated Principal Balance of the Mortgage Loans as of Cut- off Date and
(ii) the Payment Date in September 2012.
The Issuer shall not be liable upon the indebtedness evidenced by the
Bonds except to the extent of amounts available from the Trust Estate which
constitutes security for the payment of the Bonds. The assets included in the
Trust Estate will be the sole source of payments on the Class A-1 Bonds, and
each Holder hereof, by its acceptance of this Bond, agrees that (i) such Bond
will be limited in right of payment to amounts available from the Trust Estate
as provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuer, the Owner Trustee, the Indenture Trustee, IMH Assets Corp., Impac
Mortgage Holdings, Inc., the Master Servicer or any of their respective
affiliates, or to the assets of any of the foregoing entities, except the assets
of the Issuer pledged to secure the Class A-1 Bonds pursuant to the Indenture
and the rights conveyed to the Issuer under the Indenture.
Any payment of principal or interest payable on this Bond which is
punctually paid on the applicable Payment Date shall be paid to the Person in
whose name such Xxxx is registered at the close of business on the Record Date
for such Payment Date by check mailed to such person's address as it appears in
the Bond Register on such Record Date, except for the final installment of
principal and interest payable with respect to such Bond, which shall be payable
as provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Bond delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by wire transfer to an account in the United States
designated by such Xxxxxx. All reductions in the principal amount of a Bond (or
one or more Predecessor Bonds) effected by payments of principal made on any
Payment Date shall be binding upon all Holders of this Bond and of any bond
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, whether or not such payment is noted on such Bond. The final
payment of this Bond shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuer maintained by it for such purpose pursuant to Section 3.02
of the Indenture.
Subject to the foregoing provisions, each Bond delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Bond shall carry the right to unpaid principal and interest that were
carried by such other Bond.
A-1-3
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Bonds, the Bonds may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Bond Principal Balance of the Bonds, the amount payable to the Holder of this
Bond will be equal to the sum of the unpaid Bond Principal Balance of the Bonds,
together with accrued and unpaid interest thereon as described in the Indenture.
The Indenture provides that, notwithstanding the acceleration of the maturity of
the Bonds, under certain circumstances specified therein, all amounts collected
as proceeds of the Trust Estate securing the Bonds or otherwise shall continue
to be applied to payments of principal of and interest on the Bonds as if they
had not been declared due and payable.
The failure to pay any Unpaid Interest Shortfall at any time when funds
are not available to make such payment as provided in the Indenture shall not
constitute an Event of Default under the Indenture.
Pursuant to the Indenture, unless a Bond Insurer Default (as defined in
the Indenture) exists (i) the Bond Insurer shall be deemed to be the holder of
the Class A-1 Bonds for certain purposes specified in the Indenture (other than
with respect to payment on the Class A-1 Bonds), and will be entitled to
exercise all rights of the Bondholders thereunder, including the rights of
Bondholders relating to the occurrence of, and the remedies with respect to, an
Event of Default, without the consent of such Bondholders, and (ii) the Trustee
may take actions which would otherwise be at its option or within its
discretion, including actions relating to the occurrence of, and the remedies
with respect to, an Event of Default, only at the direction, or with the
consent, of the Bond Insurer.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Bond may be registered on the Bond Register of
the Issuer. Upon surrender for registration of transfer of, or presentation of a
written instrument of transfer for, this Bond at the office or agency designated
by the Issuer pursuant to the Indenture, accompanied by proper instruments of
assignment in form satisfactory to the Indenture Trustee, one or more new Bonds
of any authorized denominations and of a like aggregate initial Bond Principal
Balance, will be issued to the designated transferee or transferees.
Prior to the due presentment for registration of transfer of this Bond,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Bond is registered as the owner
of such Bond (i) on the applicable Record Date for the purpose of making
payments and interest of such Bond, and (ii) on any other date for all other
purposes whatsoever, as the owner hereof, whether or not this Bond be overdue,
and neither the Issuer, the Indenture Trustee nor any such agent of the Issuer
or the Indenture Trustee shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Bonds under the Indenture at any
time by the Issuer with the consent of the Bond Insurer and the Holders of a
majority of all Bonds at the time outstanding. The Indenture also contains
provisions permitting (i) the Bond Insurer or (ii) if the Bond Insurer defaults,
the Holders of Bonds representing specified percentages of the aggregate Bond
Principal Balance of the Class A-1 Bonds and Class B
A-1-4
Bonds and Notional Amount of the Class A-IO Bonds on behalf of the Holders of
all the Bonds, to waive any past Default under the Indenture and its
consequences. Any such waiver by the Holder, at the time of the giving thereof,
of this Bond (or any one or more Predecessor Bonds) shall bind the Holder of
every Bond issued upon the registration of transfer hereof or in exchange hereof
or in lieu hereof, whether or not notation of such consent or waiver is made
upon such Bond. The Indenture also permits the Issuer and the Indenture Trustee
to amend or waive certain terms and conditions set forth in the Indenture
without the consent of the Holders of the Bonds issued thereunder.
Initially, the Bonds will be registered in the name of CEDE & Co. as
nominee of DTC, acting in its capacity as the Depository for the Bonds. The
Bonds will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. The Bonds
are exchangeable for a like aggregate initial Bond Principal Balance of Bonds of
different authorized denominations, as requested by the Holder surrendering
same.
Unless the Certificate of Authentication hereon has been executed by
the Indenture Trustee by manual signature, this Bond shall not be entitled to
any benefit under the Indenture, or be valid or obligatory for any purpose.
AS PROVIDED IN THE INDENTURE, THIS BOND AND THE INDENTURE CREATING THIS
BOND SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
A-1-5
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by Wilmington Trust Company, not in its individual capacity but solely
as Owner Trustee.
Dated: August 28, 2002
IMPAC CMB TRUST SERIES 2002-5
BY: WILMINGTON TRUST COMPANY, not
in its individual capacity but
solely in its capacity as Owner
Trustee
By:
-------------------------------
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1 Bonds referred to in the within-mentioned
Indenture.
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Indenture Trustee
By:
-------------------------------
Authorized Signatory
A-1-6
ABBREVIATIONS
-------------
The following abbreviations, when used in the inscription on the face
of the Bond, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT -- Custodian
------------------ ----------------------------
(Cust) (Minor)
under Uniform Gifts to Minor Act
-------------------------
(State)
Additional abbreviations may also be used though not in the above list.
A-1-7
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
____________________________________________________
____________________________________________________
____________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within Bond and all rights thereunder, and hereby irrevocably constitutes
and appoints ___________________ attorney to transfer said Xxxx on the books
kept for registration thereof, with full power of substitution in the premises.
Dated:
-------------------------------------- ---------------------------
Signature Guaranteed by
--------------------------------------------------------
NOTICE: The signature(s) to this assignment must correspond with the
name as it appears upon the face of the within Bond in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.
A-1-8
EXHIBIT A-2
FORM OF CLASS A-IO BONDS
UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY BOND ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS BOND IS A NON-RECOURSE OBLIGATION OF THE ISSUER, AND IS LIMITED IN RIGHT OF
PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST AS PROVIDED IN THE INDENTURE
REFERRED TO BELOW. THE ISSUER IS NOT OTHERWISE PERSONALLY LIABLE FOR PAYMENTS ON
THIS BOND.
A-2-1
IMPAC CMB TRUST SERIES 2002-5
COLLATERALIZED ASSET-BACKED BONDS
CLASS A-IO
Aggregate Notional Amount: Bond Interest
$_____________ Rate: Step-Down Rate
Initial Notional Amount Bond No. ___
of this Bond: $_______________
Percentage Interest: ______% CUSIP No. ___________
Impac CMB Trust Series 2002-5 (the "Issuer"), a Delaware business
trust, for value received, hereby promises to pay to CEDE & CO. or registered
assigns, interest on the Notional Amount of this Bond (this "Bond") outstanding
from time to time as provided below in monthly installments on the twenty-fifth
day of each month or, if such day is not a Business Day, the next succeeding
Business Day (each a "Payment Date"), commencing in September 2002 and ending on
or before the Payment Date occurring in February 2005 (the "Final Scheduled
Payment Date").
This Bond is one of a duly authorized issue of the Issuer's
Collateralized Asset-Backed Bonds, Series 2002-5 (the "Bonds"), issued under an
Indenture dated as of August 28, 2002 (the "Indenture"), between the Issuer and
Deutsche Bank National Trust Company, as indenture trustee (the "Indenture
Trustee", which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights thereunder of the
Issuer, the Indenture Trustee, and the Holders of the Bonds and the terms upon
which the Bonds are to be authenticated and delivered. All terms used in this
Bond which are defined in the Indenture shall have the meanings assigned to them
in the Indenture.
Payments of interest on this Bond will be made on each Payment Date to
the Bondholder of record as of the related Record Date. The "Notional Amount" of
this Bond immediately prior to any Payment Date is set forth in Appendix A to
the Indenture.
The interest on this Bond is due and payable as described in the
Indenture, in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts. All
payments made by the Issuer with respect to this Bond shall be equal to this
Xxxx's pro rata share of the aggregate payments on all Class A-IO Bonds as
described above, and shall be applied as interest as provided in the Indenture.
All interest accrued on the Bonds, if not previously paid, will become
finally due and payable at the Final Scheduled Payment Date.
The Bonds are subject to redemption in whole, but not in part, by the
Holder of the Certificates on any Payment Date on or after the earlier of (i)
the Payment Date on which the aggregate Stated Principal Balance of the Mortgage
Loans as of the end of the prior Due Period is
A-2-2
less than or equal to 25% of the aggregate Stated Principal Balance of the
Mortgage Loans as of Cut- off Date and (ii) the Payment Date in September 2012.
The Issuer shall not be liable upon the indebtedness evidenced by the
Bonds except to the extent of amounts available from the Trust Estate which
constitutes security for the payment of the Bonds. The assets included in the
Trust Estate will be the sole source of payments on the Class A-IO Bonds, and
each Holder hereof, by its acceptance of this Bond, agrees that (i) such Bond
will be limited in right of payment to amounts available from the Trust Estate
as provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuer, the Owner Trustee, the Indenture Trustee, IMH Assets Corp., Impac
Mortgage Holdings, Inc., the Master Servicer or any of their respective
affiliates, or to the assets of any of the foregoing entities, except the assets
of the Issuer pledged to secure the Class A-IO Bonds pursuant to the Indenture
and the rights conveyed to the Issuer under the Indenture.
Any payment of interest payable on this Bond which is punctually paid
on the applicable Payment Date shall be paid to the Person in whose name such
Xxxx is registered at the close of business on the Record Date for such Payment
Date by check mailed to such person's address as it appears in the Bond Register
on such Record Date, except for the final installment of interest payable with
respect to such Bond, which shall be payable as provided below. Notwithstanding
the foregoing, upon written request with appropriate instructions by the Holder
of this Bond delivered to the Indenture Trustee at least five Business Days
prior to the Record Date, any payment of interest, other than the final
installment of interest, shall be made by wire transfer to an account in the
United States designated by such Xxxxxx. The final payment of this Bond shall be
payable upon presentation and surrender thereof on or after the Payment Date
thereof at the Corporate Trust Office or the office or agency of the Issuer
maintained by it for such purpose pursuant to Section 3.02 of the Indenture.
Subject to the foregoing provisions, each Bond delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Bond shall carry the right to unpaid interest that were carried by such
other Bond.
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Bonds, the Bonds may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs, the amount payable to the Holder of this
Bond will be equal to the Class A-IO Adjusted Issue Price together with accrued
and unpaid interest on the Notional Amount of this Bond as described in the
Indenture. The Indenture provides that, notwithstanding the acceleration of the
maturity of the Bonds, under certain circumstances specified therein, all
amounts collected as proceeds of the Trust Estate securing the Bonds or
otherwise shall continue to be applied to payments of interest on the Bonds as
if they had not been declared due and payable.
The failure to pay any Unpaid Interest Shortfall at any time when funds
are not available to make such payment as provided in the Indenture shall not
constitute an Event of Default under the Indenture.
Pursuant to the Indenture, unless a Bond Insurer Default (as defined in
the Indenture) exists (i) the Bond Insurer shall be deemed to be the holder of
the Class A-1 Bonds for certain purposes
A-2-3
specified in the Indenture (other than with respect to payment on the Class A-1
Bonds), and will be entitled to exercise all rights of the Bondholders
thereunder, including the rights of Bondholders relating to the occurrence of,
and the remedies with respect to, an Event of Default, without the consent of
such Bondholders, and (ii) the Trustee may take actions which would otherwise be
at its option or within its discretion, including actions relating to the
occurrence of, and the remedies with respect to, an Event of Default, only at
the direction, or with the consent, of the Bond Insurer.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Bond may be registered on the Bond Register of
the Issuer. Upon surrender for registration of transfer of, or presentation of a
written instrument of transfer for, this Bond at the office or agency designated
by the Issuer pursuant to the Indenture, accompanied by proper instruments of
assignment in form satisfactory to the Indenture Trustee, one or more new Bonds
of any authorized denominations and of a like aggregate initial Notional Amount,
will be issued to the designated transferee or transferees.
Prior to the due presentment for registration of transfer of this Bond,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Bond is registered as the owner
of such Bond (i) on the applicable Record Date for the purpose of making
payments and interest of such Bond, and (ii) on any other date for all other
purposes whatsoever, as the owner hereof, whether or not this Bond be overdue,
and neither the Issuer, the Indenture Trustee nor any such agent of the Issuer
or the Indenture Trustee shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Bonds under the Indenture at any
time by the Issuer with the consent of the Bond Insurer and the Holders of a
majority of all Bonds at the time outstanding. The Indenture also contains
provisions permitting (i) the Bond Insurer or (ii) if the Bond Insurer defaults,
the Holders of Bonds representing specified percentages of the aggregate Bond
Principal Balance of the Class A-1 Bonds and Class B Bonds and Notional Amount
of the Class A-IO Bonds on behalf of the Holders of all the Bonds, to waive any
past Default under the Indenture and its consequences. Any such waiver by the
Holder, at the time of the giving thereof, of this Bond (or any one or more
Predecessor Bonds) shall bind the Holder of every Bond issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not notation of such consent or waiver is made upon such Bond. The Indenture
also permits the Issuer and the Indenture Trustee to amend or waive certain
terms and conditions set forth in the Indenture without the consent of the
Holders of the Bonds issued thereunder.
Initially, the Bonds will be registered in the name of Cede & Co. as
nominee of DTC, acting in its capacity as the Depository for the Bonds. The
Bonds will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. The Bonds
are exchangeable for a like aggregate initial Notional Amount of Bonds of
different authorized denominations, as requested by the Holder surrendering
same.
Unless the Certificate of Authentication hereon has been executed by
the Indenture Trustee by manual signature, this Bond shall not be entitled to
any benefit under the Indenture, or be valid or obligatory for any purpose.
A-2-4
AS PROVIDED IN THE INDENTURE, THIS BOND AND THE INDENTURE CREATING THIS
BOND SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
A-2-5
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by Wilmington Trust Company, not in its individual capacity but solely
as Owner Trustee.
Dated: August 28, 2002
IMPAC CMB TRUST SERIES 2002-5
BY: WILMINGTON TRUST COMPANY, not in
its individual capacity but solely in its
capacity as Owner Trustee
By:
-------------------------------
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A-IO Bonds referred to in the within-mentioned
Indenture.
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Indenture Trustee
By:
-------------------------------
Authorized Signatory
A-2-6
ABBREVIATIONS
-------------
The following abbreviations, when used in the inscription on the face
of the Bond, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT -- Custodian
------------------ ----------------------------
(Cust) (Minor)
under Uniform Gifts to Minor Act
-------------------------
(State)
Additional abbreviations may also be used though not in the above list.
A-2-7
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
____________________________________________________
____________________________________________________
____________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within Bond and all rights thereunder, and hereby irrevocably constitutes
and appoints ___________________ attorney to transfer said Xxxx on the books
kept for registration thereof, with full power of substitution in the premises.
Dated:
-------------------------------------- ---------------------------
Signature Guaranteed by
--------------------------------------------------------
NOTICE: The signature(s) to this assignment must correspond with the
name as it appears upon the face of the within Bond in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.
A-2-8
EXHIBIT A-3
FORM OF CLASS B BONDS
THIS BOND IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A BONDS AS DESCRIBED
IN THE INDENTURE.
UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY BOND ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE HOLDER OF THIS BOND OR BENEFICIAL OWNER OF ANY INTEREST HEREIN WILL BE
DEEMED TO REPRESENT TO ONE OF THE REPRESENTATIONS CONTAINED IN SECTION 4.15 OF
THE INDENTURE.
THIS BOND IS A NON-RECOURSE OBLIGATION OF THE ISSUER, AND IS LIMITED IN RIGHT OF
PAYMENT TO AMOUNTS AVAILABLE FROM THE TRUST ESTATE AS PROVIDED IN THE INDENTURE
REFERRED TO BELOW. THE ISSUER IS NOT OTHERWISE PERSONALLY LIABLE FOR PAYMENTS ON
THIS BOND.
PRINCIPAL OF THIS BOND IS PAYABLE OVER TIME AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING PRINCIPAL OF THIS BOND AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ON THE FACE HEREOF.
A-3-1
IMPAC CMB TRUST SERIES 2002-5
COLLATERALIZED ASSET-BACKED BONDS
CLASS B
Aggregate Bond Principal Bond Interest
Balance: Rate: Adjustable Rate
$_________________________
Initial Bond Principal Bond No. ___
Balance of this Bond: $___________________
Percentage Interest: _______% CUSIP No. ______________
Impac CMB Trust Series 2002-5 (the "Issuer"), a Delaware business
trust, for value received, hereby promises to pay to Cede & Co. or registered
assigns, the principal sum of ______________________________ ($___________) in
monthly installments on the twenty-fifth day of each month or, if such day is
not a Business Day, the next succeeding Business Day (each a "Payment Date"),
commencing in September 2002 and ending on or before the Payment Date occurring
in September 2032 (the "Final Scheduled Payment Date") and to pay interest on
the Bond Principal Balance of this Bond (this "Bond") outstanding from time to
time as provided below.
This Bond is one of a duly authorized issue of the Issuer's
Collateralized Asset-Backed Bonds, Series 2002-5 (the "Bonds"), issued under an
Indenture dated as of August 28, 2002 (the "Indenture"), between the Issuer and
Deutsche Bank National Trust Company, as indenture trustee (the "Indenture
Trustee", which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights thereunder of the
Issuer, the Indenture Trustee, and the Holders of the Bonds and the terms upon
which the Bonds are to be authenticated and delivered. All terms used in this
Bond which are defined in the Indenture shall have the meanings assigned to them
in the Indenture.
Payments of principal and interest on this Bond will be made on each
Payment Date to the Bondholder of record as of the related Record Date. The
"Bond Principal Balance" of a Bond as of any date of determination is equal to
the initial Bond Principal Balance thereof, reduced by the aggregate of all
amounts previously paid with respect to such Bond on account of principal and
the aggregate amount of cumulative Realized Losses allocated to such Bond on all
prior Payment Dates.
The principal of, and interest on, this Bond are due and payable as
described in the Indenture, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts. All payments made by the Issuer with respect to this Bond shall
be equal to this Bond's pro rata share of the aggregate payments on all Class B
Bonds as described above, and shall be applied as between interest and principal
as provided in the Indenture.
A-3-2
All principal and interest accrued on the Bonds, if not previously
paid, will become finally due and payable at the Final Scheduled Payment Date.
The Bonds are subject to redemption in whole, but not in part, by the
Holder of the Certificates on any Payment Date on or after the earlier of (i)
the Payment Date on which the aggregate Stated Principal Balance of the Mortgage
Loans is less than or equal to 25% of aggregate Stated Principal Balance of the
Mortgage Loans as of Cut-off Date and (ii) the Payment Date in September 2012.
The Issuer shall not be liable upon the indebtedness evidenced by the
Bonds except to the extent of amounts available from the Trust Estate which
constitutes security for the payment of the Bonds. The assets included in the
Trust Estate will be the sole source of payments on the Class B Bonds, and each
Holder hereof, by its acceptance of this Bond, agrees that (i) such Bond will be
limited in right of payment to amounts available from the Trust Estate as
provided in the Indenture and (ii) such Holder shall have no recourse to the
Issuer, the Owner Trustee, the Indenture Trustee, IMH Assets Corp., Impac
Mortgage Holdings, Inc., the Master Servicer or any of their respective
affiliates, or to the assets of any of the foregoing entities, except the assets
of the Issuer pledged to secure the Class B Bonds pursuant to the Indenture and
the rights conveyed to the Issuer under the Indenture.
Any payment of principal or interest payable on this Bond which is
punctually paid on the applicable Payment Date shall be paid to the Person in
whose name such Xxxx is registered at the close of business on the Record Date
for such Payment Date by check mailed to such person's address as it appears in
the Bond Register on such Record Date, except for the final installment of
principal and interest payable with respect to such Bond, which shall be payable
as provided below. Notwithstanding the foregoing, upon written request with
appropriate instructions by the Holder of this Bond delivered to the Indenture
Trustee at least five Business Days prior to the Record Date, any payment of
principal or interest, other than the final installment of principal or
interest, shall be made by wire transfer to an account in the United States
designated by such Xxxxxx. All reductions in the principal amount of a Bond (or
one or more Predecessor Bonds) effected by payments of principal made on any
Payment Date shall be binding upon all Holders of this Bond and of any bond
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, whether or not such payment is noted on such Bond. The final
payment of this Bond shall be payable upon presentation and surrender thereof on
or after the Payment Date thereof at the Corporate Trust Office or the office or
agency of the Issuer maintained by it for such purpose pursuant to Section 3.02
of the Indenture.
Subject to the foregoing provisions, each Bond delivered under the
Indenture, upon registration of transfer of or in exchange for or in lieu of any
other Bond shall carry the right to unpaid principal and interest that were
carried by such other Bond.
If an Event of Default as defined in the Indenture shall occur and be
continuing with respect to the Bonds, the Bonds may become or be declared due
and payable in the manner and with the effect provided in the Indenture. If any
such acceleration of maturity occurs prior to the payment of the entire unpaid
Bond Principal Balance of the Bonds, the amount payable to the Holder of this
Bond will be equal to the sum of the unpaid Bond Principal Balance of the Bonds,
together with
A-3-3
accrued and unpaid interest thereon as described in the Indenture. The Indenture
provides that, notwithstanding the acceleration of the maturity of the Bonds,
under certain circumstances specified therein, all amounts collected as proceeds
of the Trust Estate securing the Bonds or otherwise shall continue to be applied
to payments of principal of and interest on the Bonds as if they had not been
declared due and payable.
The failure to pay any Unpaid Interest Shortfall at any time when funds
are not available to make such payment as provided in the Indenture shall not
constitute an Event of Default under the Indenture.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Bond may be registered on the Bond Register of
the Issuer. Upon surrender for registration of transfer of, or presentation of a
written instrument of transfer for, this Bond at the office or agency designated
by the Issuer pursuant to the Indenture, accompanied by proper instruments of
assignment in form satisfactory to the Indenture Trustee, one or more new Bonds
of any authorized denominations and of a like aggregate initial Bond Principal
Balance, will be issued to the designated transferee or transferees.
Prior to the due presentment for registration of transfer of this Bond,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Bond is registered as the owner
of such Bond (i) on the applicable Record Date for the purpose of making
payments and interest of such Bond, and (ii) on any other date for all other
purposes whatsoever, as the owner hereof, whether or not this Bond be overdue,
and neither the Issuer, the Indenture Trustee nor any such agent of the Issuer
or the Indenture Trustee shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Bonds under the Indenture at any
time by the Issuer with the consent of the Bond Insurer and the Holders of a
majority of all Bonds at the time outstanding. The Indenture also contains
provisions permitting the Holders of Bonds representing specified percentages of
the aggregate Bond Principal Balance of the Bonds on behalf of the Holders of
all the Bonds, to waive any past Default under the Indenture and its
consequences. Any such waiver by the Holder, at the time of the giving thereof,
of this Bond (or any one or more Predecessor Bonds) shall bind the Holder of
every Bond issued upon the registration of transfer hereof or in exchange hereof
or in lieu hereof, whether or not notation of such consent or waiver is made
upon such Bond. The Indenture also permits the Issuer and the Indenture Trustee
to amend or waive certain terms and conditions set forth in the Indenture
without the consent of the Holders of the Bonds issued thereunder.
Initially, the Bonds will be registered in the name of Cede & Co. as
nominee of DTC, acting in its capacity as the Depository for the Bonds. The
Bonds will be delivered by the clearing agency in denominations as provided in
the Indenture and subject to certain limitations therein set forth. The Bonds
are exchangeable for a like aggregate initial Bond Principal Balance of Bonds of
different authorized denominations, as requested by the Holder surrendering
same.
A-3-4
Unless the Certificate of Authentication hereon has been executed by
the Indenture Trustee by manual signature, this Bond shall not be entitled to
any benefit under the Indenture, or be valid or obligatory for any purpose.
AS PROVIDED IN THE INDENTURE, THIS BOND AND THE INDENTURE CREATING THIS
BOND SHALL BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN.
A-3-5
IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly
executed by Wilmington Trust Company, not in its individual capacity but solely
as Owner Trustee.
Dated: August 28, 2002
IMPAC CMB TRUST SERIES 2002-5
BY: WILMINGTON TRUST COMPANY, not
in its individual capacity but
solely in its capacity as Owner
Trustee
By:
------------------------------
Authorized Signatory
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Bonds referred to in the within-mentioned Indenture.
DEUTSCHE BANK NATIONAL TRUST COMPANY, as Indenture Trustee
By:
-------------------------------
Authorized Signatory
A-3-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of the Bond, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT -- __________ Custodian
______________________________
(Cust) (Minor)
under Uniform Gifts to Minor Act
_____________________
(State)
Additional abbreviations may also be used though not in
the above list.
A-3-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
(Please print or typewrite name and address, including zip code, of assignee)
--------------------------------------------------------------------------------
the within Bond and all rights thereunder, and hereby irrevocably constitutes
and appoints ________________________ attorney to transfer said Xxxx on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated:
-------------------------- -------------------------------
Signature Guaranteed by
---------------------------------------------------
NOTICE: The signature(s) to this assignment must correspond with the
name as it appears upon the face of the within Bond in every particular, without
alteration or enlargement or any change whatsoever. Signature(s) must be
guaranteed by a commercial bank or by a member firm of the New York Stock
Exchange or another national securities exchange. Notarized or witnessed
signatures are not acceptable.
A-3-8
EXHIBIT B
MORTGAGE LOAN SCHEDULE
(provided upon request)
B-1
EXHIBIT C
FORM OF INITIAL CERTIFICATION
------------------ , 200-
[Issuer]
[Bond Insurer]
[Master Servicer]
Attention: Impac CMB Trust Series 2002-5
Re: Indenture dated as of August 28, 2002, between Impac CMB
Trust Series 2002-5 and Deutsche Bank National Trust Company
------------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.03(a) of the above-captioned
Indenture, and Section 2.1(b)(i)-(v) of the Mortgage Loan Sale and Contribution
Agreement, dated as of August 28, 2002 between Impac Mortgage Holdings, Inc.
(formerly known as Imperial Credit Mortgage Holdings, Inc.) and Impac Funding
Corporation (formerly known as ICI Funding Corporation) (the "MLSCA"; and
together with the Indenture, the "Agreements"), the undersigned, as Indenture
Trustee, hereby certifies that as to each Mortgage Loan listed in the Mortgage
Loan Schedule (other than any Mortgage Loan paid in full or listed on the
exception report attached hereto) it has reviewed the Mortgage File and the
Mortgage Loan Schedule and has determined that: (i) all documents required to be
included in the Mortgage File are in its possession; (ii) such documents have
been reviewed by it and appear regular on their face and relate to such Mortgage
Loan; and (iii) based on examination by it, and only as to such documents, the
information set forth in items (iii) and (v) of the definition or description of
"Mortgage Loan Schedule" is correct.
The Indenture Trustee has made no independent examination of
any documents contained in each Mortgage File beyond the review specifically
required in the above-referenced Agreements. The Indenture Trustee makes no
representation that any documents specified in clause (v) of Section 2.1 (b) of
the MLSCA should be included in any Mortgage File. The Indenture Trustee makes
no representations as to and shall not be responsible to verify: (i) the
validity, legality, sufficiency, enforceability, due authorization,
recordability or genuineness of any of the documents contained in each Mortgage
File of any of the Mortgage Loans identified on the Mortgage Loan Schedule, (ii)
the collectability, insurability, effectiveness or suitability of any such
Mortgage Loan, or (iii) the existence of any assumption, modification, written
assurance or substitution agreement with respect to any Mortgage File if no such
documents appear in the Mortgage File delivered to the Indenture Trustee.
C-1
Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Indenture.
DEUTSCHE BANK NATIONAL TRUST
COMPANY,
as Indenture Trustee
By:
-------------------------------
Name:
Title:
C-2
EXHIBIT D
FORM OF FINAL CERTIFICATION
--------------, 200--
[Issuer]
[Bond Insurer]
[Master Servicer]
Attention: Impac CMB Trust Series 2002-5
Re: Indenture, dated as of August 28, 2002, between Impac CMB
Trust Series 2002-5 and Deutsche Bank National Trust Company
------------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.03(b) of the above-captioned
Indenture, and Section 2.1(b) of the Mortgage Loan Sale and Contribution
Agreement, dated as of August 28, 2002, between Impac Mortgage Holdings, Inc.
(formerly known as Imperial Credit Mortgage Holdings, Inc.) and Impac Funding
Corporation (formerly known as ICI Funding Corporation) (the "MLSCA"; and
together with the Indenture, the "Agreements"), the undersigned, as Indenture
Trustee, hereby certifies that as to each Mortgage Loan listed in the Mortgage
Loan Schedule (other than any Mortgage Loan paid in full or listed on the
exception report attached hereto) it has received the documents set forth in
Section 2.1(b) of the MLSCA.
The Indenture Trustee has made no independent examination of
any documents contained in each Mortgage File beyond the review specifically
required in the Agreements. The Indenture Trustee makes no representation that
any documents specified in clause (v) of Section 2.1 (b) should be included in
any Mortgage File. The Indenture Trustee makes no representations as to and
shall not be responsible to verify: (i) the validity, legality, sufficiency,
enforceability, due authorization, recordability or genuineness of any of the
documents contained in each Mortgage File of any of the Mortgage Loans
identified on the Mortgage Loan Schedule, (ii) the collectability, insurability,
effectiveness or suitability of any such Mortgage Loan or (iii) the existence of
any assumption, modification, written assurance or substitution agreement with
respect to any Mortgage File if no such documents appear in the Mortgage File
delivered to the Indenture Trustee.
D-1
Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Indenture.
DEUTSCHE BANK NATIONAL
TRUST COMPANY,
as Indenture Trustee
By:
-------------------------------
Name:
Title:
D-2
EXHIBIT E
DERIVATIVE CONTRACTS
E-1
EXHIBIT F
SPECIAL CERTIFICATE CAP CONTRACT
F-1
EXHIBIT G
Seller Guarantee
F-2
APPENDIX A
DEFINITIONS
ACCRUAL PERIOD: With respect to each Class of Bonds, other
than the Class A-IO Bonds, and any Payment Date, the period from the preceding
Payment Date (or in the case of the first Payment Date, from the Closing Date)
through the day preceding such Payment Date. With respect to the Class A-IO
Bonds and each Payment Date, the prior calendar month.
ACCRUED BOND INTEREST: With respect to any Payment Date and
each Class of Bonds, interest accrued during the related Accrual Period on the
Bond Principal Balance or Notional Amount, as applicable, thereof at the
then-applicable Bond Interest Rate on the related Bond Principal Balance or
Notional Amount thereof immediately prior to such Payment Date, less such Bonds'
Unpaid Interest Shortfall for such Payment Date, plus any Accrued Bond Interest
remaining unpaid from any prior Payment Date with interest thereon at the
related Bond Interest Rate. Accrued Bond Interest for each Class of Bonds, other
than the Class A-IO Bonds, shall be calculated on the basis of the actual number
of days in the Accrual Period and a 360-day year. Accrued Bond Interest for the
Class A-IO Bonds shall be calculated on the basis of twelve 30-day months and a
360-day year.
ADJUSTMENT DATE: As to each Mortgage Loan, each date set forth
in the related Mortgage Note on which an adjustment to the interest rate on such
Mortgage Loan becomes effective.
ADVANCE: As to any Mortgage Loan, any advance made by the
Master Servicer pursuant to Section 4.04 of the Servicing Agreement or by a
Subservicer in respect of delinquent Monthly Payments of principal and interest
pursuant to the related Subservicing Agreement.
AFFILIATE: With respect to any Person, any other Person
controlling, controlled by or under common control with such Person. For
purposes of this definition, "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 and "controlling" and "controlled"
shall have meanings correlative to the foregoing.
ALLOCATED REALIZED LOSS AMOUNT: With respect to the Class B
Bonds and any Payment Date, an amount equal to the sum of any Realized Loss
allocated to the Class B Bonds on that Payment Date and any Allocated Realized
Loss Amount for that Class remaining unpaid from the previous Payment Date.
APPRAISED VALUE: The appraised value of a Mortgaged Property
based upon the lesser of (i) the appraisal made at the time of the origination
of the related Mortgage Loan, or (ii) the sales price of such Mortgaged Property
at such time of origination. With respect to a Mortgage Loan the proceeds of
which were used to refinance an existing Mortgage Loan, the appraised value of
the Mortgaged Property based upon the appraisal obtained at the time of
refinancing.
ASSIGNMENT OF MORTGAGE: An assignment of Mortgage, notice of
transfer or equivalent instrument, in recordable form, which is sufficient under
the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect of record the sale of the
Mortgage, which assignment, notice of transfer or equivalent instrument may be
in the form of one or more blanket assignments covering Mortgages secured by
Mortgaged Properties located in the same county, if permitted by law.
AUTHORIZED NEWSPAPER: A newspaper of general circulation in
the Borough of Manhattan, The City of New York, printed in the English language
and customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays.
AUTHORIZED OFFICER: With respect to the Issuer, any officer of
the Owner Trustee who is authorized to act for the Owner Trustee in matters
relating to the Issuer and who is identified on the list of Authorized Officers
delivered by the Owner Trustee to the Indenture Trustee on the Closing Date (as
such list may be modified or supplemented from time to time thereafter).
AVAILABLE FUNDS: With respect to any Payment Date, the sum of
the following, in each case with respect to the Mortgage Loans:
(i) each previously undistributed Monthly Payment due
after the Cut-Off Date received on or prior to the related
Determination Date or advanced prior to such Payment Date
(other than Monthly Payments due after the related Due Period,
which shall be treated as if received during the Due Period
they were due and other than Monthly Payments with respect to
which the Master Servicer has made an unreimbursed Advance) on
each outstanding Mortgage Loan (less the related Master
Servicing Fees, any Subservicing Fees under any Subservicing
Agreement and any fees or penalties retained by the Master
Servicer or any Subservicer, the fees of the Owner Trustee and
the Indenture Trustee and any amounts in respect of the
premium payable to Radian under the Radian Lender-Paid PMI
Policies);
(ii) all proceeds of any Mortgage Loan repurchased
during the related Prepayment Period (or deemed to have been
so repurchased in accordance with the Servicing Agreement)
pursuant to the Servicing Agreement and the amount of any
shortfall deposited in the Collection Account in connection
with the substitution of a Deleted Mortgage Loan pursuant to
the Mortgage Loan Sale and Contribution Agreement, during the
related Prepayment Period;
(iii) all other unscheduled collections (including,
without limitation, Principal Prepayments, Insurance Proceeds,
Liquidation Proceeds and REO Proceeds) received during the
related Prepayment Period to the extent applied by the Master
Servicer as recoveries of principal or interest of the related
Mortgage Loan pursuant to the Servicing Agreement;
(iv) any amounts received from the Seller in respect
of the Seller Guarantee; and
(v) any (i) Compensating Interest payments and (ii)
Foreclosure Profits, to the extent not payable to the
Subservicers;
2
MINUS
(vi) expenses incurred by and reimbursable to the
Master Servicer or the Depositor pursuant to the Servicing
Agreement or otherwise, or in connection with enforcing any
repurchase, substitution or indemnification obligation of the
Seller (other than an Affiliate of the Depositor) in respect
of a Mortgage Loan;
(vii) amounts expended by the Master Servicer (a)
pursuant to the Servicing Agreement in good faith in
connection with the restoration of property related to a
Mortgage Loan damaged by an Uninsured Cause, and (b) in
connection with the liquidation of a Mortgage Loan or
disposition of an REO Property related to a Mortgage Loan to
the extent not otherwise reimbursed to the Master Servicer
pursuant to the Servicing Agreement;
(viii) if the Bonds have been declared due and
payable following an Event of Default on such Payment Date,
any amounts owed to the Indenture Trustee by the Issuer
pursuant to Section 6.07 of the Indenture;
(ix) the Net Derivative Fee;
(x) the Premium Amount; and
(xi) any other amounts withdrawn from the Collection
Account by the Master Servicer pursuant to Section 3.07(a)(ii)
through (xv) of the Servicing Agreement, not described above
in clauses (vi) through (viii) above.
AVAILABLE FUNDS RATE: On any Payment Date, the per annum rate
equal to the product of:
(i) (A) the product of:
(1) the weighted average of the Net Mortgage
Rates on the Mortgage Loans included in the
trust as of the end of the prior Due Period,
weighted on the basis of the Stated
Principal Balances thereof as of the end of
the prior Due Period and
(2) a fraction equal to
(x) the aggregate Stated Principal
Balance of the Mortgage Loans as of the end
of the prior Due Period divided by
(y) the aggregate Bond Principal
Balance of the Class A-1 Bonds and Class B
Bonds immediately prior to such Payment
Date, minus
3
(B) the Policy Premium Rate times a fraction equal to
(x) the aggregate Bond Principal Balance of
the Class A-1 Bonds immediately prior to such Payment
Date divided by
(y) the aggregate Bond Principal Balance of
the Class A-1 Bonds and Class B Bonds immediately
prior to such Payment Date, minus
(C) if such Payment Date occurs during the period
from September 2002 to February 2005, the
Pass-Through Rate for the Class A-IO Bonds for such
Payment Date multiplied by a fraction equal to
(x) the Notional Amount of the Class A-IO
Bonds immediately prior to such Payment Date
over
(y) the aggregate Stated Principal Balances
of the Mortgage Loans as of the first day of
the month preceding the month in which such
Payment Date occurs; and
(ii) a fraction equal to (x) 30 divided by (y) the number of
days in the related Accrual Period.
BALLOON LOAN: Each of the Mortgage Loans identified in the
Mortgage Loan Schedule as having an original term to maturity that is shorter
than the related amortization term.
BALLOON PAYMENT: With respect to any Balloon Loan, the related
Monthly Payment payable on the stated maturity date of such Balloon Loan.
BANKRUPTCY CODE: The Bankruptcy Code of 1978, as amended.
BASIC DOCUMENTS: The Trust Agreement, the Certificate of
Trust, the Indenture, the Servicing Agreement, the Insurance Agreement, the
Mortgage Loan Sale and Contribution Agreement, the Seller Guarantee, the
Derivative Contracts, the Special Certificate Cap Contract and the other
documents and certificates delivered in connection with any of the above.
BASIC PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Payment Date, the lesser of (a) the excess of (i) the Available Funds for such
Payment Date over (ii) the aggregate amount of Accrued Bond Interest for the
Bonds for such Payment Date and (b) the excess of (i) the Principal Remittance
Amount for such Payment Date over (ii) the Overcollateralization Release Amount,
if any, for such Payment Date.
BASIS RISK SHORTFALL: With respect to any Class of Bonds,
other than the Class A-IO Bonds, on each Payment Date where clause (iii) of the
definition of "Bond Interest Rate" is less than clauses (i) or (ii) of the
definition of "Bond Interest Rate", the excess, if any, of (x) the aggregate
Accrued Bond Interest thereon for such Payment Date calculated pursuant to the
lesser of clause (i)
4
or (ii) of the definition of Bond Interest Rate over (y) interest accrued on the
Mortgage Loans at the Available Funds Rate.
BASIS RISK SHORTFALL CARRY-FORWARD AMOUNT: With respect to
each Class of Bonds, other than the Class A-IO Bonds, and any Payment Date, as
determined separately for each Class of Bonds, other than the Class A-IO Bonds,
an amount equal to the aggregate amount of Basis Risk Shortfall for such Bonds
on such Payment Date, plus any unpaid Basis Risk Shortfall for such Class of
Bonds from prior Payment Dates, plus interest thereon at the Bond Interest Rate
for such Payment Date, to the extent previously unreimbursed by Net Monthly
Excess Cashflow or the Derivative Contracts.
BENEFICIAL OWNER: With respect to any Bond, the Person who is
the beneficial owner of such Xxxx as reflected on the books of the Depository or
on the books of a Person maintaining an account with such Depository (directly
as a Depository Participant or indirectly through a Depository Participant, in
accordance with the rules of such Depository).
BOND INSURANCE POLICY: The bond guaranty insurance policy
issued by the Bond Insurer for the benefit of the Class A-1 Bondholders.
BOND INSURANCE PREMIUM: The premium payable to the Bond
Insurer with respect to the Bond Insurance Policy, as specified in the Insurance
Agreement.
BOND INSURER: Ambac Assurance Corporation, a
Wisconsin-domiciled stock insurance corporation, any successor thereto or any
replacement bond insurer substituted pursuant to Section 3.30 of the Indenture.
XXXX INSURER DEFAULT: The existence and continuance of any of
the following: (a) a failure by the Bond Insurer to make a payment required
under the Bond Insurance Policy in accordance with its terms; or (b)(i) the Bond
Insurer (A) files any petition or commences any case or proceeding under any
provision or chapter of the Bankruptcy Code or any other similar federal or
state law relating to insolvency, bankruptcy, rehabilitation, liquidation or
reorganization, (B) makes a general assignment for the benefit of its creditors,
or (C) has an order for relief entered against it under the Bankruptcy Code or
any other similar federal or state law relating to insolvency, bankruptcy,
rehabilitation, liquidation or reorganization which is final and nonappealable;
or (ii) a court of competent jurisdiction, the New York or Wisconsin Department
of Insurance or other competent regulatory authority enters a final and
nonappealable order, judgment or decree (A) appointing a custodian, trustee,
agent or receiver for the Bond Insurer or for all or any material portion of its
property or (B) authorizing the taking of possession by a custodian, trustee,
agent or receiver of the Bond Insurer (or the taking of possession of all or any
material portion of the property of the Bond Insurer).
BOND INTEREST RATE: With respect to each Payment Date and each
Class of Bonds, other than the Class A-IO Bonds, a floating rate equal to the
least of (i) One-Month LIBOR plus the related Bond Margin, (ii) the Maximum Bond
Rate and (iii) the Available Funds Rate with respect to such Payment Date. With
respect to the Class A-IO Bonds, a fixed rate equal to 4.75% per annum.
5
BOND MARGIN: With respect to the Class A-1 Bonds, on any
Payment Date prior to the Step-Up Date, 0.370% per annum, and on any Payment
Date on and after the Step-Up Date, 0.740% per annum. With respect to the Class
B Bonds, on any Payment Date prior to the Step-Up Date, 2.350% per annum, and on
any Payment Date on and after the Step-Up Date, 3.525% per annum.
BOND OWNER: The Beneficial Owner of a Bond.
BOND PRINCIPAL BALANCE: With respect to any Bond, other than a
Class A-IO Bond, as of any date of determination, the initial Bond Principal
Balance as stated on the face thereof, minus all amounts distributed in respect
of principal with respect to such Bond and, in the case of any Class B Bond, the
aggregate amount of any reductions in the Bond Principal Balance thereof deemed
to have occurred in connection with allocations of Realized Losses on all prior
Payment Dates. The Class A-IO Bonds do not have a Bond Principal Balance.
BOND REGISTER: The register maintained by the Bond Registrar
in which the Bond Registrar shall provide for the registration of Bonds and of
transfers and exchanges of Bonds.
BOND REGISTRAR: The Indenture Trustee, in its capacity as Bond
Registrar, or any successor to the Indenture Trustee in such capacity.
BONDHOLDER OR HOLDER: The Person in whose name a Bond is
registered in the Bond Register, except that, any Bond registered in the name of
the Depositor, the Issuer, the Indenture Trustee, the Seller or the Master
Servicer or any Affiliate of any of them shall be deemed not to be a holder or
holders, nor shall any so owned be considered outstanding, for purposes of
giving any request, demand, authorization, direction, notice, consent or waiver
under the Indenture or the Trust Agreement; provided that, in determining
whether the Indenture Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only Bonds
that a Responsible Officer of the Indenture Trustee or the Owner Trustee
actually knows to be so owned shall be so disregarded. Owners of Bonds that have
been pledged in good faith may be regarded as Holders if the pledgee establishes
to the satisfaction of the Indenture Trustee or the Owner Trustee the pledgee's
right so to act with respect to such Bonds and that the pledgee is not the
Issuer, any other obligor upon the Bonds or any Affiliate of any of the
foregoing Persons. Any bonds on which payments are made under the Bond Insurance
Policy shall be deemed Outstanding until the Bond Insurer has been reimbursed
with respect thereto and the Bond Insurer shall be deemed the Bondholder thereof
to the extent of such unreimbursed payment.
BONDS: A Class A Bond or Class B Bond.
BOOK-ENTRY BONDS: Beneficial interests in the Bonds, ownership
and transfers of which shall be made through book entries by the Depository as
described in Section 4.06 of the Indenture.
BUSINESS DAY: Any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the City of New York, Delaware or
California or in the city in which the corporate trust offices of the Indenture
Trustee or the principal office of the Bond Insurer are located, are required or
authorized by law to be closed.
6
BUSINESS TRUST STATUTE: Chapter 38 of Title 12 of the Delaware
Code, 12 DEL. Code ss.ss.3801 ET SEQ., as the same may be amended from time to
time.
CASH LIQUIDATION: As to any defaulted Mortgage Loan other than
a Mortgage Loan as to which an REO Acquisition occurred, a determination by the
Master Servicer evidenced in a certificate of a Servicing Officer that it has
received all Insurance Proceeds, Liquidation Proceeds and other payments or cash
recoveries which the Master Servicer reasonably and in good faith expects to be
finally recoverable with respect to such Mortgage Loan.
CERTIFICATE DISTRIBUTION ACCOUNT: The account or accounts
created and maintained pursuant to Section 3.10(c) of the Trust Agreement. The
Certificate Distribution Account shall be an Eligible Account.
CERTIFICATE PAYING AGENT: The meaning specified in Section
3.10 of the Trust Agreement.
CERTIFICATE PERCENTAGE INTEREST: With respect to each
Certificate, the Certificate Percentage Interest stated on the face thereof.
CERTIFICATE REGISTER: The register maintained by the
Certificate Registrar in which the Certificate Registrar shall provide for the
registration of Certificates and of transfers and exchanges of Certificates.
CERTIFICATE REGISTRAR: Initially, the Indenture Trustee, in
its capacity as Certificate Registrar, or any successor to the Indenture Trustee
in such capacity.
CERTIFICATE OF TRUST: The Certificate of Trust filed for the
Trust pursuant to Section 3810(a) of the Business Trust Statute.
CERTIFICATES OR TRUST CERTIFICATES: The Impac CMB Trust Series
2002-5 Trust Certificates, Series 2002-5, evidencing the beneficial ownership
interest in the Issuer and executed by the Owner Trustee in substantially the
form set forth in Exhibit A to the Trust Agreement.
CERTIFICATEHOLDER OR HOLDER: The Person in whose name a
Certificate is registered in the Certificate Register. Owners of Certificates
that have been pledged in good faith may be regarded as Holders if the pledgee
establishes to the satisfaction of the Indenture Trustee or the Owner Trustee,
as the case may be, the pledgee's right so to act with respect to such
Certificates and that the pledgee is not the Issuer, any other obligor upon the
Certificates or any Affiliate of any of the foregoing Persons.
CLASS: Any of the Class A-1 Bonds, Class A-IO Bonds or Class B
Bonds.
CLASS A BONDS: The Class A-1 Bonds and Class A-IO Bonds.
CLASS A-1 BONDS: The Class A-1 Bonds in the form attached as
Exhibit A-1 to the Indenture.
7
CLASS A-IO ADJUSTED ISSUE PRICE: With respect to the Class
A-IO Bonds, an amount approximately equal to the present value of the remaining
distributions on the Class A-IO Bonds, using a discount rate equal to the
discount rate reflected in the price paid by the initial purchasers of the Class
A-IO Bonds on the Closing Date.
CLASS A-IO BONDS: The Class A-IO Bonds in the form attached as
Exhibit A-2 to the Indenture.
CLASS B BONDS: The Class B Bonds in the form attached as
Exhibit A-3 to the Indenture.
CLOSING DATE: August 28, 2002.
CODE: The Internal Revenue Code of 1986, as amended, and the
rules and regulations promulgated thereunder.
COLLATERAL: The meaning specified in the Granting Clause of
the Indenture.
COLLECTION ACCOUNT: The account or accounts created and
maintained pursuant to Section 3.06(d) of the Servicing Agreement. The
Collection Account shall be an Eligible Account.
COLLECTION PERIOD: With respect to each Payment Date, the
calendar month immediately preceding the month in which such Payment Date
occurs.
COMPENSATING INTEREST: With respect to any Payment Date, the
amount of any Prepayment Interest Shortfalls resulting from prepayments in full
during the preceding calendar month, but only to the extent such Prepayment
Interest Shortfalls do not exceed an amount equal to the lesser of (a)
one-twelfth of 0.125% of the aggregate Stated Principal Balance of the Mortgage
Loans immediately preceding such Payment Date and (b) the sum of the Master
Servicing Fee and Subservicing Fee for such Payment Date.
CORPORATE TRUST OFFICE: With respect to the Indenture Trustee,
Certificate Registrar, Certificate Paying Agent and Paying Agent, the principal
corporate trust office of the Indenture Trustee and Bond Registrar at which at
any particular time its corporate trust business shall be administered, which
office at the date of the execution of this instrument is located at 0000 Xxxx
Xx. Xxxxxx Xxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000, Attention: IM0205. With respect
to the Owner Trustee, the principal corporate trust office of the Owner Trustee
at which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Trust Agreement
is located at Wilmington Trust Company, Xxxxxx Square North, 0000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Impac CMB Trust Series 2002-5
(IM0205).
CUMULATIVE LOSSES: As to any Payment Date and the Mortgage
Loans, the cumulative aggregate amount of Realized Losses on the Mortgage Loans
from the Cut-Off Date through the end of the calendar month immediately
preceding such Payment Date.
8
CUMULATIVE LOSS PERCENTAGE: As to any Payment Date and the
Mortgage Loans, the percentage equivalent of the fraction obtained by dividing
(i) the aggregate of Realized Losses on the Mortgage Loans from the Cut-Off Date
through such Payment Date by (ii) the aggregate Cut-Off Date Principal Balance
of the Mortgage Loans.
CUT-OFF DATE: With respect to the Mortgage Loans, August 1,
2002.
CUT-OFF DATE BALANCE: The aggregate Stated Principal Balance
of the Mortgage Loans as of the Cut-off Date.
CUT-OFF DATE PRINCIPAL BALANCE: With respect to any Mortgage
Loan, the unpaid principal balance thereof as of the Cut-Off Date after applying
the principal portion of Monthly Payments due on or before such date, whether or
not received, and without regard to any payments due after such date.
DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction constituting a Deficient Valuation or any reduction that results in a
permanent forgiveness of principal.
DEFAULT: Any occurrence which is or with notice or the lapse
of time or both would become an Event of Default.
DEFICIENCY AMOUNT: With respect to each Payment Date prior to
the Final Scheduled Payment Date, an amount equal to the sum of (i) the excess,
if any, of (a) the aggregate amount of Accrued Bond Interest on the Class A-1
Bonds for that Payment Date over (b) the Available Funds less the Accrued Bond
Interest on the Class A-IO Bonds for that Payment Date and (ii) any
Undercollateralization Amount with respect to the Class A-1 Bonds. With respect
to the Final Scheduled Payment Date, an amount equal to the sum of (i) the
excess, if any, of (a) the aggregate amount of Accrued Bond Interest on the
Class A-1 Bonds over (b) the Available Funds for that Payment Date and (ii) the
excess, if any, of the aggregate Bond Principal Balance of all outstanding Class
A-1 Bonds due on such Final Scheduled Payment Date over the Available Funds not
used to pay the Accrued Bond Interest on the Class A Bonds and Class B Bonds for
such Final Scheduled Payment Date. For any date on which the acceleration of the
Bonds has been directed or consented to by the Bond Insurer pursuant to the
Indenture, the amount required to pay the Bond Principal Balance of the Class
A-1 Bonds in full, together with accrued and unpaid interest thereon through the
date of payment of the Class A-1 Bonds.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a
valuation by a court of competent jurisdiction of the Mortgaged Property in an
amount less than the then outstanding indebtedness under the Mortgage Loan, or
any reduction in the amount of principal to be paid in connection with any
scheduled Monthly Payment that constitutes a permanent forgiveness of principal,
which valuation or reduction results from a proceeding under the Bankruptcy
Code.
DEFINITIVE BONDS: The meaning specified in Section 4.06 of the
Indenture.
9
DELETED MORTGAGE LOAN: A Mortgage Loan replaced or to be
replaced with an Eligible Substitute Mortgage Loan.
DELINQUENCY PERCENTAGE: As of the last day of any Due Period
and with respect to the Mortgage Loans, the percentage equivalent of a fraction,
the numerator of which equals the aggregate Principal Balance of the Mortgage
Loans that are 90 or more days delinquent, in foreclosure or converted to REO
Properties as of such last day of such Due Period, and the denominator of which
is the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of such Due Period.
DEPOSITOR: IMH Assets Corp., a California corporation, or its
successor in interest.
DEPOSITORY OR DEPOSITORY AGENCY: The Depository Trust Company
or a successor appointed by the Indenture Trustee. Any successor to the
Depository shall be an organization registered as a "clearing agency" pursuant
to Section 17A of the Exchange Act and the regulations of the Securities and
Exchange Commission thereunder.
DEPOSITORY PARTICIPANT: A Person for whom, from time to time,
the Depository effects book-entry transfers and pledges of securities deposited
with the Depository.
DETERMINATION DATE: With respect to any Payment Date, the 15th
of the related month, or if the 15th day of such month is not a Business Day,
the immediately preceding Business Day.
DERIVATIVE CONTRACTS: The eleven Confirmations, together with
the associated ISDA Master Agreements, each for the benefit of the Bonds,
delivered to the Indenture Trustee on the Closing Date and attached to the
Indenture as Exhibit E.
DERIVATIVE CONTRACT COUNTERPARTIES: Bear Xxxxxxx Financial
Products Inc., Bear Xxxxxxx Capital Markets Inc., Xxxxxx Brothers Special
Financing Inc. and Bank of America, N.A.
DUE DATE: With respect to each Mortgage Loan, the day of the
month on which each scheduled Monthly Payment is due.
DUE PERIOD: With respect to any Payment Date and the Mortgage
Loans, the period commencing on the second day of the month immediately
preceding the month of such Payment Date (or, with respect to the first Due
Period, the day following the Cut-Off Date) and ending on the first day of the
month of such Payment Date.
ELIGIBLE ACCOUNT: An account that is any of the following: (i)
maintained with a depository institution the short term deposits of which have
been rated by each Rating Agency in its highest rating available, or (ii) an
account or accounts in a depository institution in which such accounts are fully
insured to the limits established by the FDIC, PROVIDED that any deposits not so
insured shall, to the extent acceptable to the Bond Insurer and each Rating
Agency, as evidenced in writing, be maintained such that (as evidenced by an
Opinion of Counsel delivered to the Indenture Trustee, the Bond Insurer and each
Rating Agency) the Indenture Trustee has a claim with respect to the funds in
such account or a perfected first security interest against any collateral
(which shall
10
be limited to Eligible Investments) securing such funds that is superior to
claims of any other depositors or creditors of the depository institution with
which such account is maintained, or (iii) in the case of the Collection
Account, either (A) a trust account or accounts maintained at the corporate
trust department of the Indenture Trustee or (B) an account or accounts
maintained at the corporate trust department of the Indenture Trustee, as long
as its short term debt obligations are rated P-1 by Xxxxx'x and A-1 by Standard
& Poor's or better and its long term debt obligations are rated A2 by Xxxxx'x
and A by Standard & Poor's or better, or (iv) in the case of the Collection
Account and the Payment Account, a trust account or accounts maintained in the
corporate trust division of the Indenture Trustee, or (v) an account or accounts
of a depository institution acceptable to each Rating Agency as evidenced in
writing by each Rating Agency that use of any such account as the Collection
Account or the Payment Account will not reduce the rating assigned to any of the
Securities by such Rating Agency below investment grade without taking into
account the Bond Insurance Policy and acceptable to the Bond Insurer as
evidenced in writing.
ELIGIBLE INVESTMENTS: One or more of the following:
(i) direct obligations of, and obligations fully
guaranteed by, the United States of America, the Federal Home
Mortgage Corporation, the Federal National Mortgage
Association, the Federal Home Loan Banks 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 and time deposits in, certificates of
deposit of, banker's acceptances issued by or federal funds
sold by any depository institution or trust company (including
the Indenture Trustee or its agent acting in their respective
commercial capacities) incorporated under the laws of the
United States of America or any State thereof and subject to
supervision and examination by federal and/or state
authorities, so long as at the time of such investment or
contractual commitment providing for such investment, such
depository institution or trust company has a short term
unsecured debt rating in the highest available rating category
of each of the Rating Agencies and provided that each such
investment has an original maturity of no more than 365 days,
and (B) any other demand or time deposit or deposit which is
fully insured by the FDIC;
(iii) repurchase obligations with a term not to
exceed 30 days with respect to any security described in
clause (i) above and entered into with a depository
institution or trust company (acting as a principal) rated "A"
or higher by Standard & Poor's and A2 or higher by Xxxxx'x;
provided, however, that collateral transferred pursuant to
such repurchase obligation must (A) be valued weekly at
current market price plus accrued interest, (B) pursuant to
such valuation, equal, at all times, 105% of the cash
transferred by the Indenture Trustee in exchange for such
collateral and (C) be delivered to the Indenture Trustee or,
if the Indenture Trustee is supplying the collateral, an agent
for the Indenture Trustee, in such a manner as to accomplish
perfection of a security interest in the collateral by
possession of certificated securities;
11
(iv) securities bearing interest or sold at a
discount issued by any corporation incorporated under the laws
of the United States of America or any State thereof which has
a long term unsecured debt rating in the highest available
rating category of each of the Rating Agencies at the time of
such investment;
(v) commercial paper having an original maturity of
less than 365 days and issued by an institution having a short
term unsecured debt rating in the highest available rating
category of each of the Rating Agencies at the time of such
investment;
(vi) a guaranteed investment contract approved by
each of the Rating Agencies and the Bond Insurer and issued by
an insurance company or other corporation having a long term
unsecured debt rating in the highest available rating category
of each of the Rating Agencies at the time of such investment;
(vii) money market funds having ratings in the
highest available long term rating category of each of the
Rating Agencies at the time of such investment; any such money
market funds which provide for demand withdrawals being
conclusively deemed to satisfy any maturity requirement for
Eligible Investments set forth in the Indenture, including
money market funds of the Indenture Trustee or any such funds
that are managed or advised by the Indenture Trustee or any
Affiliate thereof; and
(viii) any investment approved in writing by each of
the Rating Agencies and the Bond Insurer.
The Indenture Trustee may purchase from or sell to itself or an affiliate, as
principal or agent, the Eligible Investments listed above.
PROVIDED, HOWEVER, that each such instrument shall be acquired in an arm's
length transaction and no such instrument shall be an Eligible Investment if it
represents, either (1) the right to receive only interest payments with respect
to the underlying debt instrument or (2) the right to receive both principal and
interest payments derived from obligations underlying such instrument and the
principal and interest payments with respect to such instrument provide a yield
to maturity greater than 120% of the yield to maturity at par of such underlying
obligations; PROVIDED FURTHER, HOWEVER, that each such instrument acquired shall
not be acquired at a price in excess of par.
ELIGIBLE SUBSTITUTE MORTGAGE LOAN: A Mortgage Loan substituted
by the Seller for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in an Officer's Certificate delivered to the
Indenture Trustee, (i) have an outstanding principal balance, after deduction of
the principal portion of the monthly payment due in the month of substitution
(or in the case of a substitution of more than one Mortgage Loan for a Deleted
Mortgage Loan, an aggregate outstanding principal balance, after such
deduction), not in excess of the outstanding principal balance of the Deleted
Mortgage Loan (the amount of any shortfall to be deposited by the Seller in the
Collection Account in the month of substitution); (ii) comply with each
non-statistical representation and warranty set forth in Section 3.1(b) of the
Mortgage Loan Sale and Contribution Agreement as of the date of substitution;
(iii) have a Mortgage Rate no lower than and not more than
12
1% per annum higher than the Mortgage Rate of the Deleted Mortgage Loan as of
the date of substitution; (iv) have a Loan-to-Value Ratio at the time of
substitution no higher than that of the Deleted Mortgage Loan at the time of
substitution; (v) have a remaining term to stated maturity not greater than (and
not more than one year less than) that of the Deleted Mortgage Loan; and (vi)
not be 30 days or more delinquent.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
EVENT OF DEFAULT: With respect to the Indenture, 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):
(i) a failure by the Issuer to pay (a) Accrued Bond
Interest on any Class of Bonds or the Principal Distribution
Amount with respect to a Payment Date on such Payment Date or
(b) the Unpaid Interest Shortfall with respect to either Class
of Bonds, but only, with respect to clause (b), to the extent
funds are available to make such payment as provided in the
Indenture; or
(ii) the failure by the Issuer on the Final Scheduled
Payment Date to reduce the Bond Principal Balance of either
the Class A-1 Bonds or the Class B Bonds to zero; or
(iii) there occurs a default in the observance or
performance of any covenant or agreement of the Issuer made in
the Indenture, or any representation or warranty of the Issuer
made in the Indenture or in any certificate or other writing
delivered pursuant hereto or in connection herewith proving to
have been incorrect in any material respect as of the time
when the same shall have been made, and such default shall
continue or not be cured, or the circumstance or condition in
respect of which such representation or warranty was incorrect
shall not have been eliminated or otherwise cured, for a
period of 30 days after there shall have been given, by
registered or certified mail, to the Issuer by the Indenture
Trustee or to the Issuer and the Indenture Trustee by the Bond
Insurer, or if a Bond Insurer Default exists, the Holders of
at least 25% of the aggregate Bond Principal Balance of the
Outstanding Bonds, a written notice specifying such default or
incorrect representation or warranty and requiring it to be
remedied and stating that such notice is a notice of default
hereunder; or
(iv) there occurs the filing of a decree or order for
relief by a court having jurisdiction in the premises in
respect of the Issuer or any substantial part of the Trust
Estate in an involuntary case under any applicable federal or
state bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official
of the Issuer or for any substantial part of the Trust Estate,
or ordering the winding-up or liquidation of the Issuer's
affairs, and such decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or
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(v) there occurs the commencement by the Issuer of a
voluntary case under any applicable federal or state
bankruptcy, insolvency or other similar law now or hereafter
in effect, or the consent by the Issuer to the entry of an
order for relief in an involuntary case under any such law, or
the consent by the Issuer to the appointment or taking
possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of the Issuer or for
any substantial part of the assets of the Trust Estate, or the
making by the Issuer of any general assignment for the benefit
of creditors, or the failure by the Issuer generally to pay
its debts as such debts become due, or the taking of any
action by the Issuer in furtherance of any of the foregoing.
EVENT OF SERVICER TERMINATION: With respect to the Servicing
Agreement, a Servicing Default as defined in Section 6.01 of the Servicing
Agreement.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
EXPENSE FEE RATE: With respect to each Mortgage Loan, the sum
of the Master Servicing Fee Rate, the Subservicing Fee Rate, the Minimum Spread
Rate, the Indenture Trustee Fee Rate, the Owner Trustee Fee Rate, the Radian PMI
Rate, if such Mortgage Loan is a Radian PMI Insured Loan, and the Net Derivative
Fee Rate.
EXPENSES: The meaning specified in Section 7.02 of the Trust
Agreement.
EXTRA PRINCIPAL DISTRIBUTION AMOUNT: With respect to each
Payment Date occurring in or after September 2002 but in or prior to February
2003, the lesser of (x) the Net Monthly Excess Cashflow for such Payment Date
after payments to the Bond Insurer pursuant to Section 3.05(d)(i) of the
Indenture and (y) the aggregate amount of Realized Losses on the mortgage loans
during the related prepayment period, plus any Realized Losses which were not
covered by a payment of the Extra Principal Distribution Amount on any prior
Payment Date. With respect to each Payment Date occurring in or after March
2003, the lesser of (x) the Net Monthly Excess Cashflow for such Payment Date
after payments to the Bond Insurer pursuant to Section 3.05(d)(i) of the
Indenture and (y) the Overcollateralization Increase Amount for such Payment
Date.
XXXXXX XXX: Xxxxxx Xxx (formerly, the Federal National
Mortgage Association), or any successor thereto.
FDIC: The Federal Deposit Insurance Corporation or any
successor thereto.
FINAL CERTIFICATION: The final certification delivered by the
Indenture Trustee pursuant to Section 2.03(b) of the Indenture in the form
attached thereto as Exhibit D.
FINAL SCHEDULED PAYMENT DATE: With respect to each Class of
Bonds, other than the Class A-IO Bonds, the Payment Date in September 2032.
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FORECLOSURE PROFIT: With respect to a Liquidated Mortgage
Loan, the amount, if any, by which (i) the aggregate of its Net Liquidation
Proceeds exceeds (ii) the related Stated Principal Balance (plus accrued and
unpaid interest thereon at the applicable Mortgage Rate from the date interest
was last paid through the date of receipt of the final Liquidation Proceeds) of
such Liquidated Mortgage Loan immediately prior to the final recovery of its
Liquidation Proceeds.
FREDDIE MAC: Freddie Mac (formerly, the Federal Home Loan
Mortgage Corporation), or any successor thereto.
GRANT: Pledge, bargain, sell, warrant, alienate, remise,
release, convey, assign, transfer, create, and xxxxx x xxxx upon and a security
interest in and right of set-off against, deposit, set over and confirm pursuant
to the Indenture. A Grant of the Collateral or of any other agreement or
instrument shall include all rights, powers and options (but none of the
obligations) of the granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give receipt for principal
and interest payments in respect of such collateral or other agreement or
instrument and all other moneys payable thereunder, to give and receive notices
and other communications, to make waivers or other agreements, to exercise all
rights and options, to bring proceedings in the name of the granting party or
otherwise, and generally to do and receive anything that the granting party is
or may be entitled to do or receive thereunder or with respect thereto.
GROSS MARGIN: With respect to any Mortgage Loan, the
percentage set forth as the "Gross Margin" for such Mortgage Loan on the
Mortgage Loan Schedule, as adjusted from time to time in accordance with the
terms of the Servicing Agreement.
IMPAC HOLDINGS: Impac Mortgage Holdings, Inc., a Maryland
corporation, and its successors and assigns.
INDEMNIFIED PARTY: The meaning specified in Section 7.02 of
the Trust Agreement.
INDENTURE: The indenture dated as of August 28, 2002, between
the Issuer and the Indenture Trustee, as Indenture Trustee, relating to the
Impac CMB Trust Series 2002-5 Bonds.
INDENTURE TRUSTEE: Deutsche Bank National Trust Company, and
its successors and assigns or any successor indenture trustee appointed pursuant
to the terms of the Indenture.
INDENTURE TRUSTEE FEE: With respect to any Payment Date, one
month's interest accrued at the Indenture Trustee's Fee Rate on the sum of the
Stated Principal Balance of each Mortgage Loan.
INDENTURE TRUSTEE FEE RATE: On each Mortgage Loan, a rate
equal to 0.004% per annum.
INDEPENDENT: When used with respect to any specified Person,
the Person (i) is in fact independent of the Issuer, any other obligor on the
Bonds, the Seller, the Master Servicer, the Depositor and any Affiliate of any
of the foregoing Persons, (ii) does not have any direct financial interest or
any material indirect financial interest in the Issuer, any such other obligor,
the Seller, the
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Master Servicer, the Depositor or any Affiliate of any of the foregoing Persons
and (iii) is not connected with the Issuer, any such other obligor, the Seller,
the Master Servicer, the Depositor or any Affiliate of any of the foregoing
Persons as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions.
INDEPENDENT CERTIFICATE: A certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 10.01 of the
Indenture, made by an independent appraiser or other expert appointed by an
Issuer Request and approved by the Indenture Trustee in the exercise of
reasonable care, and such opinion or certificate shall state that the signer has
read the definition of "Independent" in this Indenture and that the signer is
Independent within the meaning thereof.
INDEX: With respect to any Mortgage Loan, the index for the
adjustment of the Mortgage Rate set forth as such on the related Mortgage Note.
INITIAL BOND PRINCIPAL BALANCE: With respect to the Class A-1
Bonds, $466,875,000 and with respect to the Class B Bonds, $30,625,000.
INITIAL CERTIFICATION: The initial certification delivered by
the Indenture Trustee pursuant to Section 2.03(a) of the Indenture in the form
attached thereto as Exhibit C.
INITIAL SUBSERVICERS: Wendover Funding, Inc. and Countrywide
Home Loans Servicing LP, or their respective successors in interest.
INSURANCE AGREEMENT: The Insurance and Indemnity Agreement
dated as of August 28, 2002, among the Master Servicer, the Depositor, the
Issuer, Impac Holdings, the Indenture Trustee and the Bond Insurer, including
any amendments and supplements thereto.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to
any insurance policy covering a Mortgage Loan which are required to be remitted
to the Master Servicer, net of any component thereof (i) covering any expenses
incurred by or on behalf of the Master Servicer in connection with obtaining
such proceeds, (ii) that is applied to the restoration or repair of the related
Mortgaged Property or (iii) released to the Mortgagor in accordance with the
Master Servicer's normal servicing procedures.
INSURED AMOUNT: Shall have the meaning assigned to the term
"Insured Amount" in the Bond Insurance Policy.
INTEREST DETERMINATION DATE: With respect to the first Accrual
Period, the second LIBOR Business Day preceding the Closing Date, and with
respect to each Accrual Period thereafter, the second LIBOR Business Day
preceding the related Payment Date on which such Accrual Period commences.
INTEREST RATE ADJUSTMENT DATE: With respect to each Mortgage
Loan, the date or dates on which the Mortgage Rate is adjusted in accordance
with the related Mortgage Note.
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INVESTMENT COMPANY ACT: The Investment Company Act of 1940, as
amended, and any amendments thereto.
ISSUER: Impac CMB Trust Series 2002-5, a Delaware business
trust, or its successor in interest.
ISSUER REQUEST: A written order or request signed in the name
of the Issuer by any one of its Authorized Officers and approved in writing by
the Bond Insurer, so long as no Bond Insurer Default exists, and delivered to
the Indenture Trustee.
LIBOR BUSINESS DAY: A day on which banks are open for dealing
in foreign currency and exchange in London and New York City.
LIEN: Any mortgage, deed of trust, pledge, conveyance,
hypothecation, assignment, participation, deposit arrangement, encumbrance, lien
(statutory or other), preference, priority right or interest or other security
agreement or preferential arrangement of any kind or nature whatsoever,
including, without limitation, any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing and the filing of any financing statement under the UCC
(other than any such financing statement filed for informational purposes only)
or comparable law of any jurisdiction to evidence any of the foregoing;
PROVIDED, HOWEVER, that any assignment pursuant to Section 6.02 of the Servicing
Agreement shall not be deemed to constitute a Lien.
LIFETIME RATE CAP: With respect to each Mortgage Loan with
respect to which the related Mortgage Note provides for a lifetime rate cap, the
maximum Mortgage Rate permitted over the life of such Mortgage Loan under the
terms of such Mortgage Note, as set forth on the Mortgage Loan Schedule and
initially as set forth on Exhibit A to the Servicing Agreement.
LIQUIDATED MORTGAGE LOAN: With respect to any Payment Date,
any Mortgage Loan in respect of which the Master Servicer has determined, in
accordance with the servicing procedures specified in the Servicing Agreement,
as of the end of the related Due Period that substantially all Liquidation
Proceeds which it reasonably expects to recover with respect to the disposition
of the related Mortgaged Property or REO Property have been recovered.
LIQUIDATION EXPENSES: Out-of-pocket expenses (exclusive of
overhead) which are incurred by or on behalf of the Master Servicer in
connection with the liquidation of any Mortgage Loan and not recovered under any
insurance policy, such expenses including, without limitation, legal fees and
expenses, any unreimbursed amount expended (including, without limitation,
amounts advanced to correct defaults on any mortgage loan which is senior to
such Mortgage Loan and amounts advanced to keep current or pay off a mortgage
loan that is senior to such Mortgage Loan) respecting the related Mortgage Loan
and any related and unreimbursed expenditures for real estate property taxes or
for property restoration, preservation or insurance against casualty loss or
damage.
LIQUIDATION PROCEEDS: Proceeds (including Insurance Proceeds)
received in connection with the liquidation of any Mortgage Loan or related REO
Property, whether through trustee's sale, foreclosure sale or otherwise.
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LOAN-TO-VALUE RATIO: With respect to any Mortgage Loan, as of
any date of determination, a fraction expressed as a percentage, the numerator
of which is the then current principal amount of the Mortgage Loan, and the
denominator of which is the Appraised Value of the related Mortgaged Property.
LOAN YEAR: With respect to any Mortgage Loan, the one-year
period commencing on the day succeeding the origination of such Mortgage Loan
and ending on the anniversary date of such Mortgage Loan, and each annual period
thereafter.
LOST NOTE AFFIDAVIT: With respect to any Mortgage Loan as to
which the original Mortgage Note has been lost or destroyed and has not been
replaced, an affidavit from the Seller certifying that the original Mortgage
Note has been lost, misplaced or destroyed (together with a copy of the related
Mortgage Note).
MASTER SERVICER: Impac Funding Corporation, a California
corporation, and its successors and assigns.
MASTER SERVICING FEE: With respect to each Mortgage Loan and
any Payment Date, the fee payable monthly to the Master Servicer in respect of
master servicing compensation that accrues at an annual rate equal to the Master
Servicing Fee Rate multiplied by the Stated Principal Balance of such Mortgage
Loan as of the related Due Date in the related Due Period.
MASTER SERVICING FEE RATE: With respect to any Mortgage Loan,
0.030% per annum.
MAXIMUM BOND RATE: 12.350% per annum.
MAXIMUM MORTGAGE RATE: With respect to each Mortgage Loan, the
maximum Mortgage Rate.
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 Mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for Mortgage Loans
registered with MERS on the MERS(R)System.
MINIMUM MORTGAGE RATE: With respect to each Mortgage Loan, the
minimum Mortgage Rate.
MINIMUM SPREAD RATE: Commencing on the tenth Payment Date,
0.500% per annum.
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.
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MONTHLY PAYMENT: With respect to any Mortgage Loan (including
any REO Property) and any Due Date, the payment of principal and interest due
thereon in accordance with the amortization schedule at the time applicable
thereto (after adjustment, if any, for partial Principal Prepayments and for
Deficient Valuations occurring prior to such Due Date but before any adjustment
to such amortization schedule by reason of any bankruptcy, other than a
Deficient Valuation, or similar proceeding or any moratorium or similar waiver
or grace period).
MOODY'S: Xxxxx'x Investors Service, Inc. or its successor in
interest.
MORTGAGE: The mortgage, deed of trust or other instrument
creating a first lien on an estate in fee simple interest in real property
securing a Mortgage Loan.
MORTGAGE FILE: The file containing the Related Documents
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to the Mortgage Loan Sale and
Contribution Agreement or the Servicing Agreement.
MORTGAGE LOANS: The Mortgage Loans that will be transferred
and assigned to the Trust pursuant to Section 2.03(a) of the Indenture, each
Mortgage Loan so held being identified in the Mortgage Loan Schedule.
MORTGAGE LOAN SALE AND CONTRIBUTION AGREEMENT: The Mortgage
Loan Sale and Contribution Agreement, dated as of the Closing Date, between the
Seller, as seller, and the Purchaser, as purchaser, relating to the sale,
transfer and assignment of the Mortgage Loans.
MORTGAGE LOAN SCHEDULE: With respect to any date, the schedule
of Mortgage Loans held by the Issuer on such date. The initial schedule of
Mortgage Loans as of the respective Cut-Off Dates is the schedule set forth in
Exhibit B of the Indenture, which schedule sets forth as to each Mortgage Loan:
(i) the loan number and name of the Mortgagor;
(ii) the street address, city, state and zip code of
the Mortgaged Property;
(iii) the original Mortgage Rate;
(iv) the maturity date;
(v) the original principal balance;
(vi) the first Payment Date;
(vii) the type of Mortgaged Property;
(viii) the Monthly Payment in effect as of the
related Cut-Off Dates;
(ix) the Cut-off Date Principal Balance;
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(x) the Index and the Gross Margin, if applicable;
(xi) the Adjustment Date frequency and Payment Date
frequency, if applicable;
(xii) the occupancy status;
(xiii) the purpose of the Mortgage Loan;
(xiv) the Appraised Value of the Mortgaged Property;
(xv) (A) the original term to maturity and (B) if
such Mortgage Loan is a Balloon Loan, the amortization term
thereof;
(xvi) the paid-through date of the Mortgage Loan;
(xvii) whether the Mortgage Loan is a Balloon
Mortgage Loan or a Mortgage Loan the terms of which do not
provide for a Balloon Payment;
(xviii) the Loan-to-Value Ratio;
(xix) whether such Mortgage Loan is a Radian PMI
Insured Loan, and if so, the related Radian PMI Rate; and
(xx) whether or not the Mortgage Loan was
underwritten pursuant to a limited documentation program.
The Mortgage Loan Schedule shall also set forth the total of
the amounts described under (ix) above for all of the Mortgage Loans.
MORTGAGE NOTE: The note or other evidence of the indebtedness
of a Mortgagor under a Mortgage Loan.
MORTGAGE RATE: With respect to any Mortgage Loan, the annual
rate at which interest accrues on such Mortgage Loan.
MORTGAGED PROPERTY: The underlying property, including real
property and improvements thereon, securing a Mortgage Loan.
MORTGAGOR: The obligor or obligors under a Mortgage Note.
NET DERIVATIVE CONTRACT PAYMENT AMOUNT: With respect to any
Payment Date, the amount equal to the excess, if any, of (a) the aggregate
amount payable on that Payment Date to the Issuer from the Derivative Contract
Counterparties pursuant to the Derivative Contracts, over (b) the
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aggregate amount payable on that Payment Date to the Derivative Counterparties
under the Derivative Contracts.
NET DERIVATIVE FEE: With respect to any Payment Date, the
amount equal to the excess, if any, of (a) the aggregate amount payable on that
Payment Date to the Derivative Counterparties in respect of the Derivative
Contracts over (b) the aggregate amount payable on that Payment Date to the
Issuer from the Derivative Counterparties pursuant to the Derivative Contracts.
NET DERIVATIVE FEE RATE: With respect to any Payment Date, the
fraction, expressed as a rate per annum, equal to (x) the Net Derivative Fee on
such Payment Date over (y) the aggregate Stated Principal Balance of the
Mortgage Loans as of the beginning of the related Due Period.
NET LIQUIDATION PROCEEDS: With respect to any Liquidated
Mortgage Loan, Liquidation Proceeds net of Liquidation Expenses.
NET MONTHLY EXCESS CASH FLOW: For any Payment Date, the sum of
(a) any Overcollateralization Release Amount and (b) the excess of (x) the
Available Funds for such Payment Date over (y) the sum for such Payment Date of
(A) the aggregate amount of Accrued Bond Interest for the Bonds and (B) the
Principal Remittance Amount.
NET MORTGAGE RATE: On any Mortgage Loan, the then applicable
mortgage rate thereon minus the sum of (1) the Master Servicing Fee Rate, (2)
the Subservicing Fee Rate, (3) the Indenture Trustee's Fee Rate, (4) the Owner
Trustee's Fee Rate, (5) the Minimum Spread Rate, (6) the Net Derivative Fee Rate
and (7) the related Radian PMI Rate, if such Mortgage Loan is a Radian PMI
Insured Loan.
NINETY DAY ROLLING DELINQUENCY PERCENTAGE: For any Payment
Date, the three-month average of the aggregate Stated Principal Balance of the
Mortgage Loans that are 90 or more days delinquent, in foreclosure or converted
to REO Properties as of the close of business on the last day of the preceding
calendar month. For purposes of the foregoing calculations, a mortgage loan is
considered "90 days" delinquent if a payment due on the first day of a month has
not been received by the second day of the third following month.
NONRECOVERABLE ADVANCE: Any advance (i) which was previously
made or is proposed to be made by the Master Servicer; and (ii) which, in the
good faith judgment of the Master Servicer, will not or, in the case of a
proposed advance, would not, be ultimately recoverable by the Master Servicer
from Liquidation Proceeds, Insurance Proceeds or future payments on any Mortgage
Loan. The Indenture Trustee may conclusively rely on any determination of
nonrecoverability made by the Master Servicer.
NOTIONAL AMOUNT: With respect to the Class A-IO Bonds, for the
September 2002 Payment Date through the August 2003 Payment Date, $50,000,000,
for the September 2003 Payment Date through the August 2004 Payment Date,
$17,500,000, and for the September 2004 Payment Date through the February 2005
Payment Date, $12,500,000.
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OFFICER'S CERTIFICATE: With respect to the Master Servicer, a
certificate signed by the President, Managing Director, a Director, a Vice
President or an Assistant Vice President, of the Master Servicer and delivered
to the Indenture Trustee. With respect to the Issuer, a certificate signed by
any Authorized Officer of the Issuer, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 10.01 of the
Indenture, and delivered to the Indenture Trustee. Unless otherwise specified,
any reference in the Indenture to an Officer's Certificate shall be to an
Officer's Certificate of any Authorized Officer of the Issuer.
ONE-MONTH LIBOR: With respect to any Accrual Period, the rate
determined by the Indenture Trustee on the related Interest Determination Date
on the basis of the London interbank offered rate for one-month United States
dollar deposits, as such rates appear on the Telerate Screen Page 3750, as of
11:00 a.m. (London time) on such Interest Determination Date.
In the event that on any Interest Determination Date, Telerate
Screen 3750 fails to indicate the London interbank offered rate for one-month
United States dollar deposits, then One- Month LIBOR for the related Interest
Accrual Period will be established by the Indenture Trustee as follows:
(i) If on such Interest Determination Date two or
more Reference Banks provide such offered quotations,
One-Month LIBOR for the related Accrual Period shall be the
arithmetic mean of such offered quotations (rounded upwards if
necessary to the nearest whole multiple of 1/16%).
(ii) If on such Interest Determination Date fewer
than two Reference Banks provide such offered quotations,
One-Month LIBOR for the related Accrual Period shall be the
higher of (i) One-Month LIBOR as determined on the previous
Interest Determination Date and (ii) the Reserve Interest
Rate.
The establishment of One-Month LIBOR on each Interest
Determination Date by the Indenture Trustee and the Indenture Trustee's
calculation of the rate of interest applicable for the related Accrual Period
shall (in the absence of manifest error) be final and binding.
OPINION OF COUNSEL: A written opinion of counsel acceptable to
the Indenture Trustee and/or the Bond Insurer, as applicable, in its reasonable
discretion which counsel may be in-house counsel for the Master Servicer if
acceptable to the Indenture Trustee, the Bond Insurer and the Rating Agencies or
counsel for the Depositor, as the case may be.
ORIGINAL VALUE: Except in the case of a refinanced Mortgage
Loan, the lesser of the Appraised Value or sales price of Mortgaged Property at
the time a Mortgage Loan is closed, and for a refinanced Mortgage Loan, the
Original Value is the value of such property set forth in an appraisal
acceptable to the Master Servicer.
OUTSTANDING: With respect to the Bonds, as of the date of
determination, all Bonds theretofore executed, authenticated and delivered under
this Indenture except:
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(i) Bonds theretofore canceled by the Bond Registrar
or delivered to the Indenture Trustee for cancellation; and
(ii) Bonds in exchange for or in lieu of which other
Bonds have been executed, authenticated and delivered pursuant
to the Indenture unless proof satisfactory to the Indenture
Trustee is presented that any such Bonds are held by a holder
in due course;
all Bonds that have been paid with funds provided under the Bond Insurance
Policy shall be deemed to be Outstanding until the Bond Insurer has been
reimbursed with respect thereto.
OUTSTANDING MORTGAGE LOAN: As to any Due Date, a Mortgage Loan
(including an REO Property) which was not the subject of a Principal Prepayment
in Full, Cash Liquidation or REO Disposition and which was not purchased,
deleted or substituted for prior to such Due Date pursuant to the Servicing
Agreement.
OVERCOLLATERALIZATION INCREASE AMOUNT: As of any Payment Date,
the excess, if any, of (a) the Overcollateralization Target Amount over (B) the
Overcollateralized Amount on such Payment Date (after taking into account the
payments to the Bonds, other than the Class A-IO Bonds, of the Basic Principal
Distribution Amount on such Payment Date).
OVERCOLLATERALIZATION RELEASE AMOUNT: With respect to any
Payment Date, the lesser of (x) the Principal Remittance Amount for such Payment
Date and (y) the excess, if any, of (i) the Overcollateralized Amount for such
Payment Date (assuming that 100% of the Principal Remittance Amount is applied
as a principal payment on such Payment Date) over (ii) the Overcollateralization
Target Amount for such Payment Date.
OVERCOLLATERALIZATION TARGET AMOUNT: With respect to any
Payment Date prior to the Stepdown Date or on or after the Stepdown Date for
which a Trigger Event is in effect, 0.90% of the Cut-off Date Balance. With
respect to any Payment Date on or after the Stepdown Date for which a Trigger
Event is not in effect, the greatest of (i) 1.80% of the aggregate Stated
Principal Balance of the mortgage loans as of the end of the related Due Period,
(ii) 0.50% of the of Cut-off Date Balance and (iii) two times the excess of (1)
50% of the aggregate Stated Principal Balance of the Mortgage Loans 90 or more
days delinquent (including for this purpose any such Mortgage Loans in
bankruptcy or foreclosure and Mortgage Loans with respect to which the related
Mortgaged Property has been acquired by the Trust) as of the end of the related
Due Period over (2) four times the Net Monthly Excess Cashflow (which, solely
for purposes of this definition, shall be determined solely in respect of clause
(b) of the definition of Net Monthly Excess Cashflow herein) for such Payment
Date.
OVERCOLLATERALIZED AMOUNT: As of any Payment Date, the amount,
if any, that the aggregate principal balances of the Mortgage Loans (after
giving effect to scheduled payments of principal due during the related Due
Period, to the extent received or Advanced, and unscheduled collections of
principal received during the related Prepayment Period and after reduction for
Realized Losses incurred during the related Prepayment Period) exceeds the
aggregate Bond
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Principal Balance of the Bonds (other than the Class A-IO Bonds) as of such
Payment Date (after giving effect to distributions to be made on such Payment
Date).
OWNER TRUST ESTATE: The corpus of the Issuer created by the
Trust Agreement which consists of items referred to in Section 3.01 of the Trust
Agreement.
OWNER TRUSTEE: Wilmington Trust Company and its successors and
assigns or any successor owner trustee appointed pursuant to the terms of the
Trust Agreement.
OWNER TRUSTEE FEE: With respect to any Payment Date the
product of (i) the Owner Trustee Fee Rate divided by 12 and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the first day of the
related Due Period.
OWNER TRUSTEE FEE RATE: 0.0017% per annum.
PAYING AGENT: Any paying agent or co-paying agent appointed
pursuant to Section 3.03 of the Indenture, which initially shall be the
Indenture Trustee.
PAYMENT ACCOUNT: The account established by the Indenture
Trustee pursuant to Section 3.01 of the Indenture. The Payment Account shall be
an Eligible Account.
PAYMENT DATE: The 25th day of each month, or if such day is
not a Business Day, then the next Business Day.
PERCENTAGE INTEREST: With respect to any Bond, the percentage
obtained by dividing the Bond Principal Balance or Notional Amount of such Bond
by the aggregate Bond Principal Balances or Notional Amounts of all Bonds of
that Class. With respect to any Certificate, the percentage as stated on the
face thereof.
PERIODIC RATE CAP: With respect to any Mortgage Loan, the
maximum rate, if any, by which the Mortgage Rate on such Mortgage Loan can
adjust on any Adjustment Date, as stated in the related Mortgage Note or
Mortgage.
PERSON: Any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
PLAN: Any employee benefit plan or certain other retirement
plans and arrangements, including individual retirement accounts and annuities,
Xxxxx plans and bank collective investment funds and insurance company general
or separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA and Section 4975 of the Code.
POLICY PREMIUM RATE: With respect to any Payment Date, the
rate per annum at which the Premium Amount for the Bond Insurance Policy
accrues, as specified in the Insurance Agreement.
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POOL BALANCE: With respect to any date of determination, the
aggregate of the Stated Principal Balances of all Mortgage Loans as of such
date.
PREFERENCE AMOUNT: With respect to the Class A-1 Bonds, any
amount previously distributed to a Class A-1 Bondholder that is recoverable and
sought to be recovered as a voidable preference by a trustee in bankruptcy
pursuant to the United States Bankruptcy Code (11 U.S.C.), as amended from time
to time, in accordance with a final nonappealable order of a court having
competent jurisdiction.
PREMIUM AMOUNT: The amount of premium due to the Bond Insurer
in accordance with the terms of the Insurance Agreement.
PREPAYMENT INTEREST SHORTFALL: As to any Payment Date and any
Mortgage Loan (other than a Mortgage Loan relating to an REO Property) that was
the subject of (a) a Principal Prepayment in Full during the related Prepayment
Period, an amount equal to the excess of interest accrued during the related
Prepayment Period at the Net Mortgage Rate on the Stated Principal Balance of
such Mortgage Loan over the sum of the amount of interest (less interest at the
related Expense Fee Rate) paid by the Mortgagor for such Prepayment Period to
the date of such Principal Prepayment in Full and any Advances made by the
Master Servicer pursuant to Section 4.04 of the Servicing Agreement or (b) a
partial Principal Prepayment during the related Prepayment Period, an amount
equal to the interest at the Mortgage Rate (less the Subservicing Fee Rate)
during the related Prepayment Period on the amount of such partial Principal
Prepayment.
PREPAYMENT PERIOD: With respect to each Mortgage Loan and any
Payment Date, the prior calendar month.
PRIMARY INSURANCE POLICY: Each primary policy of mortgage
guaranty insurance issued by a Qualified Insurer or any replacement policy
therefor, including the Radian Lender-Paid PMI Policies.
PRINCIPAL AVAILABLE FUNDS SHORTFALL: On any Payment Date for
which the Basic Principal Distribution Amount is determined by clause (a) of the
definition thereof, the excess of (x) the amount determined pursuant to clause
(b) of the definition of Basic Principal Distribution Amount over (y) the amount
determined pursuant to clause (a) of the definition of Basic Principal
Distribution Amount.
PRINCIPAL DISTRIBUTION AMOUNT: With respect to any Payment
Date, the Basic Principal Distribution Amount plus the Extra Principal
Distribution Amount.
PRINCIPAL PREPAYMENT: Any payment of principal or other
recovery on a Mortgage Loan, including a recovery that takes the form of
Liquidation Proceeds or Insurance Proceeds, which is received in advance of its
scheduled Due Date and is not accompanied by an amount as to interest
representing scheduled interest on such payment due on any date or dates in any
month or months subsequent to the month of prepayment.
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PRINCIPAL PREPAYMENT IN FULL: Any Principal Prepayment made by
a Mortgagor of the entire principal balance of a Mortgage Loan.
PRINCIPAL REMITTANCE AMOUNT: With respect to any Payment Date,
the sum of the following:
(i) the principal portion of each previously
undistributed Monthly Payment due after the Cut-Off Date
received on or prior to the related Determination Date or
advanced prior to such Payment Date (other than Monthly
Payments due after the related Due Period, which shall be
treated as if received during the Due Period they were due) on
each Outstanding Mortgage Loan;
(ii) the principal portion of all proceeds of any
Mortgage Loan repurchased during the related Prepayment Period
(or deemed to have been so repurchased in accordance with the
Servicing Agreement) pursuant to the Servicing Agreement and
the amount of any shortfall deposited in the Collection
Account in connection with the substitution of a Deleted
Mortgage Loan pursuant to the Mortgage Loan Sale and
Contribution Agreement during the related Collection Period;
and
(iii) the principal portion of all other unscheduled
collections received during the related Prepayment Period
(including, without limitation, Principal Prepayments,
Insurance Proceeds, Liquidation Proceeds and REO Proceeds) to
the extent applied by the Master Servicer as recoveries of
principal of the related Mortgage Loan pursuant to the
Servicing Agreement; and
(iv) any portion of any Insured Amount for such
Payment Date representing an Undercollateralization Amount
allocable to the Class A-1 Bonds.
PROCEEDING: Any suit in equity, action at law or other
judicial or administrative proceeding.
PROSPECTUS: The Prospectus Supplement, dated August 23, 2002,
together with the attached Prospectus, dated June 21, 2002.
PURCHASE PRICE: The meaning specified in Section 2.2(a) of the
Mortgage Loan Sale and Contribution Agreement.
PURCHASER: IMH Assets Corp., a California corporation, and its
successors and assigns.
QUALIFIED INSURER: A mortgage guaranty insurance company duly
qualified as such under the laws of the state of its principal place of business
and each state having jurisdiction over such insurer in connection with the
insurance policy issued by such insurer, duly authorized and licensed in such
states to transact a mortgage guaranty insurance business in such states and to
write the insurance provided by the insurance policy issued by it, approved as
an insurer by the Master Servicer and as a Xxxxxx Xxx-approved mortgage insurer.
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RADIAN: Radian Guaranty, Inc., or its successors or assigns.
RADIAN LENDER-PAID PMI POLICY: A lender-paid primary mortgage
insurance policy issued by Xxxxxx in accordance with a March 29, 2002 letter
between the Seller and Xxxxxx.
RADIAN PMI INSURED LOANS: The Mortgage Loans included in the
Trust Fund covered by a Radian Lender-Paid PMI Policy, as indicated on the
Mortgage Loan Schedule.
RADIAN PMI POLICY FEE: With respect to each Radian PMI Insured
Loan and any Payment Date, the product of (i) the Radian PMI Rate divided by 12
and (ii) the Stated Principal Balance of such Mortgage Loan as of the first day
of the related Due Period.
RADIAN PMI RATE: With respect to any Mortgage Loan covered by
the Radian Lender- Paid PMI Policy, the rate per annum at which the premium with
respect to such policy accrues as indicated in the Mortgage Loan Schedule.
RATING AGENCY: Any nationally recognized statistical rating
organization, or its successor, that rated the Bonds at the request of the
Depositor at the time of the initial issuance of the Bonds. Initially, Standard
& Poor's or Xxxxx'x. If such organization or a successor is no longer in
existence, "Rating Agency" with respect to the Class A Bonds shall be such
nationally recognized statistical rating organization, or other comparable
Person, designated by the Bond Insurer so long as no Bond Insurer Default
exists, notice of which designation shall be given to the Indenture Trustee.
References herein to the highest short term unsecured rating category of a
Rating Agency shall mean A-1 or better in the case of Standard & Poor's, and P-1
or better in the case of Xxxxx'x and in the case of any other Rating Agency
shall mean such equivalent ratings. References herein to the highest long-term
rating category of a Rating Agency shall mean "AAA" in the case of Standard &
Poor's and "Aaa" in the case of Xxxxx'x and in the case of any other Rating
Agency, such equivalent rating.
REALIZED LOSS: With respect to each Mortgage Loan (or REO
Property) as to which a Cash Liquidation or REO Disposition has occurred, an
amount (not less than zero) equal to (i) the Stated Principal Balance of the
Mortgage Loan (or REO Property) as of the date of Cash Liquidation or REO
Disposition, plus (ii) interest (and REO Imputed Interest, if any) at the Net
Mortgage Rate from the Due Date as to which interest was last paid or advanced
to Bondholders up to the last day of the month in which the Cash Liquidation (or
REO Disposition) occurred on the Stated Principal Balance of such Mortgage Loan
(or REO Property) outstanding during each Due Period that such interest was not
paid or advanced, minus (iii) the proceeds, if any, received during the month in
which such Cash Liquidation (or REO Disposition) occurred, to the extent applied
as recoveries of interest at the Net Mortgage Rate and to principal of the
Mortgage Loan, net of the portion thereof reimbursable to the Master Servicer or
any Subservicer with respect to related Advances or expenses as to which the
Master Servicer or any Subservicer is entitled to reimbursement thereunder but
which have not been previously reimbursed. With respect to each Mortgage Loan
which has become the subject of a Deficient Valuation, the difference between
the principal balance of the Mortgage Loan outstanding immediately prior to such
Deficient Valuation and the principal balance of the Mortgage Loan as reduced by
the Deficient Valuation. With respect to each Mortgage Loan which has become the
object of a Debt Service Reduction, the amount of such Debt Service Reduction.
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RECORD DATE: With respect to the Bonds, other than the Class
A-IO Bonds, and any Payment Date, the close of business on the Business Day
immediately preceding such Payment Date. With respect to the Class A-IO Bonds
and any Payment Date, the close of business on the last Business Day of the
calendar month preceding such Payment Date.
REFERENCE BANKS: Any leading banks selected by the Indenture
Trustee after consultation with the Master Servicer and the Bond Insurer and
engaged in transactions in Eurodollar deposits in the international Eurocurrency
market (i) with an established place of business in London, (ii) whose
quotations appear on the Telerate Screen Page 3750 on the Interest Determination
Date in question, (iii) which have been designated as such by the Indenture
Trustee after consultation with the Master Servicer and the Bond Insurer, and
(iv) which are not Affiliates of the Depositor or the Seller.
REGISTERED HOLDER: The Person in whose name a Bond is
registered in the Bond Register on the applicable Record Date.
RELATED DOCUMENTS: With respect to each Mortgage Loan, the
documents specified in Section 2.1(b) of the Mortgage Loan Sale and Contribution
Agreement and any documents required to be added to such documents pursuant to
the Mortgage Loan Sale and Contribution Agreement, the Trust Agreement,
Indenture or the Servicing Agreement.
RELIEF ACT: The Soldiers' and Sailors' Civil Relief Act of
1940, as amended.
RELIEF ACT SHORTFALL: As to any Payment Date and any Mortgage
Loan (other than a Mortgage Loan relating to an REO Property), any shortfalls
relating to the Relief Act or similar legislation or regulations.
REMITTANCE REPORT: The report prepared by the Master Servicer
pursuant to Section 4.01 of the Servicing Agreement.
REO ACQUISITION: The acquisition by the Master Servicer on
behalf of the Indenture Trustee for the benefit of the Bondholders of any REO
Property pursuant to Section 3.13 of the Servicing Agreement.
REO DISPOSITION: As to any REO Property, a determination by
the Master Servicer that it has received substantially all Insurance Proceeds,
Liquidation Proceeds, REO Proceeds and other payments and recoveries (including
proceeds of a final sale) which the Master Servicer expects to be finally
recoverable from the sale or other disposition of the REO Property.
REO IMPUTED INTEREST: As to any REO Property, for any period,
an amount equivalent to interest (at the Net Mortgage Rate that would have been
applicable to the related Mortgage Loan had it been Outstanding) on the unpaid
principal balance of the Mortgage Loan as of the date of acquisition thereof for
such period as such balance is reduced pursuant to Section 3.13 of the Servicing
Agreement by any income from the REO Property treated as a recovery of
principal.
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REO PROCEEDS: Proceeds, net of expenses, received in respect
of any REO Property (including, without limitation, proceeds from the rental of
the related Mortgaged Property) which proceeds are required to be deposited into
the Collection Account only upon the related REO Disposition.
REO PROPERTY: A Mortgaged Property that is acquired by the
Issuer by foreclosure or by deed in lieu of foreclosure.
REPURCHASE EVENT: With respect to any Mortgage Loan, either
(i) a discovery that, as of the Closing Date, the related Mortgage was not a
valid first lien on the related Mortgaged Property, or (ii) with respect to any
Mortgage Loan as to which the Seller delivers an affidavit certifying that the
original Mortgage Note has been lost or destroyed, a subsequent default on such
Mortgage Loan if the enforcement thereof or of the related Mortgage is
materially and adversely affected by the absence of such original Mortgage Note.
REPURCHASE PRICE: With respect to any Mortgage Loan required
to be repurchased on any date pursuant to the Mortgage Loan Sale and
Contribution Agreement or purchased by the Master Servicer pursuant to the
Servicing Agreement, an amount equal to the sum, without duplication, of (i)
100% of the Stated Principal Balance thereof (without reduction for any amounts
charged off) and (ii) unpaid accrued interest at the Mortgage Rate on the
outstanding principal balance thereof from the Due Date to which interest was
last paid by the Mortgagor to the first day of the month following the month of
purchase plus (iii) the amount of unreimbursed Advances or unreimbursed
Servicing Advances made with respect to such Mortgage Loan plus (iv) any other
amounts owed to the Master Servicer or any Subservicer pursuant to Section 3.07
of the Servicing Agreement and not included in clause (iii) of this definition.
RESERVE INTEREST RATE: With respect to any Interest
Determination Date, the rate per annum that the Indenture Trustee determines to
be either (i) the arithmetic mean (rounded upwards if necessary to the nearest
whole multiple of 0.0625%) of the one-month United States dollar lending rates
which New York City banks selected by the Indenture Trustee are quoting on the
relevant Interest Determination Date to the principal London offices of leading
banks in the London interbank market or (ii) in the event that the Indenture
Trustee can determine no such arithmetic mean, the lowest one-month United
States dollar lending rate which New York City banks selected by the Indenture
Trustee are quoting on such Interest Determination Date to leading European
banks.
RESPONSIBLE OFFICER: With respect to the Indenture Trustee,
any officer of the Indenture Trustee with direct responsibility for the
administration of the Indenture and also, with respect to a particular matter,
any other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
ROLLING DELINQUENCY PERCENTAGE: For any Payment Date, the
average of the Delinquency Percentages for the Mortgage Loans as of the last day
of each of the six (or 1, 2, 3, 4, and 5 in the case of the first five Payment
Dates, as applicable) most recently ended Due Periods.
SECURITIES ACT: The Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
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SECURITIES INTERMEDIARY: Deutsche Bank National Trust Company,
or its successors and assigns.
SECURITY: Any of the Certificates or Bonds.
SECURITYHOLDER or HOLDER: Any Bondholder or a
Certificateholder.
SECURITY INSTRUMENT: A written instrument creating a valid
first lien or second 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.
SELLER: Impac Mortgage Holdings, Inc., a Maryland corporation,
and its successors and assigns.
SELLER GUARANTEE: The Guaranty Agreement of Impac Mortgage
Holdings, Inc. of payments to the Issuer, attached as Exhibit G to the
Indenture.
SERVICING ACCOUNT: The separate trust account created and
maintained by the Master Servicer or each Subservicer with respect to the
Mortgage Loans or REO Property, which shall be an Eligible Account, for
collection of taxes, assessments, insurance premiums and comparable items as
described in Section 3.08 of the Servicing Agreement.
SERVICING ADVANCES: All customary, reasonable and necessary
"out of pocket"costs and expenses incurred in connection with a default,
delinquency or other unanticipated event in the performance by the Master
Servicer or any Subservicer of its servicing obligations, including, without
duplication, but not limited to, the cost of (i) the preservation, restoration
and protection of a Mortgaged Property, (ii) any enforcement or judicial
proceedings, including foreclosures and any expenses incurred in relation to any
such proceedings that result from the Mortgage Loan being registered on the MERS
System, (iii) the management and liquidation of any REO Property and (iv)
compliance with the obligations under Sections 3.10, 3.11, 3.13 of the Servicing
Agreement.
SERVICING AGREEMENT: The Servicing Agreement dated as of
August 28, 2002, among the Master Servicer, the Issuer and the Indenture
Trustee.
SERVICING CERTIFICATE: A certificate completed and executed by
a Servicing Officer on behalf of the Master Servicer in accordance with Section
4.01 of the Servicing Agreement.
SERVICING DEFAULT: The meaning assigned in Section 6.01 of the
Servicing Agreement.
SERVICING FEE: The sum of the Master Servicing Fee and the
Subservicing Fee.
SERVICING FEE RATE: The sum of the Master Servicing Fee Rate
and the related Subservicing Fee Rate.
SERVICING OFFICEr: Any officer of the Master Servicer involved
in, or responsible for, the administration and servicing of the Mortgage Loans
whose name and specimen signature appear
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on a list of servicing officers furnished to the Indenture Trustee by the Master
Servicer, as such list may be amended from time to time.
SIXTY DAY ROLLING DELINQUENCY PERCENTAGE: For any Payment
Date, the three month average of the aggregate Stated Principal Balance of the
Mortgage Loans that are 60 or more days delinquent, in bankruptcy, in
foreclosure or converted to REO Properties as of the close of business on the
last day of the preceding calendar month. For purposes of the foregoing
calculations, a mortgage loan is considered "60 days" delinquent if a payment
due on the first day of a month has not been received by the second day of the
second following month.
SPECIAL CERTIFICATE CAP CONTRACT: The Confirmation together
with the associated ISDA Master Agreement, delivered to the Indenture Trustee on
the Closing Date and attached to the Indenture as Exhibit F.
STANDARD & POOR'S: Standard & Poor's, a division of The
XxXxxx-Xxxx Companies, Inc., or its successor in interest.
STATED PRINCIPAL BALANCE: With respect to any Mortgage Loan or
related REO Property as of any date of determination, (i) the principal balance
of the Mortgage Loan outstanding as of the Cut-Off Date, after application of
all scheduled Monthly Payments due on or before such date, whether or not
received, minus (ii) the sum of (a) the principal portion of the Monthly
Payments due with respect to such Mortgage Loan or REO Property during each Due
Period ending prior to the most recent Payment Date which were received or with
respect to which an Advance was made, (b) all Principal Prepayments with respect
to such Mortgage Loan or REO Property, and all Insurance Proceeds, Liquidation
Proceeds and REO Proceeds to the extent applied by the Master Servicer as
recoveries of principal in accordance with Section 3.13 of the Servicing
Agreement with respect to such Mortgage Loan or REO Property, which were
distributed pursuant to Section 3.05 of the Indenture on any previous Payment
Date, and (c) the principal portion of any Realized Loss with respect thereto
allocated pursuant to Section 3.30 of the Indenture for any previous Payment
Date.
STEP-DOWN DATE: The later of (i) the Payment Date in September
2005 and (ii) the first Payment Date for which the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period, and after reduction for
Realized Losses incurred during the related Prepayment Period) is equal to or
less than 50% of the Cut-off Date Principal Balance.
STEP-UP DATE: The first Payment Date following the earlier of
(i) the first Payment Date for which the Issuer can cause the redemption of the
Bonds pursuant to Section 8.07 of the Indenture and (ii) the Payment Date in
September 2012.
SUBSERVICER: Any Person with whom the Master Servicer has
entered into a Subservicing Agreement as a Subservicer and acceptable to the
Bond Insurer, including the Initial Subservicers.
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SUBSERVICING ACCOUNT: An Eligible Account established or
maintained by a Subservicer as provided for in Section 3.06(e) of the Servicing
Agreement.
SUBSERVICING AGREEMENT: The written contract between the
Master Servicer and any Subservicer relating to servicing and administration of
certain Mortgage Loans as provided in Section 3.02 of the Servicing Agreement.
SUBSERVICING FEE: With respect to each Mortgage Loan and any
Payment Date, the fee payable monthly to the subservicer in respect of servicing
compensation that accrues at an annual rate equal to the Subservicing Fee Rate
multiplied by the Stated Principal Balance of such Mortgage Loan as of the
related Due Date in the related Due Period.
SUBSERVICING FEE RATE: With Mortgage Loan, 0.375% per annum.
SUBSTITUTION ADJUSTMENT AMOUNT: With respect to any Eligible
Substitute Mortgage Loan, the amount as defined in Section 2.03 of the Servicing
Agreement.
TELERATE SCREEN PAGE 3750: The display designated as page 3750
on the Telerate Service (or such other page as may replace page 3750 on that
service for the purpose of displaying London interbank offered rates of major
banks).
TREASURY REGULATIONS: Regulations, including proposed or
temporary Regulations, promulgated under the Code. References herein to specific
provisions of proposed or temporary regulations shall include analogous
provisions of final Treasury Regulations or other successor Treasury
Regulations.
TRIGGER EVENT: A Trigger Event is in effect with respect to
any Payment Date if
(1) in the case of any Payment Date after the 36th Payment
Date, the three month average of the aggregate principal balance of mortgage
loans that are 60 or more days delinquent (including for this purpose any such
mortgage loans in bankruptcy or foreclosure and mortgage loans with respect to
which the related mortgaged property has been acquired by the trust) as of the
close of business on the last day of the preceding calendar month exceeds 4.00%
of the aggregate Stated Principal Balance of the mortgage loans; or
(2) (a) in the case of any Payment Date after the 36th Payment
Date and on or before the 48th Payment Date, the cumulative amount of Realized
Losses incurred on the mortgage loans from the Cut-off Date through the end of
the calendar month immediately preceding such Payment Date exceeds 0.50% of the
Cut-off Date Balance, (b) in the case of any Payment Date after the 48th Payment
Date and on or before the 60th Payment Date, the cumulative amount of Realized
Losses incurred on the mortgage loans from the Cut-off Date through the end of
the calendar month immediately preceding such Payment Date exceeds 1.00% of the
Cut-off Date Balance, (c) in the case of any Payment Date after the 60th Payment
Date and on or before the 72nd Payment Date, the cumulative amount of Realized
Losses incurred on the mortgage loans from the Cut-off Date through the end of
the calendar month immediately preceding such Payment Date exceeds 1.50% of the
Cut- off Date Balance and (d) in the case of any Payment Date after the 72nd
Payment Date, the
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cumulative amount of Realized Losses incurred on the mortgage loans from the
Cut-off Date through the end of the calendar month immediately preceding such
Payment Date exceeds 1.75% of the Cut- off Date Balance.
For purposes of the foregoing calculations, a Mortgage Loan is considered "60
days" and "90 days" delinquent if a payment due on the first day of a month has
not been received by the second day of the second following month and third
following month, respectively.
TRUST: The Impac CMB Trust Series 2002-5 to be created
pursuant to the Trust Agreement.
TRUST AGREEMENT: The Amended and Restated Trust Agreement
dated as of August 28, 2002, among the Owner Trustee, the Depositor and Deutsche
Bank National Trust Company, as certificate registrar and certificate paying
agent, relating to the Trust.
TRUST ESTATE: The meaning specified in the Granting Clause of
the Indenture.
TRUST INDENTURE ACT OR TIA: The Trust Indenture Act of 1939,
as amended from time to time, as in effect on any relevant date.
UCC: The Uniform Commercial Code, as amended from time to
time, as in effect in any specified jurisdiction.
UNDERCOLLATERALIZATION AMOUNT: With respect to any Payment
Date, the amount by which the aggregate Bond Principal Balance of the Class A-1
Bonds exceeds the aggregate Stated Principal Balance of the Mortgage Loans
immediately following such Payment Date.
UNDERWRITERS: Countrywide Securities Corporation and Xxxxxx
Brothers Inc., or their successors.
UNINSURED CAUSE: Any cause of damage to property subject to a
Mortgage that the complete restoration of such property is not fully
reimbursable by the hazard insurance policies.
UNPAID INTEREST SHORTFALL: For each class of Bonds and any
Payment Date, such Bonds' pro rata share, based on the amount of Accrued Bond
Interest otherwise payable on such Bond on such Payment Date, of (a) any
Prepayment Interest Shortfalls, to the extent not covered by Compensating
Interest, and (b) any Relief Act Shortfalls, plus interest on the amount of
previously allocated Unpaid Interest Shortfall on such class of Bonds which
remains unreimbursed, at the Bond Interest Rate for such class for the related
Accrual Period.
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