EXHIBIT 4
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XXXXX FARGO ASSET SECURITIES CORPORATION,
Depositor
XXXXX FARGO BANK, N.A.,
Servicer
XXXXX FARGO BANK, N.A.,
Securities Administrator
and
HSBC Bank USA, National Association,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of June 29, 2005
Home Equity Asset-Backed Certificates, Series 2005-1
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms..................................................4
Section 1.02 Accounting....................................................58
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.................................
Section 2.02 Acceptance by Custodian......................................
Section 2.03 Repurchase or Substitution of Mortgage Loans by the
Depositor....................................................
Section 2.04 Representations and Warranties of the Depositor with
respect to the Mortgage Loans................................
Section 2.05 Representations, Warranties and Covenants of the Servicer....
Section 2.06 Representations and Warranties of the Depositor..............
Section 2.07 Issuance of Certificates and the Uncertificated Regular
Interests....................................................
Section 2.08 Optional Substitution of Mortgage Loans......................
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer..................................
Section 3.02 Collection of Mortgage Loan Payments.........................
Section 3.03 Realization Upon Defaulted Mortgage Loans....................
Section 3.04 Collection Account, Distribution Account and Reserve
Accounts.....................................................
Section 3.05 Permitted Withdrawals From the Collection Account............
Section 3.06 Establishment of Escrow Accounts; Deposits in Escrow
Accounts.....................................................
Section 3.07 Permitted Withdrawals From Escrow Account....................
Section 3.08 Payment of Taxes, Insurance and Other Charges;
Collections Thereunder; Primary Mortgage Insurance...........
Section 3.09 Transfer of Accounts.........................................
Section 3.10 Maintenance of Hazard Insurance..............................
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy..........
Section 3.12 Fidelity Bond, Errors and Omissions Insurance................
Section 3.13 Title, Management and Disposition of REO Property............
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements...................................................
Section 3.15 Duties of the Credit Risk Manager............................
Section 3.16 Optional Purchases of 60+ Day Delinquent Loans...............
Section 3.17 Trustee to Cooperate; Release of Files.......................
Section 3.18 Servicing Compensation.......................................
Section 3.19 Annual Statement as to Compliance............................
Section 3.20 Annual Independent Certified Public Accountants' Reports.....
Section 3.21 Access to Certain Documentation and Information Regarding
the Mortgage Loans...........................................
Section 3.22 Obligations of the Servicer in Respect of Compensating
Interest.....................................................
Section 3.23 Investment of Funds in the Collection Account and the
Distribution Account.........................................
Section 3.24 Liability of Servicer; Indemnification.......................
Section 3.25 Reports of Foreclosure and Abandonment of Mortgaged
Properties...................................................
Section 3.26 Limitation of Liability of the Credit Risk Manager...........
Section 3.27 No Personal Solicitation.....................................
Section 3.28 Periodic Filings.............................................
ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions.......................................
Section 4.02 Distributions of Principal and Monthly Excess Cashflow
Amounts......................................................
Section 4.03 Allocation of Losses.........................................
Section 4.04 Method of Distribution.......................................
Section 4.05 Distributions on Book-Entry Certificates.....................
Section 4.06 Statements...................................................
Section 4.07 Remittance Reports; Advances.................................
Section 4.08 REMIC Distributions..........................................
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.............................................
Section 5.02 Registration of Transfer and Exchange of Certificates........
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates............
Section 5.04 Persons Deemed Owners........................................
Section 5.05 Appointment of Paying Agent..................................
ARTICLE VI
THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Servicer and the Depositor..................
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer or the Depositor................
Section 6.03 Limitation on Liability of the Servicer and Others...........
Section 6.04 Servicer Not to Resign.......................................
Section 6.05 Delegation of Duties.........................................
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination...............................
Section 7.02 Trustee to Act; Appointment of Successor.....................
Section 7.03 Waiver of Defaults...........................................
Section 7.04 Notification to Certificateholders...........................
Section 7.05 Survival of Servicer Liabilities.............................
ARTICLE VIII
THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
Section 8.01 Duties of Trustee and Securities Administrator...............
Section 8.02 Certain Matters Affecting the Trustee and the Securities
Administrator................................................
Section 8.03 Trustee and Securities Administrator Not Liable for
Certificates or Mortgage Loans...............................
Section 8.04 Trustee and Securities Administrator May Own Certificates....
Section 8.05 Trustee and Securities Administrator Fees and Expenses.......
Section 8.06 Eligibility Requirements for Trustee and Securities
Administrator................................................
Section 8.07 Resignation or Removal of Trustee and Securities
Administrator................................................
Section 8.08 Successor Trustee and Successor Securities Administrator.....
Section 8.09 Merger or Consolidation of Trustee or Securities
Administrator................................................
Section 8.10 Appointment of Co-Trustee or Separate Trustee................
Section 8.11 Limitation of Liability......................................
Section 8.12 Trustee or Securities Administrator May Enforce Claims
Without Possession of Certificates...........................
Section 8.13 Suits for Enforcement........................................
Section 8.14 Waiver of Bond Requirement...................................
Section 8.15 Waiver of Inventory, Accounting and Appraisal Requirement....
Section 8.16 Appointment of Custodian.....................................
ARTICLE IX
REMIC AND GRANTOR TRUST ADMINISTRATION
Section 9.01 REMIC Administration.........................................
Section 9.02 Prohibited Transactions and Activities.......................
Section 9.03 Indemnification with Respect to Certain Taxes and Loss of
REMIC Status.................................................
Section 9.04 REO Property.................................................
Section 9.05 Grantor Trust Administration.................................
ARTICLE X
TERMINATION
Section 10.01 Termination..................................................
Section 10.02 Additional Termination Requirements..........................
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment....................................................
Section 11.02 Recordation of Agreement; Counterparts.......................
Section 11.03 Limitation on Rights of Certificateholders...................
Section 11.04 Governing Law; Jurisdiction..................................
Section 11.05 Notices......................................................
Section 11.06 Severability of Provisions...................................
Section 11.07 Article and Section References...............................
Section 11.08 Notice to the Rating Agencies................................
Section 11.09 Further Assurances...........................................
Section 11.10 Benefits of Agreement........................................
Section 11.11 Acts of Certificateholders...................................
EXHIBITS:
Exhibit A-AI-1A Form of Class AI-1A Certificates
Exhibit A-AI-1B Form of Class AI-1B Certificates
Exhibit A-AII-1 Form of Class AII-1 Certificates
Exhibit B-1 Form of Class M-1 Certificates
Exhibit B-2 Form of Class M-2 Certificates
Exhibit B-3 Form of Class M-3 Certificates
Exhibit B-4 Form of Class M-4 Certificates
Exhibit B-5 Form of Class M-5 Certificates
Exhibit B-6 Form of Class M-6 Certificates
Exhibit B-7 Form of Class M-7 Certificates
Exhibit B-8 Form of Class M-8 Certificates
Exhibit B-9 Form of Class M-9 Certificates
Exhibit B-10 Form of Class M-10 Certificates
Exhibit B-11 Form of Class M-11 Certificates
Exhibit B-12 Form of Class M-12 Certificates
Exhibit B-13 Form of Class M-13 Certificates
Exhibit B-14 Form of Class M-14 Certificates
Exhibit C-1 Form of Class CE Certificates
Exhibit C-2 Form of Class P Certificates
Exhibit C-3 Form of Class R Certificates
Exhibit D-1 Group I Mortgage Loan Schedule
Exhibit D-2 Group II Mortgage Loan Schedule
Exhibit E Form of Request for Release
Exhibit F-1 Form of Custodian's Initial Certification
Exhibit F-2 Form of Custodian's Final Certification
Exhibit G Mortgage Loan Purchase Agreement
Exhibit H Form of Lost Note Affidavit
Exhibit I Form of ERISA Representation
Exhibit J-1 Form of Investment Letter (Non-Rule 144A)
Exhibit J-2 Form of Rule 144A Investment Letter
Exhibit K Form of Class R Certificate Transfer Affidavit
Exhibit L-1 Form of Transferor Certificate for the Class CE, Class P
and Class R Certificates
Exhibit L-2 Form of Transferor Certificate for the Class M-12, Class
M-13 and Class M-14 Certificates
Exhibit M Monthly Information Provided by Servicer
Exhibit N-1 Form of Class AI Yield Maintenance Agreement
Exhibit N-2 Form of Class AII Yield Maintenance Agreement
Exhibit N-3 Form of Class M Yield Maintenance Agreement
Exhibit O Form of Certification
Exhibit P Form of Certification of the Securities Administrator
to be Provided to Servicer
Exhibit Q List of Recordation States
Exhibit R Prepayment Penalty Matrices
This Pooling and Servicing Agreement is dated as of June 29, 2005
(the "Agreement"), among XXXXX FARGO ASSET SECURITIES CORPORATION, as depositor
(the "Depositor"), XXXXX FARGO BANK, N.A., as servicer (the "Servicer"), XXXXX
FARGO BANK, N.A., as securities administrator (the "Securities Administrator")
and HSBC BANK USA, NATIONAL ASSOCIATION, as trustee (the "Trustee").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple Classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust Fund created hereunder. The Certificates will consist of twenty
Classes of Certificates, designated as (i) the Class AI-1A, Class AI-1B and
Class AII-1 Certificates, (ii) the Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10, Class M-11,
Class M-12, Class M-13 and Class M-14 Certificates, (iii) the Class CE
Certificates, (iv) the Class P Certificates and (v) the Class R Certificate.
REMIC 1
As provided herein, the Trustee will make an election to treat the
segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement (but exclusive of the Yield Maintenance
Agreements, the Reserve Funds, the Cap Carryover Amounts, the Prepayment
Penalties, the Servicer Prepayment Penalty Payment Amounts and the Originator
Prepayment Penalty Payment Amounts) as a real estate investment conduit (a
"REMIC") for federal income tax purposes, and such segregated pool of assets
will be designated as "REMIC 1." The Class R-1 Interest will represent the sole
class of "residual interests" in REMIC 1 for purposes of the REMIC Provisions
under federal income tax law. The following table irrevocably sets forth the
designation, the Uncertificated REMIC 1 Pass-Through Rate, the initial
Uncertificated Principal Balance, and solely for purposes of satisfying Treasury
Regulations Section 1.860G-1(a)(4)(iii), the "latest possible maturity date" for
each of the REMIC 1 Regular Interests. None of the REMIC 1 Regular Interests
will be certificated.
Uncertificated Initial
REMIC 1 Uncertificated Latest Possible
Designation Pass-Through Rate Principal Balance Maturity Date(1)
----------- ----------------- ----------------- ----------------
LT1AA Variable(2) $615,442,262.33 June 25, 2035
LT1AI1A Variable(2) $2,663,050.00 June 25, 2035
LT1AI1B Variable(2) $665,765.00 June 25, 2035
LT1AII1 Variable(2) $1,927,560.00 June 25, 2035
LT1M1 Variable(2) $160,140.00 June 25, 2035
LT1M2 Variable(2) $150,725.00 June 25, 2035
LT1M3 Variable(2) $91,060.00 June 25, 2035
LT1M4 Variable(2) $78,500.00 June 25, 2035
LT1M5 Variable(2) $72,220.00 June 25, 2035
LT1M6 Variable(2) $62,800.00 June 25, 2035
LT1M7 Variable(2) $62,800.00 June 25, 2035
LT1M8 Variable(2) $43,960.00 June 25, 2035
LT1M9 Variable(2) $62,800.00 June 25, 2035
LT1M10 Variable(2) $62,800.00 June 25, 2035
LT1M11 Variable(2) $37,680.00 June 25, 2035
LT1M12 Variable(2) $47,100.00 June 25, 2035
LT1M13 Variable(2) $25,120.00 June 25, 2035
LT1M14 Variable(2) $18,840.00 June 25, 2035
LT1ZZ Variable(2) $6,327,126.17 June 25, 2035
LT1SUB Variable(2) $12,965.31 June 25, 2035
LT1GRP Variable(2) $79,541.61 June 25, 2035
LT2SUB Variable(2) $7,507.65 June 25, 2035
LT2GRP Variable(2) $46,058.85 June 25, 2035
LT1XX Variable(2) $627,856,235.08 June 25, 2035
(1) Solely for purposes of Treasury Regulations Section 1.860G-1(a)(4)(iii),
the Distribution Date immediately following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for each REMIC 1 Regular Interest.
(2) Calculated in accordance with the definition of "Uncertificated REMIC 1
Pass-Through Rate" herein.
REMIC 2
As provided herein, the Trustee shall make an election to treat the
segregated pool of assets consisting of the REMIC 1 Regular Interests as a REMIC
for federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC 2." The Class R-2 Interest represents the sole class of
"residual interests" in REMIC 2 for purposes of the REMIC Provisions.
The following table sets forth (or describes) the Class designation,
Original Principal Balance, the Pass-Through Rate and Assumed Final Maturity
Dates for each Class of Certificates comprising the interests in the Trust Fund
created hereunder:
Original Pass-Through Assumed Final
Class Principal Balance Rate Maturity Dates*
----- ----------------- ------------ ------------------
AI-1A $532,610,000.00 (1) April 25, 2035
AI-1B $133,153,000.00 (2) April 25, 2035
AII-1 $385,512,000.00 (3) April 25, 2035
M-1 $32,028,000.00 (4) February 25, 2035
M-2 $30,145,000.00 (5) February 25, 2035
M-3 $18,212,000.00 (6) January 25, 2035
M-4 $15,700,000.00 (7) January 25, 2035
M-5 $14,444,000.00 (8) December 25, 2034
M-6 $12,560,000.00 (9) November 25, 2034
M-7 $12,560,000.00 (10) October 25, 2034
M-8 $8,792,000.00 (11) September 25, 2034
M-9 $12,560,000.00 (12) August 25, 2034
M-10 $12,560,000.00 (13) June 25, 2034
M-11 $7,536,000.00 (14) February 25, 2034
M-12 $9,420,000.00 (15) October 25, 2033
M-13 $5,024,000.00 (16) November 25, 2032
M-14 $3,768,000.00 (17) November 25, 2031
CE (18) (18) N/A
P X/X X/X X/X
X X/X X/X X/X
Total $1,246,584,000.00
* Solely for purposes of Treasury Regulations Section 1.860G-1(a)(4)(iii),
the Distribution Date following the maturity date for the Mortgage Loan
with the latest maturity date has been designated as the "latest possible
maturity date" for each Class of Certificates that represents one or more
of the "regular interests" in REMIC 2.
(1) The Pass-Through Rate for the Class AI-1A Certificates during each
Interest Accrual Period is equal to the lesser of: (i) the Class AI-1A
Formula Rate and (ii) the Group I Cap for such Distribution Date.
(2) The Pass-Through Rate for the Class AI-1B Certificates during each
Interest Accrual Period is equal to the lesser of: (i) the Class AI-1B
Formula Rate and (ii) the Group I Cap for such Distribution Date.
(3) The Pass-Through Rate for the Class AII-1 Certificates during each
Interest Accrual Period is equal to the lesser of: (i) the Class AII-1
Formula Rate and (ii) the Group II Cap for such Distribution Date.
(4) The Pass-Through Rate for the Class M-1 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-1 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(5) The Pass-Through Rate for the Class M-2 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-2 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(6) The Pass-Through Rate for the Class M-3 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-3 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(7) The Pass-Through Rate for the Class M-4 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-4 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(8) The Pass-Through Rate for the Class M-5 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-5 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(9) The Pass-Through Rate for the Class M-6 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-6 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(10) The Pass-Through Rate for the Class M-7 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-7 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(11) The Pass-Through Rate for the Class M-8 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-8 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(12) The Pass-Through Rate for the Class M-9 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-9 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(13) The Pass-Through Rate for the Class M-10 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-10 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(14) The Pass-Through Rate for the Class M-11 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-11 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(15) The Pass-Through Rate for the Class M-12 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-12 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(16) The Pass-Through Rate for the Class M-13 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-13 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(17) The Pass-Through Rate for the Class M-14 Certificates during each Interest
Accrual Period is equal to the lesser of: (i) the Class M-14 Formula Rate
and (ii) the Pool Cap for such Distribution Date.
(18) Solely for REMIC purposes, the Class CE Certificates will (i) have an
Original Principal Balance equal to the Initial Overcollateralization
Amount (but will not bear interest on such amount) and (ii) will bear
interest on their Notional Amount.
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement or in the Preliminary Statement, the
following words and phrases, unless the context otherwise requires, shall have
the meanings specified in this Article. Interest on all Regular Certificates
will be calculated on the basis of the actual number of days in the related
Interest Accrual Period and a 360-day year.
"1933 Act": The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan": Each Mortgage Loan (including each
Mortgage Loan in foreclosure and each Mortgage Loan for which the Mortgagor has
filed for bankruptcy after the Closing Date) with respect to which any portion
of a Monthly Payment is, as of the last day of the prior Collection Period, two
months or more past due and each Mortgage Loan relating to an REO Property.
"Account": Any of the Collection Account, the Distribution Account,
the Class AI Reserve Account, the Class AII Reserve Account, the Class M Reserve
Account or the Escrow Account.
"Accrued Certificate Interest": With respect to each Distribution
Date and Class of Certificates (other than the Class CE, Class P and Class R
Certificates), an amount equal to the interest accrued at the Pass-Through Rate
set forth or described for such Class in the table in the Preliminary Statement
during the related Interest Accrual Period on the Principal Balance of such
Class of Certificates, reduced by such Class' Interest Percentage of any Current
Interest Shortfall Amount for such Distribution Date.
"Adjustable Rate Mortgage Loan": A Mortgage Loan which has a rate at
which interest accrues that adjusts based on the applicable Index plus a related
Gross Margin, as set forth and subject to the limitations in the related
Mortgage Note.
"Adjustment Date": With respect to each Adjustable-Rate Mortgage
Loan, each adjustment date on which the Mortgage Interest Rate changes pursuant
to the related Mortgage Note. The first Adjustment Date following the applicable
Cut-off Date as to each Adjustable Rate Mortgage Loan is set forth in the
Mortgage Loan Schedules.
"Advance": As to any Mortgage Loan, any advance made by the Servicer
in respect of any Distribution Date pursuant to Section 4.07 or if the Servicer
fails to make any advance, by the Trustee pursuant to Section 7.01.
"Adverse REMIC Event": As defined in Section 9.01(f) hereof.
"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.
"Agreement": This Pooling and Servicing Agreement and all amendments
and supplements hereto.
"Applicable Regulations": As to any Mortgage Loan, all federal,
state and local laws, statutes, rules and regulations applicable thereto.
"Applied Realized Loss Amount": With respect to each Distribution
Date, the excess, if any, of (a) the aggregate of the Principal Balances of the
Certificates (after giving effect to all distributions on such Distribution Date
and the increase of any Principal Balances as a result of Subsequent Recoveries)
over (b) the Pool Balance as of the end of the related Collection Period.
"Assignment": 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 or
record the sale of the Mortgage.
"Assumed Final Maturity Date": As to each Class of Certificates, the
date set forth as such in the Preliminary Statement.
"Available Funds": As to any Distribution Date, an amount equal to
the excess of (i) the sum of: (a) the aggregate of the Monthly Payments due
during the related Collection Period and received on or prior to the related
Determination Date by the Servicer, (b) Liquidation Proceeds, Insurance
Proceeds, Condemnation Proceeds, Principal Prepayments, Substitution Adjustment
Amounts, the Purchase Price for any repurchased Mortgage Loan, the Termination
Price with respect to the termination of the Trust pursuant to Section 10.01
hereof and other unscheduled recoveries of principal and interest (excluding
Prepayment Penalties, Originator Prepayment Penalty Payment Amounts and Servicer
Prepayment Penalty Payment Amounts) in respect of the Mortgage Loans during the
related Prepayment Period, (c) the aggregate of any amounts received in respect
of an REO Property deposited in the Collection Account for such Distribution
Date, (d) any Compensating Interest for such Distribution Date, (e) the
aggregate of any Advances made by the Servicer or the Trustee for such
Distribution Date and (f) any Reimbursement Amount or Subsequent Recovery
deposited into the Collection Account during the related Prepayment Period over
(ii) the sum of (a) amounts reimbursable or payable to the Servicer pursuant to
Sections 3.05 or 6.03, (b) amounts reimbursable or payable to the Trustee
pursuant to Section 7.01 or Section 8.05 and amounts reimbursable or payable to
the Securities Administrator pursuant to Section 8.05 or Section 9.01(c), (c)
Stayed Funds, (d) the Servicing Fee and (e) amounts deposited in the Collection
Account or the Distribution Account, as the case may be, in error.
"Bankruptcy Code": Title 11 of the United States Code, as amended.
"Balloon Loan": A Mortgage Loan that provides for the payment of the
unamortized principal balance of such Mortgage Loan in a single payment at the
maturity of such Mortgage Loan that is substantially greater than the preceding
monthly payment.
"Balloon Payment": A payment of the unamortized principal balance of
a Mortgage Loan in a single payment at the maturity of such Mortgage Loan that
is substantially greater than the preceding Monthly Payment.
"Book-Entry Certificates": Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the ownership of which
is reflected on the books of the Depository or on the books of a Person
maintaining an account with the Depository (directly, as a "Depository
Participant," or indirectly, as an indirect participant in accordance with the
rules of the Depository and as described in Section 5.02 hereof). On the Closing
Date, the Class AI-1A, Class AI-1B, Class AII-1, Class M-1, Class M-2, Class
M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class
M-10, Class M-11, Class M-12, Class M-13 and Class M-14 Certificates shall be
Book-Entry Certificates.
"Business Day": Any day other than (i) a Saturday or a Sunday or
(ii) a legal holiday in the State of Delaware, State of New York, the State of
Maryland, the State of Minnesota, the State of Iowa or in the city in which the
Corporate Trust Office of the Trustee or the Securities Administrator is located
are authorized or obligated by law or executive order to be closed.
"Cap": Any of the Group I Cap, the Group II Cap or the Pool Cap.
"Cap Amount": With respect to any Distribution Date and (a) either
Class of Class AI Certificates, an amount equal to (i) the Class AI Yield
Maintenance Agreement Payment for such Distribution Date multiplied by (ii) a
fraction equal to (A) the Principal Balance of such Class immediately prior to
such Distribution Date divided by (B) the sum of the Principal Balances of the
Class AI Certificates immediately prior to such Distribution Date; and (b) any
Class of Class M Certificates and any Distribution Date, an amount equal to (i)
the Class M Yield Maintenance Agreement Payment for such Distribution Date
multiplied by (ii) a fraction equal to (A) the Principal Balance of such Class
immediately prior to such Distribution Date divided by (B) the sum of the
Principal Balances of the Class M Certificates immediately prior to such
Distribution Date.
"Cap Carryover Amount": If on any Distribution Date, the Accrued
Certificate Interest for any Certificate is based upon a Cap, the excess of (i)
the amount of interest such Certificate would have been entitled to receive on
such Distribution Date based on the related Formula Rate, over (ii) the amount
of interest such Certificate received on such Distribution Date based on the
related Cap, together with the unpaid portion of any such excess from prior
Distribution Dates (and interest accrued thereon at the then applicable Formula
Rate on such Certificate).
"Certificate": Any Regular Certificate or Class R Certificate.
"Certificate Custodian": Initially, Xxxxx Fargo Bank, N.A.;
thereafter any other Certificate Custodian acceptable to the Depository and
selected by the Securities Administrator.
"Certificate Owner": With respect to each Book-Entry Certificate,
any beneficial owner thereof.
"Certificate Register" and "Certificate Registrar": The register
maintained and registrar appointed pursuant to Section 5.02 hereof.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that a
Disqualified Organization or non-U.S. Person shall not be a Holder of the Class
R Certificate for any purpose hereof.
"Class": Collectively, Certificates or REMIC Regular Interests which
have the same priority of payment and bear the same class designation and the
form of which is identical except for variation in the Percentage Interest
evidenced thereby.
"Class A Certificate": Any one of the Class AI or Class AII-1
Certificates.
"Class A Certificateholders": Collectively, the Holders of the Class
A Certificates.
"Class AI Certificate": Any one of the Certificates with an "AI"
designated on the face thereof substantially in the form annexed hereto as
Exhibits A-AI-1A and A-AI-1B, executed by the Securities Administrator on behalf
of the Trust and authenticated and delivered by the Certificate Registrar,
representing the right to distributions as set forth herein and therein.
"Class AI Reserve Account": The trust account created and maintained
by the Securities Administrator pursuant to Section 3.04(g) which shall be
entitled "Class AI Reserve Account, Xxxxx Fargo Bank, N.A., as Securities
Administrator for HSBC Bank USA, National Association, as Trustee, in trust for
registered Holders of the Class AI-1A and Class A1-1B Certificates of Xxxxx
Fargo Home Equity Asset-Backed Securities 2005-1 Trust, Home Equity Asset-Backed
Certificates, Series 2005-1," and which must be an Eligible Account. Amounts on
deposit in the Class AI Reserve Account shall not be invested. The Class AI
Reserve Account shall not be an asset of either REMIC formed under this
Agreement.
"Class AI Yield Maintenance Agreement": The yield maintenance
agreement between the Securities Administrator, on behalf of the Trust, and the
Yield Maintenance Agreement Provider substantially in the form attached hereto
as Exhibit N-1. The Class AI Yield Maintenance Agreement shall not be an asset
of either REMIC formed under this Agreement.
"Class AI Yield Maintenance Agreement Payment": On each Distribution
Date through the Distribution Date in April 2008, the amount equal to the
product of (a) the excess of the lesser of (i) One-Month LIBOR and (ii) the
applicable upper strike rate for such Distribution Date over the lower strike
rate for such Distribution Date, in each case as set forth on the schedule
attached to the Class AI Yield Maintenance Agreement for such Distribution Date,
(b) the notional amount as set forth on the schedule attached to the Class AI
Yield Maintenance Agreement for such Distribution Date and (c) a fraction, the
numerator of which is the actual number of days elapsed since the previous
Distribution Date (or the Closing Date, in the case of the first Distribution
Date) to but excluding the current Distribution Date and the denominator of
which is 360.
"Class AI-1A Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 0.220% per annum, and (ii) following
the Optional Termination Date, 0.440% per annum.
"Class AI-1A Formula Rate": For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class AI-1A Certificate Margin and (b) the Group I
Maximum Rate Cap.
"Class AI-1B Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 0.280% per annum, and (ii) following
the Optional Termination Date, 0.560% per annum.
"Class AI-1B Formula Rate": For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class AI-1B Certificate Margin and (b) the Group I
Maximum Rate Cap.
"Class AII Certificate": Any one of the Certificates with an "AII"
designated on the face thereof substantially in the form annexed hereto as
Exhibit A-AII-1, executed by the Securities Administrator on behalf of the Trust
and authenticated and delivered by the Certificate Registrar, representing the
right to distributions as set forth herein and therein.
"Class AII-1 Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 0.230% per annum, and (ii) following
the Optional Termination Date, 0.460% per annum.
"Class AII-1 Formula Rate": For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class AII-1 Certificate Margin and (b) the Group II
Maximum Rate Cap.
"Class AII Reserve Account": The trust account created and
maintained by the Securities Administrator pursuant to Section 3.04(g) which
shall be entitled "Class AII Reserve Account, Xxxxx Fargo Bank, N.A., as
Securities Administrator for HSBC Bank USA, National Association, as Trustee, in
trust for registered Holders of the Class AII Certificates of Xxxxx Fargo Home
Equity Asset-Backed Securities 2005-1 Trust, Home Equity Asset-Backed
Certificates, Series 2005-1," and which must be an Eligible Account. Amounts on
deposit in the Class AII Reserve Account shall not be invested. The Class AII
Reserve Account shall not be an asset of either REMIC formed under this
Agreement.
"Class AII Yield Maintenance Agreement": The yield maintenance
agreement between the Securities Administrator, on behalf of the Trust, and the
Yield Maintenance Agreement Provider substantially in the form attached hereto
as Exhibit N-2. The Class AII Yield Maintenance Agreement shall not be an asset
of either REMIC formed under this Agreement.
"Class AII Yield Maintenance Agreement Payment": On each
Distribution Date through the Distribution Date in April 2008, the amount equal
to the product of (a) the excess of the lesser of (i) One-Month LIBOR and (ii)
the applicable upper strike rate for such Distribution Date over the applicable
lower strike rate for such Distribution Date, in each case as set forth on the
schedule attached to the Class AII Yield Maintenance Agreement for such
Distribution Date, (b) the notional amount set forth on the schedule attached to
the Class AII Yield Maintenance Agreement for such Distribution Date and (c) a
fraction, the numerator of which is the actual number of days elapsed since the
previous Distribution Date (or the Closing Date, in the case of the first
Distribution Date) to but excluding the current Distribution Date and the
denominator of which is 360.
"Class CE Certificates": Any one of the Class CE Certificates as
designated on the face thereof substantially in the form annexed hereto as
Exhibit C-1, executed by the Securities Administrator on behalf of the Trust and
authenticated and delivered by the Certificate Registrar, representing the right
to distributions as set forth herein and therein.
"Class CE Distributable Amount": With respect to any Distribution
Date, the sum of (i) the interest accrued on such Class CE Certificate at its
Pass-Through Rate calculated on its Notional Amount less the amount (without
duplication) of Cap Carryover Amounts paid pursuant to Section 4.02(b)(xlv),
(ii) any remaining Overcollateralization Release Amounts and (iii) the aggregate
of amounts remaining in the Reserve Accounts after the distributions in Section
3.04(g)(i) through (v).
"Class M Certificate": Any one of the Certificates with an "M"
designated on the face thereof substantially in the form annexed hereto as
Exhibit X-0, Xxxxxxx X-0, Xxxxxxx X-0, Exhibit X-0, Xxxxxxx X-0, Xxxxxxx X-0,
Exhibit X-0, Xxxxxxx X-0, Xxxxxxx X-0, Exhibit B-10, Exhibit B-11, Exhibit B-12,
Exhibit B-13 and Exhibit B-14, executed by the Securities Administrator on
behalf of the Trust and authenticated and delivered by the Certificate
Registrar, representing the right to distributions as set forth herein and
therein.
"Class M Certificateholders": Collectively, the Holders of the Class
M Certificates.
"Class M-1 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.410% per annum, and (ii) following the
Optional Termination Date, 0.615% per annum.
"Class M-1 Formula Rate": For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-1 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-1 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the Principal Balances of the Class A
Certificates (after taking into account the payment of the Senior Principal
Distribution Amount on such Distribution Date) and (ii) the Principal Balance of
the Class M-1 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 72.499936336094% and (ii) the Pool Balance
as of the last day of the related Collection Period and (B) the
Overcollateralization Floor.
"Class M-1 Realized Loss Amortization Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (iv) hereof, in each case
for such Distribution Date.
"Class M-2 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.430% per annum, and (ii) following the
Optional Termination Date, 0.645% per annum.
"Class M-2 Formula Rate": For each Distribution Date, a rate per
annum equal to the lesser of (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-2 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-2 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the Principal Balances of the Class A
Certificates (after taking into account the payment of the Senior Principal
Distribution Amount on such Distribution Date), (ii) the Principal Balance of
the Class M-1 Certificates (after taking into account the payment of the Class
M-1 Principal Distribution Amount on such Distribution Date) and (iii) the
Principal Balance of the Class M-2 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 77.300077927268%
and (ii) the Pool Balance as of the last day of the related Collection Period
and (B) the Overcollateralization Floor.
"Class M-2 Realized Loss Amortization Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (vii) hereof, in each
case for such Distribution Date.
"Class M-3 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.480% per annum, and (ii) following the
Optional Termination Date, 0.720% per annum.
"Class M-3 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-3 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-3 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), and (iv) the Principal Balance of the Class M-3 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
80.200067267406% and (ii) the Pool Balance as of the last day of the related
Collection Period and (B) the Overcollateralization Floor.
"Class M-3 Realized Loss Amortization Amount": As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (x) hereof, in each case
for such Distribution Date.
"Class M-4 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.610% per annum, and (ii) following the
Optional Termination Date, 0.915% per annum.
"Class M-4 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-4 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-4 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date) and (v) the Principal Balance of the Class M-4 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 82.700058077869% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Overcollateralization Floor.
"Class M-4 Realized Loss Amortization Amount": As to the Class M-4
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-4 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xiii) hereof, in each
case for such Distribution Date.
"Class M-5 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.630% per annum, and (ii) following the
Optional Termination Date, 0.945% per annum.
"Class M-5 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-5 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-5 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date) and (vi) the Principal Balance of the Class
M-5 Certificates immediately prior to such Distribution Date over (y) the lesser
of (A) the product of (i) 85.000049623496% and (ii) the Pool Balance as of the
last day of the related Collection Period and (B) the Overcollateralization
Floor.
"Class M-5 Realized Loss Amortization Amount": As to the Class M-5
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-5 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xvi) hereof, in each
case for such Distribution Date.
"Class M-6 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.660% per annum, and (ii) following the
Optional Termination Date, 0.990% per annum.
"Class M-6 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-6 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-6 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date) and (vii) the Principal Balance
of the Class M-6 Certificates immediately prior to such Distribution Date over
(y) the lesser of (A) the product of (i) 87.000042271867% and (ii) the Pool
Balance as of the last day of the related Collection Period and (B) the
Overcollateralization Floor.
"Class M-6 Realized Loss Amortization Amount": As to the Class M-6
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-6 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xix) hereof, in each
case for such Distribution Date.
"Class M-7 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 1.050% per annum, and (ii) following the
Optional Termination Date, 1.575% per annum.
"Class M-7 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-7 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-7 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date) and (viii) the
Principal Balance of the Class M-7 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 89.000034920238%
and (ii) the Pool Balance as of the last day of the related Collection Period
and (B) the Overcollateralization Floor.
"Class M-7 Realized Loss Amortization Amount": As to the Class M-7
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-7 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxii) hereof, in each
case for such Distribution Date.
"Class M-8 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 1.150% per annum, and (ii) following the
Optional Termination Date, 1.725% per annum.
"Class M-8 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-8 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-8 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (vii) the
Principal Balance of the Class M-7 Certificates (after taking into account the
payment of the Class M-7 Principal Distribution Amount on such Distribution
Date) and (viii) the Principal Balance of the Class M-8 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
90.400029774098% and (ii) the Pool Balance as of the last day of the related
Collection Period and (B) the Overcollateralization Floor.
"Class M-8 Realized Loss Amortization Amount": As to the Class M-8
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-8 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxv) hereof, in each
case for such Distribution Date.
"Class M-9 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 1.700% per annum, and (ii) following the
Optional Termination Date, 2.550% per annum.
"Class M-9 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-9 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-9 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Principal Balance of the Class M-7 Certificates (after taking into account the
payment of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the sum of the Principal Balances of the Class M-8 Certificates
(after taking into account the payment of the Class M-8 Principal Distribution
Amount on such Distribution Date) and (x) the Principal Balance of the Class M-9
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 92.400022422469% and (ii) the Pool Balance as of the last
day of the related Collection Period and (B) the Overcollateralization Floor.
"Class M-9 Realized Loss Amortization Amount": As to the Class M-9
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-9 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxviii) hereof, in each
case for such Distribution Date.
"Class M-10 Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per annum.
"Class M-10 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-10 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-10 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Principal Balance of the Class M-7 Certificates (after taking into account the
payment of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Principal Balance of the Class M-8 Certificates (after taking
into account the payment of the Class M-8 Principal Distribution Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9 Certificates
(after taking into account the payment of the Class M-9 Principal Distribution
Amount on such Distribution Date) and (xi) the Principal Balance of the Class
M-10 Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) 94.400015070840% and (ii) the Pool Balance as
of the last day of the related Collection Period and (B) the
Overcollateralization Floor.
"Class M-10 Realized Loss Amortization Amount": As to the Class M-10
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-10 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xxxi) hereof, in
each case for such Distribution Date.
"Class M-11 Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per annum.
"Class M-11 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-11 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-11 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Principal Balance of the Class M-7 Certificates (after taking into account the
payment of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the Class M-8 Certificates (after taking
into account the payment of the Class M-8 Principal Distribution Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9 Certificates
(after taking into account the payment of the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the Principal Balance of the Class M-10
Certificates (after taking into account the payment of the Class M-10 Principal
Distribution Amount on such Distribution Date) and (xii) the Principal Balance
of the Class M-11 Certificates immediately prior to such Distribution Date over
(y) the lesser of (A) the product of (i) 95.600010659862% and (ii) the Pool
Balance as of the last day of the related Collection Period and (B) the
Overcollateralization Floor.
"Class M-11 Realized Loss Amortization Amount": As to the Class M-11
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-11 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xxxiv) hereof, in
each case for such Distribution Date.
"Class M-12 Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per annum.
"Class M-12 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-12 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-12 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Principal Balance of the Class M-7 Certificates (after taking into account the
payment of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the Class M-8 Certificates (after taking
into account the payment of the Class M-8 Principal Distribution Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9 Certificates
(after taking into account the payment of the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the Principal Balance of the Class M-10
Certificates (after taking into account the payment of the Class M-10 Principal
Distribution Amount on such Distribution Date), (xii) the Principal Balance of
the Class M-11 Certificates (after taking into account the payment of the Class
M-11 Principal Distribution Amount on such Distribution Date) and (xiii) the
Principal Balance of the Class M-12 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 97.100005146140%
and (ii) the Pool Balance as of the last day of the related Collection Period
and (B) the Overcollateralization Floor.
"Class M-12 Realized Loss Amortization Amount": As to the Class M-12
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-12 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xxxvii) hereof, in
each case for such Distribution Date.
"Class M-13 Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 2.500% per annum, and (ii) following
the Optional Termination Date, 3.750% per annum.
"Class M-13 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-13 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-13 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Principal Balance of the Class M-7 Certificates (after taking into account the
payment of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the Class M-8 Certificates (after taking
into account the payment of the Class M-8 Principal Distribution Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9 Certificates
(after taking into account the payment of the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the Principal Balance of the Class M-10
Certificates (after taking into account the payment of the Class M-10 Principal
Distribution Amount on such Distribution Date), (xii) the Principal Balance of
the Class M-11 Certificates (after taking into account the payment of the Class
M-11 Principal Distribution Amount on such Distribution Date), (xiii) the
Principal Balance of the Class M-12 Certificates (after taking into account the
payment of the Class M-12 Principal Distribution Amount on such Distribution
Date) and (xiv) the Principal Balance of the Class M-13 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
97.900002205489% and (ii) the Pool Balance as of the last day of the related
Collection Period and (B) the Overcollateralization Floor.
"Class M-13 Realized Loss Amortization Amount": As to the Class M-13
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-13 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xl) hereof, in each
case for such Distribution Date.
"Class M-14 Certificate Margin": For each Distribution Date (i) on
or prior to the Optional Termination Date, 2.400% per annum, and (ii) following
the Optional Termination Date, 3.600% per annum.
"Class M-14 Formula Rate": For each Distribution Date, the lesser of
a rate per annum equal to (a) One-Month LIBOR as of the related LIBOR
Determination Date, plus the Class M-14 Certificate Margin and (b) the Pool
Maximum Rate Cap.
"Class M-14 Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the sum of (i) the sum of the Principal Balances of
the Class A Certificates (after taking into account the payment of the Senior
Principal Distribution Amount on such Distribution Date), (ii) the Principal
Balance of the Class M-1 Certificates (after taking into account the payment of
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Principal Balance of the Class M-2 Certificates (after taking into account
the payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Principal Balance of the Class M-3 Certificates (after taking
into account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Principal Balance of the Class M-4 Certificates
(after taking into account the payment of the Class M-4 Principal Distribution
Amount on such Distribution Date), (vi) the Principal Balance of the Class M-5
Certificates (after taking into account the payment of the Class M-5 Principal
Distribution Amount on such Distribution Date), (vii) the Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Principal Balance of the Class M-7 Certificates (after taking into account the
payment of the Class M-7 Principal Distribution Amount on such Distribution
Date), (ix) the Principal Balances of the Class M-8 Certificates (after taking
into account the payment of the Class M-8 Principal Distribution Amount on such
Distribution Date), (x) the Principal Balance of the Class M-9 Certificates
(after taking into account the payment of the Class M-9 Principal Distribution
Amount on such Distribution Date), (xi) the Principal Balance of the Class M-10
Certificates (after taking into account the payment of the Class M-10 Principal
Distribution Amount on such Distribution Date), (xii) the Principal Balance of
the Class M-11 Certificates (after taking into account the payment of the Class
M-11 Principal Distribution Amount on such Distribution Date), (xiii) the
Principal Balance of the Class M-12 Certificates (after taking into account the
payment of the Class M-12 Principal Distribution Amount on such Distribution
Date), (xiv) the Principal Balance of the Class M-13 Certificates (after taking
into account the payment of the Class M-13 Principal Distribution Amount on such
Distribution Date) and (xv) the Principal Balance of the Class M-14 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 98.500000000000% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Overcollateralization Floor.
"Class M-14 Realized Loss Amortization Amount": As to the Class M-14
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-14 Certificates as of such Distribution
Date and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the
sum of the amounts described in Section 4.02(b)(i) through (xliii) hereof, in
each case for such Distribution Date.
"Class M Reserve Account": The trust account created and maintained
by the Securities Administrator pursuant to Section 3.04(g) which shall be
entitled "Class M Reserve Account, Xxxxx Fargo Bank, N.A., as Securities
Administrator for HSBC Bank USA, National Association, as Trustee, in trust for
registered Holders of the Class M Certificates of Xxxxx Fargo Home Equity
Asset-Backed Securities 2005-1 Trust, Home Equity Asset-Backed Certificates,
Series 2005-1," and which must be an Eligible Account. Amounts on deposit in the
Class M Reserve Account shall not be invested. The Class M Reserve Account shall
not be an asset of either REMIC formed under this Agreement.
"Class M Yield Maintenance Agreement": The yield maintenance
agreement between the Securities Administrator, on behalf of the Trust, and the
Yield Maintenance Agreement Provider substantially in the form attached hereto
as Exhibit N-3. The Class M Yield Maintenance Agreement shall not be an asset of
either REMIC formed under this Agreement.
"Class M Yield Maintenance Agreement Payment": On each Distribution
Date through the Distribution Date in April 2008, the amount equal to the
product of (a) the excess of the lesser of (i) One-Month LIBOR and (ii) the
applicable upper strike rate for such Distribution Date over the lower strike
rate for such Distribution Date, in each case as set forth on the schedule
attached to the Class M Yield Maintenance Agreement for such Distribution Date,
(b) the notional amount as set forth on the schedule attached to the Class M
Yield Maintenance Agreement for such Distribution Date and (c) a fraction, the
numerator of which is the actual number of days elapsed since the previous
Distribution Date (or the Closing Date, in the case of the first Distribution
Date) to but excluding the current Distribution Date and the denominator of
which is 360.
"Class P Certificate": Any one of the Certificates with a "P"
designated on the face thereof substantially in the form annexed hereto as
Exhibit C-2, executed by the Securities Administrator on behalf of the Trust and
authenticated and delivered by the Certificate Registrar, representing the right
to distributions as set forth herein and therein.
"Class R Certificate": The Class R Certificate executed by the
Securities Administrator on behalf of the Trust, and authenticated and delivered
by the Certificate Registrar, substantially in the form annexed hereto as
Exhibit C-3 and evidencing the ownership of the Residual Interest in each of
REMIC 1 and REMIC 2. The Class R Certificate represents the ownership of the
Class R-1 Interest and the Class R-2 Interest.
"Class R-1 Interest": The uncertificated residual interest in REMIC
1.
"Class R-2 Interest": The uncertificated residual interest in REMIC
2.
"Closing Date": June 29, 2005.
"Code": The Internal Revenue Code of 1986, as it may be amended from
time to time.
"Collection Account": The account or accounts created and maintained
by the Servicer pursuant to Section 3.04(a), which shall be entitled "Collection
Account, Xxxxx Fargo Bank, N.A., as Servicer for HSBC Bank USA, National
Association, as Trustee, in trust for registered Holders of Xxxxx Fargo Home
Equity Asset-Backed Securities 2005-1 Trust, Home Equity Asset-Backed
Certificates, Series 2005-1," and which must be an Eligible Account.
"Collection Period": With respect to any Distribution Date, the
period from the second day of the calendar month preceding the month in which
such Distribution Date occurs through the first day of the month in which such
Distribution Date occurs.
"Commission": The United States Securities and Exchange Commission.
"Compensating Interest": As defined in Section 3.22 hereof.
"Condemnation Proceeds": All awards or settlements in respect of a
taking of a Mortgaged Property by exercise of the power of eminent domain or
condemnation.
"Corporate Trust Office": With respect to the Trustee, the principal
corporate trust office of the Trustee at which at any particular time its
corporate trust business in connection with this Agreement shall be
administered, which office at the date of the execution of this instrument is
located at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: WFHET 2005-1
or at such other address as the Trustee may designate from time to time by
notice to the Certificateholders, the Depositor, the Securities Administrator
and the Servicer. With respect to the Securities Administrator, the corporate
trust office of the Securities Administrator at which at any particular time its
corporate trust business in connection with this Agreement shall be
administered, which office at the date of the execution of this instrument is
located at (i) for certificate transfer purposes, Xxxxx Fargo Center, Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, 00000-0000, Attention:
Client Manager-WFHET, Series 2005-1 and (ii) for all other purposes, 0000 Xxx
Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: Client Manager-WFHET,
Series 2005-1 or at such other address as the Securities Administrator may
designate from time to time by notice to the Certificateholders, the Depositor,
the Trustee and the Servicer.
"Corresponding Classes": With respect to REMIC 1 and REMIC 2, the
following Classes shall be Corresponding Classes:
Corresponding REMIC 1 Classes Corresponding REMIC 2 Classes
----------------------------- -----------------------------
LT1AI1A Class AI-1A Certificates
LT1AI1B Class AI-1B Certificates
LT1AII1 Class AII-I Certificates
LT1M1 Class M-1 Certificates
LT1M2 Class M-2 Certificates
LT1M3 Class M-3 Certificates
LT1M4 Class M-4 Certificates
LT1M5 Class M-5 Certificates
LT1M6 Class M-6 Certificates
LT1M7 Class M-7 Certificates
LT1M8 Class M-8 Certificates
LT1M9 Class M-9 Certificates
LT1M10 Class M-10 Certificates
LT1M11 Class M-11 Certificates
LT1M12 Class M-12 Certificates
LT1M13 Class M-13 Certificates
LT1M14 Class M-14 Certificates
"Credit Risk Management Agreement": The Credit Risk Management
Agreement between the Servicer and the Credit Risk Manager dated June 29, 2005.
"Credit Risk Manager": The Murrayhill Company, a Colorado
corporation.
"Current Interest Shortfall": With respect to any Distribution Date,
the sum of (i) the aggregate amount of Relief Act Shortfalls, (ii) the aggregate
amount of Prepayment Interest Shortfalls attributable to partial Principal
Prepayments and (iii) the amount, if any, by which (x) the aggregate amount of
Prepayment Interest Shortfalls attributable to Principal Prepayments in full
exceeds (y) the Compensating Interest for such Distribution Date.
"Credit Risk Manager Fee": The fee payable to the Credit Risk
Manager on each Distribution Date for its services as Credit Risk Manager, in an
amount equal to the product of (i) one-twelfth of the Credit Risk Manager Fee
Rate and (ii) the Pool Balance as of the opening of business on the first day of
the related Collection Period.
"Credit Risk Manager Fee Rate": With respect to any Distribution
Date, 0.015% per annum.
"Custodial Agreement": That certain Custodial Agreement, dated as of
June 29, 2005, among the Custodian, the Depositor, the Servicer and the Trustee.
"Custodian": Xxxxx Fargo Bank, N.A., as custodian pursuant to the
Custodial Agreement, and any successor custodian, if any, hereafter appointed by
the Trustee pursuant to Section 8.16. The Custodian may (but need not) be the
Trustee, the Securities Administrator or the Servicer or any Person directly or
indirectly controlling or controlled by or under common control of any of them.
"Cut-off Date": With respect to each Mortgage Loan, the Due Date
occurring in June 2005.
"Cut-off Date Aggregate Principal Balance": The aggregate of the
Cut-off Date Principal Balances of the Mortgage Loans.
"Cut-off Date Principal Balance": With respect to any Mortgage Loan,
the unpaid principal balance thereof as of the applicable Cut-off Date after
giving effect to any Monthly Payment due on such date and to the application of
funds received or advanced on or before such date (or as of the applicable date
of substitution with respect to an Eligible Substitute Mortgage Loan).
"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 resulting from a Deficient Valuation.
"Defective Mortgage Loan": A Mortgage Loan replaced or to be
replaced by one or more Eligible Substitute Mortgage Loans.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding principal balance of the Mortgage
Loan, or any reduction in the amount of principal to be paid in connection with
any scheduled Monthly Payment that results in a permanent forgiveness of
principal, which valuation results from a proceeding initiated under the
Bankruptcy Code.
"Definitive Certificates": As defined in Section 5.02(c) hereof.
"Delinquent": Any Mortgage Loan with respect to which the Monthly
Payment due on a Due Date is not made by the close of business on the next
scheduled Due Date for such Mortgage Loan.
"Depositor": Xxxxx Fargo Asset Securities Corporation, a Delaware
corporation, or any successor in interest.
"Depository": The initial depository shall be The Depository Trust
Company, whose nominee is Cede & Co., or any other organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act. The Depository
shall initially be the registered Holder of the Book-Entry Certificates. The
Depository shall at all times be a "clearing corporation" as defined in Section
8-102(a)(5) of the Uniform Commercial Code of the State of New York.
"Depository Participant": A broker, dealer, bank or other financial
institution or other person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the
17th day of the calendar month in which such Distribution Date occurs or, if
such 17th day is not a Business Day, the Business Day immediately preceding such
17th day.
"Disqualified Organization": A "disqualified organization" under
Section 860E of the Code, which as of the Closing Date is any of: (i) the United
States, any state or political subdivision thereof, any possession of the United
States, any foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (ii) any organization (other than a
cooperative described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code unless such organization is subject to the tax
imposed by Section 511 of the Code, (iii) any organization described in Section
1381(a)(2)(C) of the Code, or (iv) any other Person so designated by the
Securities Administrator based upon an Opinion of Counsel provided by nationally
recognized counsel to the Securities Administrator that the holding of an
ownership interest in the Class R Certificate by such Person may cause the Trust
Fund or any Person having an ownership interest in any Class of Certificates
(other than such Person) to incur liability for any federal tax imposed under
the Code that would not otherwise be imposed but for the transfer of an
ownership interest in the Class R Certificate to such Person. A corporation will
not be treated as an instrumentality of the United States or of any state or
political subdivision thereof if all of its activities are subject to tax and a
majority of its board of directors is not selected by a governmental unit. The
term "United States," "state" and "international organization" shall have the
meanings set forth in Section 7701 of the Code.
"Distribution Account": The trust account or accounts created and
maintained by the Securities Administrator pursuant to Section 3.04(b), which
shall be entitled "Distribution Account, Xxxxx Fargo Bank, N.A., as Securities
Administrator, in trust for the registered Holders of Xxxxx Fargo Home Equity
Asset-Backed Securities 2005-1 Trust, Home Equity Asset-Backed Certificates,
Series 2005-1," and which must be an Eligible Account.
"Distribution Date": The 25th day of any calendar month, or if such
25th day is not a Business Day, the Business Day immediately following such 25th
day, commencing in July 2005.
"Distribution Date Statement": As defined in Section 4.06(a) hereof.
"Document Transfer Event": The 60th day following the day on which
either (i) Xxxxx Fargo Bank, N.A. is no longer the Servicer of any of the
Mortgage Loans or (ii) the senior, unsecured long-term debt rating of Xxxxx
Fargo & Company is less than "BBB-" by Fitch.
"Due Date": With respect to each Mortgage Loan, the day of the
calendar month on which the Monthly Payment for such Mortgage Loan was due in
accordance with the terms of the related Mortgage Note, exclusive of any grace
period.
"Eligible Account": Any of (i) an account or accounts maintained
with a federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is the principal subsidiary of a holding
company, the short-term unsecured debt obligations of such holding company) are
rated "A-1+" by S&P, "P-1" by Xxxxx'x and "F-1" by Fitch (or comparable ratings
if S&P, Xxxxx'x and Fitch are not the Rating Agencies) by each of the Rating
Agencies at the time any amounts are held on deposit therein, (ii) an account or
accounts the deposits in which are fully insured by the FDIC, (iii) a trust
account or accounts maintained with the trust department of a federal or state
chartered depository institution, national banking association or trust company
acting in its fiduciary capacity or (iv) an account otherwise acceptable to each
Rating Agency without reduction or withdrawal of their then current ratings of
the Certificates as evidenced by a letter from each Rating Agency to the
Securities Administrator and the Trustee. Eligible Accounts may bear interest.
"Eligible Investments": Any one or more of the following obligations
or securities acquired at a purchase price of not greater than par, regardless
of whether issued or managed by the Depositor, the Servicer, the Securities
Administrator, the Trustee or any of their respective Affiliates or for which an
Affiliate of the Trustee or the Securities Administrator serves as an advisor:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any
agency or instrumentality thereof, provided such obligations are backed by
the full faith and credit of the United States;
(ii) (A) demand and time deposits in, certificates of deposit of,
bankers' acceptances issued by or federal funds sold by any depository
institution or trust company (including the Trustee, the Securities
Administrator or their respective agents 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 or its ultimate parent has a
short-term uninsured debt rating in one of the two highest available
rating categories of S&P and Xxxxx'x and the highest available rating
category of Fitch 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 principal) rated
A or higher by S&P and Fitch and A2 or higher by Xxxxx'x, provided,
however, that collateral transferred pursuant to such repurchase
obligation must be of the type described in clause (i) above and must (A)
be valued daily at current market prices plus accrued interest or (B)
pursuant to such valuation, be equal, at all times, to 105% of the cash
transferred by the Trustee or the Securities Administrator in exchange for
such collateral and (C) be delivered to the Trustee, the Securities
Administrator or, if the Trustee or the Securities Administrator is
supplying the collateral, an agent for the Trustee or the Securities
Administrator, as the case may be, in such a manner as to accomplish
perfection of a security interest in the collateral by possession of
certificated securities;
(iv) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United States
of America or any State thereof and that are rated by each Rating Agency
in its highest long-term unsecured rating categories at the time of such
investment or contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than 30 days after the date of acquisition
thereof) that is rated by each Rating Agency in its highest short-term
unsecured debt rating available at the time of such investment;
(vi) units of money market funds registered under the Investment
Company Act of 1940 (including funds managed or advised by the Trustee or
the Securities Administrator or affiliates thereof) that, if rated by each
Rating Agency, are rated in its highest rating category (if so rated by
such Rating Agency); and
(vii) if previously confirmed in writing to the Trustee and the
Securities Administrator, any other demand, money market or time deposit,
or any other obligation, security or investment, as may be acceptable to
the Rating Agencies in writing as an eligible investment of funds backing
securities having ratings equivalent to its highest initial rating of the
Senior Certificates;
provided, that no instrument described hereunder shall evidence
either the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
"Eligible Substitute Mortgage Loan": A mortgage loan substituted for
a Defective Mortgage Loan pursuant to the terms of this Agreement which must, on
the date of such substitution, (i) have an outstanding principal balance, after
application of all scheduled payments of principal and interest due during or
prior to the month of substitution, not in excess of, the outstanding principal
balance of the Defective Mortgage Loan as of the Due Date in the calendar month
during which the substitution occurs, (ii) have a Mortgage Interest Rate, with
respect to a Fixed Rate Mortgage Loan, not less than the Mortgage Interest Rate
of the Defective Mortgage Loan and not more than 1% in excess of the Mortgage
Interest Rate of such Defective Mortgage Loan, (iii) if an Adjustable Rate
Mortgage Loan, have a Maximum Mortgage Interest Rate not less than the Maximum
Mortgage Interest Rate for the Defective Mortgage Loan, (iv) if an Adjustable
Rate Mortgage Loan, have a Minimum Mortgage Interest Rate not less than the
Minimum Mortgage Interest Rate of the Defective Mortgage Loan, (v) if an
Adjustable Rate Mortgage Loan, have a Gross Margin equal to or greater than the
Gross Margin of the Defective Mortgage Loan, (vi) if an Adjustable Rate Mortgage
Loan, have the same Index and frequency of adjustment as the Defective Mortgage
Loan (vii) if an Adjustable Rate Mortgage Loan, have a next Adjustment Date not
more than three months later than the next Adjustment Date on the Defective
Mortgage Loan, (viii) have an original term to maturity not greater than (and
not more than one year less than) that of the Defective Mortgage Loan, (ix) be
current as of the date of substitution, (x) have a Loan-to-Value Ratio as of the
date of substitution equal to or lower than the Loan-to-Value Ratio of the
Defective Mortgage Loan as of such date, (xi) have a risk grading at least equal
to the risk grading assigned on the Defective Mortgage Loan, (xii) have the same
lien priority as the Defective Mortgage Loan; (xiii) have a Prepayment Penalty
at least equal in amount and duration of that of the Defective Mortgage Loan and
(xiv) conform to each representation and warranty set forth in Section 2.04
hereof applicable to the Defective Mortgage Loan. In the event that one or more
mortgage loans are substituted for one or more Defective Mortgage Loans, the
amounts described in clause (i) hereof shall be determined on the basis of
aggregate principal balance, the Mortgage Interest Rates described in clause
(ii) hereof shall be determined on the basis of weighted average Mortgage
Interest Rates, the risk gradings described in clause (xi) hereof shall be
satisfied as to each such mortgage loan, the terms described in clause (viii)
hereof shall be determined on the basis of weighted average remaining term to
maturity, the Loan-to-Value Ratios described in clause (x) hereof shall be
satisfied as to each such mortgage loan and, except to the extent otherwise
provided in this sentence, the representations and warranties described in
clause (xiv) hereof must be satisfied as to each Eligible Substitute Mortgage
Loan or in the aggregate, as the case may be. Any Defective Mortgage Loan that
is a Group I Mortgage Loan or Group II Mortgage Loan must be replaced by an
Eligible Substitute Mortgage Loan that will be a Group I Mortgage Loan or Group
II Mortgage Loan, as applicable.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended.
"ERISA-Restricted Certificates": Any of the Class M-12, Class M-13,
Class M-14, Class CE, Class P and Class R Certificates.
"Escrow Account": The account or accounts created and maintained
pursuant to Section 3.06.
"Escrow Agreement": An agreement between a Mortgagor and the
Servicer relating to accounts constituting taxes and/or fire and hazard
insurance premiums required to be escrowed.
"Escrow Payments": The amounts constituting taxes and/or fire and
hazard insurance premiums required to be escrowed to an Escrow Agreement.
"Estate in Real Property": A fee simple estate in a parcel of real
property.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Expense Fee Rate": The sum of (i) the Servicing Fee Rate and (ii)
the Credit Risk Manager Fee Rate.
"Extended Period": As defined in Section 9.04(b).
"Extra Principal Distribution Amount": As of any Distribution Date,
the lesser of (x) the Monthly Excess Interest Amount for such Distribution Date,
after reduction (but not below zero) by any Current Interest Shortfall and (y)
the Overcollateralization Deficiency for such Distribution Date.
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"Fidelity Bond": Shall have the meaning assigned thereto in Section
3.12.
"Fitch": Fitch Ratings and its successors, and if such company shall
for any reason no longer perform the functions of a securities rating agency,
"Fitch" shall be deemed to refer to any other "nationally recognized statistical
rating organization" as set forth on the most current list of such organizations
released by the Commission.
"Fixed Rate Mortgage Loan": A Mortgage Loan which has a constant
annual rate at which interest accrues in accordance with the provisions of the
related Mortgage Note.
"Foreclosure Price": The amount reasonably expected to be received
from the sale of the related Mortgaged Property net of any expenses associated
with foreclosure proceedings.
"Formula Rate": Any of the Class AI-1A Formula Rate, the Class AI-1B
Formula Rate, the Class AII-1 Formula Rate, the Class M-1 Formula Rate, the
Class M-2 Formula Rate, the Class M-3 Formula Rate, the Class M-4 Formula Rate,
the Class M-5 Formula Rate, the Class M-6 Formula Rate, the Class M-7 Formula
Rate, the Class M-8 Formula Rate, the Class M-9 Formula Rate, the Class M-10
Formula Rate, the Class M-11 Formula Rate, the Class M-12 Formula Rate, the
Class M-13 Formula Rate and the Class M-14 Formula Rate.
"Grantor Trust": That portion of the Trust exclusive of REMIC 1 and
REMIC 2 consisting of (a) the Prepayment Penalties, any Originator Prepayment
Penalty Payment Amounts, any Servicer Prepayment Penalty Payment Amounts,
proceeds thereof in the Custodial Account or Distribution Account and the right
of the Class P Certificateholders to receive such Prepayment Penalties,
Originator Prepayment Penalty Payment Amounts and Servicer Prepayment Penalty
Payment Amounts, (b) the right of the Certificates (other than the Class CE,
Class P and Class R Certificates) to receive Cap Carryover Amounts, (c) the
Yield Maintenance Agreements, the Reserve Accounts and the beneficial interest
of the Class CE Certificates with respect thereto and (d) the obligation of the
Class CE Certificates to pay Cap Carryover Amounts.
"Gross Margin": With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage set forth in the related Mortgage Note that is added to the
applicable Index on each Adjustment Date in accordance with the terms of the
related Mortgage Note used to determine the Mortgage Interest Rate for such
Mortgage Loan.
"Group I Cap": As of any Distribution Date and the Class AI
Certificates, a per annum rate (adjusted by multiplying such rate by a fraction
equal to 30 over the actual number of days in the related Interest Accrual
Period) equal to the Weighted Average Net Mortgage Interest Rate for the Group I
Mortgage Loans.
"Group I Interest Remittance Amount": As of any Distribution Date,
the sum, without duplication, of (i) all interest due and collected with respect
to the related Collection Period on the Group I Mortgage Loans received by the
Servicer on or prior to the Determination Date for such Distribution Date and
any interest advanced by the Servicer or the Trustee on the Group I Mortgage
Loans with respect to the related Collection Period (less the Servicing Fee,
amounts available for reimbursement of Advances and Servicing Advances pursuant
to Section 3.05 and expenses reimbursable pursuant to Section 6.03, amounts
reimbursable or payable to the Trustee pursuant to this Agreement, including,
without limitation, Sections 7.01 and 8.05 and amounts reimbursable or payable
to the Securities Administrator pursuant to this Agreement, including, without
limitation, Sections 8.05 and 9.01(c)), (ii) all Compensating Interest paid by
the Servicer on the related Distribution Date with respect to such Group I
Mortgage Loans, (iii) the portion of any payment in connection with any
Principal Prepayment, substitution, Purchase Price, Termination Price, Insurance
Proceeds or Net Liquidation Proceeds relating to interest with respect to such
Group I Mortgage Loans received during the related Prepayment Period and (iv)
the portion of any Reimbursement Amount relating to interest on such Group I
Mortgage Loans received during the related Prepayment Period.
"Group I Maximum Rate Cap": With respect to any Distribution Date
and for the Class AI Certificates, a per annum rate (adjusted by multiplying
such rate by a fraction equal to 30 over the actual number of days in the
related Interest Accrual Period) equal to the average of the Net Rate Ceilings
for the Adjustable Rate Mortgage Loans which are Group I Mortgage Loans and the
Net Mortgage Interest Rates for the Fixed Rate Mortgage Loans which are Group I
Mortgage Loans, weighted on the basis of the unpaid principal balances of the
Group I Mortgage Loans as of the first day of the related Collection Period.
"Group I Mortgage Loan": Each Mortgage Loan listed on Exhibit D-1
hereto.
"Group I Overcollateralization Floor": With respect to any
Distribution Date, the amount by which the aggregate unpaid principal balance of
the Group I Mortgage Loans as of the last day of the related Collection Period
exceeds the product of (i) 0.50% and (ii) the aggregate unpaid principal balance
of the Group I Mortgage Loans on the Cut-off Date.
"Group I Principal Distribution Amount": With respect to any
Distribution Date, (a) the product of (i) the Group I Principal Percentage and
(ii) the sum of (A) the Principal Remittance Amount and (B) the Extra Principal
Distribution Amount, minus (b) the Group I Principal Percentage of the
Overcollateralization Release Amount.
"Group I Principal Percentage": With respect to any Distribution
Date and any Class AI Certificates, the percentage equivalent to a fraction, the
numerator of which is the Principal Remittance Amount attributable to the Group
I Mortgage Loans for such Distribution Date and the denominator of which is the
Principal Remittance Amount for such Distribution Date.
"Group I Senior Principal Distribution Amount": With respect to any
Distribution Date, the excess of (a) the aggregate Principal Balance of the
Class AI Certificates immediately prior to such Distribution Date over (b) the
lesser of (x) the product of (0) 00.000000000000% and (2) the aggregate unpaid
principal balance of the Group I Mortgage Loans as of the last day of the
related Collection Period and (y) the Group I Overcollateralization Floor.
"Group II Cap": As of any Distribution Date and the Class AII
Certificates, a per annum rate (adjusted by multiplying such rate by a fraction
equal to 30 over the actual number of days in the related Interest Accrual
Period) equal to the Weighted Average Net Mortgage Interest Rate for the Group
II Mortgage Loans.
"Group II Interest Remittance Amount": As of any Distribution Date,
the sum, without duplication, of (i) all interest due and collected with respect
to the related Collection Period on the Group II Mortgage Loans received by the
Servicer on or prior to the Determination Date for such Distribution Date and
any interest advanced by the Servicer or the Trustee on the Group II Mortgage
Loans with respect to the related Collection Period (less the Servicing Fee,
amounts available for reimbursement of Advances and Servicing Advances pursuant
to Section 3.05 and expenses reimbursable pursuant to Section 6.03, amounts
reimbursable or payable to the Trustee pursuant to this Agreement, including,
without limitation, Sections 7.01 and 8.05 and amounts reimbursable or payable
to the Securities Administrator pursuant to this Agreement, including, without
limitation, Sections 8.05 and 9.01(c)), (ii) all Compensating Interest paid by
the Servicer on the related Distribution Date with respect to such Group II
Mortgage Loans, (iii) the portion of any payment in connection with any
Principal Prepayment, substitution, Purchase Price, Termination Price, Insurance
Proceeds or Net Liquidation Proceeds relating to interest with respect to such
Group II Mortgage Loans received during the related Prepayment Period and (iv)
the portion of any Reimbursement Amount relating to interest on such Group II
Mortgage Loans received during the related Prepayment Period.
"Group II Maximum Rate Cap": With respect to any Distribution Date
and for the Class AII Certificates, a per annum rate (adjusted by multiplying
such rate by a fraction equal to 30 over the actual number of days in the
related Interest Accrual Period) equal to the average of the Net Rate Ceilings
for the Adjustable Rate Mortgage Loans which are Group II Mortgage Loans and the
Net Mortgage Interest Rates for the Fixed Rate Mortgage Loans which are Group II
Mortgage Loans, weighted on the basis of the unpaid principal balances of the
Group II Mortgage Loans as of the first day of the related Collection Period.
"Group II Mortgage Loan": Each Mortgage Loan listed on Exhibit D-2
hereto.
"Group II Overcollateralization Floor": With respect to any
Distribution Date, the amount by which the aggregate unpaid principal balance of
the Group II Mortgage Loans as of the last day of the related Collection Period
exceeds the product of (i) 0.50% and (ii) the aggregate unpaid principal balance
of the Group II Mortgage Loans on the Cut-off Date.
"Group II Principal Distribution Amount": With respect to any
Distribution Date, (a) the product of (i) the Group II Principal Percentage and
(ii) the sum of (A) the Principal Remittance Amount and (B) the Extra Principal
Distribution Amount, minus (b) the Group II Principal Percentage of the
Overcollateralization Release Amount.
"Group II Principal Percentage": With respect to any Distribution
Date and the Class AII-1 Certificates, the percentage equivalent to a fraction,
the numerator of which is the Principal Remittance Amount attributable to the
Group II Mortgage Loans for such Distribution Date and the denominator of which
is the Principal Remittance Amount for such Distribution Date.
"Group II Senior Principal Distribution Amount": With respect to any
Distribution Date, the excess of (a) the Principal Balance of the Class AII
Certificates immediately prior to such Distribution Date over (b) the lesser of
(x) the product of (0) 00.000000000000% and (2) the aggregate unpaid principal
balance of the Group II Mortgage Loans as of the last day of the related
Collection Period and (y) the Group II Overcollateralization Floor.
"Group Subordinate Amount": With respect to any Distribution Date
and (i) Loan Group I, will be equal to the greater of zero and the excess of the
aggregate unpaid principal balance of the Group I Mortgage Loans as of the first
day of the related Collection Period over the aggregate Principal Balance of the
Class AI Certificates immediately prior to such Distribution Date and (ii) Loan
Group II, will be equal to the greater of zero and the excess of the aggregate
unpaid principal balance of the Group II Mortgage Loans as of the first day of
the related Collection Period over the Principal Balance of the Class AII-1
Certificates immediately prior to such Distribution Date.
"Independent": When used with respect to any specified Person, any
such Person who (i) is in fact independent of the Depositor, the Securities
Administrator, the Trustee, the Servicer and their respective Affiliates, (ii)
does not have any direct financial interest in or any material indirect
financial interest in the Depositor, the Securities Administrator, the Trustee
or the Servicer, or any Affiliate thereof, and (iii) is not connected with the
Depositor, the Securities Administrator, the Trustee or the Servicer, or any
Affiliate thereof, as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions; provided, however,
that a Person shall not fail to be Independent of the Depositor, the Securities
Administrator, the Trustee or the Servicer, or any Affiliate thereof, merely
because such Person is the beneficial owner of 1% or less of any class of
securities issued by the Depositor, the Securities Administrator, the Trustee or
the Servicer, or any Affiliate thereof, as the case may be.
"Index": With respect to each Adjustable Rate Mortgage Loan and with
respect to each related Adjustment Date, the index as specified in the related
Mortgage Note.
"Initial Overcollateralization Amount": $9,420,616.
"Initial Principal Balance": With respect to any Certificate of a
Class other than a Class CE, Class P or Class R Certificate, the amount
designated "Initial Principal Balance" on the face thereof.
"Insurance Proceeds": Proceeds of any title policy, hazard policy or
other insurance policy covering a Mortgage Loan, to the extent such proceeds are
not to be applied to the restoration of the related Mortgaged Property or
released to the Mortgagor in accordance with the procedures that the Servicer
would follow in servicing mortgage loans held for its own account, subject to
the terms and conditions of the related Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution Date,
the period from and including the preceding Distribution Date to the day prior
to the current Distribution Date (or, in the case of the first Distribution
Date, the period from June 29, 2005 through July 24, 2005).
"Interest Carry Forward Amount": For any Class of Certificates
(other than the Class CE, Class P and Class R Certificates) and any Distribution
Date, the sum of (a) the excess, if any, of the Accrued Certificate Interest for
the prior Distribution Date and any Interest Carry Forward Amount for the prior
Distribution Date, over the amount in respect of interest actually distributed
on such Class on such prior Distribution Date and (b) interest on such excess at
the applicable Pass-Through Rate on the basis of the actual number of days
elapsed since the prior Distribution Date.
"Interest Percentage": With respect to any Class of Certificates and
any Distribution Date, the ratio (expressed as a decimal carried to at least six
places) of the Accrued Certificate Interest for such Class to the sum of the
Accrued Certificate Interest for all Classes, in each case with respect to such
Distribution Date, without regard to Current Interest Shortfalls.
"Interest Remittance Amount": As of any Determination Date, the sum
of the Group I Interest Remittance Amount and the Group II Interest Remittance
Amount.
"Late Collections": With respect to any Mortgage Loan, all amounts
received subsequent to the Determination Date immediately following any related
Collection Period, whether as late payments of Monthly Payments or as Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds or otherwise, which
represent late payments or collections of principal and/or interest due (without
regard to any acceleration of payments under the related Mortgage and Mortgage
Note) but delinquent on a contractual basis for such Collection Period and not
previously recovered.
"LIBOR Business Day": Any day on which banks in London, England and
the City of New York are open and conducting transactions in foreign currency
and exchange.
"LIBOR Determination Date": With respect to any Floating Rate Class,
(i) for the first Distribution Date, the second LIBOR Business Day preceding the
Closing Date and (ii) for each subsequent Distribution Date, the second LIBOR
Business Day prior to the immediately preceding Distribution Date.
"Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the Servicer has determined, in accordance
with the servicing procedures specified herein, as of the end of the related
Prepayment Period, that all Liquidation Proceeds, Condemnation Proceeds and
Insurance Proceeds which it expects to recover with respect to the liquidation
of the Mortgage Loan or disposition of the related REO Property have been
recovered.
"Liquidation Proceeds": The amount (other than amounts received in
respect of the rental of any REO Property prior to REO Disposition) received by
the Servicer in connection with (i) the taking of all or a part of a Mortgaged
Property by exercise of the power of eminent domain or condemnation or (ii) the
liquidation of a defaulted Mortgage Loan by means of a trustee's sale,
foreclosure sale or otherwise.
"Liquidation Report": The report with respect to a Liquidated
Mortgage Loan in such form as is agreed to by the Servicer, the Trustee and the
Securities Administrator listing (i) the sale price of the related Mortgaged
Property or amount of the REO Disposition, (ii) the amount of any Realized Loss
(or gain) with respect to such Liquidated Mortgage Loan, (iii) the expenses
relating to the liquidation of such Liquidated Mortgage Loan and (iv) such other
information as is agreed to by the Servicer, the Trustee and the Securities
Administrator.
"Loan Group": Either of Loan Group I or Loan Group II.
"Loan Group I": The Group I Mortgage Loans.
"Loan Group II": The Group II Mortgage Loans.
"Loan-to-Value Ratio": For any Mortgage Loan, the ratio, expressed
as a percentage, the numerator of which is the original loan amount (unless
otherwise indicated) of a particular Mortgage Loan at origination and the
denominator of which is the lesser of (x) the appraised value of the related
Mortgaged Property determined in the appraisal used by the originator at the
time of origination of such Mortgage Loan, and (y) if the Mortgage is originated
in connection with a sale of the Mortgaged Property, the sale price for such
Mortgaged Property.
"Losses": As defined in Section 9.03.
"Lost Note Affidavit": With respect to any Mortgage Loan as to which
the original Mortgage Note has been permanently 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 and indemnifying the Trust against any loss, cost or
liability resulting from the failure to deliver the original Mortgage Note) in
the form of Exhibit H hereto.
"Majority Certificateholders": The Holders of Certificates
evidencing at least 51% of the Voting Interests.
"Majority Class CE Certificateholders": The Holders of Class CE
Certificates evidencing at least a 51% Percentage Interest in the Class CE
Certificates.
"Marker Rate": With respect to the Class CE Certificates and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the Uncertificated REMIC Pass-Through Rates for REMIC 1 Regular Interest
LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1,
REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular
Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5,
REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular
Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10,
REMIC 1 Regular Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1
Regular Interest LT1M13, REMIC 1 Regular Interest LT1M14 and REMIC 1 Regular
Interest LT1ZZ, (i) with the rate on each such REMIC Regular Interest (other
than REMIC 1 Regular Interest LT1ZZ) subject to a cap equal to the Pass-Through
Rate of its Corresponding Class (taking into account in determining any such
Pass-Through Rate the imposition of the Group I Cap and the Group II Cap or the
Pool Cap, as applicable, as described in footnotes (1) through (17) to the table
in the Preliminary Statement relating to the Certificates) for the purposes of
this calculation and (ii) with the rate on REMIC 1 Regular Interest LT1ZZ
subject to a cap of zero for the purpose of this calculation; provided, however,
that for this purpose, calculations of the Uncertificated REMIC 1 Pass-Through
Rate and the related caps with respect to each REMIC I Regular Interest shall be
multiplied by a fraction, the numerator of which is the actual number of days in
the Interest Accrual Period and the denominator of which is 30.
"Maximum LT1ZZ Uncertificated Accrued Interest Deferral Amount":
With respect to any Distribution Date, the excess of (a) accrued interest at the
Uncertificated REMIC 1 Pass-Through Rate applicable to REMIC 1 Regular Interest
LT1ZZ for such Distribution Date on a balance equal to the Uncertificated
Principal Balance of REMIC 1 Regular Interest LT1ZZ minus the REMIC 1
Overcollateralized Amount, in each case for such Distribution Date, over (b)
Uncertificated Accrued Interest on REMIC 1 Regular Interest LT1AI1A, REMIC 1
Regular Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular Interest
LT1M13 and REMIC 1 Regular Interest LT1M14 each subject to a cap equal to the
Pass-Through Rate of the related Corresponding Class for the purpose of this
calculation; provided, however, that for this purpose, calculations of the
Uncertificated REMIC 1 Pass-Through Rate and the related caps with respect to
Uncertificated Accrued Interest on each REMIC I Regular Interest shall be
multiplied by a fraction, the numerator of which is the actual number of days in
the Interest Accrual Period and the denominator of which is 30.
"MERS": The Mortgage Electronic Registration Systems, Inc.
"MERS Mortgage Loan": Any MOM Mortgage Loan or any other Mortgage
Loan as to which MERS is (or is intended to be) the mortgagee of record and as
to which a MIN has been assigned.
"MIN": A MERS Mortgage Identification Number assigned to a Mortgage
Loan in accordance with the MERS Procedure Manual.
"MOM": A Mortgage Loan where the related Mortgage names MERS as the
original mortgagee thereof, as to which a MIN has been assigned, and which
Mortgage has not been assigned to any other person.
"Minimum Mortgage Interest Rate": With respect to each Adjustable
Rate Mortgage Loan, the percentage set forth in the related Mortgage Note as the
minimum Mortgage Interest Rate thereunder.
"Monthly Excess Cashflow Amount": The sum of the Monthly Excess
Interest Amount after reduction (but not below zero) by any Current Interest
Shortfall, the Overcollateralization Release Amount and any portion of the
Principal Distribution Amount (without duplication) remaining after principal
distributions on the Certificates (other than the Class CE, Class P and Class R
Certificates).
"Monthly Excess Interest Amount": With respect to each Distribution
Date, the amount, if any, by which the Interest Remittance Amount for such
Distribution Date exceeds the aggregate amount distributed on such Distribution
Date pursuant to paragraphs (i) through (xix) of Section 4.01.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled
monthly payment of principal and interest on such Mortgage Loan which is payable
by the related Mortgagor from time to time under the related Mortgage Note,
determined: (a) after giving effect to (i) any Deficient Valuation and/or Debt
Service Reduction with respect to such Mortgage Loan and (ii) any reduction in
the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act or similar state laws; (b) without giving effect to any extension
granted or agreed to by the Servicer pursuant to Section 3.01; and (c) on the
assumption that all other amounts, if any, due under such Mortgage Loan are paid
when due.
"Moody's": Xxxxx'x Investors Service, Inc., and its successors, and
if such company shall for any reason no longer perform the functions of a
securities rating agency, "Moody's" shall be deemed to refer to any other
"nationally recognized statistical rating organization" as set forth on the most
current list of such organizations released by the Commission.
"Mortgage": The mortgage, deed of trust or other instrument creating
a first or second lien on, or first or second priority security interest in, a
Mortgaged Property securing a Mortgage Note.
"Mortgage File": Either of the Owner Mortgage File or Retained
Mortgage File.
"Mortgage Interest Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, which rate (i) in
the case of each Fixed Rate Mortgage Loan shall remain constant at the rate set
forth in the applicable Mortgage Loan Schedule as the Mortgage Interest Rate in
effect immediately following the applicable Cut-off Date and (ii) in the case of
each Adjustable Rate Mortgage Loan (A) as of any date of determination until the
first Adjustment Date following the applicable Cut-off Date shall be the rate
set forth in the applicable Mortgage Loan Schedule as the Mortgage Interest Rate
in effect immediately following the applicable Cut-off Date and (B) as of any
date of determination thereafter shall be the rate as adjusted on the most
recent Adjustment Date, to equal the sum, rounded as provided in the Mortgage
Note, of the Index, determined as set forth in the related Mortgage Note, plus
the related Gross Margin subject to the limitations set forth in the related
Mortgage Note. With respect to each Mortgage Loan that becomes an REO Property,
as of any date of determination, the annual rate determined in accordance with
the immediately preceding sentence as of the date such Mortgage Loan became an
REO Property.
"Mortgage Loan": Each mortgage loan transferred and assigned to the
Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to time held as
a part of the Trust Fund, the Mortgage Loans so held being identified in the
Mortgage Loan Schedules.
"Mortgage Loan Purchase Agreement": The agreement between the Seller
and the Depositor, dated as of June 29, 2005, regarding the transfer of the
Mortgage Loans by the Seller to or at the direction of the Depositor.
"Mortgage Loan Schedule": As of any date with respect to the
Mortgage Loans, the lists of such Mortgage Loans included in the Trust Fund on
such date, separately identifying the Fixed Rate Mortgage Loans and the
Adjustable Rate Mortgage Loans, attached hereto as Exhibits D-1, and D-2. The
Mortgage Loan Schedules shall set forth the following information with respect
to each Mortgage Loan:
(1) the Mortgage Loan identifying number;
(2) the city, state and zip code of the Mortgaged Property;
(3) the type of property;
(4) the Mortgage Interest Rate;
(5) the Net Mortgage Interest Rate;
(6) the Monthly Payment;
(7) the original number of months to maturity;
(8) the scheduled maturity date;
(9) the Cut-off Date Principal Balance;
(10) the Loan-to-Value Ratio at origination;
(11) whether such Mortgage Loan is covered by primary mortgage insurance;
(12) the applicable Servicing Fee Rate;
(13) the Index;
(14) the Gross Margin;
(15) the Periodic Cap;
(16) the first Adjustment Date;
(17) the Rate Ceiling; and
(18) a code indicating whether the Mortgage Loan has a Prepayment Penalty
and the Prepayment Penalty term.
The Mortgage Loan Schedules shall set forth the following
information, as of the applicable Cut-off Date, with respect to the Mortgage
Loans in the aggregate, for Loan Group I and Loan Group II: (1) the number of
Mortgage Loans; (2) the current unpaid principal balance of the Mortgage Loans;
(3) the weighted average Mortgage Interest Rate of the Mortgage Loans; and (4)
the weighted average maturity of the Mortgage Loans. The Mortgage Loan Schedules
shall be amended from time to time in accordance with the provisions of this
Agreement. With respect to any Eligible Substitute Mortgage Loan, Cut-off Date
shall refer to the applicable date of substitution.
"Mortgage Note": The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on Exhibits
D-1 and D-2 from time to time, and any REO Properties acquired in respect
thereof.
"Mortgaged Property": The underlying property securing a Mortgage
Loan, including any REO Property, consisting of an Estate in Real Property
improved by a Residential Dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Liquidation Proceeds": With respect to any Liquidated Mortgage
Loan or any other disposition of related Mortgaged Property (including REO
Property) the related Liquidation Proceeds net of unreimbursed Advances,
unreimbursed Servicing Advances, unpaid Servicing Fees and any other accrued and
unpaid servicing fees received and retained in connection with the liquidation
of such Mortgage Loan or Mortgaged Property.
"Net Mortgage Interest Rate": With respect to any Mortgage Loan, the
Mortgage Interest Rate borne by such Mortgage Loan minus the Expense Fee Rate.
"Net Rate Ceiling": With respect to any Adjustable Rate Mortgage
Loan, the applicable Rate Ceiling minus the Expense Fee Rate.
"Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan that, in
the good faith business judgment of the Servicer (or the Trustee, in the case of
any Advance made by the Trustee pursuant to Section 7.01), will not or, in the
case of a proposed Advance or Servicing Advance, would not be ultimately
recoverable from Late Collections on such Mortgage Loan as provided herein.
"Notional Amount": With respect to the Class CE Certificates, an
amount equal to the aggregate principal balance of the REMIC 1 Regular
Interests.
"NYCEMA": A New York Consolidation, Extension and Modification
Agreement.
"Officers' Certificate": A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President, a vice president (however
denominated), and by the Treasurer, the Secretary, or one of the assistant
treasurers or assistant secretaries of the Servicer, the Securities
Administrator, the Trustee or the Depositor, as applicable.
"One-Month LIBOR": With respect to each Interest Accrual Period, the
rate determined by the Securities Administrator on the related LIBOR
Determination Date on the basis of the offered rate for one-month United States
dollar deposits, as such rate appears on the Telerate Page 3750, as of 11:00
a.m. (London time) on such LIBOR Determination Date. If no such quotations are
available on an LIBOR Determination Date, One-Month LIBOR for the related
Interest Accrual Period will be established by the Securities Administrator as
follows:
(i) If on such LIBOR Determination Date two or more Reference Banks
provide such offered quotations, One-Month LIBOR for the related Interest
Accrual Period shall be the arithmetic mean of such offered quotations
(rounded upwards if necessary to the nearest whole multiple of 0.001%);
(ii) If on such LIBOR Determination Date fewer than two Reference
Banks provide such offered quotations, One-Month LIBOR for the related
Interest Accrual Period shall be the arithmetic mean of the rates quoted
by one or more major banks in New York City, selected by the Securities
Administrator after consultation with the Depositor, as of 11:00 A.M., New
York City time, on such date for loans in U.S. Dollars to leading European
banks for a period of one month in amounts approximately equal to the
aggregate Principal Balance of the Floating Rate Classes; and
(iii) If no such quotations can be obtained, One-Month LIBOR for the
related Interest Accrual Period shall be One-Month LIBOR for the prior
Distribution Date.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be a salaried counsel for the Depositor, the Securities
Administrator, the Trustee or the Servicer except that any opinion of counsel
relating to (a) the qualification of either REMIC as a REMIC or (b) compliance
with the REMIC Provisions must be an opinion of Independent counsel.
"Optional Termination Date": The first Distribution Date on which
the Majority Class CE Certificateholder or, if there is no Majority Class CE
Certificateholder, the Depositor, may opt to terminate the Mortgage Pool
pursuant to Section 10.01.
"Original Principal Balance": With respect to each Class of
Certificates, the Principal Balance thereof on the Closing Date, as set forth
opposite such Class in the Preliminary Statement, except with respect to (i) the
Class P and Class R Certificates, which have an Original Principal Balance of
zero and (ii) the Class CE Certificates, which, solely for REMIC purposes, have
an Original Principal Balance equal to the Initial Overcollateralization Amount.
"Originator": Xxxxx Fargo Bank, N.A. and its successors.
"Originator Prepayment Penalty Payment Amount": The amount payable
by the Originator pursuant to Section 5(b) of the Mortgage Loan Purchase
Agreement.
"Overcollateralization Amount": As of any Distribution Date, the
excess, if any, of (x) the Pool Balance as of the last day of the related
Collection Period over (y) the aggregate Principal Balance of all Classes of
Certificates (other than the Class CE, Class P and Class R Certificates) after
taking into account all distributions of principal on such Distribution Date and
the increase of any Principal Balance as a result of Subsequent Recoveries.
"Overcollateralization Deficiency": As of any Distribution Date, the
excess, if any, of (x) the Targeted Overcollateralization Amount for such
Distribution Date over (y) the Overcollateralization Amount for such
Distribution Date, calculated for this purpose after taking into account the
reduction on such Distribution Date of the Principal Balances of all Classes of
Certificates (other than the Class CE, Class P and Class R Certificates)
resulting from the distribution of the Principal Distribution Amount (but not
the Extra Principal Distribution Amount) on such Distribution Date, but prior to
taking into account any Applied Realized Loss Amount on such Distribution Date.
"Overcollateralization Floor": As of any Distribution Date, the
amount by which the Pool Balance as of the last day of the related Collection
Period exceeds the product of (i) 0.50% and (ii) the Pool Balance as of the
Cut-off Date.
"Overcollateralization Release Amount": With respect to any
Distribution Date on or after the Stepdown Date on which a Trigger Event is not
in effect, the lesser of (x) the Principal Remittance Amount and (y) the excess,
if any, of (i) the Overcollateralization Amount for such Distribution Date,
assuming that 100% of the Principal Remittance Amount is applied as a principal
payment on the Certificates (other than the Class CE, Class P and Class R
Certificates) on such Distribution Date, over (ii) the Targeted
Overcollateralization Amount for such Distribution Date. With respect to any
Distribution Date on which a Trigger Event is in effect, the
Overcollateralization Release Amount will be zero.
"Owner Mortgage File": A file maintained by the Custodian for each
Mortgage Loan that contains the documents specified in Section 2.01(a) and any
additional documents required to be added to the Owner Mortgage File pursuant to
this Agreement.
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in such
Certificate as the Holder thereof and any other interest therein, whether direct
or indirect, legal or beneficial, as owner or as pledgee.
"Pass-Through Rate": With respect to any REMIC Regular Interest
(other than the Class CE Certificates), the Pass-Through Rate described for such
Class in the table in the Preliminary Statement. With respect to the Class CE
Certificates and any Distribution Date, a per annum rate equal to the percentage
equivalent of a fraction, the numerator of which is the sum of the amounts
calculated pursuant to clauses (A) through (U) below, and the denominator of
which is the aggregate of the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular Interest LT1M11, REMIC 1 Regular
Interest LT1M12, REMIC 1 Regular Interest LT1M13, REMIC 1 Regular Interest
LT1M14 and REMIC 1 Regular Interest LT1ZZ. For purposes of calculating the
Pass-Through Rate for the Class CE Certificates, the numerator is equal to the
sum of the following components:
(A) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1AA minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AA;
(B) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1AI1A minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AI1A;
(C) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1AI1B minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AI1B;
(D) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1AII1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AII1;
(E) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M1;
(F) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M2;
(G) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M3;
(H) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M4;
(I) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M5;
(L) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M6 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M6;
(M) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M7 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M7;
(N) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M8A minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M8;
(O) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M9 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M9;
(P) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M10 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M10;
(Q) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M11 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M11;
(R) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M12 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M12;
(S) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M13 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M13;
(T) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1M14 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M14; and
(U) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1 Regular
Interest LT1ZZ minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ.
"Paying Agent": Any paying agent appointed pursuant to Section 5.05.
"Percentage Interest": With respect to any Certificate (other than a
Class CE, Class P or Class R Certificate), a fraction, expressed as a
percentage, the numerator of which is the Initial Principal Balance, as the case
may be, represented by such Certificate and the denominator of which is the
Original Principal Balance of the related Class. With respect to a Class CE or
Class P Certificate, the portion of the Class evidenced thereby, expressed as a
percentage, as stated on the face of such Certificate; provided, however, that
the sum of all such percentages for each such Class totals 100%. With respect to
the Class R Certificate, 100%.
"Periodic Cap": With respect to each Adjustable Rate Mortgage Loan,
the applicable limit on adjustment of the Mortgage Interest Rate for each
Adjustment Date specified in the applicable Mortgage Note and designated as such
in the Mortgage Loan Schedules.
"Permitted Transferee": Any transferee of a Class R Certificate
other than a Disqualified Organization, a non-U.S. Person or a U.S. Person with
respect to whom income on the Class R Certificate is attributable to a foreign
permanent establishment or fixed base, within the meaning of an applicable
income tax treaty, of such Person or any other U.S. Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pool Balance": As of any date of determination, the aggregate
unpaid principal balance of the Mortgage Loans.
"Pool Cap": As of any Distribution Date and for the Class M
Certificates, a per annum rate (adjusted by multiplying such rate by a fraction
equal to 30 over the actual number of days in the related Interest Accrual
Period), equal to the weighted average of the Group I Cap and the Group II Cap,
weighted on the basis of the related Group Subordinate Amount. For federal
income tax purposes, the economic equivalent of such rate shall be expressed as
the weighted average of the REMIC 1 Remittance Rate on (a) REMIC 1 Regular
Interest LT1SUB, subject to a cap and floor equal to the Weighted Average Net
Mortgage Interest Rates of the Group I Mortgage Loans and (b) REMIC 1 Regular
Interest LT2SUB, subject to a cap and floor equal to the Weighted Average Net
Mortgage Interest Rates of the Group II Mortgage Loans, weighted on the basis of
the Uncertificated Balance of such REMIC 1 Regular Interests.
"Pool Maximum Rate Cap": With respect to any Distribution Date and
for the Class M Certificates, a per annum rate (adjusted by multiplying such
rate by a fraction equal to 30 over the actual number of days in the related
Interest Accrual Period), equal to the weighted average of (i) Group I Maximum
Rate Cap and (ii) the Group II Maximum Rate Cap, weighted on the basis of the
related Group Subordinate Amount.
"Prepayment Interest Shortfall": With respect to any Distribution
Date, for each Mortgage Loan that was the subject of a Principal Prepayment
during the related Prepayment Period that was applied by the Servicer to reduce
the outstanding Principal Balance of such Mortgage Loan on a date preceding the
related Due Date, an amount equal to interest at the applicable Mortgage
Interest Rate (net of the Servicing Fee Rate) on the amount of such Principal
Prepayment for the number of days commencing on the date on which the Principal
Prepayment is applied and ending on the last day of the calendar month in which
applied.
"Prepayment Penalty": With respect to any Prepayment Period, any
Prepayment Penalty, penalty or charge collected by the Servicer from a Mortgagor
in connection with any voluntary Principal Prepayment in full pursuant to the
terms of the related Mortgage Note as from time to time held as a part of the
Trust Fund, the Prepayment Penalties so held being determined in accordance with
the guidelines for Prepayment Penalty provisions set forth in the Seller
underwriting standards. The defined term "Prepayment Penalty" shall not include
any Servicer Prepayment Penalty Payment Amount or Originator Prepayment Penalty
Payment Amount.
"Prepayment Period": With respect to any Distribution Date, the one
month period ending on the last day of the calendar month preceding the month in
which such Distribution Date occurs.
"Principal Balance": With respect to any Class of Certificates
(other than the Class CE, Class P and Class R Certificates) and any Distribution
Date, the Original Principal Balance (a) reduced by the sum of (i) all amounts
actually distributed in respect of principal of such Class on all prior
Distribution Dates and (ii) Applied Realized Loss Amounts allocated thereto for
previous Distribution Dates and (b) increased by any Subsequent Recoveries
allocated to such Class for previous Distribution Dates. The Class CE, Class P
and Class R Certificates do not have a Principal Balance. With respect to any
Certificate (other than a Class CE, Class P or Class R Certificate) of a Class
and any Distribution Date, the portion of the Principal Balance of such Class
represented by such Certificate equal to the product of the Percentage Interest
evidenced by such Certificate and the Principal Balance of such Class.
"Principal Distribution Amount": With respect to any Distribution
Date, (a) the sum of (i) the Principal Remittance Amount and (ii) the Extra
Principal Distribution Amount, if any, minus the Overcollateralization Release
Amount.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.
"Principal Remittance Amount": With respect to any Distribution
Date, to the extent of funds available therefor, the sum (less amounts available
for reimbursement of Advances and Servicing Advances pursuant to Section 3.05
and expenses reimbursable pursuant to Section 6.03 and amounts reimbursable or
payable to the Securities Administrator or Trustee pursuant to this Agreement,
including, without limitation, Sections 8.05 and Section 9.01(c)) of: (i) each
payment of principal on a Mortgage Loan due during the related Collection Period
and received by the Servicer on or prior to the related Determination Date, and
any Advances with respect thereto (other than any payment received on an
Eligible Substitute Mortgage Loan substituted during the related Collection
Period), (ii) all full and partial Principal Prepayments received by the
Servicer during the related Prepayment Period, (iii) Subsequent Recoveries,
Insurance Proceeds and Net Liquidation Proceeds allocable to principal actually
collected by the Servicer during the related Prepayment Period, (iv) with
respect to Defective Mortgage Loans repurchased with respect to such Prepayment
Period, the portion of the Purchase Price allocable to principal, (v) any
Substitution Adjustment Amounts received during the related Prepayment Period
and (vi) on the Distribution Date on which the Trust is to be terminated in
accordance with Section 10.01 hereof, that portion of the Termination Price in
respect of principal.
"Private Certificates": Any of the Class M-12, Class M-13, Class
M-14, Class CE, Class P and Class R Certificates.
"Prospectus Supplement": That certain Prospectus Supplement dated
June 27, 2005 relating to the public offering of the Class A Certificates and
the Class M Certificates (other than the Class M-12, Class M-13 and Class M-14
Certificates).
"Purchase Price": With respect to any Mortgage Loan or REO Property
to be purchased pursuant to or as contemplated by Section 2.01, 2.03, 3.16 or
10.01 (or substituted pursuant to Section 2.08), an amount equal to the sum of
(i) 100% of the unpaid principal balance thereof as of the date of purchase (or
such other price as provided in Section 10.01), (ii) in the case of a Mortgage
Loan, accrued interest on such unpaid principal balance at the applicable
Mortgage Interest Rate in effect from time to time from the Due Date as to which
interest was last covered by a payment by the Mortgagor or an Advance by the
Servicer, which payment or Advance had as of the date of purchase been
distributed pursuant to Section 4.01, through the end of the calendar month in
which the purchase is to be effected, (iii) any unreimbursed Servicing Advances
and Advances and any unpaid Servicing Fees allocable to such Mortgage Loan or
REO Property, (iv) any amounts previously withdrawn from the Collection Account
in respect of such Mortgage Loan or REO Property pursuant to Section 3.13 and
(v) in the case of a Mortgage Loan required to be purchased pursuant to Section
2.03, expenses reasonably incurred or to be incurred by the Servicer, the
Securities Administrator or the Trustee in respect of the breach or defect
giving rise to the purchase obligation.
"Rate Ceiling": With respect to each Adjustable Rate Mortgage Loan,
the maximum per annum Mortgage Interest Rate permitted under the related
Mortgage Note.
"Rating Agency or Rating Agencies": Fitch, Xxxxx'x and S&P, or their
respective successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating organizations as set forth on the most current list of such organizations
released by the Commission and designated by the Depositor, notice of which
designation shall be given to the Trustee, the Securities Administrator and the
Servicer.
"Realized Loss": With respect to a Liquidated Mortgage Loan, the
amount by which the remaining unpaid principal balance of the Mortgage Loan
exceeds the amount of Net Liquidation Proceeds applied to the principal balance
of the related Mortgage Loan. With respect to any Mortgage Loan, a Deficient
Valuation or a reduction in the Principal Balance thereof resulting from a
Servicer Modification.
"Realized Loss Amortization Amount": Any of the Class M-1 Realized
Loss Amortization Amount, the Class M-2 Realized Loss Amortization Amount, the
Class M-3 Realized Loss Amortization Amount, the Class M-4 Realized Loss
Amortization Amount, the Class M-5 Realized Loss Amortization Amount, the Class
M-6 Realized Loss Amortization Amount, the Class M-7 Realized Loss Amortization
Amount, the Class M-8 Realized Loss Amortization Amount, the Class M-9 Realized
Loss Amortization Amount, the Class M-10 Realized Loss Amortization Amount, the
Class M-11 Realized Loss Amortization Amount, the Class M-12 Realized Loss
Amortization Amount, the Class M-13 Realized Loss Amortization Amount and the
Class M-14 Realized Loss Amortization Amount.
"Record Date": With respect to any Distribution Date and (i) the
Class CE and Class P Certificates, the last Business Day of the preceding month
and (ii) any Class of Book-Entry Certificates, the Business Day immediately
preceding such Distribution Date; provided, however, that if any Book-Entry
Certificate becomes a Definitive Certificate, the Record Date for such Class
shall be the last Business Day of the immediately preceding month.
"Reference Banks": Initially, the Reference Banks shall be Deutsche
Bank International, Bank of America, N.A., Citibank, N.A., and The Fuji Bank,
Limited. If any of these banks are not available, the Securities Administrator
shall select from one of the following banks a substitute Reference Bank: Credit
Suisse First Boston Corporation, Westdeutsche Landesbank Girozentrale, The X.X.
Xxxxxx Chase Bank or National Westminster Bank Plc. If any of these banks are
not available, the Securities Administrator shall in its discretion select
another Reference Bank.
"Regular Certificate": Any of the Class A, Class M and Class CE
Certificates.
"Reimbursement Amount": With respect to any Mortgage Loan, any costs
or damages incurred by the Trust in connection with a breach of the Depositor's
representations set forth in Section 2.04(i) and (dd) hereof.
"Related Documents": With respect to any Mortgage Loan, the related
Mortgage Notes, Mortgages and other related documents.
"Relief Act": The Servicemembers Civil Relief Act, as it may be
amended from time to time.
"Relief Act Interest Shortfall": With respect to any Distribution
Date, for any Mortgage Loan with respect to which there has been a reduction in
the amount of interest collectible thereon for the most recently ended
Collection Period as a result of the application of the Relief Act or similar
state laws, the amount by which (i) interest collectible on such Mortgage Loan
during such Collection Period is less than (ii) one month's interest on the
principal balance of such Mortgage Loan at the Mortgage Interest Rate for such
Mortgage Loan before giving effect to the application of the Relief Act or
similar state laws.
"REMIC": A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
"REMIC 1 Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of the sum of
the aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) the Uncertificated REMIC 1 Pass-Through Rate for REMIC
1 Regular Interest LT1AA minus the Marker Rate, divided by (b) 12.
"REMIC 1 Marker Allocation Percentage": 50% of any amount payable
from or loss attributable to the Mortgage Loans, which shall be allocated to
REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1AI1A, REMIC 1
Regular Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC 1 Regular Interest LT1M14 and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Overcollateralization Target Amount": 0.50% of the Targeted
Overcollateralization Amount.
"REMIC 1 Overcollateralized Amount": With respect to any date of
determination, (i) 0.50% of the aggregate Uncertificated Principal Balances of
the REMIC 1 Regular Interests minus (ii) the aggregate of the Uncertificated
Principal Balances of REMIC 1 Regular Interest LT1AI1A, REMIC 1 Regular Interest
LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular Interest LT1M1, REMIC
1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular
Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest LT1M6,
REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1 Regular
Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular Interest
LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular Interest LT1M13 and
REMIC 1 Regular Interest LT1M14, in each case as of such date of determination.
"REMIC 1 Principal Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) 50% of the
aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) 1 minus a fraction, the numerator of which is two
times the aggregate of the Uncertificated Principal Balances of REMIC 1 Regular
Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular Interest
LT1AII1, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1 Regular Interest
LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1
Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest
LT1M10, REMIC 1 Regular Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC
1 Regular Interest LT1M13 and REMIC 1 Regular Interest LT1M14, the denominator
of which is aggregate of the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular Interest LT1M11, REMIC 1 Regular
Interest LT1M12, REMIC 1 Regular Interest LT1M13, REMIC 1 Regular Interest
LT1M14 and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Regular Interest LT1AA": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AA
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AI1A": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AI1A
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AI1B": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AI1B
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1AII1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1AII1
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M1": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M1
shall accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.
"REMIC 1 Regular Interest LT1M2": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M2
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M3": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M3
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M4": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M4
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M5": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M5
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M6": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M6
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M7": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M7
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M8": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M8
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M9": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M9
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M10": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M10
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M11": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M11
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M12": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M12
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M13": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M13
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1M14": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1M14
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1SUB": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1SUB
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1XX": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1XX
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT1ZZ": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT1ZZ
shall accrue interest at the related Uncertificated REMIC 1 Pass- Through Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Principal Balance as set forth in the
Preliminary Statement hereto.
"REMIC 1 Regular Interest LT2GRP": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT2GRP
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interest LT2SUB": One of the separate
non-certificated beneficial ownership interests in REMIC 1 issued hereunder and
designated as a Regular Interest in REMIC 1. REMIC 1 Regular Interest LT2SUB
shall accrue interest at the related Uncertificated REMIC 1 Pass-Through Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Principal Balance as set forth in the Preliminary
Statement hereto.
"REMIC 1 Regular Interests": REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4, REMIC 1
Regular Interest LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1 Regular Interest
LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular Interest LT1M11, REMIC 1 Regular
Interest LT1M12, REMIC 1 Regular Interest LT1M13, REMIC 1 Regular Interest
LT1M14, REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC
1 Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP, REMIC 1 Regular
Interest LT1XX and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Sub WAC Allocation Percentage": 50% of any amount payable
or loss attributable from the Mortgage Loans, which shall be allocated to REMIC
1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1 Regular
Interest LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC 1 Regular Interest
LT1XX.
"REMIC 1 Subordinated Balance Ratio": The ratio among the
Uncertificated Principal Balances of each REMIC 1 Regular Interest ending with
the designation "SUB," equal to the ratio among, with respect to each such REMIC
1 Regular Interest, the excess of (x) the aggregate Principal Balance of the
Mortgage Loans in the related Loan Group over (y) the current Certificate
Principal Amount of the Class A Certificates in the related Loan Group.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits which appear at Section
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations and rulings promulgated thereunder, as the foregoing
may be in effect from time to time.
"REMIC Regular Interest": Either REMIC 1 Regular Interest or any of
the Certificates (other than the Class P and Class R Certificates).
"Remittance Report": A report prepared by the Servicer and delivered
to the Securities Administrator pursuant to Section 4.07, containing the
information attached hereto as Exhibit M.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code.
"REO Disposition": The sale or other disposition of an REO Property
on behalf of the Trust.
"REO Disposition Fee": The REO Disposition Fee shall be the greater
of one percent (1%) of the gross sales price of the REO Property or $1,500.00 up
to a maximum fee of $10,000 per REO Property.
"REO Imputed Interest": As to any REO Property, for any Collection
Period, an amount equivalent to interest (at the Net Mortgage Interest Rate that
would have been applicable to the related Mortgage Loan had it been outstanding)
for such Collection Period on the unpaid principal balance of the Mortgage Loan
as of the date of acquisition.
"REO Mortgage Loan": Any Mortgage Loan which is not a Liquidated
Mortgage Loan and as to which the indebtedness evidenced by the related Mortgage
Note is discharged and the related Mortgaged Property is held as part of the
Trust Fund.
"REO Principal Amortization": With respect to any REO Property, for
any calendar month, the aggregate of all amounts received in respect of such REO
Property during such calendar month, whether in the form of rental income, sale
proceeds (including, without limitation, that portion of the Termination Price
paid in connection with a purchase of all of the Mortgage Loans and REO
Properties pursuant to Section 10.01 that is allocable to such REO Property) or
otherwise, net of any portion of such amounts (i) payable pursuant to Section
3.13 in respect of the proper operation, management and maintenance of such REO
Property or (ii) payable or reimbursable to the Servicer pursuant to Section
3.13 for unpaid Servicing Fees in respect of the related Mortgage Loan and
payable and reimbursable to the Servicer or the Trustee for unreimbursed
Servicing Advances and Advances in respect of such REO Property or the related
Mortgage Loan.
"REO Property": A Mortgaged Property acquired by the Servicer on
behalf of the Trust through foreclosure or deed-in-lieu of foreclosure, as
described in Section 3.13.
"Request for Release": A release signed by a Servicing Officer, in
the form of Exhibit E attached hereto.
"Reserve Accounts": Any of the Class AI Reserve Account, the Class
AII Reserve Account or the Class M Reserve Account.
"Residential Dwelling": Any one of the following: (i) a detached
one-family dwelling, (ii) a detached two- to four-family dwelling, (iii) a
one-family dwelling unit in a condominium project, (iv) a manufactured home, or
(v) a detached one-family dwelling in a planned unit development, none of which
is a co-operative or mobile home.
"Residual Interest": The sole Class of "residual interests" in each
REMIC within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee or the
Securities Administrator, any officer assigned to its Corporate Trust Office (or
any successor thereto), including any Vice President, Assistant Vice President,
Trust Officer, any Assistant Secretary, any trust officer or any other officer
of the Trustee or the Securities Administrator customarily performing functions
similar to those performed by any of the above designated officers and in each
case having direct responsibility for the administration of this Agreement.
"Retained Mortgage File": A file maintained by Xxxxx Fargo Bank
prior to any Document Transfer Event for each Mortgage Loan that contains the
documents specified in Section 2.01(b) and any additional documents required to
be added to the Retained Mortgage File pursuant to this Agreement.
"S&P": Standard & Poor's, a division of The XxXxxx-Xxxx Companies,
Inc., and its successors, and if such company shall for any reason no longer
perform the functions of a securities rating agency, "S&P" shall be deemed to
refer to any other "nationally recognized statistical rating organization" as
set forth on the most current list of such organizations released by the
Commission.
"Sarbanes Oxley Certification": As defined in Section 3.28(b)
hereof.
"Securities Administrator": Xxxxx Fargo Bank, N.A., a national
banking association, or any successor Securities Administrator appointed as
herein provided.
"Seller": Xxxxx Fargo Bank, N.A., or its successor in interest, in
its capacity as seller under the Mortgage Loan Purchase Agreement.
"Senior Certificates": The Class A Certificates.
"Senior Enhancement Percentage": For any Distribution Date, the
percentage obtained by dividing (x) the sum of (i) the aggregate Principal
Balance of the Class M Certificates before taking into account the distribution
of the Principal Distribution Amount on such Distribution Date and (ii) the
Overcollateralization Amount as of the prior Distribution Date by (y) the Pool
Balance as of the last day of the related Collection Period.
"Senior Principal Distribution Amount": For any Distribution Date,
the sum of the Group I Senior Principal Distribution Amount for such
Distribution Date and the Group II Senior Principal Distribution Amount for such
Distribution Date.
"Senior Specified Enhancement Percentage": On any date of
determination thereof, 32.60%.
"Sequential Trigger Event": With respect to any Distribution Date if
(i) the aggregate Principal Balance of the Class M Certificates is reduced to
zero, (ii) with respect to any Distribution Date on or prior to the Distribution
Date in July 2007, the aggregate amount of Realized Losses incurred since the
Cut-off Date through the last day of the related Collection Period (reduced by
the aggregate amount of Subsequent Recoveries received since the Cut-off Date
through the last day of the related Collection Period) divided by the Pool
Balance on the Cut-off Date exceeds 1.25% or (iii) with respect to any
Distribution Date on or after the Distribution Date in July 2007, a Trigger
Event is in effect.
"Servicer": Xxxxx Fargo Bank, N.A., or any successor servicer
appointed as herein provided, in its capacity as Servicer hereunder. Initially
the servicing functions performed by Xxxxx Fargo Bank shall be performed by the
Xxxxx Fargo Home Mortgage division of Xxxxx Fargo Bank.
"Servicer Event of Termination": One or more of the events described
in Section 7.01.
"Servicer Modification": A modification to the terms of a Mortgage
Loan, in accordance with the terms of Section 3.01, as to which the Mortgagor is
in default or as to which, in the judgment of the Servicer, default is
reasonably foreseeable.
"Servicer Prepayment Penalty Payment Amount": The amount payable by
the Servicer in respect of any waived Prepayment Penalties pursuant to Section
3.01, which amount shall be equal to the difference between the amount of
Prepayment Penalty due by a Mortgagor before any waiver and the actual amount of
the Prepayment Penalty that was paid by the Mortgagor.
"Servicer Remittance Date": With respect to any Distribution Date,
the 23rd day of the month of such Distribution Date, or if such day is not a
Business Day, the preceding Business Day.
"Servicing Advances": All customary, reasonable and necessary "out
of pocket" costs and expenses incurred by the Servicer (including reasonable
attorneys' fees and disbursements) in the performance of its servicing
obligations, including, but not limited to, the cost of (i) the preservation,
restoration, inspection and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property and (iv) compliance with the
obligations under Section 3.08.
"Servicing Fee": With respect to each Mortgage Loan (including each
REO Property) and for any calendar month, an amount equal to one month's
interest (or in the event of any payment of interest which accompanies a
Principal Prepayment in full made by the Mortgagor during such calendar month,
interest for the number of days covered by such payment of interest) at the
Servicing Fee Rate on the same principal amount on which interest on such
Mortgage Loan accrues for such calendar month.
"Servicing Fee Rate": With respect to each Mortgage Loan, 0.50% per
annum.
"Servicing Officer": Any officer of the Servicer involved in, or
responsible for, the administration and servicing of Mortgage Loans, whose name
and specimen signature appear on a list of servicing officers furnished by the
Servicer to the Trustee, the Securities Administrator and the Depositor, as such
list may from time to time be amended.
"Servicing Standard": The standards set forth in Section 3.01.
"Startup Day": As defined in Section 9.01(b) hereof.
"Stayed Funds": Any payment required to be made under the terms of
the Certificates and this Agreement but which is not remitted by the Servicer
because the Servicer is the subject of a proceeding under the Bankruptcy Code
and the making of such remittance is prohibited by Section 362 of the Bankruptcy
Code.
"Stepdown Date": The earlier to occur of (i) the Distribution Date
on which the aggregate Principal Balance of the Class A Certificates is reduced
to zero and (ii) the later to occur of (x) the Distribution Date in July 2008
and (y) the Distribution Date on which the Senior Enhancement Percentage is
greater than or equal to the Senior Specified Enhancement Percentage.
"Subordinated Certificates": The Class M-1, Class M-2, Class M-3,
Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10,
Class M-11, Class M-12, Class M-13, Class M-14, Class CE and Class R
Certificates.
"Subsequent Recovery": Any amount (net of reimbursable expenses)
received on a Mortgage Loan subsequent to such Mortgage Loan being determined to
be a Liquidated Mortgage Loan that resulted in a Realized Loss in a prior month.
"Substitution Adjustment Amount": As defined in Section 2.03(d)
hereof.
"Targeted Overcollateralization Amount": As of any Distribution
Date, (x) prior to the Stepdown Date, 0.75% of the Cut-off Date Aggregate
Principal Balance and (y) on and after the Stepdown Date, (i) if a Trigger Event
has not occurred for such Distribution Date, the greater of (A) 1.50% of the
Pool Balance as of the last day of the related Collection Period and (B) 0.50%
of the Cut-off Date Aggregate Principal Balance and (ii) if a Trigger Event has
occurred for such Distribution Date, the Targeted Overcollateralization Amount
for the immediately preceding Distribution Date.
"Tax Matters Person": The tax matters person appointed pursuant to
Section 9.01(e) hereof.
"Tax Returns": The federal income tax returns on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of the REMIC Taxable Income or Net Loss Allocation, or any successor
forms, to be filed on behalf of the Trust for each of the two REMICs created
pursuant to this Agreement under the REMIC Provisions, together with any and all
other information reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.
"Telerate Page 3750": The display page currently so designated on
the Moneyline Telerate Service (or such other page as may replace the Telerate
Page 3750 page on that service for the purpose of displaying London interbank
offered rates of major banks).
"Termination Price": As defined in Section 10.01(a) hereof.
"Trigger Event": With respect to any Distribution Date, if (i) the
three-month rolling average of 60+ Day Delinquent Loans equals or exceeds 41.00%
of the Senior Enhancement Percentage or (ii) the aggregate amount of Realized
Losses incurred since the applicable Cut-off Date through the last day of the
related Collection Period (reduced by the aggregate amount of Subsequent
Recoveries received since the applicable Cut-off Date through the end of the
last day of the related Collection Period) divided by the Cut-off Date Aggregate
Principal Balance exceeds the applicable percentages set forth below with
respect to such Distribution Date:
Distribution Date Occurring In Percentage
------------------------------ ----------
July 2007 through June 2008 1.25%
July 2008 through June 2009 2.50%
July 2009 through June 2010 4.00%
July 2010 through June 2011 4.75%
July 2011 and thereafter 5.00%
"Trust": Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1
Trust, the trust created hereunder.
"Trust Fund": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to a portion of which two REMIC elections are to be made, such
entire Trust Fund consisting of: (i) such Mortgage Loans as from time to time
are subject to this Agreement, together with the Mortgage Files relating
thereto, and together with all collections thereon and proceeds thereof, (ii)
any REO Property, together with all collections thereon and proceeds thereof,
(iii) the Trustee's rights with respect to the Mortgage Loans under all
insurance policies required to be maintained pursuant to this Agreement and any
proceeds thereof, (iv) the Depositor's rights under the Mortgage Loan Purchase
Agreement (including any security interest created thereby), (v) the Securities
Administrator's rights under each of the Yield Maintenance Agreements and (vi)
the Collection Account, the Distribution Account and the Reserve Accounts and
such assets that are deposited therein from time to time and any investments
thereof, together with any and all income, proceeds and payments with respect
thereto.
"Trustee": HSBC Bank USA, National Association, a national banking
association, in its capacity as trustee hereunder, or any successor Trustee
appointed as herein provided.
"Uncertificated Accrued Interest": With respect to each REMIC 1
Regular Interest on each Distribution Date, an amount equal to one month's
interest at the related Uncertificated Pass-Through Rate on the Uncertificated
Principal Balance of such REMIC Regular Interest. In each case, Uncertificated
Accrued Interest will be reduced by any Prepayment Interest Shortfalls and
Relief Act Interest Shortfalls (allocated to such REMIC Regular Interests based
on their respective entitlements to interest irrespective of any Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such Distribution
Date).
"Uncertificated Principal Balance": The amount of either REMIC 1
Regular Interest outstanding as of any date of determination. As of the Closing
Date, the Uncertificated Balance of each REMIC 1 Regular Interest shall equal
the amount set forth in the Preliminary Statement hereto as its initial
uncertificated balance. On each Distribution Date, the Uncertificated Principal
Balance of each REMIC 1 Regular Interest shall be reduced by all distributions
of principal made on such REMIC 1 Regular Interest on such Distribution Date
pursuant to Section 4.08 and, if and to the extent necessary and appropriate,
shall be further reduced on such Distribution Date by Realized Losses as
provided in Section 4.08(b). The Uncertificated Balance of REMIC 1 Regular
Interest LT1ZZ shall be increased by interest deferrals as provided in Section
4.08(a)(i). The Uncertificated Balance of each REMIC 1 Regular Interest shall
never be less than zero.
"Uncertificated REMIC 1 Pass-Through Rate": With respect to REMIC 1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1AI1A, REMIC 1 Regular
Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1
Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular
Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular Interest
LT1M13, REMIC 1 Regular Interest LT1M14, REMIC 1 Regular Interest LT1ZZ, REMIC 1
Regular Interest LT1SUB, REMIC 1 Regular Interest LT2SUB and REMIC 1 Regular
Interest LT1XX, the Weighted Average Net Mortgage Rate of the Mortgage Loans.
With respect to REMIC 1 Regular Interest LT1GRP, the Weighted Average Net
Mortgage Rate of the Group I Mortgage Loans. With respect REMIC 1 Regular
Interest LT2GRP, the Weighted Average Net Mortgage Interest Rate of the Group II
Mortgage Loans.
"United States Person" or "U.S. Person": (i) A citizen or resident
of the United States, (ii) a corporation, partnership or other entity treated as
a corporation or partnership for United States federal income tax purposes
organized in or under the laws of the United States or any state thereof or the
District of Columbia (unless, in the case of a partnership, Treasury Regulations
provide otherwise), (iii) an estate the income of which is includible in gross
income for United States tax purposes, regardless of its source, or (iv) a trust
if a court within the United States is able to exercise primary supervision over
the administration of the trust and one or more United States persons have
authority to control all substantial decisions of the trust. Notwithstanding the
preceding sentence, to the extent provided in Treasury Regulations, certain
Trusts in existence on August 20, 1996, and treated as United States persons
prior to such date, that elect to continue to be treated as United States
persons will also be a U.S. Person; provided, that for purposes of the
definition of a "Permitted Transferee," a U.S. Person shall not include any
person whose income is attributable to a foreign permanent establishment or
fixed base, within the meaning of an applicable income tax treaty, of such
Person or any other Person.
"Unpaid Realized Loss Amount": For any Class X-0, Xxxxx X-0, Class
M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class
M-10, Class M-11, Class M-12, Class M-13 and Class M-14 Certificates and as to
any Distribution Date, the excess of (x) the aggregate Applied Realized Loss
Amounts applied with respect to such Class for all prior Distribution Dates over
(y) the sum of (a) the aggregate amount of any Subsequent Recoveries allocated
to such Class and (b) the aggregate Realized Loss Amortization Amounts with
respect to such Class for all prior Distribution Dates.
"Value": With respect to any Mortgaged Property, the value thereof
as determined by an independent appraisal made at the time of the origination of
the related Mortgage Loan or the sale price, if the appraisal is not available.
"Voting Interests": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. The Voting Interests
allocated among Holders of the Certificates (other than the Class CE, Class P
and Class R Certificates) shall be 98%, and shall be allocated among each such
Class according to the fraction, expressed as a percentage, the numerator of
which is the aggregate Principal Balance of all the Certificates of such Class
then outstanding and the denominator of which is the aggregate Principal Balance
of all the Certificates (other than the Class CE, Class P and Class R
Certificates) then outstanding. The Voting Interests allocated to each such
Class of Certificates shall be allocated among all holders of each such Class in
proportion to the outstanding Principal Balance of such Certificates; provided,
however, that any Certificate registered in the name of the Servicer, the
Depositor, the Securities Administrator or the Trustee or any of their
respective affiliates shall not be included in the calculation of Voting
Interests; provided that only such Certificates as are known by a Responsible
Officer of the Securities Administrator to be so registered will be so excluded.
1% of all the Voting Interests will be allocated to the Holders of each of the
Class CE and Class P Certificates. The Class R Certificates shall have no Voting
Interests.
"Weighted Average Net Mortgage Rate": The weighted average (based on
the unpaid principal balance as of the first day of the related Collection
Period or, in the case of the first Distribution Date, the applicable Cut-Off
Date) of the Net Mortgage Interest Rates of the Mortgage Loans, the Group I
Mortgage Loans or the Group II Mortgage Loans, as applicable, expressed for each
such Mortgage Loan as an annual rate and calculated on the basis of twelve
months consisting of 30 days each and a 360-day year.
"Xxxxx Fargo Bank": Xxxxx Fargo Bank, N.A., or its successor in
interest.
"Xxxxx Fargo Bank Correspondents": The entities identified on a list
provided by Xxxxx Fargo Bank to the Servicer, from which Xxxxx Fargo Bank
purchased the Mortgage Loans.
"Written Order to Authenticate": A written order by which the
Depositor directing the Securities Administrator to execute, authenticate and
deliver the Certificates.
"Yield Maintenance Agreement": Any of the Class AI Yield Maintenance
Agreement, the Class AII Yield Maintenance Agreement or the Class M Yield
Maintenance Agreement.
"Yield Maintenance Agreement Payment": Any of the Class AI Yield
Maintenance Agreement Payment, the Class AII Yield Maintenance Agreement Payment
or the Class M Yield Maintenance Agreement Payment.
"Yield Maintenance Agreement Provider": Bear Xxxxxxx Financial
Products Inc., and any successor thereto.
Section 1.02 Accounting.
Unless otherwise specified herein, for the purpose of any definition
or calculation, whenever amounts are required to be netted, subtracted or added
or any distributions are taken into account such definition or calculation and
any related definitions or calculations shall be determined without duplication
of such functions.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, on behalf of the Trust, without recourse for the benefit of the
Certificateholders all the right, title and interest of the Depositor, including
any security interest therein for the benefit of the Depositor, in and to (i)
each Mortgage Loan identified on the Mortgage Loan Schedules, including the
related Cut-off Date Principal Balance, all interest accruing thereon after the
applicable Cut-off Date and all collections in respect of interest and principal
due after the applicable Cut-off Date; (ii) property which secured each such
Mortgage Loan and which has been acquired by foreclosure or deed in lieu of
foreclosure; (iii) its interest in any insurance policies in respect of the
Mortgage Loans; (iv) all other assets included or to be included in the Trust
Fund; (v) all proceeds of any of the foregoing; and (vi) the rights of the
Depositor under the Mortgage Loan Purchase Agreement. Such assignment includes
all interest and principal due to the Depositor or the Servicer after the
applicable Cut-off Date with respect to the Mortgage Loans. It is agreed and
understood by the Depositor and the Trustee that it is not intended that any
mortgage loan be included in the Trust Fund that is a "High-Cost Home Loan" as
defined in (i) the New Jersey Home Ownership Act effective November 27, 2003,
(ii) the New Mexico Home Loan Protection Act effective January 1, 2004, (iii)
the Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
or (iv) the Indiana Home Loan Practices Act, effective January 1, 2005.
In connection with such assignment, the Depositor shall, with
respect to each Mortgage Loan, deliver, or cause to be delivered, to the
Custodian, on or before the Closing Date the following documents or instruments
with respect to each Mortgage Loan:
(i) The original Mortgage Note either (A) endorsed in blank or (B)
endorsed as provided in Section 2.01(d), with all prior and intervening
endorsements as may be necessary to show a complete chain of endorsements
or with respect to any Mortgage Loan as to which the original Mortgage
Note has been permanently lost or destroyed and has not been replaced, a
lost note affidavit with a copy of the Mortgage Note and, in the case of
any Mortgage Loan originated in the State of New York documented by a
NYCEMA, the NYCEMA, the new Mortgage Note, if applicable, the consolidated
Mortgage Note and the consolidated Mortgage;
(ii) A recorded original assignment of the related Mortgage from
Xxxxx Fargo Bank assigning the related Mortgage to the Trustee, certified
by the recording office, or, if such assignment is in the process of being
recorded, a copy of the related Mortgage transmitted for recordation
certified by an officer of Xxxxx Fargo Bank or applicable Xxxxx Fargo Bank
Correspondent to be a true and correct copy of such assignment submitted
for recordation; provided, however, if recordation is not required as
described below, an assignment in recordable form (which may be assigned
in blank) with respect to the related Mortgage;
(iii) The original of each assumption agreement, modification,
written assurance or substitution agreement pertaining to such Mortgage
Note, if any; and
(iv) For each Mortgage Loan secured by Co-op Shares, the originals
of the following documents or instruments:
(A) The loan security agreement;
(B) The stock certificate;
(C) The stock power, executed in blank;
(D) The executed proprietary lease;
(E) The executed recognition agreement;
(F) The executed UCC-1 financing statement with evidence of
recording thereon; and
(G) The executed UCC-3 financing statements or other
appropriate UCC financing statements required by state law,
evidencing a complete and unbroken chain from the mortgagee to the
Trustee with evidence of recording thereon (or in a form suitable
for recordation).
(b) Following a Document Transfer Event, the Seller shall, with
respect to each Mortgage Loan, deliver, or cause to be delivered, to the
corporate trust services division of the Custodian within 60 days copies (which
may be in electronic form mutually agreed upon by the Seller and the Custodian)
of the following additional documents or instruments with respect to each
Mortgage Loan; provided, however, that originals of such documents or
instruments shall be delivered to the Custodian if originals are required under
the law in which the related Mortgaged Property is located in order to exercise
all remedies available to the Trust under applicable law following default by
the related Mortgagor:
(i) The original recorded Mortgage with evidence of recordation
noted thereon or attached thereto, together with any addenda or riders
thereto, or a copy of such recorded Mortgage with such evidence of
recordation certified to be true and correct by the appropriate
governmental recording office; or a copy of such recorded Mortgage with
such evidence of recordation, or if the original Mortgage has been
submitted for recordation but has not been returned from the applicable
public recording office, a copy of the Mortgage certified by an officer of
Xxxxx Fargo Bank or the applicable Xxxxx Fargo Bank Correspondent to be a
true and correct copy of the original Mortgage submitted for recordation;
(ii) The original of each assumption agreement, modification,
written assurance or substitution agreement pertaining to such Mortgage,
if any, or, if such document is in the process of being recorded, a copy
of such document, certified by an officer of Xxxxx Fargo Bank or the
applicable Xxxxx Fargo Bank Correspondent of such Mortgage Loan or by the
applicable title insurance company, closing agent, settlement agent,
escrow agent or closing attorney to be a true and correct copy of such
document transmitted for recordation, if any;
(iii) For each MERS Mortgage Loan that is not a MOM Mortgage Loan,
the original assignment showing MERS as the assignee of the Mortgage, with
evidence of recording thereon or copies thereof certified by an officer of
Xxxxx Fargo Bank or the applicable Xxxxx Fargo Bank Correspondent to have
been submitted for recordation;
(iv) Each original recorded intervening assignment of the Mortgage
as may be necessary to show a complete chain of title from the Mortgage
Loan originator to Xxxxx Fargo Bank or Xxxxx Fargo Home Mortgage, Inc.,
with evidence of recordation noted thereon or attached thereto, or a copy
of such assignment with such evidence of recordation to be true and
correct by the appropriate governmental recording office, or, if any such
assignment has been submitted for recordation but has not been returned
from the applicable public recording office or is not otherwise available,
a copy of such assignment certified by an officer of Xxxxx Fargo Bank or
the applicable Xxxxx Fargo Bank Correspondent to be a true and correct
copy of the recorded assignment submitted for recordation; and
(v) The original policy of the title insurance or certificate of
title insurance or a written commitment to issue such a title insurance
policy or certificate of title insurance, or a copy of such title
insurance certified as true and correct by the applicable insurer or any
attorney's certificate of title with an Officer's Certificate of Xxxxx
Fargo Bank or the applicable Xxxxx Fargo Bank Correspondent that such
attorney's certificate of title is customarily used in lieu of a title
insurance policy in the jurisdiction in which the related mortgage
property is located.
(c) If any assignment of a Mortgage to the Trustee is in the process
of being recorded on the Closing Date, the Depositor shall use its best efforts
to cause each such original recorded document or certified copy thereof to be
delivered to the Custodian promptly following its recordation, but in no event
later than one (1) year following the Closing Date. If any Mortgage has been
recorded in the name of MERS or its designee, no assignment of Mortgage in favor
of the Trustee will be required to be prepared or delivered and instead, the
Master Servicer shall take all actions as are necessary to cause the Trust Fund
to be shown as the owner of the related Mortgage Loan on the records of MERS for
the purpose of the system of recording transfers of beneficial ownership of
mortgages maintained by MERS. The Depositor shall also cause to be delivered to
the Custodian any other original mortgage loan document included in the Owner
Mortgage File (and, if applicable, the Retained Mortgage File) if a copy thereof
has been delivered. The Depositor shall pay from its own funds, without any
right of reimbursement therefor, the amount of any costs, liabilities and
expenses incurred by the Trust by reason of the failure of the Depositor to
cause to be delivered to the Custodian within one (1) year following the Closing
Date any assignment of a Mortgage (except with respect to any Mortgage recorded
in the name of MERS) not delivered to the Custodian on the Closing Date.
In lieu of recording an assignment of any Mortgage the Depositor
may, deliver or cause to be delivered to the Custodian the assignment of the
Mortgage Loan to the Trustee in a form suitable for recordation, if (i) with
respect to a particular state the Trustee and the Custodian have received an
Opinion of Counsel acceptable to it that such recording is not required to make
the assignment effective against the parties to the Mortgage or subsequent
purchasers or encumbrancers of the Mortgaged Property or (ii) the Depositor has
been advised by each Rating Agency that non-recordation in a state will not
result in a reduction of the rating assigned by that Rating Agency at the time
of initial issuance of the Certificates. Set forth on Exhibit Q attached hereto
is a list of all states where recordation is required by either Rating Agency to
obtain the initial ratings of the Certificates. The Custodian may rely and shall
be protected in relying upon the information contained in such Exhibit Q. In the
event that the Custodian receives notice that recording is required to protect
the right, title and interest of the Trustee in and to any such Mortgage Loan
for which recordation of an assignment has not previously been required, the
Custodian shall promptly notify the Trustee and the Custodian shall within five
Business Days (or such other reasonable period of time mutually agreed upon by
the Custodian and the Trustee) of its receipt of such notice deliver each
previously unrecorded assignment to the related Servicer for recordation.
(d) Except for Mortgage Notes endorsed in blank, endorsements shall
comply with the following format:
WITHOUT RECOURSE
PAY TO THE ORDER OF:
HSBC BANK USA, NATIONAL ASSOCIATION, AS
TRUSTEE under the pooling and servicing
agreement dated as of [June 29, 2005].
and its successors and assigns,
[Xxxxx Fargo Bank, N.A.][Xxxxx Fargo Home Mortgage, Inc.]
[Signature of Officer]
[Officer's Name and Title]
Except where assignments in blank are authorized or in the case of
any Mortgage registered in the name of MERS, assignments of any Mortgage shall
comply with the following:
HSBC BANK USA, NATIONAL ASSOCIATION, AS
TRUSTEE
and its successors and assigns
Section 2.02 Acceptance by Custodian.
The Custodian, on behalf of the Trustee, acknowledges the receipt
of, subject to the provisions of Section 2.01 and subject to the review
described below and any exceptions noted on the exception report described in
the next paragraph below, the documents referred to in Section 2.01 above and
all other assets included in the definition of "Trust Fund" and declares that it
holds and will hold such documents and the other documents delivered to it
constituting the Owner Mortgage File (and in the case of a Document Transfer
Event, the Retained Mortgage File), and that it holds or will hold all such
assets and such other assets included in the definition of "Trust Fund" in trust
for the exclusive use and benefit of all present and future Certificateholders.
The Custodian, for the benefit of the Certificateholders, shall
execute and deliver to the Servicer, the Securities Administrator, the Trustee
and the Depositor on or prior to the Closing Date an initial certification in
the form attached hereto as Exhibit F-1 hereto, to the effect that, except as
may be specified in a list of exceptions attached thereto, it has received the
original Mortgage Notes (described in Section 2.01(a)(i)) relating to each
Mortgage Loan listed in the Mortgage Loan Schedules (other than any Mortgage
Loan that has been paid in full, liquidated or otherwise released as of the date
of such certification, and subject to any exceptions specifically identified in
the exception report annexed to such certification).
The Custodian will review each Owner Mortgage File within 45 days
after execution of this Agreement. The Custodian will deliver no later than 30
days after completion of such review to the Seller and the Trustee a final
certification in the form of Exhibit F-2 hereto to the effect that, except as
may be specified in a list of exceptions attached thereto, all required
documents set forth in Section 2.01(a) have been executed and received and
appear regular on their face, and that such documents relate to the Mortgage
Loans identified in the Mortgage Loan Schedule based on a comparison of the
Mortgage Loan identifying number, Mortgagor name and street address, and in so
doing the Custodian may rely on the purported due execution and genuineness of
any such document and on the purported genuineness of any signature thereon.
If in the process of reviewing the Mortgage Files and making or
preparing, as the case may be, the certifications referred to above, the
Custodian finds any document or documents constituting a part of a Mortgage File
to be missing or defective in any material respect, at the conclusion of its
review the Custodian shall so notify the Depositor, the Trustee, the Securities
Administrator and the Servicer.
The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage Loans and the
Related Documents, conveying good title thereto free and clear of any liens and
encumbrances, from the Depositor to the Trustee and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee, on behalf
of the Trust, a first priority perfected security interest in all of the
Depositor's right, title and interest in and to the Mortgage Loans and the
Related Documents, and that this Agreement shall constitute a security agreement
under applicable law.
The Securities Administrator is hereby directed to execute and
deliver, on behalf of the Trust, the Yield Maintenance Agreements.
Section 2.03 Repurchase or Substitution of Mortgage Loans by the
Depositor.
(a) Upon discovery or receipt of written notice of any materially
defective document in, or that a document is missing from, an Owner Mortgage
File (or, if applicable, a Retained Mortgage File) or of a breach of a
representation of warranty of the Depositor in Section 2.04 hereof, in respect
of any Mortgage Loan and, except for a breach of the representations and
warranties set forth in clause (ee) of Section 2.04, such breach materially
adversely affects the value of such Mortgage Loan, Prepayment Penalty or the
interest therein of the Certificateholders, the Trustee (or the Custodian) shall
promptly notify the Depositor and the Servicer of such defect, missing document
or breach and request that the Depositor cure such defect or breach or deliver
such missing document within 60 days from the date the Depositor was notified of
such missing document, breach or defect. If the Depositor does not deliver such
missing document or cure such defect or cure such breach in all material
respects during such period, the Depositor shall repurchase such Mortgage Loan
from the Trust Fund at the Purchase Price on or prior to the Determination Date
following the expiration of such period (subject to Section 2.03(d)) and the
last paragraph of this Section 2.03(a). The Purchase Price for the repurchased
Mortgage Loan shall be deposited in the Collection Account, and the Custodian,
upon receipt of written notice from the Servicer of such deposit, shall release
to the Depositor the related Owner Mortgage File (and, if applicable, Retained
Mortgage File). The Trustee shall execute and deliver such instrument of
transfer or assignment (or, in the case of a Mortgage Loan registered in the
name of MERS or its designee, the Servicer shall reflect such assignment on the
records of MERS), in each case without recourse, and deliver such instruments of
transfer or assignment, in each case without recourse, as the Depositor shall
furnish to it and as shall be necessary to vest in the Depositor any Mortgage
Loan released pursuant hereto and the Custodian and the Trustee shall have no
further responsibility with regard to such Owner Mortgage File (and, if
applicable, Retained Mortgage File). In lieu of repurchasing any such Mortgage
Loan as provided above, the Depositor may cause such Mortgage Loan to be removed
from the Trust Fund (in which case it shall become a Defective Mortgage Loan)
and substitute one or more Eligible Substitute Mortgage Loans in the manner and
subject to the limitations set forth in Section 2.03(d).
It is understood and agreed that the representations and warranties
set forth in Section 2.04 hereof shall survive delivery of the Owner Mortgage
Files (and, if applicable, Retained Mortgage Files) to the Custodian and shall
inure to the benefit of the Certificateholders notwithstanding any restrictive
or qualified endorsement or assignment. It is understood and agreed that the
obligations of the Depositor set forth in this Section 2.03(a) to cure,
substitute for or repurchase a Mortgage Loan and to pay the Reimbursement Amount
constitute the sole remedies available to the Certificateholders and to the
Trustee on their behalf respecting a breach of the representations and
warranties in Section 2.04 hereof.
Notwithstanding anything to the contrary in this Section 2.03, with
respect to any breach by the Depositor of the representation and warranty set
forth in Section 2.04(z), which breach materially and adversely affects the
value of any Prepayment Penalty or the interest of the Trust therein, the
Depositor shall not be required to repurchase such Mortgage Loans as set forth
in this Section 2.03(a). However, the Originator shall remedy such breach as
follows: Upon any Principal Prepayment with respect to the affected Mortgage
Loan, the Originator shall pay to the Trust the excess, if any, of (x) the
amount of such Prepayment Penalty calculated as set forth in the matrices
attached hereto as Exhibit R over (y) the amount collected from the Mortgagor in
respect of such Prepayment Penalty. Such amount payable by the Originator shall
be paid by the Servicer Remittance Date in the month following the month in
which the related Principal Prepayment occurred.
(b) In addition to the foregoing, in the case of a breach of the
Depositor's representation set forth in Section 2.04(i) and (dd) hereof, the
Depositor shall pay to the Trust the Reimbursement Amount. The Reimbursement
Amount shall be delivered to the Servicer for deposit into the Collection
Account within 10 days from the date the Depositor was notified by the Trustee
of the amount of such costs and damages.
(c) Within 90 days of the earlier of discovery by the Servicer or
receipt of notice by the Servicer of the breach of any representation, warranty
or covenant of the Servicer set forth in Section 2.05 which materially and
adversely affects the interests of the Certificateholders in any Mortgage Loan,
the Servicer shall cure such breach in all material respects.
(d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be effected prior
to the last Business Day that is within two years after the Closing Date. As to
any Defective Mortgage Loan for which the Depositor substitutes an Eligible
Substitute Mortgage Loan or Loans, such substitution shall be effected by the
Depositor delivering to the Custodian, on the Trustee's behalf for such Eligible
Substitute Mortgage Loan or Loans, the documents required by Section 2.01,
together with an Officers' Certificate providing that each such Eligible
Substitute Mortgage Loan satisfies the definition thereof and specifying the
Substitution Adjustment Amount (as described below), if any, in connection with
such substitution. The Custodian shall acknowledge receipt for such Eligible
Substitute Mortgage Loan or Loans and, within ten Business Days thereafter, the
Custodian shall review such documents as specified in Section 2.02 and deliver
to the Servicer and the Trustee, with respect to such Eligible Substitute
Mortgage Loan or Loans, a certification substantially in the form attached
hereto as Exhibit F-1, with any applicable exceptions noted thereon. Within one
year of the date of substitution, the Custodian shall deliver to the Servicer
and the Trustee a certification substantially in the form of Exhibit F-2 hereto
with respect to such Eligible Substitute Mortgage Loan or Loans, with any
applicable exceptions noted thereon. Monthly Payments due with respect to
Eligible Substitute Mortgage Loans in the month of substitution are not part of
the Trust Fund and will be retained by the Depositor. For the month of
substitution, distributions to Certificateholders will reflect the collections
and recoveries in respect of such Defective Mortgage Loan in the Collection
Period or Prepayment Period, as applicable, preceding the date of substitution
and the Depositor shall thereafter be entitled to retain all amounts
subsequently received in respect of such Defective Mortgage Loan. The Depositor
shall give or cause to be given written notice to the Certificateholders that
such substitution has taken place, shall amend the applicable Mortgage Loan
Schedule to reflect the removal of such Defective Mortgage Loan from the terms
of this Agreement and the substitution of the Eligible Substitute Mortgage Loan
or Loans and shall deliver a copy of such amended Mortgage Loan Schedule to the
Trustee. Upon such substitution, such Eligible Substitute Mortgage Loan or Loans
shall constitute part of the Mortgage Pool and shall be subject in all respects
to the terms of this Agreement, including all applicable representations and
warranties as of the date of substitution.
For any month in which the Depositor substitutes one or more
Eligible Substitute Mortgage Loans for one or more Defective Mortgage Loans,
including any substitution pursuant to Section 2.08, the Servicer will determine
the amount (the "Substitution Adjustment Amount"), if any, by which the
aggregate Purchase Price of all such Defective Mortgage Loans (or Mortgage Loan,
in the case of a substitution pursuant to Section 2.08) exceeds the aggregate,
as to each such Eligible Substitute Mortgage Loan, of the principal balance
thereof as of the date of substitution, together with one month's interest on
such principal balance at the applicable Net Mortgage Interest Rate. On the date
of such substitution, the Depositor will deliver or cause to be delivered to the
Servicer for deposit in the Collection Account an amount equal to the
Substitution Adjustment Amount, if any, and the Trustee, upon receipt of the
related Eligible Substitute Mortgage Loan or Loans and notice by the Servicer of
such deposit, shall release to the Depositor the related Owner Mortgage File
(and, if applicable, Retained Mortgage File) and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as the
Depositor shall deliver to it and as shall be necessary to vest therein any
Defective Mortgage Loan released pursuant hereto.
In addition, the Depositor shall obtain at its own expense and
deliver to the Trustee an Opinion of Counsel to the effect that such
substitution will not cause (a) any federal tax to be imposed on the Trust Fund,
including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(l) of the Code or on "contributions after
the startup date" under Section 860G(d)(l) of the Code, or (b) either REMIC to
fail to qualify as a REMIC at any time that any Certificate is outstanding. If
such Opinion of Counsel can not be delivered, then such substitution may only be
effected at such time as the required Opinion of Counsel can be given.
(e) Upon discovery by the Depositor, the Seller, the Servicer, the
Securities Administrator, the Custodian or the Trustee that any Mortgage Loan
does not constitute a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Code, the party discovering such fact shall within two
Business Days give written notice thereof to the other parties. In connection
therewith, the Depositor shall repurchase or, subject to the limitations set
forth in Section 2.03(d), substitute one or more Eligible Substitute Mortgage
Loans for the affected Mortgage Loan within 60 days of the earlier of discovery
or receipt of such notice with respect to such affected Mortgage Loan. In
addition, upon discovery that a Mortgage Loan is defective in a manner that
would cause it to be a "defective obligation" within the meaning of Treasury
Regulations relating to REMICs, the Depositor shall cure the defect or make the
required purchase or substitution no later than 60 days after the discovery of
the defect. Any such repurchase or substitution shall be made in the same manner
as set forth in Section 2.03(a). The Trustee shall reconvey to the Depositor the
Mortgage Loan to be released pursuant hereto in the same manner, and on the same
terms and conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.
Section 2.04 Representations and Warranties of the Depositor with
respect to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee for the
benefit of the Certificateholders that as of the Closing Date or as of such
other date specifically provided herein:
(a) The information set forth in the Mortgage Loan Schedules was
true and correct in all material respects, including, without limitation, the
information regarding any Prepayment Penalty, at the date or dates respecting
which such information was furnished as specified in the Mortgage Loan
Schedules;
(b) Immediately prior to the transfer and assignment contemplated
herein, the Depositor was the sole owner and holder of the Mortgage Loan free
and clear of any and all liens, pledges, charges or security interests of any
nature and has full right and authority to sell and assign the same;
(c) All payments required to be made up to the Due Date for such
Mortgage Loan immediately preceding the Closing Date under the terms of the
related Mortgage Note have been made and no Mortgage Loan had more than one
delinquency in the 12 months preceding the applicable Cut-off Date;
(d) The Mortgage Note, the related Mortgage and other agreements
executed in connection therewith are genuine, and each is the legal, valid and
binding obligation of the maker thereof, enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors'
rights generally and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law); and, to the best
of the Depositor's knowledge, all parties to the Mortgage Note and the Mortgage
had legal capacity to execute the Mortgage Note and the Mortgage and each
Mortgage Note and Mortgage has been duly and properly executed by the Mortgagor;
(e) All taxes, governmental assessments, insurance premiums, and
water, sewer and municipal charges, which previously became due and owing have
been paid, or an escrow of funds has been established, to the extent permitted
by law, in an amount sufficient to pay for every such item which remains unpaid;
and neither the Servicer nor the Depositor has advanced funds, or received any
advance of funds by a party other than the Mortgagor, directly or indirectly for
the payment of any amount required by the Mortgage, except for interest accruing
from the date of the Mortgage Note or date of disbursement of the Mortgage Loan
proceeds, whichever is later, to the day which precedes by thirty days the first
Due Date under the related Mortgage Note;
(f) Neither the Depositor nor any prior holder of the Mortgage or
the related Mortgage Note has modified the Mortgage or the related Mortgage Note
in any material respect, satisfied, canceled or subordinated the Mortgage in
whole or in part, released the Mortgaged Property in whole or in part from the
lien of the Mortgage, or executed any instrument of release, cancellation,
modification or satisfaction, except in each case as is reflected in an
agreement delivered to the Trustee or the Custodian pursuant to Section 2.01;
(g) No Mortgage Note or Mortgage is subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury,
nor will the operation of any of the terms of the Mortgage Note or Mortgage, or
the exercise of any right thereunder, render the Mortgage Note or Mortgage
unenforceable, in whole or in part, or subject it to any right of rescission,
set-off, counterclaim or defense, including the defense of usury, and no such
right of rescission, set-off, counterclaim or defense has been asserted with
respect thereto;
(h) The Mortgage is a valid, subsisting and enforceable first lien
on the property therein described, and the Mortgaged Property is free and clear
of all encumbrances and liens having priority over the first lien of the
Mortgage except for liens for real estate taxes and special assessments not yet
due and payable and liens or interests arising under or as a result of any
federal, state or local law, regulation or ordinance relating to hazardous
wastes or hazardous substances, and, if the related Mortgaged Property is a
condominium unit, any lien for common charges permitted by statute or homeowners
association fees; and any security agreement, chattel mortgage or equivalent
document related to, and delivered to the Trustee or to the Custodian with, any
Mortgage establishes in the Depositor a valid and subsisting first lien on the
property described therein and the Depositor has full right to sell and assign
the same to the Trustee;
(i) Each Mortgage Loan at the time it was originated complied in all
material respects with applicable federal, state and local laws including,
without limitation, truth-in-lending, real estate settlement procedures,
consumer credit protection, equal credit opportunity, predatory and abusive
lending laws and disclosure laws;
(j) Each Mortgaged Property is located in the United States and
consists of a one- to four-unit residential property, which may include a
detached home, townhouse, condominium unit, a unit in a planned unit development
or a manufacturing housing unit which constitutes real property for purposes of
the applicable state law;
(k) Except for Mortgage Loans secured by residential long-term
leases, the Mortgaged Property consists of a fee simple estate in real property;
all of the improvements which are included for the purpose of determining the
appraised value of the Mortgaged Property lie wholly within the boundaries and
building restriction lines of such property and no improvements on adjoining
properties encroach upon the Mortgaged Property (unless insured against under
the related title insurance policy); and to the best of the Depositor's
knowledge, the Mortgaged Property and all improvements thereon comply with all
requirements of any applicable zoning and subdivision laws and ordinances;
(l) With respect to each Mortgage where a lost note affidavit has
been delivered to the Custodian on the Trustee's behalf in place of the related
Mortgage Note, the related Mortgage Note is no longer in existence;
(m) The proceeds of the Mortgage Loans have been fully disbursed,
there is no requirement for future advances thereunder and any and all
requirements as to completion of any on-site or off-site improvements and as to
disbursements of any escrow funds therefor have been complied with (except for
escrow funds for exterior items which could not be completed due to weather and
escrow funds for the completion of swimming pools); and all costs, fees and
expenses incurred in making, closing or recording the Mortgage Loan have been
paid, except recording fees with respect to Mortgages not recorded as of the
Closing Date;
(n) The Mortgage Loan (except any Mortgage Loan secured by a
Mortgaged Property located in any jurisdiction, as to which an opinion of
counsel of the type customarily rendered in such jurisdiction in lieu of title
insurance is instead received) is covered by an American Land Title Association
mortgagee title insurance policy or other generally acceptable form of policy or
insurance acceptable to Xxxxxx Xxx or Xxxxxxx Mac, issued by a title insurer
acceptable to Xxxxxx Mae or Xxxxxxx Mac insuring the originator, its successors
and assigns, as to the first priority lien of the Mortgage in the original
principal amount of the Mortgage Loan and subject only to (A) the lien of
current real property taxes and assessments not yet due and payable, (B)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record as of the date of recording of such Mortgage acceptable
to mortgage lending institutions in the area in which the Mortgaged Property is
located or specifically referred to in the appraisal performed in connection
with the origination of the related Mortgage Loan, (C) liens created pursuant to
any federal, state or local law, regulation or ordinance affording liens for the
costs of clean-up of hazardous substances or hazardous wastes or for other
environmental protection purposes and (D) such other matters to which like
properties are commonly subject which do not individually, or in the aggregate,
materially interfere with the benefits of the security intended to be provided
by the Mortgage; the Depositor is the sole insured of such mortgagee title
insurance policy, the assignment to the Trustee of the Depositor's interest in
such mortgagee title insurance policy does not require any consent of or
notification to the insurer which has not been obtained or made, such mortgagee
title insurance policy is in full force and effect and will be in full force and
effect and inure to the benefit of the Trustee, no claims have been made under
such mortgagee title insurance policy, and no prior holder of the related
Mortgage, including the Depositor, has done, by act or omission, anything which
would impair the coverage of such mortgagee title insurance policy;
(o) To the best of the Depositor's knowledge, there is no default,
breach, violation or event of acceleration existing under the Mortgage or the
related Mortgage Note and no event which, with the passage of time or with
notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event of acceleration; the Depositor has not
waived any default, breach, violation or event of acceleration; and no
foreclosure action is currently threatened or has been commenced with respect to
the Mortgage Loan;
(p) The Mortgaged Property is free and clear of all mechanics' and
materialmen's liens or liens in the nature thereof; provided, however, that this
warranty shall be deemed not to have been made at the time of the initial
issuance of the Certificates if a title policy affording, in substance, the same
protection afforded by this warranty is furnished to the Trustee by the
Depositor;
(q) The Mortgage Loan meets, or is exempt from, applicable state or
federal laws, regulations and other requirements, pertaining to usury, and the
Mortgage Loan is not usurious;
(r) To the best of the Depositor's knowledge, all inspections,
licenses and certificates required to be made or issued with respect to all
portions of the Mortgaged Property and, with respect to the use and occupancy of
the same, including, but not limited to, certificates of occupancy and fire
underwriting certificates, have been made or obtained from the appropriate
authorities;
(s) Each Mortgage Note (other than with respect to any Balloon
Loans) is payable in monthly payments, resulting in complete amortization of the
Mortgage Loan over a term of not more than 360 months;
(t) Each Mortgage contains customary and enforceable provisions such
as to render the rights and remedies of the holder thereof adequate for the
realization against the Mortgaged Property of the benefits of the security,
including realization by judicial foreclosure (subject to any limitation arising
from any bankruptcy, insolvency or other law for the relief of debtors), and
there is no homestead or other exemption available to the Mortgagor which would
interfere with such right of foreclosure;
(u) The Mortgaged Property is undamaged by water, fire, earthquake,
earth movement other than earthquake, windstorm, flood, tornado or similar
casualty (excluding casualty from the presence of hazardous wastes or hazardous
substances, as to which the Depositor makes no representations), so as to affect
adversely the value of the Mortgaged Property as security for the Mortgage Loan
or the use for which the premises were intended and to the best of the
Depositor's knowledge, there is no proceeding pending or threatened for the
total or partial condemnation of the Mortgaged Property;
(v) The Mortgaged Property securing each Mortgage Loan is insured by
an insurer acceptable to Xxxxxx Xxx or Xxxxxxx Mac against loss by fire and such
hazards as are covered under a standard extended coverage endorsement, in an
amount which is not less than the lesser of 100% of the insurable value of the
Mortgaged Property and the outstanding principal balance of the Mortgage Loan,
but in no event less than the minimum amount necessary to fully compensate for
any damage or loss on a replacement cost basis; if the Mortgaged Property is a
condominium unit, it is included under the coverage afforded by a blanket policy
for the project; if upon origination of the Mortgage Loan, the improvements on
the Mortgaged Property were in an area identified in the Federal Register by the
Federal Emergency Management Agency as having special flood hazards, a flood
insurance policy meeting the requirements of the current guidelines of the
Federal Insurance Administration is in effect with a generally acceptable
insurance carrier, in an amount representing coverage not less than the least of
(A) the outstanding principal balance of the Mortgage Loan, (B) the full
insurable value of the Mortgaged Property and (C) the maximum amount of
insurance which was available under the National Flood Insurance Act of 1968, as
amended; and each Mortgage obligates the Mortgagor thereunder to maintain all
such insurance at the Mortgagor's cost and expense;
(w) To the best of the Depositor's knowledge, no Mortgagor is a
debtor in any state or federal bankruptcy or insolvency proceeding;
(x) If the Mortgage Loan is secured by a long-term residential
lease, (1) the lessor under the lease holds a fee simple interest in the land;
(2) the terms of such lease expressly permit the mortgaging of the leasehold
estate, the assignment of the lease without the lessor's consent and the
acquisition by the holder of the Mortgage of the rights of the lessee upon
foreclosure or assignment in lieu of foreclosure or provide the holder of the
Mortgage with substantially similar protections; (3) the terms of such lease do
not (a) allow the termination thereof upon the lessee's default without the
holder of the Mortgage being entitled to receive written notice of, and
opportunity to cure, such default, (b) allow the termination of the lease in the
event of damage or destruction as long as the Mortgage is in existence, (c)
prohibit the holder of the Mortgage from being insured (or receiving proceeds of
insurance) under the hazard insurance policy or policies relating to the
Mortgaged Property or (d) permit any increase in rent other than pre-established
increases set forth in the lease; (4) the original term of such lease is not
less than 15 years; (5) the term of such lease does not terminate earlier than
five years after the maturity date of the Mortgage Note; and (6) the Mortgaged
Property is located in a jurisdiction in which the use of leasehold estates in
transferring ownership in residential properties is a widely accepted practice;
(y) None of the Mortgage Loans are classified as "high cost"
Mortgage Loans under Section 32 of the Home Ownership and Equity Protection Act
of 1994 as amended or any comparable state law;
(z) With respect to each Mortgage Loan that has a Prepayment
Penalty, each such Prepayment Penalty shall be enforceable, and each Prepayment
Penalty shall be permitted pursuant to federal, state and local law. Each such
Prepayment Penalty is in an amount less than or equal to the maximum amount
permitted under applicable law. Each such Prepayment Penalty actually charged to
the related borrower is in accordance with the Prepayment Penalty matrices set
forth in Exhibit R;
(aa) Each Mortgage Loan is a "qualified mortgage" within the meaning
of Section 860G of the Code and Treas. Reg. ss.1.860G-2;
(bb) No Mortgage Loan is a "high cost" loan as defined under any
federal, state or local law applicable to such Mortgage Loan at the time of its
origination;
(cc) No Mortgage Loan is serviced by the Trustee or an affiliate of
the Trustee;
(dd) No Mortgage Loan (other than a Mortgage Loan that is a New
Jersey covered purchase loan) is a High Cost Loan or Covered Loan, as applicable
(as such terms are defined in S&P's LEVELS(R) Glossary Version 5.6b, Appendix
E), no Mortgage Loan originated on or after October 1, 2002 through March 6,
2003 is governed by the Georgia Fair Lending Act and no Mortgage Loan originated
on or after March 7, 2003 is a "high cost home loan" as defined under the
Georgia Fair Lending Act; and
(ee) In addition to the foregoing representations and warranties
made in subparagraphs (a) through (dd) above, the Depositor further represents
and warrants upon delivery of the Group I Mortgage Loans, as to each, that:
(i) No mortgage loan is covered by the Home Ownership and Equity
Protection Act of 1994;
(ii) With respect to each Group I Mortgage Loan, none of the
proceeds of such Mortgage Loan were used to finance single-premium credit
life insurance policies;
(iii) With respect to each Group I Mortgage Loan, the Servicer has
furnished accurate and complete information on the related borrower credit
files to Equifax, Experian and Trans Union Credit Information Company, in
accordance with the Fair Credit Reporting Act and its implementing
regulations;
(iv) The unpaid principal balance of each Group I Mortgage Loan does
not exceed the applicable maximum original loan amount limitations with
respect to first lien one- to four-family residential mortgage loans as
set forth in the Xxxxxxx Mac Selling Guide;
(v) With respect to each Group I Mortgage Loan that has a Prepayment
Penalty, no such Prepayment Penalty may be imposed for a term in excess of
five (5) years with respect to Mortgage Loans originated prior to October
1, 2002 and three (3) years with respect to Mortgage Loans originated on
or after October 1, 2002;
(vi) No Group I Mortgage Loan is a "high-cost," "high-cost home,"
"covered" (excluding home loans defined as "covered home loans" pursuant
to clause (1) of the definition of that term in the New Jersey Home
Ownership Security Act of 2002), "high-risk home" or "predatory" loan
under any applicable federal, state or local predatory or abusive lending
law; and
(vii) With respect to any Group I Mortgage Loan originated on or
after August 1, 2004, neither the related Mortgage nor the related
Mortgage Note requires the borrower to submit to arbitration to resolve
any dispute arising out of or relating in any way to the mortgage loan
transaction.
Notwithstanding the foregoing, no representations or warranties are
made by the Depositor as to the environmental condition of any Mortgaged
Property; the absence, presence or effect of hazardous wastes or hazardous
substances on any Mortgaged Property; any casualty resulting from the presence
or effect of hazardous wastes or hazardous substances on, near or emanating from
any Mortgaged Property; the impact on Certificateholders of any environmental
condition or presence of any hazardous substance on or near any Mortgaged
Property; or the compliance of any Mortgaged Property with any environmental
laws, nor is any agent, person or entity otherwise affiliated with the Depositor
authorized or able to make any such representation, warranty or assumption of
liability relative to any Mortgaged Property. In addition, no representations or
warranties are made by the Depositor with respect to the absence or effect of
fraud in the origination of any Mortgage Loan.
It is understood and agreed that the representations and warranties
set forth in this Section 2.04 shall survive delivery of the respective Owner
Mortgage Files (and, if applicable, Retained Mortgage Files) to the Custodian
and shall inure to the benefit of the Trustee notwithstanding any restrictive or
qualified endorsement or assignment.
Section 2.05 Representations, Warranties and Covenants of the
Servicer.
The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of each of the Trustee and the Certificateholders and
to the Depositor and the Securities Administrator that as of the Closing Date or
as of such date specifically provided herein:
(i) The Servicer is a national banking association duly chartered
and validly existing in good standing under the laws of the United States
and has all licenses necessary to carry on its business as now being
conducted, except for such licenses, certificates and permits the absence
of which, individually or in the aggregate, would not have a material
adverse effect on the ability of the Servicer to conduct its business as
it is presently conducted, and is licensed, qualified and in good standing
in the states where the Mortgaged Property is located if the laws of such
state require licensing or qualification in order to conduct business of
the type conducted by the Servicer or to ensure the enforceability or
validity of each Mortgage Loan; the Servicer has the power and authority
to execute and deliver this Agreement and to perform in accordance
herewith; the execution, delivery and performance of this Agreement
(including all instruments of transfer to be delivered pursuant to this
Agreement) by the Servicer and the consummation of the transactions
contemplated hereby have been duly and validly authorized; and all
requisite corporate action has been taken by the Servicer to make this
Agreement valid and binding upon the Servicer in accordance with its
terms;
(ii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Servicer and will
not result in the breach of any term or provision of the articles of
incorporation or by-laws of the Servicer or result in the breach of any
term or provision of, or conflict with or constitute a default under or
result in the acceleration of any obligation under, any agreement,
indenture or loan or credit agreement or other instrument to which the
Servicer or its property is subject, or result in the violation of any
law, rule, regulation, order, judgment or decree to which the Servicer or
its property is subject;
(iii) The Servicer is an approved seller/servicer of conventional
residential mortgage loans for Xxxxxx Xxx or Xxxxxxx Mac, with the
facilities, procedures, and experienced personnel necessary for the sound
servicing of mortgage loans of the same type as the Mortgage Loans. The
Servicer is a HUD approved mortgagee pursuant to Section 203 of the
National Housing Act and is in good standing to sell mortgage loans to and
service mortgage loans for Xxxxxx Mae or Xxxxxxx Mac, and no event has
occurred, including but not limited to a change in insurance coverage,
which would make the Servicer unable to comply with Xxxxxx Mae or Xxxxxxx
Mac eligibility requirements or which would require notification to either
Xxxxxx Mae or Xxxxxxx Mac;
(iv) This Agreement, and all documents and instruments contemplated
hereby which are executed and delivered by the Servicer, constitute and
will constitute valid, legal and binding obligations of the Servicer,
enforceable in accordance with their respective terms, except as the
enforcement thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement
of creditors' rights generally (whether considered in a proceeding at law
or in equity);
(v) The Servicer does not believe, nor does it have any reason or
cause to believe, that it cannot perform each and every covenant contained
in this Agreement;
(vi) There is no action, suit, proceeding or investigation pending
or, to its knowledge, threatened against the Servicer that, either
individually or in the aggregate, may result in any material adverse
change in the business, operations, financial condition, properties or
assets of the Servicer, or in any material impairment of the right or
ability of the Servicer to carry on its business substantially as now
conducted, or in any material liability on the part of the Servicer, or
that would draw into question the validity or enforceability of this
Agreement or of any action taken or to be taken in connection with the
obligations of the Servicer contemplated herein, or that would be likely
to impair materially the ability of the Servicer to perform under the
terms of this Agreement;
(vii) No consent, approval or order of any court or governmental
agency or body is required for the execution, delivery and performance by
the Servicer of or compliance by the Servicer with this Agreement or the
consummation of the transactions contemplated by this Agreement, except
for such consents, approvals, authorizations and orders, if any, that have
been obtained; and
(viii) No information in this Agreement provided by the Servicer nor
any information, certificate of an officer, statement furnished in writing
or report delivered to the Trustee or the Securities Administrator by the
Servicer in connection with the transactions contemplated hereby contains
or will contain any untrue statement of a material fact or omits or will
omit to state a material fact necessary in order to make the statements
contained therein, in light of the circumstances under which they were
made, not misleading.
(ix) The Servicer has fully furnished, and shall continue to fully
furnish for so long as it is servicing the Mortgage Loans hereunder, in
accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information on the Mortgagor credit
files to Equifax, Experian and Trans Union Credit Information Company on a
monthly basis.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.05 shall survive delivery of the Mortgage
Files to the Custodian and shall inure to the benefit of the Trustee, the
Depositor, the Securities Administrator and the Certificateholders. Upon
discovery by any of the Depositor, the Servicer, the Securities Administrator or
the Trustee of a breach of any of the foregoing representations, warranties and
covenants which materially and adversely affects the value of any Mortgage Loan,
Prepayment Penalty or the interests therein of the Certificateholders, the party
discovering such breach shall give prompt written notice (but in no event later
than two Business Days following such discovery) to the other parties hereto.
Section 2.06 Representations and Warranties of the Depositor.
The Depositor represents and warrants to the Trust and the Trustee
on behalf of the Certificateholders and to the Servicer and Securities
Administrator as follows:
(i) This agreement constitutes a legal, valid and binding obligation
of the Depositor, enforceable against the Depositor in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights in
general and except as such enforceability may be limited by general
principles of equity (whether considered in a proceeding at law or in
equity);
(ii) Immediately prior to the sale and assignment by the Depositor
to the Trustee on behalf of the Trust of each Mortgage Loan, the Depositor
had good and marketable title to each Mortgage Loan (insofar as such title
was conveyed to it by the Seller) subject to no prior lien, claim,
participation interest, mortgage, security interest, pledge, charge or
other encumbrance or other interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred all
right, title interest in the Mortgage Loans to the Trustee on behalf of
the Trust;
(iv) The Depositor has not transferred the Mortgage Loans to the
Trustee on behalf of the Trust with any intent to hinder, delay or defraud
any of its creditors;
(v) The Depositor has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware,
with full corporate power and authority to own its assets and conduct its
business as presently being conducted;
(vi) The Depositor is not in violation of its certificate of
incorporation or by-laws or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Depositor is a party or by which it or its
properties may be bound, which default might result in any material
adverse changes in the financial condition, earnings, affairs or business
of the Depositor or which might materially and adversely affect the
properties or assets, taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this Agreement by
the Depositor, and the consummation of the transactions contemplated
thereby, do not and will not result in a material breach or violation of
any of the terms or provisions of, or, to the knowledge of the Depositor,
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Depositor is a
party or by which the Depositor is bound or to which any of the property
or assets of the Depositor is subject, nor will such actions result in any
violation of the provisions of the certificate of incorporation or by-laws
of the Depositor or, to the best of the Depositor's knowledge without
independent investigation, any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Depositor or any of its properties or assets (except for such conflicts,
breaches, violations and defaults as would not have a material adverse
effect on the ability of the Depositor to perform its obligations under
this Agreement);
(viii) To the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization, order,
registration or qualification of or with any court or governmental agency
or body of the United States or any other jurisdiction is required for the
issuance of the Certificates, or the consummation by the Depositor of the
other transactions contemplated by this Agreement, except such consents,
approvals, authorizations, registrations or qualifications as (a) may be
required under State securities or blue sky laws, (b) have been previously
obtained or (c) the failure of which to obtain would not have a material
adverse effect on the performance by the Depositor of its obligations
under, or the validity or enforceability of, this Agreement; and
(ix) There are no actions, proceedings or investigations pending
before or, to the Depositor's knowledge, threatened by any court,
administrative agency or other tribunal to which the Depositor is a party
or of which any of its properties is the subject: (a) which if determined
adversely to the Depositor would have a material adverse effect on the
business, results of operations or financial condition of the Depositor;
(b) asserting the invalidity of this Agreement or the Certificates; (c)
seeking to prevent the issuance of the Certificates or the consummation by
the Depositor of any of the transactions contemplated by this Agreement,
as the case may be; or (d) which might materially and adversely affect the
performance by the Depositor of its obligations under, or the validity or
enforceability of, this Agreement.
Section 2.07 Issuance of Certificates and the Uncertificated Regular
Interests.
The Trustee acknowledges the assignment to it of the Mortgage Loans
and the delivery to the Custodian on its behalf of the Mortgage Files, subject
to the provisions of Sections 2.01 and 2.02, and the Trustee acknowledges the
assignment to it of all other assets included in the Trust Fund, receipt of
which is hereby acknowledged. Concurrently with such assignment and delivery and
in exchange therefor, the Securities Administrator, pursuant to the Written
Order to Authenticate executed by an officer of the Depositor, has executed, and
the Certificate Registrar has authenticated and delivered to or upon the order
of the Depositor, the Class A Certificates and Class M Certificates (other than
the Class M-12, Class M-13 and Class M-14 Certificates) in minimum dollar
denominations of $25,000 and integral dollar multiples of $1 in excess thereof
and the Class M-12, Class M-13 and Class M-14 Certificates in minimum
denominations of $250,000 and integral multiples of $1 in excess thereof. The
Class CE and Class P Certificates are issuable only in minimum Percentage
Interests of 10%. The Class R Certificate is issuable only as a single
certificate. The Trustee acknowledges the issuance of the uncertificated REMIC 1
Regular Interests and declares that it hold such regular interests as assets of
REMIC 2. The Trustee acknowledges the obligation of the Class CE Certificates to
pay Cap Carryover Amounts, and declares that it hold the same as assets of the
Grantor Trust on behalf of the Holders of the Class AI-1A, Class AI-B, Class
AII, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9, Class M-10, Class M-11, Class M-12, Class M-13 and
Class M-14 Certificates, respectively. In addition to the assets described in
the preceding sentence, the assets of the Grantor Trust shall also include (i)
Prepayment Penalties, any Servicer Prepayment Penalty Payment Amounts, any
Originator Prepayment Penalty Payment Amounts and the beneficial interest of the
Class P Certificates with respect thereto and (ii) the Yield Maintenance
Agreements, the Reserve Accounts and the beneficial interest of the Class CE
Certificates with respect thereto, subject to the obligation to pay Cap
Carryover Amounts. The interests evidenced by the Certificates constitute the
entire beneficial ownership interest in the Trust Fund.
Section 2.08 Optional Substitution of Mortgage Loans.
During the three-month period beginning on the Closing Date, the
Depositor shall have the right, but not the obligation, in its sole discretion
for any reason, to substitute for any Mortgage Loan, an Eligible Substitute
Mortgage Loan. Any such substitution shall be carried out in the manner
described in Section 2.03. The Substitution Adjustment Amount, if any, plus
accrued interest thereon and the other amounts referred to in Section 2.03,
shall be deposited in the Certificate Account. For purposes of determining the
Substitution Adjustment Amount for any Mortgage Loan substituted pursuant to
this Section 2.08, the purchase price for such Mortgage Loan shall be the
Purchase Price.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer.
The Servicer, as independent contract servicer, shall service and
administer the Mortgage Loans in accordance with this Agreement and the normal
and usual standards of practice of sub-prime mortgage servicers servicing
similar mortgage loans in the same respective jurisdictions as the Mortgaged
Properties, and shall have full power and authority, acting alone, to do or
cause to be done any and all things in connection with such servicing and
administration which the Servicer may deem necessary or desirable and consistent
with the terms of this Agreement (the "Servicing Standards").
Consistent with the terms of this Agreement, the Servicer may waive,
modify or vary any term of any Mortgage Loan or consent to the postponement of
strict compliance with any such term or in any manner grant indulgence to any
Mortgagor if in the Servicer's reasonable determination such waiver,
modification, postponement or indulgence is not materially adverse to the
Certificateholders; provided, however, that the Servicer shall not make future
advances and (unless the Mortgagor is in default with respect to the Mortgage
Loan or such default is, in the judgment of the Servicer, reasonably
foreseeable) the Servicer shall not permit any modification with respect to any
Mortgage Loan that would (i) change the Mortgage Interest Rate, defer or forgive
the payment thereof of any principal or interest payments, reduce the
outstanding principal amount (except for actual payments of principal) or extend
the final maturity date with respect to such Mortgage Loan, (ii) affect
adversely the status of either REMIC as a REMIC or (iii) cause either REMIC to
be subject to a tax on "prohibited transactions" or "contributions" pursuant to
the REMIC Provisions. Notwithstanding the foregoing, the Servicer shall not
permit any modification with respect to any Mortgage Loan that would both (x)
effect an exchange or reissuance of such Mortgage Loan under Section 1.860G-2(b)
of the Treasury Regulations and (y) cause either REMIC constituting part of the
Trust Fund to fail to qualify as a REMIC under the Code or the imposition of any
tax on "prohibited transactions" or "contributions" after the Startup Day under
the REMIC Provisions. Without limiting the generality of the foregoing, the
Servicer shall continue, and is hereby authorized and empowered to execute and
deliver on behalf of itself and the Trustee, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and with respect to the
Mortgaged Properties. The Servicer shall make all required Servicing Advances
and shall service and administer the Mortgage Loans in accordance with
Applicable Regulations, and shall provide to the Mortgagor any reports required
to be provided to them thereby. By the execution of this Agreement, the Trustee
hereby grants to the Servicer, a power of attorney to enable the Servicer to
carry out its servicing and administrative duties hereunder; provided, however,
that the Trustee shall not be held liable for any misuse of any such power of
attorney by the Servicer. Notwithstanding anything contained herein to the
contrary, the Servicer shall not, without the Trustee's written consent: (i)
initiate any action, suit or proceeding solely under the Trustee's name without
indicating the Servicer's representative capacity; or (ii) take any action with
the intent to cause, and that actually causes, the Trustee to be registered to
do business in any state.
In servicing and administering the Mortgage Loans, the Servicer
shall employ procedures including collection procedures and exercise the same
care that it customarily employs and exercises in servicing and administering
mortgage loans for its own account giving due consideration to accepted mortgage
servicing practices of prudent lending institutions and the Certificateholders'
reliance on the Servicer.
Notwithstanding anything in this Agreement to the contrary, in the
event of a voluntary Principal Prepayment in full of a Mortgage Loan, the
Servicer may not waive any Prepayment Penalty or portion thereof required by the
terms of the related Mortgage Note unless (i)(a) the Servicer determines that
such waiver is standard and customary in servicing similar mortgage loans, (b)
such waiver relates to a default or a reasonably foreseeable default and (c)
would, in the reasonable judgment of the Servicer, maximize recovery of
Liquidation Proceeds for such Mortgage Loan, taking into account the value of
such Prepayment Penalty, or (ii) the enforceability thereof is limited (1) by
bankruptcy, insolvency, moratorium, receivership, or other similar law relating
to creditors' rights generally or (2) due to acceleration in connection with a
foreclosure or other involuntary payment. If the Servicer has waived or does not
collect all or a portion of a Prepayment Penalty relating to a voluntary
Principal Prepayment in full due to any action or omission of the Servicer,
other than as provided above, the Servicer shall, on the date on which the
Principal Prepayment in full is remitted to the Securities Administrator,
deliver to the Securities Administrator the Servicer Prepayment Penalty Amount
with respect to such Mortgage Loan for distribution in accordance with the terms
of this Agreement.
In the event that a Prepayment Penalty due with respect to any
Mortgage Loan is not timely received by the Servicer, the Servicer shall use
commercially reasonable efforts to determine whether the Originator is obligated
to pay a related Originator Prepayment Penalty Payment Amount, and if the
Servicer determines that a Originator Prepayment Penalty Payment Amount is due,
the Servicer shall promptly notify the Originator, and the Servicer shall
enforce the Originator's obligations as set forth in the Mortgage Loan Purchase
Agreement to pay any such Originator Prepayment Penalty Payment Amounts and, to
the extent that such amounts are received by the Servicer, shall cause such
amounts to be deposited into the Collection Account within one Business Day of
receipt.
Section 3.02 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest
on all Mortgage Loans are paid in full or as long as the Mortgage Loan remains
subject to this Agreement, the Servicer will diligently collect all payments due
under each Mortgage Loan when the same shall become due and payable and shall,
to the extent such procedures shall be consistent with the Servicing Standards
set forth in this Agreement and Applicable Regulations, follow such collection
procedures as it follows with respect to mortgage loans comparable to the
Mortgage Loans and held for its own account. Further, where applicable, the
Servicer will take special care in ascertaining and estimating annual Escrow
Payments that, as provided in the Escrow Agreement, will become due and payable
to that end that the installments payable by the Mortgagors will be sufficient
to pay such charges as and when they become due and payable.
Section 3.03 Realization Upon Defaulted Mortgage Loans.
In the event that any payment due under any Mortgage Loan is not
paid when the same becomes due and payable, or in the event the Mortgagor fails
to perform any other covenant or obligation under the Mortgage Loan and such
failure continues beyond any applicable grace period, the Servicer shall take
such action as it shall deem to be in the best interest of the
Certificateholders.
In connection with a foreclosure or other conversion, the Servicer
shall exercise such rights and powers vested in it hereunder and use the same
degree of care and skill in its exercise as it would exercise or use under the
circumstances in the conduct of its own affairs and consistent with Applicable
Regulations and the Servicing Standards, including, without limitation,
advancing funds for the payment of taxes and insurance premiums with respect to
first lien Mortgage Loans.
Notwithstanding the foregoing provisions of this Section 3.03, with
respect to any Mortgage Loan as to which the Servicer has received actual notice
of, or has actual knowledge of, the presence of any toxic or hazardous substance
on the related Mortgaged Property, the Servicer shall not either (i) obtain
title to such Mortgaged Property as a result of or in lieu of foreclosure or
otherwise, or (ii) otherwise acquire possession of, or take any other action
with respect to, such Mortgaged Property if, as a result of any such action, the
Trust would be considered to hold title to, to be a mortgagee-in-possession of,
or to be an owner or operator of such Mortgaged Property within the meaning of
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended from time to time, or any comparable law, unless the Servicer
has also previously determined, based on its reasonable judgment and a report
prepared by a Person who regularly conducts environmental audits using customary
industry standards, stating that:
A. such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best economic interest of
the Certificateholders to take such actions as are necessary to bring the
Mortgaged Property into compliance therewith; and
B. there are no circumstances present at such Mortgaged Property
relating to the use, management or disposal of any hazardous substances,
hazardous materials, hazardous wastes, or petroleum-based materials for which
investigation, testing, monitoring, containment, clean-up or remediation could
be required under any federal, state or local law or regulation, or that if any
such materials are present for which such action could be required, that it
would be in the best economic interest of the Certificateholders to take such
actions with respect to the affected Mortgaged Property.
Notwithstanding the foregoing, if such environmental audit reveals,
or if the Servicer has actual knowledge or notice, that such Mortgaged Property
contains such wastes or substances, the Servicer shall not foreclose or accept a
deed in lieu of foreclosure.
The cost of the environmental audit report contemplated by this
Section 3.03 shall be advanced by the Servicer, subject to the Servicer's right
to be reimbursed therefor from the Collection Account as provided in Section
3.05(ii).
If the Servicer determines, as described above, that it is in the
best economic interest of the Certificateholders to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged Property, then
the Servicer shall take such action as it deems to be in the best economic
interest of the Certificateholders. The cost of any such compliance,
containment, cleanup or remediation shall be advanced by the Servicer, subject
to the Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.05(ii).
Section 3.04 Collection Account, Distribution Account and Reserve
Accounts.
(a) The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan separate and apart from any of its own
funds and general assets and shall establish and maintain one or more accounts
(such account or accounts, the "Collection Account"). Each Collection Account
shall be an Eligible Account.
The Servicer shall deposit in the Collection Account within three
Business Days of receipt, and retain therein, the following payments and
collections received or made by it after the applicable Cut-off Date with
respect to the Mortgage Loans, without duplication:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans
adjusted to the Mortgage Interest Rate less the Servicing Fee Rate;
(iii) all Net Liquidation Proceeds and Subsequent Recoveries;
(iv) all Insurance Proceeds including amounts required to be
deposited pursuant to Section 3.10, other than proceeds to be held in the
Escrow Account and applied to the restoration or repair of the Mortgaged
Property or released to the Mortgagor in accordance with the Servicer's
normal servicing procedures, the loan documents or applicable law;
(v) all Condemnation Proceeds affecting any Mortgaged Property which
are not released to the Mortgagor in accordance with the Servicer's normal
servicing procedures, the loan documents or applicable law;
(vi) any amounts required to be deposited by the Servicer in
connection with any REO Property pursuant to Section 3.13;
(vii) all Prepayment Penalties collected by the Servicer in
connection with the voluntary Principal Prepayment in full of any of the
Mortgage Loans, all Originator Prepayment Penalty Payment Amounts paid by
the Originator and all Servicer Prepayment Penalty Payment Amounts
required to be paid by the Servicer pursuant to Section 3.01 in connection
with any such Principal Prepayment; and
(viii) all amounts required to be deposited by the Servicer pursuant
to Section 2.03.
Any interest paid on funds deposited in the Collection Account,
subject to Section 3.23, shall accrue to the benefit of the Servicer and the
Servicer shall be entitled to retain and withdraw such interest from the
Collection Account pursuant to Section 3.05(v). The foregoing requirements for
deposit from the Collection Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing, payments in the
nature of late payment charges, bad check fees, prepayment penalties that are
not Prepayment Penalties, Originator Prepayment Penalty Payment Amounts or
Servicer Prepayment Penalty Payment Amounts, assumption fees and other similar
fees need not be deposited by the Servicer in the Collection Account. Amounts
deposited into the Collection Account in error may be withdrawn at any time.
(b) On behalf of the Trust Fund, the Securities Administrator shall
establish and maintain one or more accounts (such account or accounts, the
"Distribution Account"), on behalf of the Trustee, held in trust for the benefit
of the Certificateholders. On behalf of the Trust Fund, the Servicer shall
deliver (or cause the Originator to deliver in the case of clause (iii) below)
to the Securities Administrator in immediately available funds for deposit in
the Distribution Account by 1:00 p.m. New York City time on the Servicer
Remittance Date, (i) that portion of the Available Funds (calculated without
regard to the references in the definition thereof to amounts that may be
deposited to the Distribution Account from a different source as provided
herein) then on deposit in the Collection Account, (ii) the amount of all
Prepayment Penalties collected by the Servicer in connection with the voluntary
Principal Prepayment in full of any of the Mortgage Loans then on deposit in the
Collection Account (other than any such Prepayment Penalties received after the
related Prepayment Period), (iii) any Originator Prepayment Penalty Payment
Amount or Servicer Prepayment Penalty Payment Amount that became due during the
related Prepayment Period and (iv) amounts reimbursable or payable to the
Trustee pursuant to Section 7.01 and Section 8.05 and amounts reimbursable or
payable to the Securities Administrator pursuant to Section 8.05 or Section
9.01(c). These amounts may be sent via a single combined wire transfer. Except
as otherwise provided in Section 3.04(f), amounts in the Distribution Account
shall be deemed to be held on behalf of the related REMICs in accordance with
the REMIC distributions set forth in Section 4.08. The Securities Administrator
may, from time to time, withdraw from the Distribution Account for the following
purposes:
(i) to pay to itself and to the Trustee any amounts owed to itself
and the Trustee pursuant to Section 8.05, any amounts owed to itself
pursuant to Section 9.01(c) and any amounts owed to the Trustee pursuant
to Section 7.01;
(ii) to pay to itself as compensation any interest earned on funds
in the Distribution Account (all such interest to be withdrawn monthly on
each Distribution Date); and
(iii) to clear and terminate the Distribution Account upon the
termination of this Agreement.
(c) Funds in the Collection Account and the Distribution Account may
be invested in Permitted Investments in accordance with the provisions set forth
in Section 3.23. The Servicer shall give notice to the Securities Administrator
(and the Securities Administrator shall give such notice to the Trustee) of the
location of the Collection Account maintained by it when established upon
request and prior to any change thereof. The Securities Administrator shall give
notice to the Servicer, the Trustee and the Depositor of the location of the
Distribution Account when established and prior to any change thereof.
(d) In the event the Servicer shall deliver to the Securities
Administrator for deposit in the Distribution Account any amount not required to
be deposited therein, it may at any time request that the Securities
Administrator withdraw such amount from the Distribution Account and remit to
the Servicer any such amount, any provision herein to the contrary
notwithstanding. In addition, the Servicer shall deliver to the Securities
Administrator from time to time for deposit, and the Securities Administrator
shall so deposit, in the Distribution Account in respect of REMIC 1:
(i) any Advances, as required pursuant to Section 4.07;
(ii) any Stayed Funds, as soon as permitted by the federal
bankruptcy court having jurisdiction in such matters;
(iii) any Prepayment Penalties or amounts in connection with the
waiver of such Prepayment Penalties, in each case required to be deposited
pursuant to Section 3.01;
(iv) any amounts required to be deposited in the Distribution
Account pursuant to Sections 2.03, 3.04, 3.16, 3.23 or 4.07; and
(v) any amounts required to be deposited by the Servicer pursuant to
Section 3.11 in connection with the deductible clause in any blanket
hazard insurance policy, such deposit being made from the Servicer's own
funds, without reimbursement therefor.
(e) Promptly upon receipt of any Stayed Funds, whether from the
Servicer, a trustee in bankruptcy, or federal bankruptcy court or other source,
the Securities Administrator shall, unless such funds have been received from
the Servicer, notify the Servicer of such receipt and deposit such funds in the
Distribution Account, subject to withdrawal thereof as permitted hereunder. In
addition, the Securities Administrator shall deposit in the Distribution Account
any amounts required to be deposited pursuant to Section 3.23(b) in connection
with losses realized on Permitted Investments with respect to funds held in the
Distribution Account.
(f) Any Prepayment Penalties, Originator Prepayment Penalty Payment
Amounts and Servicer Prepayment Penalty Payment Amounts deposited pursuant to
Section 3.04(a)(vii) shall not be assets of either REMIC created hereunder, but
shall be considered assets of the Grantor Trust held by the Securities
Administrator, on behalf of the Trustee, for the benefit of the Class P
Certificateholders. In addition, any Cap Carryover Amounts that are paid with
respect to the Class A or Class M Certificates will be treated as first having
been distributed with respect to the Class CE Certificates and then having been
paid outside of the REMICs to the Class A or Class M Certificateholders.
(g) The Securities Administrator shall establish and maintain (I)
the Class AI Reserve Account, held in trust for the benefit of the Holders of
the Class AI-1A and Class AI-1B Certificates, (II) the Class AII Reserve
Account, held in trust for the benefit of the Holders of the Class AII-1
Certificates and (III) the Class M Reserve Account, held in trust for the
benefit of the Holders of the Class M-1, Class M-2, Class M-3, Class M-4 and
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10, Class M-11,
Class M-12, Class M-13 and Class M-14 Certificates. The Securities Administrator
shall deposit in the (I) Class AI Reserve Account on the date received by it,
any Class AI Yield Maintenance Agreement Payment received from the Yield
Maintenance Agreement Provider for the related Distribution Date, (II) Class AII
Reserve Account on the date received by it, any Class AII Yield Maintenance
Agreement Payment received from the Yield Maintenance Agreement Provider for the
related Distribution Date and (III) Class M Reserve Account on the date received
by it, any Class M Yield Maintenance Agreement Payment received from the Yield
Maintenance Agreement Provider for the related Distribution Date. On each
Distribution Date, the Securities Administrator shall withdraw from the (I)
Class AI Reserve Account any Class AI Yield Maintenance Agreement Payment, (II)
Class AII Reserve Account any Class AII Yield Maintenance Agreement Payment and
(III) Class M Reserve Account any Class M Yield Maintenance Agreement Payment
and apply them in the following order of priority:
(i) to the Class AI-1A and Class AI-1B Certificates from the Class
AI Reserve Account, in each case only up to the Cap Amount for the related
Class, any Cap Carryover Amounts for such Classes for such Distribution
Date, distributed concurrently, to the Class AI-1A and Class AI-1B
Certificates;
(ii) to the Class AII-1 Certificates, from the Class AII Reserve
Account, any Cap Carryover Amount for such Class for such Distribution
Date;
(iii) to the Class AI Certificates, from the Class AI Reserve
Account, without regard to the Cap Amount for the related Class, any
remaining unpaid Cap Carryover Amounts for such Classes for such
Distribution Date (after distributions pursuant to clause (i) above),
distributed concurrently, to the Class AI-1A and Class AI-1B Certificates,
pro rata (based on their respective remaining Cap Carryover Amounts);
(iv) to the Class M Certificates, from the Class M Reserve Account,
in each case only up to the Cap Amount for the related Class, any Cap
Carryover Amounts for such Classes for such Distribution Date, distributed
concurrently, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class
M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10, Class M-11,
Class M-12, Class M-13 and Class M-14 Certificates;
(v) to the Class M Certificates, from the Class M Reserve Account,
without regard to the Cap Amount for the related Class, any remaining
unpaid Cap Carryover Amounts for such Classes for such Distribution Date
(after distributions pursuant to clause (iv) above), distributed
concurrently, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class
M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10, Class M-11,
Class M-12, Class M-13 and Class M-14 Certificates, pro rata, based on
their respective remaining Cap Carryover Amounts; and
(vi) to the Class CE Certificates, any remaining amount on deposit
in the Reserve Accounts.
(h) The Securities Administrator shall account for the Reserve
Accounts as assets of a grantor trust under subpart E, part I of subchapter J of
the Code and not assets of either REMIC created pursuant to this Agreement. The
beneficial owner of the Reserve Accounts is the Class CE Certificateholder. For
all federal tax purposes, amounts transferred or reimbursed by REMIC 2 to the
Reserve Accounts shall be treated as distributions by the Securities
Administrator to the Class CE Certificateholder.
(i) Any Cap Carryover Amounts paid by the Securities Administrator
pursuant to this Section 3.04(g) to the Regular Certificates (other than the
Class CE Certificates) shall be accounted for by the Securities Administrator as
amounts paid first to the Class CE Certificates and then to the respective Class
or Classes of Regular Certificates (other than the Class CE Certificates). In
addition, the Securities Administrator shall account for the Regular
Certificates' (other than the Class CE Certificates) rights to receive payments
of Cap Carryover Amounts as rights in a limited recourse interest rate cap
contract written by the Class CE Certificates in favor of the Regular
Certificates (other than the Class CE Certificates).
(j) For federal tax return and information reporting, the right of
the Holders of the Regular Certificates (other than the Class CE Certificates)
to receive payments under the Class AI Yield Maintenance Agreement, the Class
AII Yield Maintenance Agreement and the Class M Yield Maintenance Agreement in
respect of the related Yield Maintenance Agreement Payments shall be assigned a
value of zero.
Section 3.05 Permitted Withdrawals From the Collection Account.
The Servicer may, from time to time, withdraw from the Collection
Account for the following purposes:
(i) to remit to the Securities Administrator for deposit in the
Distribution Account the amounts required to be so remitted pursuant to
Section 3.04(b) or permitted to be so remitted pursuant to the first
sentence of Section 3.04(d);
(ii) first, to the extent the Servicer has not previously reimbursed
the Trustee pursuant to Section 4.07(e), to reimburse the Trustee for any
unreimbursed Advances made by the Trustee and second, to reimburse itself
for any unreimbursed Advances and Servicing Advances; the Servicer's right
to reimburse itself and the Trustee pursuant to this subclause (ii) being
limited to amounts received on the related Mortgage Loan which represent
payments of (a) principal and/or interest respecting which any such
Advance was made or (b) Condemnation Proceeds, Insurance Proceeds or
Liquidation Proceeds respecting which any such Servicing Advance was made;
(iii) first, to the extent the Servicer has not previously
reimbursed the Trustee pursuant to Section 4.07(e), to reimburse the
Trustee for any unreimbursed Advances made by the Trustee and second to
reimburse itself for any unreimbursed Servicing Advances, any unpaid
Servicing Fees and for unreimbursed Advances, in each case, to the extent
that such amounts are deemed to be Nonrecoverable Advances, and to
reimburse itself and the Trustee for such amounts to the extent that such
amounts are nonrecoverable from the disposition of REO Property pursuant
to Section 3.03 or Section 3.13 hereof;
(iv) to reimburse itself for any amounts paid or expenses incurred
pursuant to Section 3.03 (and not otherwise previously reimbursed);
(v) to pay to itself as servicing compensation (a) any interest
earned on funds in the Collection Account (all such interest to be
withdrawn monthly not later than each Servicer Remittance Date) and (b)
the Servicing Fee from that portion of any payment or recovery as to
interest to a particular Mortgage Loan to the extent not retained pursuant
to Section 3.04(ii);
(vi) to reimburse itself for any amounts paid pursuant to Section
6.03 (and not otherwise previously reimbursed);
(vii) to reimburse the Servicer (if the Servicer is not an Affiliate
of the repurchasing party), the Securities Administrator or the Trustee,
as the case may be, for enforcement expenses reasonably incurred in
respect of the breach or defect giving rise to the purchase obligation
under Section 2.03 of this Agreement that were included in the Purchase
Price of the Mortgage Loan, including any expenses arising out of the
enforcement of the purchase obligation;
(viii) to reimburse the Depositor or the Servicer for expenses and
costs reimbursable to them pursuant to Section 3.24(b); and
(ix) to clear and terminate the Collection Account upon the
termination of this Agreement.
The foregoing requirements for withdrawal from the Collection
Account shall be exclusive. In the event the Servicer shall deposit in the
Collection Account any amount not required to be deposited therein, it may at
any time withdraw such amount from the Collection Account, any provision herein
to the contrary notwithstanding.
Section 3.06 Establishment of Escrow Accounts; Deposits in Escrow
Accounts.
The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan which constitute Escrow Payments
separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Escrow Accounts, in the form of time deposit
or demand accounts. A copy of such letter agreement shall be furnished to the
Trustee upon request. The Escrow Account shall be an Eligible Account.
The Servicer shall deposit in the Escrow Account or Accounts within
three Business Days of receipt, and retain therein, (i) all Escrow Payments
collected on account of the Mortgage Loans, for the purpose of effecting timely
payment of any such items as required under the terms of this Agreement, and
(ii) all Insurance Proceeds which are to be applied to the restoration or repair
of any Mortgaged Property. The Servicer shall make withdrawals therefrom only to
effect such payments as are required under this Agreement, and for such other
purposes as shall be set forth in, or in accordance with, Section 3.07. The
Servicer shall be entitled to retain any interest paid on funds deposited in the
Escrow Account by the depository institution other than interest on escrowed
funds required by law to be paid to the Mortgagor and, to the extent required by
the related Mortgage Loan or Applicable Regulations, the Servicer shall pay
interest on escrowed funds to the Mortgagor notwithstanding that the Escrow
Account is non-interest bearing or that interest paid thereon is insufficient
for such purposes.
Section 3.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account may be made by the Servicer (i)
to effect timely payments of Escrow Payments, (ii) to reimburse the Servicer for
any Servicing Advance made by the Servicer with respect to a related Mortgage
Loan but only from amounts received on the related Mortgage Loan which represent
late payments or Late Collections of Escrow Payments thereunder, (iii) to refund
to the Mortgagor any funds as may be determined to be overages, (iv) for
transfer to the Collection Account in accordance with the terms of this
Agreement, (v) for application to restoration or repair of the Mortgaged
Property, (vi) to pay to the Servicer, or to the Mortgagor to the extent
required by the related Mortgage Loan or Applicable Regulations, any interest
paid on the funds deposited in the Escrow Account, (vii) to clear and terminate
the Escrow Account on the termination of this Agreement, or (viii) to transfer
to the Collection Account any Insurance Proceeds. As part of its servicing
duties, the Servicer shall pay to the Mortgagor interest on funds in the Escrow
Account, to the extent required by the related Mortgage Loan or Applicable
Regulations, and to the extent that interest earned on funds in the Escrow
Account is insufficient, shall pay such interest from its own funds, without any
reimbursement therefor.
In the event the Servicer shall deposit in the Escrow Account any
amount not required to be deposited therein, it may at any time withdraw such
amount from the Escrow Account, any provision herein to the contrary
notwithstanding.
Section 3.08 Payment of Taxes, Insurance and Other Charges;
Collections Thereunder; Primary Mortgage Insurance.
(a) With respect to each Mortgage Loan subject to an Escrow
Agreement, the Servicer shall maintain accurate records reflecting the status of
taxes, which are or may become a lien upon the Mortgaged Property and the status
of fire, flood (if applicable) and hazard insurance coverage and shall obtain,
from time to time, all bills for the payment of such charges (including renewal
premiums) and shall effect payment thereof prior to the applicable penalty or
termination date and at a time appropriate for securing maximum discounts
allowable, employing for such purpose deposits of the Mortgagor in the Escrow
Account which shall have been estimated and accumulated by the Servicer in
amounts sufficient for such purposes, as allowed under the terms of the Escrow
Agreement or Applicable Regulations. To the extent that a Mortgage Loan is not
subject to an Escrow Agreement, the Servicer shall determine that any such
payments are made by the Mortgagor. The Servicer assumes full responsibility for
the payment of all such bills and shall effect payments of all such bills
irrespective of the Mortgagor's faithful performance in the payment of same or
the making of the Escrow Payments and shall make Servicing Advances from its own
funds to effect such payments.
(b) For any Mortgage Loan with a Loan-to-Value Ratio at origination
of greater than 80%, if the Mortgage Loan Schedule indicates that such Mortgage
Loan has primary mortgage insurance, the Servicer shall maintain coverage under
a primary mortgage insurance policy until the Loan-to-Value Ratio on any such
Mortgage Loan is reduced to 78% or lower as a result of principal payments on
such Mortgage Loan or based upon an appraisal of the related Mortgaged Property
after the Closing Date. Notwithstanding anything to the contrary herein, the
Servicer shall be responsible for the payment of all primary mortgage insurance
premiums out of the Servicer's own funds, without any right to reimbursement
therefor. The Servicer shall not assign its obligation under any primary
mortgage insurance policy without the consent of each Rating Agency. In the
event that Xxxxx Fargo Bank, N.A. is no longer Servicer hereunder, Xxxxx Fargo
Bank, N.A. agrees to continue pay all primary mortgage insurance premiums for
the Mortgage Loans.
Section 3.09 Transfer of Accounts.
The Servicer may transfer the Collection Account or the Escrow
Account to a different depository institution from time to time. Upon such
transfer, the Servicer shall deliver to the Securities Administrator (and the
Securities Administrator shall provide to the Depositor and the Trustee), a
certification or letter agreement, as the case may be, as required pursuant to
Sections 3.04 and 3.06.
Section 3.10 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each Mortgage Loan
fire and hazard insurance with extended coverage as is customary in the area
where the Mortgaged Property is located in an amount which is at least equal to
the lesser of (i) the amount necessary to fully compensate for any damage or
loss to the improvements which are a part of such property on a replacement cost
basis or (ii) the Principal Balance of the Mortgage Loan, in each case in an
amount not less than such amount as is necessary to prevent the Mortgagor and/or
the Mortgagee from becoming a co-insurer. If the Mortgaged Property is in an
area identified in the Federal Register by the Flood Emergency Management Agency
as having special flood hazards and flood insurance has been made available, the
Servicer will cause to be maintained a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
with a generally acceptable insurance carrier, in an amount representing
coverage not less than the least of (i) the Principal Balance of the Mortgage
Loan, (ii) the maximum insurable value of the improvements securing such
Mortgage Loan or (iii) the maximum amount of insurance which is available under
the National Flood Insurance Act of 1968, as amended. The Servicer shall also
maintain on the REO Property for the benefit of the Certificateholders, (x) fire
and hazard insurance with extended coverage in an amount which is at least equal
to the replacement cost of the improvements which are a part of such property
and (y) to the extent required and available under the Flood Disaster Protection
Act of 1973, as amended, flood insurance in an amount as provided above. Any
amounts collected by the Servicer under any such policies other than amounts to
be deposited in the Escrow Account and applied to the restoration or repair of
the Mortgaged Property or REO Property, or released to the Mortgagor in
accordance with the Servicer's normal servicing procedures, shall be deposited
in the Collection Account, subject to withdrawal pursuant to Section 3.05. It is
understood and agreed that no earthquake or other additional insurance is
required to be maintained by the Servicer or the Mortgagor or maintained on
property acquired in respect of the Mortgage Loan, other than pursuant to such
Applicable Regulations as shall at any time be in force and as shall require
such additional insurance. All such policies shall be endorsed with standard
mortgagee clauses with loss payable to the Servicer and shall provide for at
least thirty days prior written notice of any cancellation, reduction in the
amount of or material change in coverage to the Servicer. The Servicer shall not
interfere with the Mortgagor's freedom of choice in selecting either his
insurance carrier or agent, provided, however, that the Servicer shall not
accept any such insurance policies from insurance companies unless such
companies currently reflect a general policy rating of B:VI or better in Best's
Key Rating Guide and are licensed to do business in the state wherein the
property subject to the policy is located.
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.
In the event that the Servicer shall obtain and maintain a blanket
policy issued by an insurer that has a general policy rating of B:VI or better
in Best's Key Rating Guide insuring against hazard losses on all of the Mortgage
Loans, then, to the extent such policy provides coverage in an amount equal to
the amount required pursuant to Section 3.10 and otherwise complies with all
other requirements of Section 3.10, it shall conclusively be deemed to have
satisfied its obligations as set forth in Section 3.10, it being understood and
agreed that such policy may contain a deductible clause, in which case the
Servicer shall, in the event that there shall not have been maintained on the
related Mortgaged Property or REO Property a policy complying with Section 3.10,
and there shall have been a loss which would have been covered by such policy,
deliver to the Securities Administrator for deposit in the Distribution Account
the amount not otherwise payable under the blanket policy because of such
deductible clause, which amount shall not be reimbursable to the Servicer from
the Trust Fund. In connection with its activities as servicer of the Mortgage
Loans, the Servicer agrees to prepare and present, on behalf of the Trustee,
claims under any such blanket policy in a timely fashion in accordance with the
terms of such policy. Upon request of the Securities Administrator, the Servicer
shall cause to be delivered to the Custodian and the Securities Administrator a
certified true copy of such policy and a statement from the insurer thereunder
that such policy shall in no event be terminated or materially modified without
thirty days prior written notice to the Trustee.
Section 3.12 Fidelity Bond, Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket fidelity
bond (the "Fidelity Bond") and an errors and omissions insurance policy, with
broad coverage with financially responsible companies on all officers, employees
or other persons acting in any capacity with regard to the Mortgage Loans to
handle funds, money, documents and papers relating to the Mortgage Loans. The
Fidelity Bond and errors and omissions insurance shall be in the form of the
Mortgage Banker's Blanket Bond and shall protect and insure the Servicer against
losses, including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such persons. Such Fidelity Bond shall also protect and insure
the Servicer against losses in connection with the failure to maintain any
insurance policies required pursuant to this Agreement and the release or
satisfaction of a Mortgage Loan without having obtained payment in full of the
indebtedness secured thereby. No provision of this Section 3.12 requiring the
Fidelity Bond and errors and omissions insurance shall diminish or relieve the
Servicer from its duties and obligations as set forth in this Agreement. The
minimum coverage under any such bond and insurance policy shall be in an amount
acceptable to Xxxxxx Xxx or Xxxxxxx Mac. Upon request of the Trustee, the
Servicer shall cause to be delivered to the Trustee a certified true copy of the
Fidelity Bond and errors and omissions insurance policy and a statement from the
surety and the insurer that such Fidelity Bond and errors and omissions
insurance policy shall in no event be terminated or materially modified without
thirty days' prior written notice to the Trustee.
Section 3.13 Title, Management and Disposition of REO Property.
(a) In the event that title to a Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken in the name of the Trustee, on behalf of the Certificateholders,
or in the event the Trustee is not authorized or permitted to hold title to real
property in the state where the REO Property is located, or would be adversely
affected under the "doing business" or tax laws of such state by so holding
title, the deed or certificate of sale shall be taken in the name of such Person
or Persons as shall be consistent with an Opinion of Counsel obtained by the
Servicer from an attorney duly licensed to practice law in the state where the
REO Property is located. Any Person or Persons holding such title other than the
Trustee shall acknowledge in writing that such title is being held as nominee
for the benefit of the Trustee. Pursuant to the power of attorney granted in
Section 3.01, the Servicer is hereby authorized to acquire, transfer and dispose
of any REO Property taken in the name of the Trustee pursuant to this Section
3.13 without further documentation of its authority as attorney in fact for the
Trustee on behalf of the Trust.
(b) In the event that the Trust Fund acquires any REO Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Servicer shall dispose of such REO Property before the end of
the third calendar year beginning after the year of its acquisition by the Trust
Fund for purposes of Section 860G(a)(8) of the Code or, at the expense of the
Trust Fund, request from the Internal Revenue Service, more than 60 days before
the day on which the above-mentioned grace period would otherwise expire, an
extension of the above-mentioned grace period, unless the Servicer obtains an
Opinion of Counsel, addressed and delivered to the Servicer and the Trustee, to
the effect that the holding by the Trust Fund of such REO Property subsequent to
such period will not: (i) result in the imposition of any tax on "prohibited
transactions" as defined in Section 860F of the Code; or (ii) cause either REMIC
constituting any part of the Trust Fund to fail to qualify as a REMIC at any
time that any Certificates are outstanding, in which case the Trust Fund may
continue to hold such REO Property (subject to any conditions contained in such
Opinion of Counsel). The Servicer shall be entitled to be reimbursed from the
Collection Account for any costs incurred in obtaining such Opinion of Counsel,
as provided in Section 3.05.
Subject to compliance with applicable laws and regulations as shall
at any time be in force, and notwithstanding any other provisions of this
Agreement, no REO Property acquired by the Trust Fund shall be rented (or
allowed to continue to be rented) or otherwise used by or on behalf of the Trust
Fund in such a manner or pursuant to any terms that would: (i) cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code; or (ii) subject either REMIC constituting part
of the Trust Fund to the imposition of any federal income taxes on the income
earned from such REO Property, including any taxes imposed by reason of Sections
860F or 860G(c) of the Code, unless the Servicer has agreed to indemnify and
hold harmless the Trust Fund with respect to the imposition of any such taxes.
The Servicer shall manage, conserve, protect and operate each REO
Property for the Certificateholders and the Trust Fund solely for the purpose of
its prompt disposition and sale in a manner which does not cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code or result in the receipt by the related REMIC of
any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure property" which
is subject to taxation under the REMIC Provisions. The Servicer shall cause each
REO Property to be inspected promptly upon the acquisition of title thereto and
possession thereof and shall cause each REO Property to be inspected at least
annually thereafter. The Servicer shall make or cause to be made a written or
electronic report of each such inspection. Such reports shall be retained in the
Mortgage File and copies thereof shall be forwarded by the Servicer to the
Trustee upon request. The Servicer shall attempt to sell the same (and may
temporarily rent the same) on such terms and conditions as the Servicer deems to
be in the best interest of the Certificateholders and the Trust Fund.
With respect to each REO Property, the Servicer shall segregate and
hold all funds collected and received in connection with the operation of the
REO Property separate and apart from its own funds or general assets and shall
deposit or cause to be deposited, on a daily basis, within three Business Days
of receipt, into the Collection Account, all revenues received with respect to
the related REO Property and shall withdraw therefrom funds necessary for the
proper operation, management and maintenance of the REO Property, including the
cost of maintaining any hazard insurance pursuant to Section 3.10 hereof and the
fees of any managing agent acting on behalf of the Servicer. The Servicer shall
furnish to the Securities Administrator and the Trustee, on each Servicer
Remittance Date, an operating statement for each REO Property covering the
operation of each REO Property for the previous month, if applicable. Such
operation statement shall be accompanied by such other information as the
Securities Administrator or the Trustee shall reasonably request.
The Servicer shall use its best efforts to dispose of the REO
Property as promptly as is practically consistent with protecting the
Certificateholders' interests.
Each REO Disposition shall be carried out by the Servicer at such
price and upon such terms and conditions as the Servicer deems to be in the best
interest of the Certificateholders. If as of the date title to any REO Property
was acquired by the Servicer there were outstanding unreimbursed Servicing
Advances with respect to the REO Property, the Servicer, upon an REO Disposition
of such REO Property, shall be entitled to reimbursement for any related
unreimbursed Servicing Advances from proceeds received in connection with such
REO Disposition. The Servicer shall be entitled to an REO Disposition Fee upon
each REO Disposition, and may withhold and retain the REO Disposition Fee from
Liquidation Proceeds. The proceeds from the REO Disposition, net of any payments
to the Servicer as provided above, shall be deposited in the Collection Account
and shall be distributed to the Trust in the month following receipt thereof in
accordance with Section 4.01.
Any REO Disposition shall be for cash only (unless changes in the
REMIC Provisions made subsequent to the Startup Day allow a sale for other
consideration and an Opinion of Counsel is obtained by the Servicer to the
effect that such sale shall not cause either REMIC constituting part of the
Trust Fund to fail to qualify as a REMIC).
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements.
When a Mortgaged Property has been or is about to be conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of such conveyance
or prospective conveyance, exercise its rights to accelerate the maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in the related
Mortgage or Mortgage Note; provided, however, that the Servicer shall not
exercise any such right if the "due-on-sale" clause, in the reasonable belief of
the Servicer, is not enforceable under applicable law. In such event, the
Servicer shall make reasonable efforts to enter into an assumption and
modification agreement with the Person to whom such property has been or is
about to be conveyed, pursuant to which such Person becomes liable under the
Mortgage Note and, unless prohibited by applicable law or the Mortgage, the
Mortgagor remains liable thereon. If the foregoing is not permitted under
applicable law, the Servicer is authorized to enter into a substitution of
liability agreement with such Person, pursuant to which the original Mortgagor
is released from liability and such Person is substituted as Mortgagor and
becomes liable under the Note. The Mortgage Loan, as assumed, shall conform in
all respects to the requirements, representations and warranties of this
Agreement. The Servicer shall notify the Trustee that any such assumption or
substitution agreement has been completed by forwarding to the Trustee (or the
Custodian, as the case may be) the original copy of such assumption or
substitution agreement (indicating the Mortgage File to which it relates) which
copy shall be added by the Trustee (or the Custodian, as the case may be) to the
related Mortgage File and which shall, for all purposes, be considered a part of
such Mortgage File to the same extent as all other documents and instruments
constituting a part thereof. The Servicer shall be responsible for recording any
such assumption or substitution agreements. Except as otherwise provided in
Section 3.01, in connection with any such assumption or substitution agreement,
the Monthly Payment on the related Mortgage Loan shall not be changed but shall
remain as in effect immediately prior to the assumption or substitution, the
stated maturity or outstanding principal amount of such Mortgage Loan shall not
be changed nor shall any required monthly payments of principal or interest be
deferred or forgiven. Any fee collected by the Servicer for consenting to any
such conveyance or entering into an assumption or substitution agreement shall
be retained by or paid to the Servicer as additional servicing compensation.
Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or any assumption which the Servicer may be
restricted by law from preventing, for any reason whatsoever.
Section 3.15 Duties of the Credit Risk Manager.
For and on behalf of the Trust, the Credit Risk Manager shall
provide reports and recommendations as to loss mitigation activities concerning
Mortgage Loans that are past due, are in default, as to which there has been
commencement of foreclosure, as to which there has been forbearance in exercise
of remedies, as to which any obligor is the subject of bankruptcy, receivership,
or an arrangement of creditors, or which have become REO Properties. Such
reports and recommendations will be based upon information provided pursuant to
the Credit Risk Management Agreement. The Credit Risk Manager shall look solely
to the Servicer for all information and data (including loss and delinquency
information and data) and loan-level information and data relating to the
servicing of the Mortgage Loans.
The Credit Risk Manager may be removed at any time by a vote of
Certificateholders holding Certificates evidencing at least 66 2/3% of the
aggregate Voting Interests of the Certificates. After any such termination, the
Credit Risk Manager shall have no further obligations hereunder, and shall no
longer be entitled to the Credit Risk Manager Fee.
Section 3.16 Optional Purchases of 60+ Day Delinquent Loans.
(a) The Depositor may, at its option, purchase any 60+ Day
Delinquent Loan or any Mortgage Loan or REO Property for which the Servicer has
accepted a deed in lieu of foreclosure during the following time periods: (i)
beginning on the first day of the second month following the month in which the
Servicer has reported that it has initiated foreclosure proceedings with respect
to such 60+ Day Delinquent Loan, with such repurchase option expiring on the
last day of such second following month; (ii) beginning on the first day of the
second month following the month in which the Servicer has reported that such
defaulted Mortgage Loan has become an REO Property, with such repurchase option
expiring on the last day of such second following month; and (iii) beginning on
the day on which the Servicer accepts a contractual commitment by a third party
to purchase the Mortgaged Property related to the 60+ Day Delinquent Loan or REO
Property, with such repurchase option expiring on the earlier of the last day of
the month in which such contractual commitment was accepted by the Servicer or
the day immediately prior to the day on which the closing occurs with respect to
such third party purchase of the Mortgaged Property related to the 60+ Day
Delinquent Loan or REO Property.
Prior to purchase pursuant to this Section 3.16, the Servicer shall
be required to continue to make monthly Advances pursuant to Section 4.07. The
Depositor shall not use any procedure in selecting Mortgage Loans to be
purchased which is materially adverse to the interests of the
Certificateholders. The Depositor shall purchase any such 60+ Day Delinquent
Loan or REO Property that it elects to purchase at a price equal to the Purchase
Price. The Purchase Price for the repurchased Mortgage Loan or REO Property
shall be deposited in the Collection Account, and the Trustee, upon receipt of
written certification from the Depositor of such deposit, shall release to, or
at the direction of, the Depositor, the related Mortgage File and shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, as the Depositor shall furnish to it and as shall be necessary to vest
in the Depositor any Mortgage Loan or REO Property released pursuant hereto and
the Trustee shall have no further responsibility with regard to such Mortgage
File.
Section 3.17 Trustee to Cooperate; Release of Files.
(a) Upon the payment in full of any Mortgage Loan (including any
liquidation of any Mortgage Loan through foreclosure or otherwise, or the
receipt by the Servicer of a notification that payment in full will be escrowed
in a manner customary for such purposes), the Servicer shall confirm to the
Trustee and the Securities Administrator that all amounts required to be
remitted to the Distribution Account in connection with such Mortgage Loan have
been so deposited, and the Servicer shall deliver two copies of such Request for
Release to the Custodian. The Custodian shall, within five Business Days of its
receipt of such a Request for Release, release the related Owner Mortgage File
(and Retained Mortgage File, if applicable) to the Servicer, as requested by the
Servicer. No expenses incurred in connection with any instrument of satisfaction
or deed of reconveyance shall be chargeable to the Distribution Account.
From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including but not limited to, collection under
any insurance policies, or to effect a partial release of any Mortgaged Property
from the lien of the Mortgage, the Servicer shall deliver to the Custodian two
copies of a Request for Release. The Custodian shall, within five Business Days,
release the related Owner Mortgage File (and Retained Mortgage File, if
applicable) to the Servicer. Any such Request for Release shall obligate the
Servicer to return the Owner Mortgage File (and Retained Mortgage File, if
applicable) to the Custodian by the twenty-first day following the release
thereof, unless (i) the Mortgage Loan has been liquidated and the Liquidation
Proceeds relating to the Mortgage Loan have been deposited in the Distribution
Account or (ii) the Owner Mortgage File, Retained Mortgage File, if applicable,
or such document has been delivered to an attorney, or to a public trustee or
other public official as required by law, for purposes of initiating or pursuing
legal action or other proceedings for the foreclosure of the Mortgaged Property
either judicially or non-judicially. Upon receipt of two copies of a Request for
Release stating that such Mortgage Loan was liquidated and that all amounts
received or to be received in connection with such liquidation which are
required to be deposited into the Distribution Account have been so deposited,
or that such Mortgage Loan has become an REO Property, the Custodian shall amend
its records.
Upon the occurrence of the event specified in clause (ii) of the
preceding paragraph, the Trustee shall execute and deliver to the Servicer, as
directed by the Servicer, court pleadings, requests for trustee's sale or other
documents necessary to the foreclosure or trustee's sale in respect of a
Mortgaged Property or to any legal action brought to obtain judgment against any
Mortgagor on the Mortgage Note or Mortgage or to obtain a deficiency judgment,
or to enforce any other remedies or rights provided by the Mortgage Note or
Mortgage or otherwise available at law or in equity. Each such direction shall
include a request that such pleadings or documents be executed by the Trustee
and a statement as to the reason such documents or pleadings are required and a
certification that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure proceeding or
trustee's sale.
(b) Subject to Section 3.01, the Servicer shall have the right to
accept applications of Mortgagors for consent to (i) partial releases of
Mortgages, (ii) alterations, and (iii) removal, demolition or division of
properties subject to Mortgages. No application for approval shall be considered
by the Servicer unless: (w) either (A) it has received an Opinion of Counsel,
addressed to the Trustee (which opinion shall not be an expense of the Trustee
or the Trust Fund) that such sale, disposition, substitution, acquisition or
contribution will not affect adversely the status of either REMIC constituting
part of the Trust Fund as a REMIC or cause either REMIC constituting part of the
Trust Fund to be subject to a tax on "prohibited transactions" or
"contributions" pursuant to the REMIC Provisions or (B) other evidence
satisfactory to the Servicer; (x) the provisions of the related Mortgage Note
and Mortgage have been complied with; (y) the Loan-to-Value Ratio and
debt-to-income ratio after any release does not exceed the maximum Loan-to-Value
Ratio and debt-to-income ratio established in accordance with the underwriting
standards of the Mortgage Loans; and (z) the lien priority of the related
Mortgage is not affected. Upon receipt by the Trustee of a Servicing Officer's
certificate setting forth the action proposed to be taken in respect of a
particular Mortgage Loan and certifying that the criteria set forth in the
immediately preceding sentence have been satisfied, the Trustee shall execute
and deliver to the Servicer the consent or partial release so requested by, and
furnished to it by, the Servicer. A proposed form of consent or partial release,
as the case may be, shall accompany any Servicing Officer's certificate
delivered by the Servicer pursuant to this paragraph.
Section 3.18 Servicing Compensation.
As compensation for its activities hereunder, the Servicer shall be
entitled to retain the amount of the Servicing Fee with respect to each Mortgage
Loan (including REO Properties). The Servicer shall be entitled to retain
additional servicing compensation in the form of release fees, bad check
charges, assumption fees, modification or extension fees, late payment charges,
prepayment penalties that are not Prepayment Penalties, Originator Prepayment
Penalty Payment Amounts, Originator Prepayment Penalty Payment Amounts or REO
Disposition Fees, or any other service-related fees, Insurance Proceeds and
Liquidation Proceeds not required to be deposited in the Collection Account and
similar items, to the extent collected from Mortgagors. In addition, the
Servicer shall be entitled to the investment income on funds on deposit in the
Collection Account.
Section 3.19 Annual Statement as to Compliance.
(a) The Servicer, at its own expense, will deliver to the Securities
Administrator, not later than February 28 following the end of each calendar
year, commencing in February 2006, a Servicing Officer's certificate stating, as
to each signer thereof, that (i) a review of the activities of the Servicer
during such preceding fiscal year (or such shorter period in the case of the
first such report) and of performance under this Agreement or similar agreements
has been made under such officers' supervision, and (ii) to the best of such
officer's knowledge, based on such review, the Servicer has fulfilled all its
obligations under this Agreement for such year, or, if there has been a default
in the fulfillment of all such obligations, specifying each such default known
to such officers and the nature and status thereof including the steps being
taken by the Servicer to remedy such default. The Securities Administrator shall
forward such certificate to the Depositor and the Trustee immediately upon
receipt.
(b) Delivery of such reports, information and documents to the
Securities Administrator is for informational purposes only and the Trustee's,
Securities Administrator's and Depositor's receipt of such shall not constitute
constructive notice of any information contained therein or determinable, from
information contained therein, including the Servicer's compliance with any of
its covenants hereunder (as to which the Trustee, the Securities Administrator
and the Depositor are entitled to rely exclusively on Officers' Certificates).
Section 3.20 Annual Independent Certified Public Accountants'
Reports.
(a) Not later than February 28 following the end of each calendar
year commencing with 2006, the Servicer, at its expense, shall cause a
nationally recognized firm of independent certified public accountants to
furnish to the Securities Administrator a report stating that (i) it has
obtained a letter of representation regarding certain matters from the
management of the Servicer which includes an assertion that the Servicer has
complied with certain minimum residential mortgage loan servicing standards,
identified in either the Uniform Single Attestation Program for Mortgage Bankers
established by the Mortgage Bankers Association of America or the Audit Program
for Mortgages serviced by FHLMC, with respect to the servicing of residential
mortgage loans during the most recently completed fiscal year and (ii) on the
basis of an examination conducted by such firm in accordance with standards
established by the American Institute of Certified Public Accountants, such
representation is fairly stated in all material respects, subject to such
exceptions and other qualifications that may be appropriate. The Securities
Administrator shall furnish a copy of such report to the Trustee, the Depositor
and each Rating Agency immediately upon receipt. Copies of such statement shall
be provided by the Trustee to any Certificateholder upon request, provided that
such statement has been delivered by the Servicer to the Trustee.
(b) Delivery of such reports, information and documents to the
Trustee and the Securities Administrator is for informational purposes only and
the Trustee's and Securities Administrator's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee and the
Securities Administrator are entitled to rely exclusively on Officers'
Certificates).
Section 3.21 Access to Certain Documentation and Information
Regarding the Mortgage Loans.
The Servicer shall provide to the Trustee, the Securities
Administrator, Certificateholders that are federally insured savings and loan
associations, the Office of Thrift Supervision, the FDIC and the supervisory
agents and examiners of each of the foregoing (which, in the case of supervisory
agents and examiners, may be required by applicable state and federal
regulations) access to the available documentation regarding the Mortgage Loans,
such access being afforded without charge but only upon reasonable advance
request and during normal business hours at the offices of the Servicer
designated by it.
Upon request, the Servicer shall furnish to the Securities
Administrator its most recent financial statements and such other information
relating to the Servicer's capacity to perform its obligations under this
Agreement as it possesses. The Securities Administrator shall deliver such
financial statements to the Depositor and the Trustee immediately upon receipt.
To the extent such information is not otherwise available to the public, the
Depositor, the Securities Administrator and the Trustee shall not disseminate
any information obtained pursuant to the preceding sentence without the
Servicer's written consent, except as required pursuant to this Agreement or to
the extent that it is appropriate to do so (i) in working with legal counsel,
auditors, taxing authorities or other governmental agencies or (ii) pursuant to
any law, rule, regulation, order, judgment, writ, injunction or decree of any
court or governmental authority having jurisdiction over the Depositor and the
Trustee or the Trust Fund, and in any case, each of the Depositor, the
Securities Administrator or the Trustee, as the case may be, shall use its best
efforts to assure the confidentiality of any such disseminated non-public
information.
Section 3.22 Obligations of the Servicer in Respect of Compensating
Interest.
With respect to each Distribution Date, not later than the close of
business on the related Servicer Remittance Date, the Servicer shall deliver to
the Securities Administrator for deposit in the Distribution Account an amount
("Compensating Interest") equal to the lesser of (A) the aggregate of the
Prepayment Interest Shortfalls on the Mortgage Loans for such Distribution Date
resulting from Principal Prepayments on the Mortgage Loans during the related
Prepayment Period and (B) its aggregate Servicing Fee received in the related
Collection Period. The Servicer shall apply Compensating Interest to offset any
Prepayment Interest Shortfalls attributable to Principal Prepayments in full on
the Mortgage Loans. The Servicer shall not have the right to reimbursement for
any amounts remitted to the Securities Administrator in respect of Compensating
Interest. Such amounts so remitted shall be included in the Available Funds and
distributed therewith on the next Distribution Date.
Section 3.23 Investment of Funds in the Collection Account and the
Distribution Account.
(a) The Servicer may direct in writing any depository institution
maintaining the Collection Account and the Securities Administrator may direct
in writing any depository institution maintaining the Distribution Account (for
purposes of this Section 3.23, each an "Investment Account"), to invest the
funds in such Investment Account in one or more Permitted Investments bearing
interest or sold at a discount, and maturing, unless payable on demand, (i) no
later than the Business Day immediately preceding the date on which such funds
are required to be withdrawn from such account pursuant to this Agreement, if a
Person other than the Securities Administrator is the obligor thereon, and (ii)
no later than the date on which such funds are required to be withdrawn from
such account pursuant to this Agreement, if the Securities Administrator is the
obligor thereon. All such Permitted Investments shall be held to maturity,
unless payable on demand. Any investment of funds in an Investment Account shall
be made in the name of the Securities Administrator or the Servicer, as
applicable (in its capacity as such) or in the name of a nominee of the same.
The Servicer or the Securities Administrator, as applicable, shall be entitled
to sole possession over each such investment and the income thereon, and any
certificate or other instrument evidencing any such investment shall be
delivered directly to the Securities Administrator or its agent, together with
any document of transfer necessary to transfer title to such investment to the
Securities Administrator or its nominee. In the event amounts on deposit in an
Investment Account are at any time invested in a Permitted Investment payable on
demand, the Servicer or the Securities Administrator:
(x) consistent with any notice required to be given
thereunder, demand that payment thereon be made on the
last day such Permitted Investment may otherwise mature
hereunder in an amount equal to the lesser of (1) all
amounts then payable thereunder and (2) the amount
required to be withdrawn on such date; and
(y) demand payment of all amounts due thereunder promptly
upon determination by a Responsible Officer of the
Securities Administrator that such Permitted Investment
would not constitute a Permitted Investment in respect
of funds thereafter on deposit in the Investment
Account.
(b) All income and gain realized from the investment of funds in the
Collection Account shall be for the benefit of the Servicer. The Servicer shall
deposit in the Collection Account the amount of any loss incurred in respect of
any such Permitted Investment made with funds in such account immediately upon
realization of such loss. All income and gain realized from the investment of
funds in the Distribution Account shall be for the benefit of the Securities
Administrator. The Securities Administrator shall deposit in the Distribution
Account the amount of any loss incurred on Permitted Investments in the
Distribution Account.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Securities Administrator may and, subject to Section 8.01 and
Section 8.02(a)(v), upon the request of the Holders of Certificates representing
more than 50% of the Voting Rights allocated to any Class of Certificates, shall
take such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate proceedings.
Section 3.24 Liability of Servicer; Indemnification.
(a) Subject to clause (b) below and Section 6.03, the Servicer
(except the Securities Administrator if it is required to succeed the Servicer
hereunder) indemnifies and holds the Trustee, the Securities Administrator and
the Depositor (and their respective officers, directors and Affiliates) and each
Certificateholder harmless against any and all claims, losses, penalties, fines,
forfeitures, reasonable legal fees and related costs, judgments, and any other
costs, fees and expenses that the Trustee, the Securities Administrator, the
Depositor and any Certificateholder may sustain in any way related to the
failure of the Servicer to perform its duties and service the Mortgage Loans in
compliance with the Servicing Standards. The Servicer shall immediately notify
the Trustee, the Securities Administrator, the Depositor and each
Certificateholder if a claim is made that may result in such claims, losses,
penalties, fines, forfeitures, legal fees or related costs, judgments, or any
other costs, fees and expenses, and the Servicer shall assume (with the consent
of the Securities Administrator) the defense of any such claim and pay all
expenses in connection therewith, including reasonable counsel fees, and
promptly pay, discharge and satisfy any judgment or decree which may be entered
against the Servicer, the Trustee, the Securities Administrator, the Depositor
and/or Certificateholder in respect of such claim. The provisions of this
Section 3.24 shall survive the termination of this Agreement and the payment of
the outstanding Certificates.
(b) None of the Depositor, the Servicer, or any of the directors,
officers, employees or agents of the Depositor or the Servicer shall be under
any liability to the Trust Fund or the Certificateholders for any action taken,
or for refraining from the taking of any action, in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Depositor or the Servicer or any such Person against any
breach of warranties or representations made herein, or against any specific
liability imposed on the Servicer for a breach of the Servicing Standard, or
against any liability which would otherwise be imposed by reason of its
respective willful misfeasance, bad faith, fraud or negligence in the
performance of its duties or by reasons of negligent disregard of its respective
obligations or duties hereunder.
The Depositor, the Servicer and any director, officer, employee or
agent of the Depositor or the Servicer, may rely in good faith on any document
of any kind which, prima facie, is properly executed and submitted by any
appropriate Person with respect to any matters arising hereunder. The Depositor,
the Servicer and any director, officer, employee or agent of the Depositor or
the Servicer shall be indemnified and held harmless by the Trust Fund against
any loss, liability or expense incurred in connection with any legal action
relating to this Agreement or the Certificates, other than any loss, liability
or expense incurred in connection with any legal action incurred by reason of
its respective misfeasance, bad faith, fraud or negligence, a breach of a
representation or warranty hereunder or (in the case of the Servicer) a breach
of the Servicing Standard in the performance of its respective duties or by
reason of negligent disregard of its respective obligations or duties hereunder.
Neither the Depositor nor the Servicer shall be under any obligation to appear
in, prosecute or defend any legal action unless such action is related to its
respective duties under this Agreement and in its opinion does not expose it to
any expense or liability; provided, however, that each of the Depositor and the
Servicer may in its discretion undertake any action related to its obligations
hereunder which it may deem necessary or desirable with respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. The Servicer's right to indemnity or
reimbursement pursuant to this Section shall survive any resignation or
termination of the Servicer pursuant to Section 6.04 or 7.01 with respect to any
losses, expenses, costs or liabilities arising prior to such resignation or
termination (or arising from events that occurred prior to such resignation or
termination). In such event, unless the Depositor or the Servicer acts without
the consent of Holders of Certificates entitled to at least 51% of the Voting
Rights, the legal expenses and costs of such action and any liability resulting
therefrom (except any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder) shall be expenses, costs and liabilities of the Trust Fund, and the
Depositor and the Servicer shall be entitled to be reimbursed therefor from the
Collection Account as and to the extent provided in Section 3.05, any such right
of reimbursement being prior to the rights of the Certificateholders to receive
any amount in the Collection Account.
Section 3.25 Reports of Foreclosure and Abandonment of Mortgaged
Properties.
On or before April 30 of each year beginning in 2006, the Servicer
shall file the reports of foreclosure and abandonment of any Mortgaged Property
required by Section 6050J of the Code with the Internal Revenue Service and
provide an Officer's Certificate certifying its compliance with this Section
3.25 to the Trustee. The reports from the Servicer shall be in form and
substance sufficient to meet the reporting requirements imposed by such Section
6050J.
Section 3.26 Limitation of Liability of the Credit Risk Manager.
Neither the Credit Risk Manager, nor any of the directors, officers,
employees or agents of the Credit Risk Manager, shall be under any liability to
the Trustee, the Securities Administrator, the Certificateholders or the
Depositor for any action taken or for refraining from the taking of any action
in good faith pursuant to this Agreement, in reliance upon information provided
by the Servicer under the Credit Risk Management Agreement or for errors in
judgment; provided, however, that this provision shall not protect the Credit
Risk Manager or any such person against liability that would otherwise be
imposed by reason of willful malfeasance, bad faith or gross negligence in its
performance of its duties or by reason of reckless disregard for its obligations
and duties under this Agreement or the applicable Credit Risk Management
Agreement. The Credit Risk Manager and any director, officer, employee or agent
of the Credit Risk Manager may rely in good faith on any document of any kind
prima facie properly executed and submitted by any Person respecting any matters
arising hereunder, and may rely in good faith upon the accuracy of information
furnished by the Servicer pursuant to the applicable Credit Risk Management
Agreement in the performance of its duties thereunder and hereunder.
Section 3.27 No Personal Solicitation.
From and after the Closing Date, the Servicer agrees that it will
not take any action or permit or cause any action to be taken by any of its
agents and Affiliates, or by any independent contractors or independent mortgage
brokerage companies on the Servicer's behalf, to personally, by telephone, mail
or electronic mail, solicit the Mortgagor under any Mortgage Loan for the
purpose of refinancing such Mortgage Loan; provided, that the Servicer may
solicit any Mortgagor for whom the Servicer has received a request for
verification of mortgage, a request for demand for payoff, a mortgagor initiated
written or verbal communication indicating a desire to prepay the related
Mortgage Loan, or the mortgagor initiates a title search; provided further, it
is understood and agreed that promotions undertaken by the Servicer or any of
its Affiliates which (i) concern optional insurance products or other additional
products or (ii) are directed to the general public at large, including, without
limitation, mass mailings based on commercially acquired mailing lists,
newspaper, radio and television advertisements shall not constitute solicitation
under this Section, nor is the Servicer prohibited from responding to
unsolicited requests or inquiries made by a Mortgagor or an agent of a
Mortgagor. Furthermore, the Servicer shall be permitted to include in its
monthly statements to borrowers or otherwise, statements regarding the
availability of the Servicer's counseling services with respect to refinancing
mortgage loans.
Section 3.28 Periodic Filings.
(a) The Securities Administrator and the Servicer shall reasonably
cooperate with the Depositor in connection with the Trust's satisfying the
reporting requirements under the Securities Exchange Act of 1934, as amended.
The Securities Administrator shall prepare on behalf of the Trust any Forms 8-K
(other than the Form 8-K to which this Agreement is attached as a exhibit
thereto) and 10-K customary for similar securities as required by the Exchange
Act and the Rules and Regulations of the Commission thereunder, and the
Securities Administrator shall file (via the Commission's Electronic Data
Gathering and Retrieval System) such Forms on behalf of the Depositor. The
Servicer shall be responsible for signing all 8-Ks (other than the Form 8-K to
which this Agreement is attached as an exhibit thereto) and 10-Ks required to be
filed.
(b) The Securities Administrator shall file a Form 8-K within 15
days after each Distribution Date, including a Form 8-K with a copy of the
statement to the Certificateholders for such Distribution Date as an exhibit
thereto. Prior to March 30th of each year (or such earlier date as may be
required by the Exchange Act and the Rules and Regulations of the Commission),
the Securities Administrator shall file a Form 10-K, in substance as required by
applicable law or applicable Commission staff interpretations. Such Form 10-K
shall include as exhibits the Servicer's annual statement of compliance
described under Section 3.19 and the accountant's report described under Section
3.20, in each case to the extent they have been timely delivered to the
Securities Administrator. The Securities Administrator shall have no liability
with respect to any failure to properly prepare or file such periodic reports
resulting from or relating to the Securities Administrator's inability or
failure to obtain any information not resulting from its own negligence or
willful misconduct. The Form 10-K and any amended Form 10-K shall also include a
certification of the Servicer in the form attached hereto as Exhibit O (the
"Sarbanes Oxley Certification"), which shall be signed by the senior officer of
the Servicer in charge of its servicing, and which the Servicer shall deliver to
the Securities Administrator prior to March 15th of each year in which a Form
10-K is to be filed with respect to the Trust.
(c) Not later than 15 calendar days before the date on which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Commission (or, if
such day is not a Business Day, the immediately preceding Business Day), the
Securities Administrator shall sign and deliver to the Servicer a certification
in the form attached hereto as Exhibit P (the "Securities Administrator's
Certification") for the benefit of the Servicer and its officers, directors and
Affiliates as to items 1 through 3 of the Xxxxxxxx-Xxxxx Certification;
provided, however, that the Securities Administrator shall not undertake an
analysis of the accountant's report attached as an exhibit to the Form 10-K. In
addition, the Securities Administrator shall indemnify and hold harmless the
Servicer and each Person, if any, who "controls" the Servicer within the meaning
of the Securities Act and its officers, directors and Affiliates from and
against any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments and other costs and expenses
arising out of or based upon a breach of the Securities Administrator's
obligations under this Section 3.28(c) or the Securities Administrator's
negligence, bad faith or willful misconduct in connection therewith or any
inaccuracy in the Securities Administrator's Certification. If the
indemnification provided for in this Section 3.28(c) is unavailable or
insufficient to hold harmless such Persons, then the Securities Administrator
shall contribute to the amount paid or payable by such Persons as a result of
the losses, claims, damages or liabilities of such Persons in such proportion as
is appropriate to reflect the relative fault of the Depositor or the Servicer on
the one hand and the Securities Administrator on the other. The Securities
Administrator acknowledges that the Servicer is relying on the Securities
Administrator's performance of its obligations under this Section 3.28(c) in
order to perform its obligations under Section 3.28(b) above.
(d) Upon any filing with the Commission, the Securities
Administrator shall promptly deliver to the Depositor a copy of any such
executed report, statement or information.
(e) If the Commission issues additional interpretative guidance or
promulgates additional rules or regulations, or if other changes in applicable
law occur, which would require the reporting arrangements, or the allocation of
responsibilities with respect thereto, described in this Section 3.28, to be
conducted differently than as described, the Depositor, the Servicer and the
Securities Administrator will reasonably cooperate to amend the provisions of
this Section 3.28 in order to comply with such amended reporting requirements
and such amendment of this Section 3.28. Any such amendment shall be made in
accordance with Section 11.01 without the consent of the Certificateholders, and
may result in a change in the reports filed by the Securities Administrator on
behalf of the Trust under the Exchange Act. Notwithstanding the foregoing, none
of the Depositor, the Servicer or the Securities Administrator shall be
obligated to enter into any amendment pursuant to this Section 3.28 that
adversely affects its obligations and immunities under this Agreement.
(f) Unless otherwise instructed by the Depositor, prior to January
30 of the first year in which the Securities Administrator is able to do so
under applicable law, the Securities Administrator shall file a Form 15
Suspension Notification with respect to the Trust. At any time after the filing
of a Form 15 Suspension Notification, if the number of Certificateholders of
record exceeds the number set forth in Section 15(d) of the Exchange Act or the
regulations promulgated pursuant thereto which would cause the Trust to again
become subject to the reporting requirements of the Exchange Act, the Securities
Administrator shall recommence preparing and filing reports on Form 8-K and 10-K
as required pursuant to this Section 3.28.
ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions.
On each Distribution Date, the Securities Administrator shall
withdraw from the Distribution Account the Interest Remittance Amount and apply
it in the following order of priority (based upon the Mortgage Loan information
provided to it in the Remittance Report, upon which the Securities Administrator
may conclusively rely), and the calculations required to be made by the
Securities Administrator, to the extent available:
(i) to the Credit Risk Manager, the Credit Risk Manager Fee for such
Distribution Date;
(ii) concurrently, as follows:
(A) concurrently, from the Group I Interest Remittance Amount,
to the Class AI-1A and Class AI-1B Certificates, pro rata (based on
the Accrued Certificate Interest for each such Class), the
applicable Accrued Certificate Interest thereon for such
Distribution Date; and
(B) from the Group II Interest Remittance Amount, to the Class
AII-1 Certificates, Accrued Certificate Interest thereon for such
Distribution Date;
(iii) concurrently, as follows:
(A) concurrently, from the Group I Interest Remittance Amount,
to the Class AI-1A and Class AI-1B Certificates, pro rata (based on
the Interest Carry Forward Amount for each such Class), the
applicable Interest Carry Forward Amount thereon for such
Distribution Date; and
(B) from the Group II Interest Remittance Amount, to the Class
AII-1 Certificates, the Interest Carry Forward Amount thereon for
such Distribution Date;
(iv) concurrently, as follows:
(A) from the Group I Interest Remittance Amount, to the Class
AII-1 Certificates, any Accrued Certificate Interest for such Class
for such Distribution Date, to the extent not distributed pursuant
to clause (ii) above; and
(B) concurrently, from the Group II Interest Remittance
Amount, to the Class AI-1A and Class AI-1B Certificates, pro rata
(based on the Accrued Certificate Interest for each such Class), any
Accrued Certificate Interest for such Classes for such Distribution
Date, to the extent not distributed pursuant to clause (ii) above;
and
(v) concurrently, as follows:
(A) from the Group I Interest Remittance Amount, to the Class
AII-1 Certificates, any Interest Carry Forward Amount for such Class
for such Distribution Date, to the extent not distributed pursuant
to clause (iii) above; and
(B) concurrently, from the Group II Interest Remittance
Amount, to the Class AI-1A and Class AI-1B Certificates, pro rata
(based on the Interest Carry Forward Amount for each such Class),
any Interest Carry Forward Amount for such Classes for such
Distribution Date, to the extent not distributed pursuant to clause
(iii) above;
(vi) to the Class M-1 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(vii) to the Class M-2 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(viii) to the Class M-3 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(ix) to the Class M-4 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(x) to the Class M-5 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(xi) to the Class M-6 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date;
(xii) to the Class M-7 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xiii) to the Class M-8 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xiv) to the Class M-9 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xv) to the Class M-10 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xvi) to the Class M-11 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xvii) to the Class M-12 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xviii) to the Class M-13 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date; and
(xix) to the Class M-14 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date.
Section 4.02 Distributions of Principal and Monthly Excess Cashflow
Amounts.
(a) On each Distribution Date, the Securities Administrator shall
make the following distributions in the following order of priority (based upon
the Mortgage Loan information provided to it in the Remittance Report and the
calculations required to be made by the Securities Administrator), to the extent
of the Principal Distribution Amount:
(i) before the Stepdown Date or with respect to which a Trigger
Event is in effect, sequentially, as follows:
first, concurrently, as follows:
(i) the Group I Principal Distribution Amount, (a) with
respect to each Distribution Date on which a Sequential Trigger
Event is not in effect, concurrently, to the Class AI-1A and Class
AI-1B Certificates, pro rata, and (b) with respect to each
Distribution Date on which a Sequential Trigger Event is in effect,
sequentially, to the Class AI-1A and Class AI-1B Certificates; and
(ii) the Group II Principal Distribution Amount, to the Class
AII-1 Certificates;
second, concurrently, as follows:
(i) the Group I Principal Distribution Amount remaining after
priority first (i) above, to the Class AII-1 Certificates; and
(ii) the Group II Principal Distribution Amount remaining
after priority first (ii) above, (a) with respect to each
Distribution Date on which a Sequential Trigger Event is not in
effect, concurrently, to the Class AI-1A and Class AI-1B
Certificates, pro rata, and (b) with respect to each Distribution
Date on which a Sequential Trigger Event is in effect, sequentially,
to the Class AI-1A and Class AI-1B Certificates;
third, sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10,
Class M-11, Class M-12, Class M-13 and Class M-14 Certificates; and
fourth, any remaining Principal Distribution Amount will be
distributed as part of the Monthly Excess Cashflow Amount as set forth in
Section 4.02(b).
(ii) on or after the Stepdown Date and as long as a Trigger Event is
not in effect:
first, concurrently, as follows:
(i) from the Group I Principal Distribution Amount, (a) with
respect to each Distribution Date on which a Sequential Trigger
Event is not in effect, concurrently, to the Class AI-1A and Class
AI-1B Certificates, pro rata, up to an amount equal to the Group I
Senior Principal Distribution Amount and (b) with respect to any
Distribution Date on which a Sequential Trigger Event is in effect,
sequentially, to the Class AI-1A and Class AI-1B Certificates up to
an amount equal to the Group I Senior Principal Distribution Amount;
and
(ii) from the Group II Principal Distribution Amount, to the
Class AII-1 Certificates, up to an amount equal to the Group II
Senior Principal Distribution Amount;
second, concurrently, as follows:
(i) the Group I Principal Distribution Amount remaining after
priority first (i) above, to the Class AII-1 Certificates, up to an
amount equal to the Group II Senior Principal Distribution Amount
not paid pursuant to priority first (ii) above; and
(ii) the Group II Principal Distribution Amount remaining
after priority first (ii) above, up to an amount equal to the Group
I Senior Principal Distribution Amount not paid pursuant to priority
first (i) above, (a) with respect to each Distribution Date on which
a Sequential Trigger Event is not in effect, concurrently, to the
Class AI-1A and Class AI-1B Certificates, pro rata, and (b) with
respect to any Distribution Date on which a Sequential Trigger Event
is in effect, sequentially, to the Class AI-1A and Class AI-1B
Certificates;
third, to the Class M-1 Certificates, up to the Class M-1 Principal
Distribution Amount;
fourth, to the Class M-2 Certificates, up to the Class M-2 Principal
Distribution Amount;
fifth, to the Class M-3 Certificates, up to the Class M-3 Principal
Distribution Amount;
sixth, to the Class M-4 Certificates, up to the Class M-4 Principal
Distribution Amount;
seventh, to the Class M-5 Certificates, up to the Class M-5
Principal Distribution Amount;
eighth, to the Class M-6 Certificates, up to the Class M-6 Principal
Distribution Amount;
ninth, to the Class M-7 Certificates, up to the Class M-7 Principal
Distribution Amount;
tenth, to the Class M-8 Certificates, up to the Class M-8 Principal
Distribution Amount;
eleventh, to the Class M-9 Certificates, up to the Class M-9
Principal Distribution Amount;
twelfth, to the Class M-10 Certificates, up to the Class M-10
Principal Distribution Amount;
thirteenth, to the Class M-11 Certificates, up to the Class M-11
Principal Distribution Amount;
fourteenth, to the Class M-12 Certificates, up to the Class M-12
Principal Distribution Amount;
fifteenth, to the Class M-13 Certificates, up to the Class M-13
Principal Distribution Amount;
sixteenth, to the Class M-14 Certificates, up to the Class M-14
Principal Distribution Amount; and
seventeenth, any remaining Principal Distribution Amount will be
distributed as part of the Monthly Excess Cashflow Amount as set forth in
Section 4.02(b).
(b) On each Distribution Date, any Monthly Excess Cashflow Amount
remaining after distributions made pursuant to Section 4.02(f) on such
Distribution Date shall be distributed, to the extent available, in the
following order of priority on such Distribution Date:
(i) to the Class A Certificates, pro rata, any remaining Accrued
Certificate Interest for such Distribution Date;
(ii) to the Class A Certificates, pro rata, any Interest Carry
Forward Amounts for such Classes for such Distribution Date;
(iii) to the Class M-1 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(iv) to the Class M-1 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(v) to the Class M-1 Certificates, any Class M-1 Realized Loss
Amortization Amount for such Distribution Date;
(vi) to the Class M-2 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(vii) to the Class M-2 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(viii) to the Class M-2 Certificates, any Class M-2 Realized Loss
Amortization Amount for such Distribution Date;
(ix) to the Class M-3 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(x) to the Class M-3 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xi) to the Class M-3 Certificates, any Class M-3 Realized Loss
Amortization Amount for such Distribution Date;
(xii) to the Class M-4 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xiii) to the Class M-4 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xiv) to the Class M-4 Certificates, any Class M-4 Realized Loss
Amortization Amount for such Distribution Date;
(xv) to the Class M-5 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xvi) to the Class M-5 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xvii) to the Class M-5 Certificates, any Class M-5 Realized Loss
Amortization Amount for such Distribution Date;
(xviii) to the Class M-6 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xix) to the Class M-6 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xx) to the Class M-6 Certificates, any Class M-6 Realized Loss
Amortization Amount for such Distribution Date;
(xxi) to the Class M-7 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xxii) to the Class M-7 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xxiii) to the Class M-7 Certificates, any Class M-7 Realized Loss
Amortization Amount for such Distribution Date;
(xxiv) to the Class M-8 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xxv) to the Class M-8 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xxvi) to the Class M-8 Certificates, any Class M-8 Realized Loss
Amortization Amount for such Distribution Date;
(xxvii) to the Class M-9 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xxviii) to the Class M-9 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xxix) to the Class M-9 Certificates, any Class M-9 Realized Loss
Amortization Amount for such Distribution Date;
(xxx) to the Class M-10 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xxxi) to the Class M-10 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xxxii) to the Class M-10 Certificates, any Class M-10 Realized Loss
Amortization Amount for such Distribution Date;
(xxxiii) to the Class M-11 Certificates, any remaining unpaid
Accrued Certificate Interest for such Distribution Date;
(xxxiv) to the Class M-11 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xxxv) to the Class M-11 Certificates, any Class M-11 Realized Loss
Amortization Amount for such Distribution Date;
(xxxvi) to the Class M-12 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xxxvii) to the Class M-12 Certificates, any remaining Interest
Carry Forward Amount for such Distribution Date;
(xxxviii) to the Class M-12 Certificates, any Class M-12 Realized
Loss Amortization Amount for such Distribution Date;
(xxxix) to the Class M-13 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xl) to the Class M-13 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xli) to the Class M-13 Certificates, any Class M-13 Realized Loss
Amortization Amount for such Distribution Date;
(xlii) to the Class M-14 Certificates, any remaining unpaid Accrued
Certificate Interest for such Distribution Date;
(xliii) to the Class M-14 Certificates, any remaining Interest Carry
Forward Amount for such Distribution Date;
(xliv) to the Class M-14 Certificates, any Class M-14 Realized Loss
Amortization Amount for such Distribution Date;
(xlv) sequentially, as follows:
(a) concurrently, to the Class A Certificates, pro rata (based
on the outstanding Principal Balance of each such Class) any Cap
Carryover Amount for such Class, after giving effect to any amounts
received from the applicable Reserve Account pursuant to Section
3.04(g);
(b) concurrently, to the Class A Certificates, pro rata (based
on the remaining unpaid Cap Carryover Amount for each such Class
after distributions pursuant to clause (xlv)(a) above) any remaining
unpaid Cap Carryover Amount for such Class, after giving effect to
any distributions pursuant to clause (xlv)(a) above; and
(c) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9, Class M-10, Class M-11,
Class M-12, Class M-13 and Class M-14 Certificates, any Cap Carryover Amount for
such Class, after giving effect to any amounts received from the Class M Reserve
Account pursuant to Section 3.04(g); and
(xlvi) to the Class CE Certificates, up to the Class CE
Distributable Amount for such Distribution Date.
On each Distribution Date, there shall be distributed to the Holder
of the Class R Certificate in respect of the Class R-1 Interest, any remaining
amount in the Distribution Account on such date after the application pursuant
to Sections 4.01, 4.02(a) and 4.02(b)(i)-(xlvi).
(c) On each Distribution Date, the Securities Administrator shall
withdraw any amounts then on deposit in the Distribution Account that represent
Prepayment Penalties collected by the Servicer in connection with the Principal
Prepayment in full of any of the Mortgage Loans, any Originator Prepayment
Penalty Payment Amounts or Servicer Prepayment Penalty Payment Amounts and shall
distribute such amounts to the Holders of the Class P Certificates. Such amounts
shall be treated as having been distributed to the Holders of the Class P
Certificates from the Grantor Trust.
(d) Any amounts distributed to the Certificates (other than the
Class CE, Class P and Class R Certificates) in respect of interest pursuant to
Section 4.02(b)(xlv) that constitute Cap Carryover Amounts shall be deemed
distributed (i) to the extent the source of such funds is a Yield Maintenance
Agreement Payment or a distribution from a Reserve Account, from the Grantor
Trust and (ii) otherwise, as first, a distribution by REMIC 2 to the Class CE
Certificates and then, a distribution to the applicable Certificates from the
Grantor Trust, in either case, as payments on notional principal contracts in
the nature of cap contracts. Any remaining amount with respect to the Class CE
Certificates or any remaining Yield Maintenance Agreement Payments shall be
treated as having been distributed to the Holders of the Class CE Certificates
from the Grantor Trust.
(e) On each Distribution Date, Unpaid Realized Loss Amounts on the
Certificates (other than the Class CE, Class P and Class R Certificates) will be
reduced by the amount of any Subsequent Recoveries received during the related
Prepayment Period in the same order as Realized Loss Amortization Amounts are
paid to the Certificates (other than the Class CE, Class P and Class R
Certificates) pursuant to Section 4.02(b) above.
(f) On each Distribution Date, prior to any distributions of the
Monthly Excess Cashflow Amount pursuant to Section 4.02(b), any Monthly Excess
Interest Amount shall be distributed, to the extent available, in the following
order of priority on such Distribution Date: (i) concurrently, based on each
Class' Interest Percentage of the Current Interest Shortfall for such
Distribution Date, to the Class A Certificates, pro rata, and (ii) sequentially,
up to each Class' Interest Percentage of the Current Interest Shortfall for such
Distribution Date, to the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8, Class M-9, Class M-10, Class M-11, Class M-12,
Class M-13 and Class M-14 Certificates.
Section 4.03 Allocation of Losses.
Realized Losses shall be allocated, through the priority of
distributions in Section 4.02, first against the Monthly Excess Interest Amount
and then against the Overcollateralization Amount until such amount has been
reduced to zero. If, after giving effect to the distribution of the Principal
Distribution Amount on any Distribution Date the aggregate Principal Balance of
the Certificates (other than the Class CE, Class P and Class R Certificates)
exceeds the Pool Balance as of the end of the related Collection Period, the
resulting Applied Realized Loss Amount will be allocated against the Class M-14,
Class M-13, Class M-12, Class M-11, Class M-10, Class M-9, Class M-8, Class M-7,
Class M-6, Class M-5, Class M-4, Class M-3, Class M-2 and Class M-1
Certificates, in that order and until the respective Principal Balances thereof
are reduced to zero.
Section 4.04 Method of Distribution.
The Securities Administrator shall make distributions in respect of
a Distribution Date to each Certificateholder of record on the related Record
Date (other than as provided in Section 10.01 respecting the final
distribution), in the case of Certificateholders of the Certificates, by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least seven Business Days prior to the Record Date immediately prior
to such Distribution Date and is the registered owner of such Certificates, or
by check mailed by first class mail to the address of the Person entitled
thereto, as such name and address shall appear on the Certificate Register,
provided that the Certificate Registrar may deduct a reasonable wire transfer
fee from any payment made by wire transfer. Distributions among
Certificateholders shall be made in proportion to the Percentage Interests
evidenced by the Certificates held by such Certificateholders.
Section 4.05 Distributions on Book-Entry Certificates.
Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, which shall credit 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 Certificate 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 Certificate Owners that it represents. All such credits
and disbursements with respect to a Book-Entry Certificate are to be made by the
Depository and the Depository Participants in accordance with the provisions of
the Certificates. None of Securities Administrator, the Trustee, the Depositor
or the Servicer shall have any responsibility therefor except as otherwise
provided by applicable law.
Section 4.06 Statements.
(a) On each Distribution Date, based on the Mortgage Loan
information contained in the Remittance Report, the Securities Administrator
shall prepare and make available on its website at xxx.xxxxxxx.xxx, a statement
(the "Distribution Date Statement") as to the distributions made on such
Distribution Date:
(i) the amount of the distribution made on such Distribution Date to
the Holders of each Class of Certificates allocable to principal,
separately identified and the amount of the distribution made on such
Distribution Date to the Holders of the Class P Certificates from
Prepayment Penalties, Originator Prepayment Penalty Payment Amounts and
Servicer Prepayment Penalty Payment Amounts;
(ii) the amount of the distribution made on such Distribution Date
to the Holders of each Class of Certificates allocable to interest or
Class CE Distributable Amount, separately identified;
(iii) the Overcollateralization Amount, the Overcollateralization
Release Amount, the Overcollateralization Deficiency and the Targeted
Overcollateralization Amount as of such Distribution Date and the Monthly
Excess Interest Amount and Monthly Excess Cashflow Amount for such
Distribution Date;
(iv) the aggregate amount of servicing compensation received by the
Servicer during the related Collection Period;
(v) the aggregate amount of Advances for the related Collection
Period, cumulative unreimbursed Advances and Servicing Advances and
cumulative Nonrecoverable Advances;
(vi) the Pool Balance, at the close of business at the end of the
related Collection Period;
(vii) the number, weighted average remaining term to maturity and
weighted average Mortgage Interest Rate of the Mortgage Loans as of the
related Due Date;
(viii) the number and aggregate unpaid principal balance of Mortgage
Loans (a) 30 to 59 days past due on a contractual basis, (b) 60 to 89 days
past due on a contractual basis, (c) 90 or more days past due on a
contractual basis, (d) as to which foreclosure proceedings have been
commenced and (e) in bankruptcy as of the close of business on the last
day of the calendar month preceding such Distribution Date;
(ix) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number of such Mortgage
Loan, the unpaid Principal Balance of the REO Property as of the close of
business on the last Business Day of such calendar month and the Principal
Balance of such Mortgage Loan as of the date it became an REO Property;
(x) the book value of any REO Property as of the close of business
on the last Business Day of the calendar month preceding the Distribution
Date, and, cumulatively, the total number and cumulative principal balance
of all REO Properties as of the close of business of the last day of the
preceding Collection Period;
(xi) separately stated for each Loan Group, the aggregate amount of
Principal Prepayments made during the related Prepayment Period;
(xii) separately stated for each Loan Group, the aggregate amount of
Realized Losses incurred during the related Collection Period and the
cumulative amount of Realized Losses;
(xiii) the Principal Balance of each Class of Certificates, after
giving effect to the distributions, and allocations of Realized Losses or
Applied Realized Loss Amounts, as applicable, made on such Distribution
Date, separately identifying any reduction thereof due to allocations of
Realized Losses or Applied Realized Loss Amounts;
(xiv) the Accrued Certificate Interest in respect of each Class of
Certificates for such Distribution Date and any related Cap Carryover
Amounts, and the respective portions thereof, if any, remaining unpaid
following the distributions made in respect of such Certificates on such
Distribution Date;
(xv) the aggregate amount of any Prepayment Interest Shortfalls and
of any Compensating Interest for such Distribution Date, to the extent not
covered by payments by the Servicer pursuant to Section 3.23;
(xvi) the Interest Percentage for each Class of Certificates, the
amount of any Current Interest Shortfall and the amount of the
distribution made to each Class of Certificates pursuant to Section
4.02(e) for such Distribution Date;
(xvii) the Cap Carryover Amounts distributed on such Distribution
Date, the amounts remaining after giving effect to distributions thereof
on such Distribution Date and the amount of all Cap Carryover Amounts
covered by withdrawals from the applicable Reserve Account on such
Distribution Date;
(xviii) any Overcollateralization Deficiency after giving effect to
the distribution of principal on such Distribution Date;
(xix) whether a Trigger Event has occurred and is continuing, and
the cumulative Realized Losses, as a percentage of the original Pool
Balance;
(xx) the Available Funds;
(xxi) the Pass-Through Rate for each Class of Certificates for such
Distribution Date;
(xxii) the information contained in the Liquidation Report for such
Distribution Date;
(xxiii) the aggregate Principal Balance of Mortgage Loans purchased
by the Servicer or the Depositor during the related Prepayment Period and
indicating the section of this Agreement requiring or allowing the
purchase of each such Mortgage Loan;
(xxiv) the aggregate Principal Balance of the Mortgage Loans
repurchased by the Depositor during the related Prepayment Period in
connection with Section 3.16;
(xxv) the amount of the Credit Risk Manager Fee paid;
(xxvi) the Mortgage Loan identifying number of each Mortgage Loan
with a Prepayment Penalty that was the subject of a Principal Prepayment
in full during the related Collection Period, the Prepayment Penalty
listed on each related Mortgage Note and the Prepayment Penalty collected,
and the Servicer Prepayment Penalty Payment Amount and the Originator
Prepayment Penalty Payment Amount paid with respect to each such Mortgage
Loan;
(xxvii) the amount of any Yield Maintenance Agreement Payments for
such Distribution Date; and
(xxviii) the amount of Subsequent Recoveries received during the
related Prepayment Period.
Assistance in using the Securities Administrator's website can be
obtained by calling the Securities Administrator's customer service desk at
(000) 000-0000. The Securities Administrator shall provide such information to
parties that are unable to use the above distribution option by mailing to them
via first class mail a paper copy of the Distribution Date Statement, upon
request of any such party made by calling the customer service desk and
indicating such. The Securities Administrator shall have the right to change the
way such reports are distributed in order to make such distribution more
convenient and/or more accessible to the parties, and the Securities
Administrator shall provide timely and adequate notification to all parties
regarding any such change.
The Securities Administrator may fully rely upon and shall have no
liability with respect to information with respect to the Mortgage Loans
provided by the Servicer.
In the case of information furnished pursuant to subclauses (i),
(ii) and (xiii) above, the amounts shall be expressed in a separate section of
the report as a dollar amount for each Class for each $1,000 original dollar
amount as of the Closing Date.
(b) Within a reasonable period of time after the end of each
calendar year, the Securities Administrator shall furnish to each Person who at
any time during the calendar year was a Certificateholder of a Regular
Certificate, if requested in writing by such Person, such information as is
reasonably necessary to provide to such Person a statement containing the
information set forth in subclauses (i), (ii), (xiv) and (xvii) above,
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Securities
Administrator shall be deemed to have been satisfied to the extent that
substantially comparable information shall be prepared and furnished by the
Securities Administrator to Certificateholders pursuant to any requirements of
the Code as are in force from time to time.
(c) On each Distribution Date, the Securities Administrator shall
forward to the Class R Certificateholder a copy of the reports forwarded to the
holder of any Regular Certificate in respect of such Distribution Date with such
other information as the Securities Administrator deems necessary or
appropriate. Such obligation of the Securities Administrator shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be prepared and furnished to Class R Certificateholder by the Securities
Administrator pursuant to any requirements of the Code as from time to time in
force.
Section 4.07 Remittance Reports; Advances.
(a) On the 15th calendar day of each month, or the following
Business Day if such 15th calendar day is not a Business Day, the Servicer shall
deliver to the Securities Administrator by telecopy (or by such other means as
the Servicer and the Securities Administrator may agree from time to time) a
Remittance Report with respect to the related Distribution Date. On the same
date, the Servicer shall electronically forward to the Securities Administrator
in such medium as may be agreed between the Servicer and the Securities
Administrator the information set forth in such Remittance Report with respect
to the related Distribution Date and such information reasonably available to
the Servicer necessary in order for the Securities Administrator to perform the
calculations necessary to make the distributions and allocations contemplated by
Section 4.01, 4.02 and 4.03 and to prepare the Distribution Date Statement. The
Securities Administrator shall not be responsible to recompute, recalculate or
verify any information provided to it by the Servicer.
(b) The amount of Advances to be made by the Servicer for any
Distribution Date shall equal, subject to Section 4.07(d), the sum of (i) the
aggregate amount of Monthly Payments (net of the related Servicing Fee), due
during the related Collection Period in respect of the Mortgage Loans, which
Monthly Payments were delinquent on a contractual basis as of the close of
business on the related Determination Date and (ii) with respect to each REO
Property, which REO Property was acquired during or prior to the related
Collection Period and as to which REO Property an REO Disposition did not occur
during the related Collection Period, an amount equal to the excess, if any, of
the REO Imputed Interest on such REO Property for such Collection Period, over
the net income from such REO Property transferred to the Distribution Account
pursuant to Section 3.13 for distribution on such Distribution Date. For
purposes of the preceding sentence, the Monthly Payment on each Balloon Loan
with a delinquent Balloon Payment is equal to the assumed monthly payment that
would have been due on the related Due Date based on the original principal
amortization schedule for such Balloon Loan.
On or before 1:00 p.m. New York City time on the Servicer Remittance
Date, the Servicer shall remit in immediately available funds to the Securities
Administrator for deposit in the Distribution Account an amount equal to the
aggregate amount of Advances, if any, to be made in respect of the Mortgage
Loans for the related Distribution Date either (i) from its own funds or (ii)
from the Collection Account, to the extent of funds held therein for future
distribution (in which case it will cause to be made an appropriate entry in the
records of the Collection Account that amounts held for future distribution have
been, as permitted by this Section 4.07, used by the Servicer in discharge of
any such Advance) or (iii) in the form of any combination of (i) and (ii)
aggregating the total amount of Advances to be made by the Servicer with respect
to the Mortgage Loans. Any amounts held for future distribution and so used
shall be appropriately reflected in the Servicer's records and replaced by the
Servicer by deposit in the Collection Account on or before any future Servicer
Remittance Date to the extent that the Available Funds for the related
Distribution Date (determined without regard to Advances to be made on the
Servicer Remittance Date) shall be less than the total amount that would be
distributed to the Classes of Certificateholders pursuant to Section 4.01 and
4.02 on such Distribution Date if such amounts held for future distributions had
not been so used to make Advances. The Securities Administrator will provide
notice to the Servicer by telecopy by 4:00 p.m. New York City time on any
Servicer Remittance Date in the event that (i) the Servicer fails to remit the
Advances required to be made by the Servicer for the related Distribution Date
or (ii) the amount remitted by the Servicer to the Securities Administrator on
such date is less than the Advances required to be made by the Servicer for the
related Distribution Date, as set forth in the related Remittance Report.
(c) The obligation of the Servicer to make such Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan, shall continue until the
earlier of such time as the Trust acquires title to the related Mortgaged
Property or such Mortgage Loan is paid in full by the Mortgagor or disposed of
by the Trust, or until the recovery of all Liquidation Proceeds thereon.
(d) Notwithstanding anything herein to the contrary, no Advance or
Servicing Advance shall be required to be made hereunder by the Servicer if such
Advance would, if made, constitute a Nonrecoverable Advance. The determination
by the Servicer that it has made a Nonrecoverable Advance or that any proposed
Advance, if made, would constitute a Nonrecoverable Advance, shall be evidenced
by an Officers' Certificate of the Servicer delivered to the Securities
Administrator.
(e) In the event that the Servicer fails to remit any Advances as
required pursuant to this Section 4.07, the Securities Administrator shall
notify the Trustee by 4:00 p.m. on the Servicer Remittance Date identifying for
each Advance the related Mortgage Loan and the amount of the Advance. On or
before 11:00 a.m. New York City time on the Distribution Date immediately
following the Servicer Remittance Date, the Trustee shall remit in immediately
available funds to the Securities Administrator such Advances that the Servicer
was required but failed to make for the related Distribution Date; provided that
the Trustee may conclusively rely upon any determination by the Servicer that an
Advance if made would be a Nonrecoverable Advance; provided further that the
Trustee is not obligated to make any Advance that the Trustee, in its good faith
business judgment, determines would constitute a Nonrecoverable Advance, such
determination to be evidenced by an Officer's Certificate of the Trustee
delivered to the Securities Administrator. So long as the Trustee has not
terminated all of the rights and obligations of the Servicer pursuant to Section
7.01(b) as a result of a Servicer Event of Termination pursuant to
7.01(a)(i)(A), the Servicer shall pay to the Trustee an amount equal to the
Advance made by the Trustee plus interest at an annual rate equal to Prime Rate,
adjusted as of the date of each change, plus two percentage points, but in no
event greater than the maximum amount permitted by applicable law, on any
Advances made by the Trustee. Such interest shall be solely an obligation of the
Servicer and shall not be payable or reimbursable from any assets of the Trust
Fund.
Section 4.08 REMIC Distributions.
(a) On each Distribution Date, the Securities Administrator shall
cause in the following order of priority, the following amounts to be
distributed by REMIC 1 to REMIC 2 on account of the REMIC 1 Regular Interests or
withdrawn from the Distribution Account and distributed to the Holders of the
Class R Certificates (in respect of the Class R-1 Interest), as the case may be:
(i) to Holders of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular
Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC 1 Regular
Interest LT1AII1, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest
LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4,
REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest LT1M6, REMIC 1
Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8, REMIC 1 Regular
Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1 Regular Interest
LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular Interest LT1M13,
REMIC 1 Regular Interest LT1M14 and REMIC 1 Regular Interest LT1ZZ, pro
rata, in an amount equal to (A) the Uncertificated Accrued Interest for
such Distribution Date, plus (B) any amounts in respect thereof remaining
unpaid from previous Distribution Dates. Amounts payable as Uncertificated
Accrued Interest in respect of REMIC 1 Regular Interest LT1ZZ shall be
reduced and deferred when the REMIC 1 Overcollateralized Amount is less
than the REMIC 1 Overcollateralization Target Amount, by the lesser of (x)
the amount of such difference and (y) the Maximum LT1ZZ Uncertificated
Accrued Interest Deferral Amount and such amount will be payable to the
Holders of REMIC 1 Regular Interest LT1AI1A, REMIC 1 Regular Interest
LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1 Regular Interest LT1M1,
REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular
Interest LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest
LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10,
REMIC 1 Regular Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1
Regular Interest LT1M13 and REMIC 1 Regular Interest LT1M14 in the same
proportion as the Overcollateralization Deficiency is allocated to the
Corresponding Certificates;
(ii) to Holders of REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular
Interest LT1GRP, REMIC 1 Regular Interest LT2SUB, REMIC 1 Regular Interest
LT2GRP and REMIC 1 Regular Interest LT1XX, pro rata, in an amount equal to
(A) the Uncertificated Accrued Interest for such Distribution Date, plus
(B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates;
(iii) to the Holders of REMIC 1 Regular Interests, in an amount
equal to the remainder of the REMIC 1 Marker Allocation Percentage of
Available Funds for such Distribution Date after the distributions made
pursuant to clause (i) above, allocated as follows:
(1) to REMIC 1 Regular Interest LT1AA, 98.00% of such
remainder, until the Uncertificated Principal Balance of such
Uncertificated REMIC 1 Regular Interest is reduced to zero;
(2) to REMIC 1 Regular Interest LT1AI1A, REMIC 1 Regular
Interest LT1AI1B, REMIC 1 Regular Interest LT1AII1, REMIC 1
Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC
1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1M4,
REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular
Interest LT1M8, REMIC 1 Regular Interest LT1M9, REMIC 1
Regular Interest LT1M10, REMIC 1 Regular Interest LT1M11,
REMIC 1 Regular Interest LT1M12, REMIC 1 Regular Interest
LT1M13 and REMIC 1 Regular Interest LT1M14, 1.00% of such
remainder, in the same proportion as principal payments are
allocated to the Corresponding Certificates, until the
Uncertificated Principal Balances of such REMIC 1 Regular
Interests are reduced to zero; then
(3) to REMIC 1 Regular Interest LT1ZZ, 1.00% of such
remainder, until the Uncertificated Principal Balance of such
REMIC 1 Regular Interest is reduced to zero;
provided, however, that (i) 98.00% and (ii) 2.00% of any principal
payments that are attributable to an Aggregate Overcollateralization Release
Amount shall be allocated to (i) REMIC 1 Regular Interest LT1AA and (ii) REMIC 1
Regular Interest LT1ZZ, respectively; and
(iv) to the Holders of REMIC 1 Regular Interests, in an amount equal
to the REMIC 1 Sub WAC Allocation Percentage of Available Funds for such
Distribution Date after the distributions made pursuant to clause (i)
above, such that distributions of principal shall be deemed to be made to
the REMIC 1 Regular Interests first, so as to keep the Uncertificated
Principal Balance of each REMIC 1 Regular Interest ending with the
designation "GRP" equal to 0.01% of the aggregate Principal Balance of the
Mortgage Loans in the related group of Mortgage Loans; second, to each
REMIC 1 Regular Interest ending with the designation "SUB," so that the
Uncertificated Principal Balance of each such REMIC 1 Regular Interest is
equal to 0.01% of the excess of (x) the aggregate Principal Balance of the
Mortgage Loans in the related group of Mortgage Loans over (y) the
aggregate current Principal Balance of the Class A Certificates in the
related group of Mortgage Loans (except that if any such excess is a
larger number than in the preceding distribution period, the least amount
of principal shall be distributed to such REMIC 1 Regular Interests such
that the REMIC 1 Subordinated Balance Ratio is maintained); and third, any
remaining principal to REMIC 1 Regular Interest LT1XX.
(b) The Securities Administrator shall cause the following
allocation of losses:
(i) The REMIC 1 Marker Allocation Percentage of the aggregate amount
of any Prepayment Interest Shortfalls and the REMIC 1 Marker Allocation
Percentage of the aggregate amount of any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall
be allocated first, to Uncertificated Accrued Interest payable to REMIC 1
Regular Interest LT1AA and REMIC 1 Regular Interest LT1ZZ up to an
aggregate amount equal to the REMIC 1 Interest Loss Allocation Amount, 98%
and 2%, respectively, and thereafter among REMIC 1 Regular Interest LT1AA,
REMIC 1 Regular Interest LT1AI1A, REMIC 1 Regular Interest LT1AI1B, REMIC
1 Regular Interest LT1AII1, REMIC 1 Regular Interest LT1M1, REMIC 1
Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular
Interest LT1M4, REMIC 1 Regular Interest LT1M5, REMIC 1 Regular Interest
LT1M6, REMIC 1 Regular Interest LT1M7, REMIC 1 Regular Interest LT1M8,
REMIC 1 Regular Interest LT1M9, REMIC 1 Regular Interest LT1M10, REMIC 1
Regular Interest LT1M11, REMIC 1 Regular Interest LT1M12, REMIC 1 Regular
Interest LT1M13 and REMIC 1 Regular Interest LT1M14 and REMIC 1 Regular
Interest LT1ZZ pro rata based on, and to the extent of, one month's
interest at the then applicable respective Uncertificated REMIC 1
Pass-Through Rate on the respective Uncertificated Principal Balance of
each such REMIC 1 Regular Interest;
(ii) The REMIC 1 Sub WAC Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls and the REMIC 1 Sub WAC
Allocation Percentage of the aggregate amount of any Relief Act Interest
Shortfalls incurred in respect of the Mortgage Loans for any Distribution
Date shall be allocated to Uncertificated Accrued Interest payable to
REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1
Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC 1
Regular Interest LT1XX, pro rata based on, and to the extent of, one
month's interest at the then applicable respective Uncertificated REMIC 1
Pass-Through Rate on the respective Uncertificated Principal Balance of
each such REMIC 1 Regular Interest;
(iii) The REMIC 1 Marker Allocation Percentage of all Realized
Losses on the Mortgage Loans shall be allocated by the Securities
Administrator on each Distribution Date to the following REMIC 1 Regular
Interests in the specified percentages, as follows: first, to
Uncertificated Accrued Interest payable to REMIC 1 Regular Interest LT1AA
and REMIC 1 Regular Interest LT1ZZ up to an aggregate amount equal to the
REMIC 1 Interest Loss Allocation Amount, 98% and 2%, respectively; second,
to the Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA
and REMIC 1 Regular Interest LT1ZZ up to an aggregate amount equal to the
REMIC 1 Principal Loss Allocation Amount, 98% and 2%, respectively; third,
to the Uncertificated Principal Balances of REMIC 1 Regular Interest
LT1AA, REMIC 1 Regular Interest LT1M14 and REMIC 1 Regular Interest LT1ZZ,
98%, 1% and 1%, respectively, until the Uncertificated Principal Balance
of REMIC 1 Regular Interest LT1M14 has been reduced to zero; fourth, to
the Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA,
REMIC 1 Regular Interest LT1M13 and REMIC 1 Regular Interest LT1ZZ, 98%,
1% and 1%, respectively, until the Uncertificated Principal Balance of
REMIC 1 Regular Interest LT1M13 has been reduced to zero; fifth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M12 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M12 has been reduced to zero; sixth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M11 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M11 has been reduced to zero; seventh, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M10 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M10 has been reduced to zero; eighth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M9 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M9 has been reduced to zero; ninth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M8 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1M8 has been reduced to zero; tenth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M7 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M7 has been reduced to zero; eleventh, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M6 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M6 has been reduced to zero; twelfth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M5 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M5 has been reduced to zero; thirteenth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M4 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M4 has been reduced to zero; fourteenth to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M3 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M3 has been reduced to zero; fifteenth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M2 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1
Regular Interest LT1M2 has been reduced to zero; and sixteenth, to the
Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC
1 Regular Interest LT1M1 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1M1 has been reduced to zero; and
(iv) The REMIC 1 Sub WAC Allocation Percentage of all Realized
Losses shall be applied after all distributions have been made on each
Distribution Date first, so as to keep the Uncertificated Principal
Balance of each REMIC 1 Regular Interest ending with the designation "GRP"
equal to 0.01% of the aggregate Stated Principal Balance of the Mortgage
Loans in the related Loan Group; second, to each REMIC 1 Regular Interest
ending with the designation "SUB," so that the Uncertificated Principal
Balance of each such REMIC 1 Regular Interest is equal to 0.01% of the
excess of (x) the aggregate Principal Balance of the Mortgage Loans in the
related Loan Group over (y) the aggregate current Principal Balances of
the Class A Certificates in the related group of Mortgage Loans (except
that if any such excess is a larger number than in the preceding
distribution period, the least amount of Realized Losses shall be applied
to such REMIC 1 Regular Interests such that the REMIC 1 Subordinated
Balance Ratio is maintained); and third, any remaining Realized Losses
shall be allocated to REMIC 1 Regular Interest LT1XX.
(c) With respect to REMIC 1, any increase in principal balance due
to a Subsequent Recovery shall be allocated as follows: 50% to REMIC 1 Regular
Interest LT1XX; 49% to REMIC 1 Regular Interest LT1AA; 0.5% to REMIC 1 Regular
Interest LT1ZZ; and 0.5% to each REMIC 1 Regular Interest that is a
Corresponding Class to any REMIC 2 Regular Interest that was increased as a
result of such Subsequent Recovery (provided, that if more than one REMIC 2
Regular Interest is so increased, such amount shall be allocated to the REMIC 1
Regular Interests that are Corresponding Classes in the same proportion as the
increase is allocated to the applicable REMIC 2 Regular Interests).
(d) Notwithstanding anything to the contrary contained herein, the
above distributions in this Section 4.08 (other than on the Certificates) are
deemed distributions, and distributions of funds from the Distribution Account
shall be made only in accordance with Sections 4.01 and 4.02 hereof.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
Each of the Class AI-1A, Class AI-1B, Class AII-1, Class M-1, Class
M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class
M-9, Class M-10, Class M-11, Class M-12, Class M-13, Class M-14, Class CE, Class
P and Class R Certificates shall be substantially in the forms annexed hereto as
exhibits, and shall, on original issue, be executed by the Securities
Administrator and authenticated and delivered by the Certificate Registrar to or
upon the receipt of a Written Order to Authenticate from the Depositor
concurrently with the sale and assignment to the Trustee of the Trust Fund. Each
Class of the Class A and Class M Certificates (other than the Class M-12, Class
M-13 and Class M-14 Certificates) shall be initially evidenced by one or more
Certificates representing a Percentage Interest with a minimum dollar
denomination of $25,000 and integral multiples of $1,000 in excess thereof. Each
of the Class M-12, Class M-13 and Class M-14 Certificates shall be initially
evidenced by one or more Certificates representing a Percentage Interest with a
minimum dollar denomination of $250,000 and integral multiples of $1 in excess
thereof. The Class CE and Class P Certificates are issuable only in minimum
Percentage Interests of 10%. The Class R Certificate is issuable only as a
single certificate.
The Certificates shall be executed on behalf of the Trust by manual
or facsimile signature on behalf of the Securities Administrator by a
Responsible Officer. Certificates bearing the manual or facsimile signatures of
individuals who were, at the time when such signatures were affixed, authorized
to sign on behalf of the Securities Administrator shall bind the Trust,
notwithstanding that such individuals or any of them have ceased to be so
authorized prior to the authentication and delivery of such Certificates or did
not hold such offices at the date of such Certificate. No Certificate shall be
entitled to any benefit under this Agreement or be valid for any purpose, unless
such Certificate shall have been manually authenticated by the Certificate
Registrar substantially in the form provided for herein, and such authentication
upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication. Subject to Section
5.02(c), the Certificates (other than the Class CE, Class P and Class R
Certificates) shall be Book-Entry Certificates. The Class CE, Class P and Class
R Certificates shall not be Book-Entry Certificates but shall be issued in fully
registered certificate form.
Section 5.02 Registration of Transfer and Exchange of Certificates.
(a) The Certificate Registrar shall cause to be kept at the
Corporate Trust Office of the Securities Administrator a Certificate Register 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 of Certificates as herein provided. The Securities
Administrator shall initially serve as Certificate Registrar for the purpose of
registering Certificates and transfers and exchanges of Certificates as herein
provided. The Securities Administrator as Certificate Registrar shall be subject
to the same standards of care, limitations on liability and rights to indemnity
as the Securities Administrator, and the provisions of Sections 8.01, 8.02,
8.03, 8.04, 8.05, 8.14, 8.15 and 8.16 shall apply to the Certificate Registrar
to the same extent as they apply to the Securities Administrator. Any
Certificate Registrar appointed in accordance with this Section 5.02(a) may at
any time resign by giving at least 30 days' advance written notice of
resignation to the Securities Administrator, the Trustee, the Servicer and the
Depositor, such resignation to become effective upon appointment of a successor
Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at
any office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph and, in the case of the Class R Certificate,
upon satisfaction of the conditions set forth below, the Securities
Administrator on behalf of the Trust shall execute and the Certificate Registrar
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same aggregate Percentage
Interest.
At the option of the Certificateholders, Certificates may be
exchanged for other Certificates in authorized denominations and the same
aggregate Percentage Interests, upon surrender of the Certificates to be
exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the Securities Administrator shall execute on behalf
of the Trust and the Certificate Registrar shall authenticate and deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of transfer
or exchange shall (if so required by the Securities Administrator or the
Certificate Registrar) be duly endorsed by, or be accompanied by a written
instrument of transfer satisfactory to the Securities Administrator and the
Certificate Registrar duly executed by, the Holder thereof or his attorney duly
authorized in writing.
(b) Upon original issuance, the Book-Entry Certificates shall be
issued in the form of one or more typewritten certificates, to be delivered to
the Depository by, or on behalf of, the Depositor; or to, and deposited with the
Certificate Custodian, on behalf of the Depository, if directed to do so
pursuant to instructions from the Depository. Except as provided in paragraph
(c) below, the Book-Entry Certificates shall at all times remain registered in
the name of the Depository or its nominee and at all times: (i) registration of
such Certificates may not be transferred by the Securities Administrator except
to another Depository; (ii) the Depository shall maintain book-entry records
with respect to the Certificate Owners and with respect to ownership and
transfers of such Certificates; (iii) ownership and transfers of registration of
such Certificates on the books of the Depository shall be governed by applicable
rules established by the Depository; (iv) the Depository may collect its usual
and customary fees, charges and expenses from its Depository Participants; (v)
the Securities Administrator shall for all purposes deal with the Depository as
representative of the Certificate Owners of the Certificates for purposes of
exercising the rights of Holders under this Agreement, and requests and
directions for and votes of such representative shall not be deemed to be
inconsistent if they are made with respect to different Certificate Owners; (vi)
the Securities Administrator may rely and shall be fully protected in relying
upon information furnished by the Depository with respect to its Depository
Participants and furnished by the Depository Participants with respect to
indirect participating firms and Persons shown on the books of such indirect
participating firms as direct or indirect Certificate Owners; and (vii) the
direct participants of the Depository shall have no rights under this Agreement
under or with respect to any of the Certificates held on their behalf by the
Depository, and the Depository may be treated by the Securities Administrator
and its agents, employees, officers and directors as the absolute owner of the
Certificates for all purposes whatsoever.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owners. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners that it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures. The parties hereto
are hereby authorized to execute one or more Letter of Representations with the
Depository or take such other action as may be necessary or desirable to
register a Book-Entry Certificate to the Depository. In the event of any
conflict between the terms of any such Letter of Representation and this
Agreement, the terms of this Agreement shall control.
(c) If the Depository advises the Securities Administrator in
writing that the Depository is no longer willing or able to discharge properly
its responsibilities as Depository and the Securities Administrator or the
Depositor is unable to locate a qualified successor and upon surrender to the
Certificate Registrar of the Book-Entry Certificates by the Depository,
accompanied by registration instructions from the Depository for registration,
the Securities Administrator shall, at the Trust's expense, execute on behalf of
the Trust and the Certificate Registrar shall authenticate definitive, fully
registered certificates (the "Definitive Certificates"). None of the Depositor
or the Securities Administrator shall be liable for any delay in delivery of
such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Certificates, the
Securities Administrator, the Certificate Registrar, the Servicer, the
Securities Administrator, any Paying Agent and the Depositor shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder.
(d) Except with respect to a transfer of the Private Certificates
between or among the Depositor, the Seller, their affiliates or both, no
transfer, sale, pledge or other disposition of any Private Certificate shall be
made unless such disposition is exempt from the registration requirements of the
1933 Act, and any applicable state securities laws or is made in accordance with
the 1933 Act and laws. In the event of any such transfer, (i) solely in the case
of the Class CE, Class P and Class R Certificates, unless such transfer is made
in reliance upon Rule 144A (as evidenced by the investment letter delivered to
the Certificate Registrar, in substantially the form attached hereto as Exhibit
J-2) under the 1933 Act, the Certificate Registrar and the Depositor shall
require a written Opinion of Counsel (which may be in-house counsel) acceptable
to and in form and substance reasonably satisfactory to the Certificate
Registrar and the Depositor that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall not be an expense of the Certificate Registrar or the Depositor or (ii)
the Certificate Registrar shall require the transferor to execute a transferor
certificate (in substantially the form attached hereto as (a) Exhibit L-1 for
any transfer of a Class CE, Class P or Class R Certificate and (b) Exhibit L-2
for any transfer of a Class M-12, Class M-13 or Class M-14 Certificate) and the
transferee to execute an investment letter in substantially in the form attached
hereto as Exhibit J-1 or J-2 (in the case of the Class P, Class CE or Class R
Certificates) or in the form attached hereto as Exhibit J-2 (in the case of the
Class M-12, Class M-13 or Class M-14 Certificates) acceptable to and in form and
substance reasonably satisfactory to the Depositor and the Certificate Registrar
certifying to the Depositor and the Certificate Registrar the facts surrounding
such transfer, which investment letter shall not be an expense of the
Certificate Registrar or the Depositor. The transferor of a Private Certificate
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws. For purposes of this Section 5.02(d) the representations required in
any transferor certificate (in substantially the form attached hereto as Exhibit
L-2 for any transfer of a Class M-12, Class M-13 or Class M-14 Certificate) and
any investment letter (substantially in the form of Exhibit J-2 hereto) shall be
deemed to have been made in connection with the transfer of any Private
Certificate that is a Book-Entry Certificate.
No transfer of an ERISA-Restricted Certificate shall be made unless
the Certificate Registrar and the Depositor shall have received either (i) a
representation from the transferee of such Certificate, acceptable to and in
form and substance satisfactory to the Certificate Registrar and the Depositor,
(such requirement is satisfied only by the Certificate Registrar's receipt of a
representation letter from the transferee substantially in the form of Exhibit I
hereto, as appropriate), to the effect that such transferee is not an employee
benefit plan or arrangement subject to Section 406 of ERISA or a plan subject to
Section 4975 of the Code or a plan subject to any federal, state or local law
("Similar Law") materially similar to the foregoing provisions of ERISA or of
the Code, nor a person acting on behalf of any such plan or arrangement nor
using the assets of any such plan or arrangement to effect such transfer other
than (except in the case of the Class CE, Class P or Class R Certificates) an
insurance company that represents (or is deemed to represent) that (A) the
source of funds used to purchase the Certificates is an "insurance company
general account" (as such term is defined in Section V(e) of PTE 95-60, 60 Fed.
Reg. 35925 (July 12, 1995)), (B) that there is no Plan with respect to which the
amount of such general account's reserves and liabilities for the contract(s)
held by or on behalf of such Plan and all other Plans maintained by the same
employer (or affiliate thereof as defined in Section V(a)(1) of PTE 95-60) or by
the same employee organization exceeds 10% of the total of all reserves and
liabilities of such general account (as such amounts are determined under
Section I(a) of PTE 95-60) at the date of acquisition and (C) all Plans that
have an interest in such general account are Plans to which PTE 95-60 applies,
or (ii) (except in the case of the Class CE, Class P or R Certificates) in the
case of any such ERISA Restricted Certificate presented for registration in the
name of an employee benefit plan subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code (or comparable provisions of any subsequent
enactments), or a trustee of any such plan or any other person acting on behalf
of any such plan or arrangement or using such plan's or arrangement's assets, an
Opinion of Counsel satisfactory to the Certificate Registrar and the Depositor,
to the effect that the purchase or holding of such ERISA Restricted Certificate
will not constitute or result in a non-exempt prohibited transaction within the
meaning of ERISA Section 4975 of the Code on Similar Law and will not subject
the Depositor, the Servicer, the Trustee, the Securities Administrator or the
Certificate Registrar to any obligation in addition to those expressly
undertaken in this Agreement or to any liability. For purposes of clause (i) of
the preceding sentence, such representation shall be deemed to have been made to
the Certificate Registrar by the acceptance by a Certificate Owner of the
beneficial interest in any such Class of ERISA-Restricted Certificates, unless
the Certificate Registrar shall have received from the transferee an alternative
representation acceptable in form and substance to the Depositor.
Notwithstanding anything else to the contrary herein, any purported transfer of
an ERISA-Restricted Certificate to or on behalf of an employee benefit plan
subject to ERISA, Section 4975 of the Code or Similar Law without the delivery
to the Certificate Registrar and the Depositor of an Opinion of Counsel
satisfactory to the Certificate Registrar as described above shall be void and
of no effect.
Each Person who has or who acquires any Ownership Interest in the
Class R Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably appointed the Depositor or its designee as its attorney-in-fact
to negotiate the terms of any mandatory sale under clause (v) below and to
execute all instruments of transfer and to do all other things necessary in
connection with any such sale, and the rights of each Person acquiring any
Ownership Interest in the Class R Certificate are expressly subject to the
following provisions:
(i) Each Person holding or acquiring any Ownership Interest in the
Class R Certificate shall be a Permitted Transferee and shall promptly
notify the Certificate Registrar of any change or impending change in its
status as a Permitted Transferee.
(ii) No Person shall acquire an Ownership Interest in the Class R
Certificate unless such Ownership Interest is a pro rata undivided
interest.
(iii) In connection with any proposed transfer of any Ownership
Interest in the Class R Certificate, the Certificate Registrar shall as a
condition to registration of the transfer, require delivery to it, in form
and substance satisfactory to it, of each of the following:
A. an affidavit in the form of Exhibit K hereto from the proposed
transferee to the effect that, among other things, such transferee is a
Permitted Transferee and that it is not acquiring its Ownership Interest in the
Class R Certificate that is the subject of the proposed transfer as a nominee,
trustee or agent for any Person who is not a Permitted Transferee; and
B. a covenant of the proposed transferee to the effect that the
proposed transferee agrees to be bound by and to abide by the transfer
restrictions applicable to the Class R Certificate.
(iv) Any attempted or purported transfer of any Ownership Interest
in the Class R Certificate in violation of the provisions of this Section
shall be absolutely null and void and shall vest no rights in the
purported transferee. If any purported transferee shall, in violation of
the provisions of this Section, become the Holder of the Class R
Certificate, then the prior Holder of such Class R Certificate that is a
Permitted Transferee shall, upon discovery that the registration of
transfer of such Class R Certificate was not in fact permitted by this
Section, be restored to all rights as Holder thereof retroactive to the
date of registration of transfer of such Class R Certificate. The
Certificate Registrar shall be under no liability to any Person for any
registration of transfer of the Class R Certificate that is in fact not
permitted by this Section or for making any distributions due on such
Class R Certificate to the Holder thereof or taking any other action with
respect to such Holder under the provisions of this Agreement so long as
the Certificate Registrar received the documents specified in clause
(iii). The Securities Administrator shall be entitled to recover from any
Holder of the Class R Certificate that was in fact not a Permitted
Transferee at the time such distributions were made all distributions made
on such Class R Certificate. Any such distributions so recovered by the
Securities Administrator shall be distributed and delivered by the
Securities Administrator to the prior Holder of such Class R Certificate
that is a Permitted Transferee.
(v) If any Person other than a Disqualified Organization acquires
any Ownership Interest in the Class R Certificate in violation of the
restrictions in this Section, then the Certificate Registrar shall have
the right but not the obligation, without notice to the Holder of the
Class R Certificate or any other Person having an Ownership Interest
therein, to notify the Depositor to arrange for the sale of the Class R
Certificate. The proceeds of such sale, net of commissions (which may
include commissions payable to the Depositor or its affiliates in
connection with such sale), expenses and taxes due, if any, will be
remitted by the Securities Administrator to the previous Holder of the
Class R Certificate that is a Permitted Transferee, except that in the
event that the Securities Administrator determines that the Holder of the
Class R Certificate may be liable for any amount due under this Section or
any other provisions of this Agreement, the Securities Administrator may
withhold a corresponding amount from such remittance as security for such
claim. The terms and conditions of any sale under this clause (v) shall be
determined in the sole discretion of the Securities Administrator and it
shall not be liable to any Person having an Ownership Interest in the
Class R Certificate as a result of its exercise of such discretion.
(vi) If any Person other than a Permitted Transferee acquires any
Ownership Interest in the Class R Certificate in violation of the
restrictions in this Section, then the Securities Administrator will
provide to the Internal Revenue Service, and to the persons specified in
Sections 860E(e)(3) and (6) of the Code, information needed to compute the
tax imposed under Section 860E(e)(5) of the Code on transfers of residual
interests to disqualified organizations. The Securities Administrator
shall be entitled to reasonable compensation for providing such
information from the person to whom it is provided.
The foregoing provisions of this Section shall cease to apply to transfers
occurring on or after the date on which there shall have been delivered to the
Certificate Registrar, in form and substance satisfactory to the Certificate
Registrar, (i) written notification from each Rating Agency that the removal of
the restrictions on Transfer set forth in this Section will not cause such
Rating Agency to downgrade its rating of the Certificates and (ii) an Opinion of
Counsel to the effect that such removal will not cause either REMIC hereunder to
fail to qualify as a REMIC.
(e) No service charge shall be made for any registration of transfer
or exchange of Certificates of any Class, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer or
exchange shall be cancelled by the Certificate Registrar and disposed of
pursuant to its standard procedures.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate and (ii) there is delivered to
the Securities Administrator, the Trustee, the Depositor and the Certificate
Registrar such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Securities Administrator or
the Certificate Registrar that such Certificate has been acquired by a bona fide
purchaser, the Securities Administrator shall execute on behalf of the Trust,
and the Certificate Registrar shall authenticate and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and Percentage Interest. Upon the issuance of any new
Certificate under this Section, the Securities Administrator or the Certificate
Registrar may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Securities Administrator and
the Certificate Registrar) in connection therewith. Any duplicate Certificate
issued pursuant to this Section, shall constitute complete and indefeasible
evidence of ownership in the Trust, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.
Section 5.04 Persons Deemed Owners.
The Servicer, the Depositor, the Trustee, the Securities
Administrator, the Certificate Registrar, any Paying Agent and any agent of the
Servicer, the Depositor, the Securities Administrator, the Trustee, the
Certificate Registrar or any Paying Agent may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 4.01
and 4.02 and for all other purposes whatsoever, and none of the Servicer, the
Trust, the Trustee, the Securities Administrator nor any agent of any of them
shall be affected by notice to the contrary.
Section 5.05 Appointment of Paying Agent.
The Paying Agent shall make distributions to Certificateholders from
the Distribution Account pursuant to Section 4.01 and 4.02 and shall report the
amounts of such distributions to the Securities Administrator. The duties of the
Paying Agent may include the obligation to distribute statements and provide
information to Certificateholders as required hereunder. The Paying Agent
hereunder shall at all times be an entity duly incorporated and validly existing
under the laws of the United States of America or any state thereof, authorized
under such laws to exercise corporate trust powers and subject to supervision or
examination by federal or state authorities. The Paying Agent shall initially be
the Securities Administrator. The Securities Administrator may appoint a
successor to act as Paying Agent, which appointment shall be reasonably
satisfactory to the Depositor and the Rating Agencies. The Securities
Administrator as Paying Agent shall be subject to the same standards of care,
limitations on liability and rights to indemnity as the Securities
Administrator, and the provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05,
8.14, 8.15 and 8.16 shall apply to the Paying Agent to the same extent as they
apply to the Securities Administrator. Any Paying Agent appointed in accordance
with this Section 5.05 may at any time resign by giving at least 30 days'
advance written notice of resignation to the Trustee, the Securities
Administrator, the Servicer and the Depositor, such resignation to become
effective upon appointment of a successor Paying Agent.
ARTICLE VI
THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Servicer and the Depositor.
The Servicer shall be liable in accordance herewith only to the
extent of the obligations specifically imposed upon and undertaken by the
Servicer herein. The Depositor shall be liable in accordance herewith only to
the extent of the obligations specifically imposed upon and undertaken by the
Depositor.
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer or the Depositor.
Any entity into which the Servicer or the Depositor may be merged or
consolidated, or any entity resulting from any merger, conversion or
consolidation to which the Servicer or the Depositor shall be a party, or any
organization succeeding to the business of the Servicer or the Depositor, shall
be the successor of the Servicer or the Depositor, as the case may be,
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that the successor servicer shall satisfy
all the requirements of Section 7.02 with respect to the qualifications of a
successor servicer.
Section 6.03 Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors or officers or
employees or agents of the Servicer shall be under any liability to the Trust or
the Certificateholders for any action taken or for refraining from the taking of
any action by the Servicer in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability which would otherwise be
imposed by reason of its willful misfeasance, bad faith or gross negligence in
the performance of duties of the Servicer or by reason of its reckless disregard
of its obligations and duties of the Servicer hereunder. The Servicer and any
director or officer or employee or agent of the Servicer may rely in good faith
on any document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising hereunder. The Servicer and any director
or officer or employee or agent of the Servicer shall be indemnified by the
Trust and held harmless against any loss, liability or expense incurred in
connection with any legal action relating to this Agreement or the Certificates,
other than any loss, liability or expense related to any specific Mortgage Loan
or Mortgage Loans (except as any such loss, liability or expense shall be
otherwise reimbursable pursuant to this Agreement) and any loss, liability or
expense incurred by reason of its willful misfeasance, bad faith or gross
negligence in the performance of duties hereunder or by reason of its reckless
disregard of obligations and duties hereunder. The Servicer may undertake any
such action which it may deem necessary or desirable in respect of this
Agreement, and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, the reasonable legal expenses
and costs of such action and any liability resulting therefrom shall be
expenses, costs and liabilities of the Trust and the Servicer shall be entitled
to be reimbursed therefor pursuant to Section 3.05. The Servicer's right to
indemnity or reimbursement pursuant to this Section shall survive any
resignation or termination of the Servicer pursuant to Section 6.04 or 7.01 with
respect to any losses, expenses, costs or liabilities arising prior to such
resignation or termination (or arising from events that occurred prior to such
resignation or termination). This paragraph shall apply to the Servicer solely
in its capacity as Servicer hereunder and in no other capacities.
Section 6.04 Servicer Not to Resign.
Subject to the provisions of Section 7.01 and Section 6.02, the
Servicer shall not resign from the obligations and duties hereby imposed on it
except (i) upon determination that the performance of its obligations or duties
hereunder are no longer permissible under applicable law or are in material
conflict by reason of applicable law with any other activities carried on by it
or its subsidiaries or Affiliates, the other activities of the Servicer so
causing such a conflict being of a type and nature carried on by the Servicer or
its subsidiaries or Affiliates at the date of this Agreement or (ii) upon
satisfaction of the following conditions: (a) the Servicer has proposed a
successor servicer to the Trustee and the Securities Administrator in writing
and such proposed successor servicer is reasonably acceptable to the Trustee and
the Securities Administrator; and (b) each Rating Agency shall have delivered a
letter to the Trustee and the Securities Administrator prior to the appointment
of the successor servicer stating that the proposed appointment of such
successor servicer as Servicer hereunder will not result in the reduction or
withdrawal of the then current rating of the Regular Certificates or the ratings
that are in effect; provided, however, that no such resignation by the Servicer
shall become effective until such successor servicer or, in the case of (i)
above, the Trustee shall have assumed the Servicer's responsibilities and
obligations hereunder or the Trustee shall have designated a successor servicer
in accordance with Section 7.02. Any such resignation shall not relieve the
Servicer of responsibility for any of the obligations specified in Sections 7.01
and 7.02 as obligations that survive the resignation or termination of the
Servicer. Any such determination permitting the resignation of the Servicer
shall be evidenced by an Opinion of Counsel to such effect delivered to the
Trustee and the Securities Administrator.
Section 6.05 Delegation of Duties.
In the ordinary course of business, the Servicer at any time may
delegate any of its duties hereunder to any Person, including any of its
Affiliates, who agrees to conduct such duties in accordance with standards
comparable to those set forth in Section 3.01. Such delegation shall not relieve
the Servicer of its liabilities and responsibilities with respect to such duties
and shall not constitute a resignation within the meaning of Section 6.04. The
Servicer shall provide the Trustee and the Rating Agencies with 60 days prior
written notice prior to the delegation of any of its duties to any Person other
than any of the Servicer's Affiliates or their respective successors and
assigns.
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination.
(a) If any one of the following events ("Servicer Events of
Termination") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Advance, Servicing
Advance or to pay Compensating Interest and such failure described in this
clause (A) continues unremedied until 1:00 p.m. New York City time on the
Business Day immediately following the Distribution Date following such
failure; or
(B) any other failure by the Servicer to deposit in the Collection
Account or Distribution Account any deposit required to be made under the
terms of this Agreement, which failure described in this clause (B)
continues unremedied for a period of three Business Days after the first
date on which written notice of such failure is given to the Servicer; or
(ii) The failure by the Servicer duly to observe or perform, in any
material respect, any other covenants, obligations or agreements of the
Servicer as set forth in this Agreement, which failure continues
unremedied for a period of 60 days, after the date (A) on which written
notice of such failure, requiring the same to be remedied, shall have been
given to the Servicer by the Trustee, the Securities Administrator or by
any Holder of a Regular Certificate evidencing at least 25% of the Voting
Interests or (B) actual knowledge of such failure by a Servicing Officer
of the Servicer; or
(iii) The entry against the Servicer of a decree or order by a court
or agency or supervisory authority having jurisdiction in the premises for
the appointment of a trustee, conservator, receiver or liquidator in any
insolvency, conservatorship, receivership, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to
the appointment of a conservator or receiver or liquidator or similar
person in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to the Servicer or of or
relating to all or substantially all of its property; or a decree or order
of a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator, receiver, liquidator or
similar person in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Servicer
and such decree or order shall have remained in force undischarged,
unbonded or unstayed for a period of 60 days; or the Servicer shall admit
in writing its inability to pay its debts generally as they become due,
file a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its
creditors or voluntarily suspend payment of its obligations; or
(v) the Servicer becoming ineligible to service for both Xxxxxx Xxx
and Xxxxxxx Mac (unless remedied within 90 days).
(b) Then, and in each and every such case, so long as a Servicer
Event of Termination shall not have been remedied within the applicable grace
period, (x) with respect solely to clause (i)(A) above, if such Advance is not
made by 1:00 p.m. New York City time on the Business Day immediately following
the Distribution Date, the Trustee may terminate all of the rights and
obligations of the Servicer under this Agreement and the Trustee shall assume
upon such termination (or, pursuant to Section 4.07(e), prior to such
termination in the case of the obligation to make Advances), pursuant to Section
7.02, the duties of a successor servicer (including, but not limited to, the
duty to make Advances required pursuant to this Agreement) and (y) in the case
of (i)(B), (ii), (iii), (iv) and (v) above, the Trustee shall, at the direction
of the Holders of each Class of Regular Certificates evidencing Voting Interests
aggregating not less than 66 2/3%, by notice then given in writing to the
Servicer (and to the Trustee if given by Holders of Certificates), terminate all
of the rights and obligations of the Servicer as servicer under this Agreement.
Any such notice to the Servicer shall also be given to the Securities
Administrator, each Rating Agency and the Depositor. On or after the receipt by
the Servicer (and by the Trustee if such notice is given by the Holders) of such
written notice, all authority and power of the Servicer under this Agreement,
whether with respect to the Certificates or the Mortgage Loans or otherwise,
shall pass to and be vested in the Trustee pursuant to and under this Section or
successor servicer appointed in connection with Section 7.02; and, without
limitation, the Trustee or successor servicer is hereby authorized and empowered
to execute and deliver, on behalf of the Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement of each
Mortgage Loan and Related Documents or otherwise. The Servicer agrees to
cooperate with the Trustee (or the applicable successor servicer) in effecting
the termination of the responsibilities and rights of the Servicer hereunder,
including, without limitation, the delivery to the Trustee (or the applicable
successor servicer) of all documents and records requested by it to enable it to
assume the Servicer's functions under this Agreement within twenty Business Days
subsequent to such notice, the transfer within two Business Days subsequent to
such notice to the Trustee (or the applicable successor servicer) for the
administration by it of all cash amounts that shall at the time be held by the
Servicer and to be deposited by it in the Collection Account, the Distribution
Account or any Escrow Account or that have been deposited by the Servicer in
such accounts or thereafter received by the Servicer with respect to the
Mortgage Loans or any REO Property received by the Servicer. All reasonable
out-of-pocket costs and expenses (including attorneys' fees) incurred in
connection with transferring the servicing to the successor servicer and
amending this Agreement to reflect such succession as Servicer pursuant to this
Section shall be paid by the predecessor servicer (or if the predecessor
servicer is the Trustee, the initial servicer) upon presentation of reasonable
documentation of such costs and expenses, and if such predecessor Servicer
defaults in its obligation to pay such costs, such costs shall be paid by the
successor Servicer or the Trustee (in which case the successor Servicer or the
Trustee shall be entitled to reimbursement therefor from the assets of the
Trust).
Notwithstanding any termination of the activities of a Servicer
hereunder, the Servicer shall be entitled to receive payment of all accrued and
unpaid Servicing Fees and reimbursement for all outstanding Advances and
Servicing Advances properly made prior to the date of termination.
Section 7.02 Trustee to Act; Appointment of Successor.
(a) Within 90 days of the time the Servicer (and the Trustee, if
notice is sent by the Holders) receives a notice of termination pursuant to
Section 7.01 or 6.04, the Trustee (or such other successor servicer as is
approved in accordance with this Agreement) shall be the successor in all
respects to the Servicer in its capacity as servicer under this Agreement and
the transactions set forth or provided for herein and shall be subject to all
the responsibilities, duties and liabilities relating thereto placed on the
Servicer by the terms and provisions hereof arising on and after its succession.
As compensation therefor, the Trustee (or such other successor servicer) shall
be entitled to such compensation as the Servicer would have been entitled to
hereunder if no such notice of termination had been given. Notwithstanding the
above, (i) if the Trustee is unwilling to act as successor servicer or (ii) if
the Trustee is legally unable so to act, the Trustee shall appoint or petition a
court of competent jurisdiction to appoint, any established housing and home
finance institution, bank or other mortgage loan or home equity loan servicer
having a net worth of not less than $50,000,000 as the successor to the Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder; provided, that the appointment of any
such successor servicer will not result in the qualification, reduction or
withdrawal of the ratings assigned to the Certificates or the ratings that are
in effect by the Rating Agencies as evidenced by a letter to such effect from
the Rating Agencies. Pending appointment of a successor to the Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the successor shall be entitled to receive
compensation out of payments on Mortgage Loans in an amount equal to the
compensation which the Servicer would otherwise have received pursuant to
Section 3.18 (or such other compensation as the Trustee and such successor shall
agree, not to exceed the Servicing Fee). The successor servicer shall be
entitled to withdraw from the Collection Account all costs and expenses
associated with the transfer of the servicing to the successor servicer,
including costs and expenses of the Trustee. The appointment of a successor
servicer shall not affect any liability of the predecessor servicer which may
have arisen under this Agreement prior to its termination as Servicer to pay any
deductible under an insurance policy pursuant to Section 3.11 or to indemnify
the parties indicated in Section 3.24 pursuant to the terms thereof, nor shall
any successor servicer be liable for any acts or omissions of the predecessor
servicer or for any breach by such servicer of any of its representations or
warranties contained herein or in any related document or agreement. The Trustee
and such successor shall take such action, consistent with this Agreement, as
shall be necessary to effectuate any such succession.
(b) Any successor, including the Trustee, to the Servicer as
servicer shall during the term of its service as servicer continue to service
and administer the Mortgage Loans for the benefit of Certificateholders, and
maintain in force a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Servicer hereunder and a
Fidelity Bond in respect of its officers, employees and agents to the same
extent as the Servicer is so required pursuant to Section 3.12.
Section 7.03 Waiver of Defaults.
The Holders of Certificates entitled to at least 66 2/3% of the
Voting Interests allocated to the Classes of Certificates affected by a Servicer
Event of Termination may, on behalf of all Certificateholders, waive any events
permitting removal of the Servicer as servicer pursuant to this Article VII,
provided, however, that such Holders may not waive a default in making a
required distribution on a Certificate without the consent of the Holder of such
Certificate. Upon any waiver of a past default, such default shall cease to
exist and any Servicer Event of Termination arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereto
except to the extent expressly so waived. Notice of any such waiver shall be
given by the Trustee to the Securities Administrator and the Rating Agencies.
Section 7.04 Notification to Certificateholders.
(a) On any termination or appointment of a successor to the Servicer
pursuant to this Article VII or Section 6.04, the Trustee shall give prompt
written notice thereof to the Securities Administrator and the
Certificateholders at their respective addresses appearing in the Certificate
Register and each Rating Agency.
(b) No later than 60 days after the occurrence of any event which
constitutes or which, with notice or a lapse of time or both, would constitute a
Servicer Event of Termination for five Business Days after a Responsible Officer
of the Trustee becomes aware of the occurrence of such an event, the Trustee
shall transmit by mail to the Securities Administrator and all
Certificateholders notice of such occurrence unless such default or Servicer
Event of Termination shall have been waived or cured. Such notice shall be given
to the Rating Agencies promptly after any such occurrence.
Section 7.05 Survival of Servicer Liabilities.
Notwithstanding anything herein to the contrary, upon termination of
the Servicer hereunder, any liabilities of the Servicer which accrued prior to
such termination shall survive such termination.
ARTICLE VIII
THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
Section 8.01 Duties of Trustee and Securities Administrator.
The Trustee, prior to the occurrence of a Servicer Event of
Termination of which a Responsible Officer of the Trustee shall have actual
knowledge and after the curing of all Servicer Events of Termination which may
have occurred, and the Securities Administrator, each undertakes to perform such
duties and only such duties as are specifically set forth in this Agreement as
duties of the Trustee and the Securities Administrator, respectively. If a
Servicer Event of Termination has occurred (which has not been cured), of which
a Responsible Officer of the Trustee has knowledge, the Trustee shall exercise
such of the rights and powers vested in it by this Agreement, and use the same
degree of care and skill in their exercise, as a prudent person would exercise
or use under the circumstances in the conduct of such person's own affairs.
Upon receipt of all resolutions, certificates, statements, opinions,
reports, documents, orders or other instruments furnished to the Trustee and the
Securities Administrator which are specifically required to be furnished
pursuant to any provision of this Agreement, the Trustee and the Securities
Administrator shall examine them to determine whether they conform to the
requirements of this Agreement; provided, however, that neither the Trustee or
the Securities Administrator shall be responsible for the accuracy or content of
any resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by the Servicer, the Seller or the Depositor
hereunder. If any such instrument is found not to conform in any material
respect to the requirements of this Agreement, the Trustee shall notify the
Certificateholders of such instrument in the event that the Trustee, after so
requesting, does not receive a satisfactorily corrected instrument.
No provision of this Agreement shall be construed to relieve the
Trustee and the Securities Administrator from liability for its own negligent
action, its own negligent failure to act or its own misconduct; provided,
however, that:
(i) prior to the occurrence of a Servicer Event of Termination, and
after the curing of all such Servicer Events of Termination which may have
occurred, the duties and obligations of the Trustee and the Securities
Administrator shall be determined solely by the express provisions of this
Agreement, neither the Trustee nor the Securities Administrator shall be
liable except for the performance of such duties and obligations as are
specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and the
Securities Administrator and, in the absence of bad faith on the part of
the Trustee or the Securities Administrator, the Trustee or the Securities
Administrator, as the case may be, may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee or the
Securities Administrator and conforming to the requirements of this
Agreement;
(ii) neither the Trustee nor the Securities Administrator shall be
personally liable for an error of judgment made in good faith by a
Responsible Officer of the Trustee or the Securities Administrator, unless
it shall be proved that the Trustee or the Securities Administrator,
respectively, was negligent in ascertaining or investigating the facts
related thereto;
(iii) neither the Trustee nor the Securities Administrator shall be
personally liable with respect to any action taken, suffered or omitted to
be taken by it in good faith in accordance with the direction of the
Majority Certificateholders relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee or the
Securities Administrator or exercising or omitting to exercise any trust
or power conferred upon the Trustee or the Securities Administrator under
this Agreement; and
(iv) neither the Trustee nor the Securities Administrator shall be
charged with knowledge of any failure by the Servicer to comply with the
obligations of the Servicer referred to in clauses (i) and (ii) of Section
7.01(a) or any Servicer Event of Termination unless a Responsible Officer
of the Trustee or the Securities Administrator obtains actual knowledge of
such failure or the Trustee or the Securities Administrator receives
written notice of such failure from the Servicer or the Majority
Certificateholders.
Neither the Trustee nor the Securities Administrator shall be
required to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee or the Securities Administrator
to perform, or be responsible for the manner of performance of, any of the
obligations of the Servicer under this Agreement, except during such time, if
any, as the Securities Administrator shall be the successor to, and be vested
with the rights, duties, powers and privileges of, the Servicer in accordance
with the terms of this Agreement.
Section 8.02 Certain Matters Affecting the Trustee and the
Securities Administrator.
(a) Except as otherwise provided in Section 8.01:
(i) the Trustee and the Securities Administrator may request and
rely upon, and shall be protected in acting or refraining from acting
upon, any resolution, Officer's Certificate, certificate of auditors or
any other certificate, statement, instrument, opinion, report, notice,
request, consent, order, appraisal, bond or other paper or document
reasonably believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) the Trustee and the Securities Administrator may consult with
counsel and any advice or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such advice
or Opinion of Counsel;
(iii) neither the Trustee nor the Securities Administrator shall be
under any obligation to exercise any of the rights or powers vested in it
by this Agreement, or to institute, conduct or defend any litigation
hereunder or in relation hereto, at the request, order or direction of the
Certificateholders pursuant to the provisions of this Agreement, unless
such Certificateholders shall have offered to the Trustee or the
Securities Administrator, as the case may be, reasonable security or
indemnity against the costs, expenses and liabilities which may be
incurred therein or thereby; the right of the Trustee or the Securities
Administrator, as the case may be, to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and neither
the Trustee nor the Securities Administrator shall be answerable for other
than its negligence or willful misconduct in the performance of any such
act;
(iv) neither the Trustee nor the Securities Administrator shall be
personally liable for any action taken, suffered or omitted by it in good
faith and believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
(v) prior to the occurrence of a Servicer Event of Termination and
after the curing of all Servicer Events of Termination which may have
occurred, neither the Trustee nor the Securities Administrator shall be
bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or documents,
unless requested in writing to do so by the Majority Certificateholders;
provided, however, that if the payment within a reasonable time to the
Trustee or the Securities Administrator of the costs, expenses or
liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee or the Securities
Administrator, not reasonably assured to the Trustee or the Securities
Administrator by the security afforded to it by the terms of this
Agreement, the Trustee and the Securities Administrator may require
reasonable indemnity against such cost, expense or liability as a
condition to such proceeding. The reasonable expense of every such
examination shall be paid by the Servicer or, if paid by the Trustee or
the Securities Administrator, shall be reimbursed by the Servicer upon
demand. Nothing in this clause (v) shall derogate from the obligation of
the Servicer to observe any applicable law prohibiting disclosure of
information regarding the Mortgagors;
(vi) neither the Trustee nor the Securities Administrator shall be
accountable, have any liability or make any representation as to any acts
or omissions hereunder of the Servicer until such time as the Trustee may
be required to act as Servicer pursuant to Section 7.02;
(vii) each of the Trustee and the Securities Administrator may
execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys or a
custodian and neither the Trustee nor the Securities Administrator shall
be responsible for any misconduct or negligence on the part of any such
agent, attorney or custodian appointed by it with due care; and
(viii) the right of the Trustee or the Securities Administrator to
perform any discretionary act enumerated in this Agreement shall not be
construed as a duty, and neither the Trustee nor the Securities
Administrator shall be answerable for other than its negligence or willful
misconduct in the performance of such act.
Section 8.03 Trustee and Securities Administrator Not Liable for
Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than
the authentication of the Trustee on the Certificates) shall be taken as the
statements of the Depositor, and neither the Trustee nor the Securities
Administrator assumes any responsibility for the correctness of the same.
Neither the Trustee nor the Securities Administrator makes any representations
as to the validity or sufficiency of this Agreement or of the Certificates
(other than the signature and authentication of the Securities Administrator on
the Certificates, in the case of the Securities Administrator) or of any
Mortgage Loan or Related Document. Neither the Trustee nor the Securities
Administrator shall be accountable for the use or application by the Servicer,
or for the use or application of any funds paid to the Servicer in respect of
the Mortgage Loans or deposited in or withdrawn from the Collection Account by
the Servicer. Neither the Trustee nor the Securities Administrator shall at any
time have any responsibility or liability for or with respect to the legality,
validity and enforceability of any Mortgage or any Mortgage Loan, or the
perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
or its ability to generate the payments to be distributed to Certificateholders
under this Agreement, including, without limitation: the existence, condition
and ownership of any Mortgaged Property; the existence and enforceability of any
hazard insurance thereon (other than the Trustee's responsibility if the Trustee
shall assume the duties of the Servicer pursuant to Section 7.02); the validity
of the assignment of any Mortgage Loan to the Trustee or of any intervening
assignment; the completeness of any Mortgage Loan; the performance or
enforcement of any Mortgage Loan (other than the Trustee's responsibility if the
Trustee shall assume the duties of the Servicer pursuant to Section 7.02); the
compliance by the Depositor or the Servicer with any warranty or representation
made under this Agreement or in any related document or the accuracy of any such
warranty or representation (except, in the case of the Trustee, after receipt of
notice of any non-compliance therewith or any breach thereof); any investment of
monies by or at the direction of the Servicer or any loss resulting therefrom,
it being understood that the Trustee shall remain responsible for any Trust
property that it may hold in its individual capacity; the acts or omissions of
any of the Servicer (other than the Trustee's responsibility if the Trustee
shall assume the duties of the Servicer pursuant to Section 7.02), or any
Mortgagor; any action of the Servicer (other than the Trustee's responsibility
if the Trustee shall assume the duties of the Servicer pursuant to Section
7.02), taken in the name of the Trust; the failure of the Servicer to act or
perform any duties required of it as agent of the Trust hereunder (other than
the Trustee's responsibility if the Trustee shall assume the duties of the
Servicer pursuant to Section 7.02); or any action by the Trustee or the
Securities Administrator taken at the instruction of the Servicer (other than
the Trustee's responsibility if the Trustee shall assume the duties of the
Servicer pursuant to Section 7.02); provided, however, that the foregoing shall
not relieve the Trustee and the Securities Administrator of their obligation to
perform their respective duties under this Agreement. The Trustee shall have no
responsibility for filing any financing or continuation statement in any public
office at any time or to otherwise perfect or maintain the perfection of any
security interest or lien granted to it hereunder.
Section 8.04 Trustee and Securities Administrator May Own
Certificates.
Each of the Trustee and the Securities Administrator in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights as it would have if it were not Trustee or Securities
Administrator and may transact any banking and trust business with the Servicer,
the Depositor or their Affiliates.
Section 8.05 Trustee and Securities Administrator Fees and Expenses.
The Securities Administrator shall be entitled to the investment
income on funds on deposit in the Distribution Account as set forth in Section
3.23. This shall constitute compensation to the Securities Administrator for its
activities hereunder. The fees and expenses of the Trustee shall be paid in
accordance with a side letter agreement between the Trustee and the Securities
Administrator. The Trust shall reimburse the Trustee and the Securities
Administrator for all reasonable expenses, disbursements and advances incurred
or made by the Trustee or the Securities Administrator in accordance with any of
the provisions of this Agreement (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ), except any such expense, disbursement or advance as may arise from
its gross negligence or bad faith or which is the responsibility of the Trustee
or Securities Administrator hereunder or that does not constitute an
"unanticipated expense" of the REMIC within the meaning of Treasury Regulation
Section 1.860G(b)(3)(ii). In addition, the Trustee, the Securities Administrator
and their respective officers, directors, employees and agents shall be
indemnified by the Trust from, and held harmless against, any and all losses,
liabilities, damages, claims or expenses incurred in connection with any legal
action relating to this Agreement or the Certificates, other than any loss,
liability or expense (i) that constitutes a specific liability of the Trustee or
the Securities Administrator, as applicable, under this Agreement, (ii) incurred
by reason of willful misfeasance, bad faith or gross negligence of the Trustee
or Securities Administrator, as applicable, in the performance of its respective
duties hereunder or by reason of the Trustee's or the Securities
Administrator's, as the case may be, reckless disregard of its obligations and
duties hereunder or (iii) that does not constitute an "unanticipated expense" of
the REMIC within the meaning of Treasury Regulation Section 1.860G(b)(3)(ii).
The Trustee and its officers, directors, employees and agents shall be
indemnified by the Trust from, and held harmless against, any and all losses,
liabilities, damages, claims or expenses, including reasonable attorneys' fees,
that may be imposed on, incurred by or asserted against the Custodian in any way
related to or arising out of the Custodial Agreement or any action taken or not
taken by the Custodian and which the Trustee had paid to the Custodian pursuant
to the terms of the Custodial Agreement, other than any loss, liability or
expense (i) that constitutes a specific liability of the Custodian under the
Custodial Agreement or (ii) or incurred by reason of willful misfeasance, bad
faith or negligence of the Custodian in the performance of its duties under the
Custodial Agreement or by reason of the Custodian's reckless disregard of its
obligations under the Custodial Agreement. Subject to the provisions of this
Article VIII, the Trustee and its officers, directors, employees and agents
shall be indemnified by the Securities Administrator from, and held harmless
against, any and all losses, liabilities, damages, claims or expenses incurred
by the Trustee in connection with or arising out of the willful misfeasance, bad
faith or negligence of the Securities Administrator in the performance of its
duties under this Agreement or by reason of the Securities Administrator's
reckless disregard of its obligations and duties under this Agreement. Subject
to the provisions of this Article VIII, the Securities Administrator and its
officers, directors, employees and agents shall be indemnified by the Trustee
from, and held harmless against, any and all losses, liabilities, damages,
claims or expenses incurred by the Securities Administrator in connection with
or arising out of willful misfeasance, bad faith or negligence of the Trustee in
the performance of its duties under this Agreement or by reason of the Trustee's
reckless disregard of its obligations and duties under this Agreement. This
Section shall survive termination of this Agreement or the resignation or
removal of any Trustee or Securities Administrator hereunder.
Section 8.06 Eligibility Requirements for Trustee and Securities
Administrator.
Each of the Trustee and the Securities Administrator shall at all
times be (i) an entity duly organized and validly existing under the laws of the
United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 or a member of a bank holding system, the aggregate combined
capital surplus of which is at least $50,000,000, provided that its separate
capital and surplus shall at all times be at least the amount specified in
Section 310(a)(2) of the Trust Indenture Act of 1939, (ii) be subject to
supervision or examination by federal or state authority and (iii) have a
minimum long-term debt rating of BBB by Fitch and S&P and Baa3 by Xxxxx'x and a
long term debt rating of at least A1 or better by Xxxxx'x, and subject to
supervision or examination by federal or state authority. The Trustee shall not
be an affiliate of the Depositor or the Servicer. If such entity publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section 8.06, the combined capital and surplus of such entity shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. The principal office of the Trustee and the
Securities Administrator (other than the initial Trustee or Securities
Administrator) shall be in a state with respect to which an Opinion of Counsel
has been delivered to such Trustee or Securities Administrator at the time such
Trustee or Securities Administrator is appointed Trustee or Securities
Administrator, at such entity's expense, to the effect that the Trust will not
be a taxable entity under the laws of such state. In case at any time the
Trustee or Securities Administrator shall cease to be eligible in accordance
with the provisions of this Section 8.06, the Trustee or Securities
Administrator shall resign immediately in the manner and with the effect
specified in Section 8.07. The Securities Administrator (i) may not be the
Originator, the Servicer, the Depositor or an affiliate of the Depositor unless
the Securities Administrator is in an institutional trust department, (ii) must
be authorized to exercise corporate trust powers under the laws of its
jurisdiction of organization, and (iii) must be rated at least A/F1 by Fitch and
A-1 by S&P, if Fitch and S&P, as applicable, is a Rating Agency, or the
equivalent rating by Xxxxx'x (or such other rating acceptable to Fitch and S&P
pursuant to a ratings confirmation). If no successor Securities Administrator
shall have been appointed and shall have accepted appointment within 60 days
after the Securities Administrator ceases to be the Securities Administrator
pursuant to this Section 8.06, then the Trustee shall perform the duties of the
Securities Administrator pursuant to this Agreement. The Trustee shall notify
the Rating Agencies of any change of Securities Administrator.
Section 8.07 Resignation or Removal of Trustee and Securities
Administrator.
The Trustee or the Securities Administrator may at any time resign
and be discharged from the trusts hereby created by giving written notice
thereof to the Depositor, the Servicer and each Rating Agency. Upon receiving
such notice of resignation, the Depositor shall promptly appoint a successor
Trustee or Securities Administrator, by written instrument, in duplicate, one
copy of which instrument shall be delivered to the resigning Trustee or
Securities Administrator, as applicable, and one copy to the successor Trustee
or Securities Administrator, as the case may be. If no successor Trustee or
Securities Administrator shall have been so appointed and having accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee or Securities Administrator may petition any court of
competent jurisdiction for the appointment of a successor Trustee or Securities
Administrator.
If at any time the Trustee or the Securities Administrator shall
cease to be eligible in accordance with the provisions of Section 8.06 and shall
fail to resign after written request therefor by the Depositor, or if at any
time the Trustee or the Securities Administrator shall be legally unable to act,
or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or
the Securities Administrator or of its property shall be appointed, or any
public officer shall take charge or control of the Trustee or the Securities
Administrator or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Depositor may remove the Trustee or the
Securities Administrator, as the case may be. If the Depositor or the Servicer
removes the Trustee or the Securities Administrator under the authority of the
immediately preceding sentence, the Depositor shall promptly appoint a successor
Trustee or Securities Administrator by written instrument, in duplicate, one
copy of which instrument shall be delivered to the Trustee or Securities
Administrator so removed and one copy to the successor Trustee or Securities
Administrator.
The Majority Certificateholders may at any time remove the Trustee
or the Securities Administrator by written instrument or instruments delivered
to the Servicer, the Depositor, the Securities Administrator and the Trustee;
the Depositor shall thereupon use its best efforts to appoint a successor
Trustee or Securities Administrator, as the case may be in accordance with this
Section.
Any resignation or removal of the Trustee or the Securities
Administrator and appointment of a successor Trustee or Securities Administrator
pursuant to any of the provisions of this Section 8.07 shall not become
effective until acceptance of appointment by the successor Trustee or Securities
Administrator as provided in Section 8.08.
Section 8.08 Successor Trustee and Successor Securities
Administrator.
Any successor Trustee or Securities Administrator appointed as
provided in Section 8.07 shall execute, acknowledge and deliver to the
Depositor, the Rating Agencies, the Servicer and to its predecessor Trustee or
Securities Administrator an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor Trustee or Securities
Administrator shall become effective, and such successor Trustee or Securities
Administrator, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as Trustee or Securities
Administrator. The Depositor, the Servicer and the predecessor Trustee or
Securities Administrator shall execute and deliver such instruments and do such
other things as may reasonably be required for fully and certainly vesting and
confirming in the successor Trustee or Securities Administrator all such rights,
powers, duties and obligations.
No successor Trustee or Securities Administrator shall accept
appointment as provided in this Section 8.08 unless at the time of such
acceptance such successor Trustee or Securities Administrator shall be eligible
under the provisions of Section 8.06 and the appointment of such successor
Trustee or Securities Administrator shall not result in a downgrading of the
Regular Certificates by any Rating Agency, as evidenced by a letter from each
Rating Agency.
Upon acceptance of appointment by a successor Trustee or Securities
Administrator as provided in this Section 8.08, the successor Trustee or
Securities Administrator shall mail notice of the appointment of a successor
Trustee or Securities Administrator hereunder to all Holders of Certificates at
their addresses as shown in the Certificate Register and to each Rating Agency.
Section 8.09 Merger or Consolidation of Trustee or Securities
Administrator.
Any entity into which the Trustee or the Securities Administrator
may be merged or converted or with which it may be consolidated, or any entity
resulting from any merger, conversion or consolidation to which the Trustee or
the Securities Administrator shall be a party, or any entity succeeding to the
business of the Trustee or the Securities Administrator, shall be the successor
of the Trustee or Securities Administrator hereunder, provided such entity shall
be eligible under the provisions of Section 8.06 and 8.08, without the execution
or filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding.
Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust or any Mortgaged Property may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Certificateholders, such title to the Trust, or any part thereof, and, subject
to the other provisions of this Section 8.10, such powers, duties, obligations,
rights and trusts as the Servicer and the Trustee may consider necessary or
desirable. Any such co-trustee or separate trustee shall be subject to the
written approval of the Servicer. If the Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or in
the case a Servicer Event of Termination shall have occurred and be continuing,
the Trustee alone shall have the power to make such appointment. No co-trustee
or separate trustee hereunder shall be required to meet the terms of eligibility
as a successor Trustee under Section 8.06, and no notice to Certificateholders
of the appointment of any co-trustee or separate trustee shall be required under
Section 8.08.
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 Trustee shall be conferred or imposed upon and exercised or
performed by the 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 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 Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the Trust or any portion thereof in any such jurisdiction) shall
be exercised and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Trustee;
(ii) no trustee hereunder shall be held personally liable by reason
of any act or omission of any other trustee hereunder; and
(iii) the Securities Administrator and the Trustee, acting jointly
may at any time accept the resignation of or remove any separate trustee
or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Depositor, the Securities Administrator, the Rating Agencies and the Servicer.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor Trustee.
Section 8.11 Limitation of Liability.
The Certificates are executed by the Securities Administrator, not
in its individual capacity but solely as Securities Administrator of the Trust,
in the exercise of the powers and authority conferred and vested in it by this
Agreement. Each of the undertakings and agreements made on the part of the
Securities Administrator in the Certificates is made and intended not as a
personal undertaking or agreement by the Securities Administrator but is made
and intended for the purpose of binding only the Trust.
Section 8.12 Trustee or Securities Administrator May Enforce Claims
Without Possession of Certificates.
(a) All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee or the Securities
Administrator without the possession of any of the Certificates or the
production thereof in any proceeding relating thereto, and such proceeding
instituted by the Trustee or the Securities Administrator shall be brought in
its own name or in its capacity as Trustee or Securities Administrator for the
benefit of all Holders of such Certificates, subject to the provisions of this
Agreement. Any recovery of judgment shall, after provision for the payment of
the reasonable compensation, expenses, disbursement and advances of the Trustee
or Securities Administrator, as the case may be, or their agents and counsel, be
for the ratable benefit of the Certificateholders in respect of which such
judgment has been recovered.
(b) The Trustee shall afford the Depositor, the Servicer, the
Securities Administrator and each Certificateholder upon reasonable notice
during normal business hours, access to all records maintained by the Trustee in
respect of its duties hereunder and access to officers of the Trustee
responsible for performing such duties. The Trustee shall cooperate fully with
the Servicer, the Depositor, the Securities Administrator and such
Certificateholder and shall make available to the Servicer, the Depositor, the
Securities Administrator and such Certificateholder for review and copying at
the expense of the party requesting such copies, such books, documents or
records as may be requested with respect to the Trustee's duties hereunder. The
Depositor, the Servicer, the Securities Administrator and the Certificateholders
shall not have any responsibility or liability for any action or failure to act
by the Trustee and are not obligated to supervise the performance of the Trustee
under this Agreement or otherwise.
(c) The Securities Administrator shall afford the Depositor, the
Trustee, the Servicer and each Certificateholder upon reasonable notice during
normal business hours, access to all records maintained by the Securities
Administrator in respect of its duties hereunder and access to officers of the
Securities Administrator responsible for performing such duties. The Securities
Administrator shall cooperate fully with the Servicer, the Trustee, the
Depositor and such Certificateholder and shall make available to the Servicer,
the Trustee, the Depositor and such Certificateholder for review and copying at
the expense of the party requesting such copies, such books, documents or
records as may be requested with respect to the Securities Administrator's
duties hereunder. The Depositor, the Trustee, the Servicer and the
Certificateholders shall not have any responsibility or liability for any action
or failure to act by the Securities Administrator and are not obligated to
supervise the performance of the Securities Administrator under this Agreement
or otherwise.
Section 8.13 Suits for Enforcement.
In case a Servicer Event of Termination or other default by the
Servicer hereunder shall occur and be continuing, the Trustee may proceed to
protect and enforce its rights and the rights of the Certificateholders under
this Agreement by a suit, action or proceeding in equity or at law or otherwise,
whether for the specific performance of any covenant or agreement contained in
this Agreement or in aid of the execution of any power granted in this Agreement
or for the enforcement of any other legal, equitable or other remedy, as the
Trustee, being advised by counsel, and subject to the foregoing, shall deem most
effectual to protect and enforce any of the rights of the Trustee and the
Certificateholders.
Section 8.14 Waiver of Bond Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee post a bond or other surety with any
court, agency or body whatsoever.
Section 8.15 Waiver of Inventory, Accounting and Appraisal
Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.
Section 8.16 Appointment of Custodian.
Xxxxx Fargo Bank, N.A., has been appointed Custodian by the Trustee
pursuant to the Custodial Agreement. If such entity resigns or is terminated as
Custodian pursuant to the Custodial Agreement, the Trustee shall serve as
Custodian or the Trustee may, with the consent of the Depositor and the
Servicer, appoint one or more Custodians to hold all or a portion of the
Mortgage Files as agent for the Trustee, by entering into a custodial agreement
in the form of the Custodial Agreement or otherwise in a form acceptable to the
Depositor and the Servicer. Subject to this Article VIII, the Trustee agrees to
comply with the terms of the Custodial Agreement and any such custodial
agreement and to enforce the terms and provisions thereof against the Custodian
for the benefit of the Certificateholders. Each Custodian will be a depositary
institution subject to supervision by federal or state authority, shall have a
combined capital and surplus of at least $10,000,000 and shall be qualified to
do business in the jurisdiction in which it holds any Mortgage File and afforded
the same protections hereunder as the Trustee.
ARTICLE IX
REMIC AND GRANTOR TRUST ADMINISTRATION
Section 9.01 REMIC Administration.
(a) The Trustee shall make or cause to be made REMIC elections for
each of REMIC 1 and REMIC 2 as set forth in the Preliminary Statement on Forms
1066 as prepared by the Securities Administrator or other appropriate federal
tax or information return for the taxable year ending on the last day of the
calendar year in which the Certificates are issued. The Securities Administrator
shall prepare such Forms 1066 and any other appropriate federal tax or
information return and deliver them to the Trustee on a timely basis for the
Trustee's execution. The Trustee shall execute and the Securities Administrator
shall file such forms. The regular interests and residual interest in each REMIC
shall be as designated in the Preliminary Statement.
(b) The Closing Date is hereby designated as the "Startup Day" of
each REMIC within the meaning of section 860G(a)(9) of the Code.
(c) The Securities Administrator shall pay any and all tax related
expenses (not including taxes) of each REMIC, including but not limited to any
professional fees or expenses related to audits or any administrative or
judicial proceedings with respect to such REMIC that involve the Internal
Revenue Service or state tax authorities, but only to the extent that (i) such
expenses are ordinary or routine expenses, including expenses of a routine audit
but not expenses of litigation (except as described in (ii)); or (ii) such
expenses or liabilities (including taxes and penalties) are attributable to the
negligence or willful misconduct of the Securities Administrator in fulfilling
its duties hereunder. The Securities Administrator shall be entitled to
reimbursement of expenses to the extent provided in clause (i) above from the
Trust.
(d) The Securities Administrator shall prepare or cause to be
prepared, and cause the Trustee to sign and the Securities Administrator shall
file or cause to be filed, each REMIC's federal and state tax and information
returns as such REMIC's direct representative. The expenses of preparing and
filing such returns shall be borne by the Securities Administrator. The
Securities Administrator will apply for an Employer Identification Number from
the Internal Revenue Service via a form SS-4 or any other acceptable method for
all REMICs and other tax entities and will also file a Form 8811 with respect to
all such REMICs with the Internal Revenue Service.
(e) The Holder of the Class R Certificate shall be the "tax matters
person" as defined in the REMIC Provisions (the "Tax Matters Person") with
respect to each REMIC, and the Securities Administrator is irrevocably
designated as and shall act as attorney-in-fact and agent for such Tax Matters
Person for each REMIC. The Securities Administrator, as agent for the Tax
Matters Person, shall perform, on behalf of each REMIC, all reporting and other
tax compliance duties that are the responsibility of such REMIC under the Code,
the REMIC Provisions, or other compliance guidance issued by the Internal
Revenue Service or any state or local taxing authority. Among its other duties,
if required by the Code, the REMIC Provisions, or other such guidance, the
Securities Administrator, as agent for the Tax Matters Person, shall provide (i)
to the Treasury or other governmental authority such information as is necessary
for the application of any tax relating to the transfer of the Class R
Certificate to any disqualified person or organization and (ii) to the
Certificateholders such information or reports as are required by the Code or
REMIC Provisions.
(f) The Trustee, the Securities Administrator, the Servicer, and the
Holders of Certificates shall take any action or cause either REMIC formed under
this Agreement to take any action necessary to create or maintain the status of
such REMIC as a REMIC under the REMIC Provisions and shall assist each other as
necessary to create or maintain such status. None of the Trustee, the Servicer,
the Securities Administrator or the Holder of the Class R Certificate shall take
any action or cause either REMIC formed under this Agreement to take any action
or fail to take (or fail to cause to be taken) any action that, under the REMIC
Provisions, if taken or not taken, as the case may be, could (i) endanger the
status of such REMIC as a REMIC or (ii) result in the imposition of a tax upon
such REMIC (including but not limited to the tax on prohibited transactions as
defined in Code Section 860F(a)(2) and the tax on prohibited contributions set
forth on Section 860G(d) of the Code) (either such event, an "Adverse REMIC
Event") unless the Securities Administrator, the Trustee and the Servicer have
received an Opinion of Counsel (at the expense of the party seeking to take such
action) to the effect that the contemplated action will not endanger such status
or result in the imposition of such a tax. In addition, prior to taking any
action with respect to either REMIC formed under this Agreement or the assets
therein, or causing such REMIC to take any action, which is not expressly
permitted under the terms of this Agreement, any Holder of the Class R
Certificate will consult with the Securities Administrator, the Trustee and the
Servicer, or their respective designees, in writing, with respect to whether
such action could cause an Adverse REMIC Event to occur with respect to such
REMIC, and no such Person shall take any such action or cause such REMIC to take
any such action as to which the Securities Administrator, the Trustee or the
Servicer has advised it in writing that an Adverse REMIC Event could occur.
(g) The Holder of the Class R Certificate shall pay when due any and
all taxes imposed on either REMIC formed under this Agreement by federal or
state governmental authorities, but only from amounts, if any, distributable
thereon. To the extent that such REMIC taxes are not paid by the Class R
Certificateholder, the Securities Administrator shall pay any remaining REMIC
taxes out of future amounts otherwise distributable to the Holder of the Class R
Certificate or, if no such amounts are available, out of other amounts held in
the Distribution Account, and shall reduce amounts otherwise payable to Holders
of the REMIC Regular Interests or the Certificates, as the case may be.
(h) The Securities Administrator, shall, for federal income tax
purposes, maintain or cause to be maintained books and records with respect to
each REMIC formed under this Agreement on a calendar year and on an accrual
basis.
(i) No additional contributions of assets shall be made to either
REMIC, except as expressly provided in this Agreement with respect to Eligible
Substitute Mortgage Loans.
(j) None of the Trustee, the Securities Administrator or the
Servicer shall enter into any arrangement by which either REMIC will receive a
fee or other compensation for services.
(k) On or before April 15 of each calendar year, beginning in 2006,
the Securities Administrator shall deliver to each Rating Agency an Officer's
Certificate stating the Securities Administrator's compliance with the
provisions of this Section 9.01.
(l) The Securities Administrator shall treat (i) the rights of the
Certificates (other than the Class CE, Class P and Class R Certificates) to
receive Cap Carryover Amounts as a right in interest rate cap contracts written
by the Class CE Certificateholders in favor of the Holders of the Certificates
(other than the Class CE, Class P and Class R Certificates) and (ii) the rights
of the Class CE Certificates under the Yield Maintenance Agreements in
accordance with the terms thereof and shall assign such rights for federal tax
return and information reporting a value of zero. The Securities Administrator
shall account for such as property held separate and apart from the regular
interests it holds in each of the REMICs created hereunder. The provisions of
this paragraph are intended to satisfy the requirements of Treasury Regulations
Section 1.860G-2(i) for the treatment of property rights coupled with regular
interests to be separately respected and shall be interpreted consistent with
such regulation. On each Distribution Date, to the extent the Certificates
(other than the Class CE, Class P and Class R Certificates) receive interest in
excess of their Pass-Through Rate, such interest will be treated as distributed
to the Class CE Certificates, together with any amount deposited in the Reserve
Accounts in respect of the Yield Maintenance Agreements, and then paid to the
respective Classes of Certificates (other than the Class CE, Class P and Class R
Certificates) pursuant to the related interest rate cap agreement.
Section 9.02 Prohibited Transactions and Activities.
None of the Depositor, the Servicer, the Securities Administrator or
the Trustee shall sell, dispose of, or substitute for any of the Mortgage Loans,
except in a disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii)
the bankruptcy of the Trust Fund, (iii) the termination of either REMIC pursuant
to Article X of this Agreement, (iv) a substitution pursuant to Article II of
this Agreement, (v) a repurchase of Mortgage Loans pursuant to Article II of
this Agreement or (vi) an optional purchase by the Depositor pursuant to Section
3.16 of this Agreement, nor acquire any assets for either REMIC constituting
part of the Trust Fund, nor sell or dispose of any investments in the
Distribution Account for gain, nor accept any contributions to either REMIC
constituting part of the Trust Fund after the Closing Date, unless it has
received an Opinion of Counsel (at the expense of the party causing such sale,
disposition, or substitution) that such disposition, acquisition, substitution,
or acceptance will not (a) affect adversely the status of such REMIC as a REMIC
or of the interests therein other than the Class R Certificate as the regular
interests therein, (b) affect the distribution of interest or principal on the
Certificates, (c) result in the encumbrance of the assets transferred or
assigned to the Trust Fund (except pursuant to the provisions of this Agreement)
or (d) cause such REMIC to be subject to a tax on prohibited transactions or
prohibited contributions pursuant to the REMIC Provisions.
Section 9.03 Indemnification with Respect to Certain Taxes and Loss
of REMIC Status.
In the event that either REMIC formed hereunder fails to qualify as
a REMIC, loses its status as a REMIC, or incurs federal, state or local taxes as
a result of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Servicer, the Trustee or the
Securities Administrator of its duties and obligations set forth herein, such
person shall indemnify the Holder of the Class R Certificate against any and all
losses, claims, damages, liabilities or expenses ("Losses") resulting from such
negligence; provided, however, that no such person shall be liable for any such
Losses attributable to the action or inaction of the Trustee, the Depositor or
the Holder of the Class R Certificate, as applicable, nor for any such Losses
resulting from misinformation provided by the Holder of the Class R Certificate
on which such person has relied. The foregoing shall not be deemed to limit or
restrict the rights and remedies of the Holder of the Class R Certificate now or
hereafter existing at law or in equity. Notwithstanding the foregoing, however,
in no event shall the Servicer have any liability (1) for any action or omission
that is taken in accordance with and in compliance with the express terms of, or
which is expressly permitted by the terms of, this Agreement, (2) for any Losses
other than arising out of a negligent performance by the Servicer, the Trustee
or the Securities Administrator of its duties and obligations set forth herein,
and (3) for any special or consequential damages to Certificateholders (in
addition to payment of principal and interest on the Certificates).
Section 9.04 REO Property.
(a) Subject to compliance with applicable laws and regulations as
shall at any time be in force, and notwithstanding any other provision of this
Agreement, the Servicer, acting on behalf of the Trust hereunder, shall not
rent, lease, or otherwise earn income on behalf of either REMIC with respect to
any REO Property which might cause such REO Property to fail to qualify as
"foreclosure" property within the meaning of section 860G(a)(8) of the Code or
result in the receipt by either REMIC of any "income from non-permitted assets"
within the meaning of section 860F(a)(2) of the Code or any "net income from
foreclosure property" which is subject to tax under the REMIC Provisions unless
the Servicer has advised the Trustee in writing to the effect that, under the
REMIC Provisions, such action would not adversely affect the status of either
REMIC as a REMIC and any income generated for such REMIC by the REO Property
would not result in the imposition of a tax upon such REMIC.
(b) The Servicer shall make reasonable efforts to sell any REO
Property for its fair market value. In any event, however, the Servicer shall
dispose of any REO Property before the close of the third calendar year
beginning after the year of its acquisition by the Trust Fund unless the
Servicer has received a grant of extension from the Internal Revenue Service to
the effect that, under the REMIC Provisions and any relevant proposed
legislation and under applicable state law, either REMIC constituting part of
the Trust Fund may hold REO Property for a longer period without adversely
affecting its REMIC status or causing the imposition of a Federal or state tax
upon either REMIC constituting part of the Trust Fund. If the Servicer has
received such an extension, then the Servicer shall continue to attempt to sell
the REO Property for its fair market value as determined in good faith by the
Servicer for such longer period as such extension permits (the "Extended
Period"). If the Servicer has not received such an extension and the Servicer is
unable to sell the REO Property by September 30th of the third year after its
acquisition by the Trust Fund or if the Servicer has received such an extension,
and the Servicer is unable to sell the REO Property within the period ending
three months before the close of the Extended Period, the Servicer shall, before
the end of the applicable period, (i) purchase such REO Property at a price
equal to the REO Property's fair market value as determined in good faith by the
Servicer or (ii) auction the REO Property to the highest bidder (which may be
the Servicer) in an auction reasonably designed to produce a fair price prior to
the expiration of the applicable period.
Section 9.05 Grantor Trust Administration.
The parties intend that the portions of the Trust Fund consisting of
the right of the Class P Certificates to receive Prepayment Penalties,
Originator Prepayment Penalty Payment Amounts and Servicer Prepayment Penalty
Payment Amounts, the right of the Certificates (other than the Class CE, Class P
and Class R Certificates) to receive Cap Carryover Amounts, the Reserve Accounts
and the right of the Class CE Certificates to receive Yield Maintenance
Agreement Payments subject to the obligation of the Class CE Certificates to pay
Cap Carryover Amounts, shall be treated as a "grantor trust" under the Code, and
the provisions hereof shall be interpreted consistently with this intention. In
furtherance of such intention, the Securities Administrator shall furnish or
cause to be furnished (i) the Holders of the Class P Certificates, (ii) to the
Holders of the Regular Certificates (other than the Class CE Certificates) and
(iii) to the Holders of the Class CE Certificates and shall file or cause to be
filed with the Internal Revenue Service together with Form 1041 or such other
form as may be applicable, their allocable shares of income and expenses with
respect to the property held by the Grantor Trust, at the time or times and in
the manner required by the Code.
ARTICLE X
TERMINATION
Section 10.01 Termination.
(a) The respective obligations and responsibilities of the Servicer,
the Depositor, the Trustee, the Securities Administrator and the Certificate
Registrar created hereby (other than the obligation of the Trustee to make
certain payments to Certificateholders after the final Distribution Date and the
obligation of the Securities Administrator to send certain notices as
hereinafter set forth) shall terminate upon notice to the Trustee upon the
earliest of (i) the Distribution Date on which the Principal Balance of each
Class of Certificates has been reduced to zero, (ii) the final payment or other
liquidation of the last Mortgage Loan in the Trust, and (iii) the optional
purchase by the Majority Class CE Certificateholders, or if there is no Majority
Class CE Certificateholders, the Depositor of the Mortgage Loans as described
below. Notwithstanding the foregoing, in no event shall the trust created hereby
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants of Xxxxxx X. Xxxxxxx, the late ambassador of the United
States to the Court of St. Xxxxx, living on the date hereof.
The Majority Class CE Certificateholders or Depositor may, at its
option, terminate the Trust Fund and retire the Certificates on the next
succeeding Distribution Date upon which the aggregate current Pool Balance is
less than 10% of the Cut-off Date Aggregate Principal Balance by purchasing all
of the outstanding (i) Mortgage Loans in the Trust Fund at a price equal to the
sum of the outstanding unpaid principal balance of the Mortgage Loans and except
to the extent previously advanced by the Servicer, accrued and unpaid interest
thereon at the weighted average of the Mortgage Interest Rates through the end
of the Collection Period preceding the final Distribution Date plus unreimbursed
Servicing Advances, Advances and any unpaid Servicing Fees allocable to such
Mortgage Loans and (ii) REO Properties in the Trust Fund at a price equal to
their fair market value as determined in good faith by the Servicer (the
"Termination Price"). If the Majority Class CE Certificateholder (or, if there
is no Majority Class CE Certificateholder, the Depositor or an affiliate of the
Depositor) is subject to regulation by the OCC, the FDIC, the Federal Reserve or
the Office of Thrift Supervision, however, the option may not be exercised
unless the aggregate fair market value of the Mortgage Loans and REO Properties
is greater than or equal to the Termination Price. Notwithstanding the
foregoing, no party may exercise this optional purchase right unless any
Reimbursement Amount owed to the Trust pursuant to Section 2.03 hereof has been
paid.
Any such purchase shall be accomplished by delivery by the party
exercising the optional purchase right on the Determination Date before such
Distribution Date of the Termination Price to the Securities Administrator for
deposit into the Distribution Account as part of Available Funds.
(b) Notice of any termination, specifying the Distribution Date
(which shall be a date that would otherwise be a Distribution Date) upon which
the Certificateholders may surrender their Certificates to the Securities
Administrator for payment of the final distribution and cancellation, shall be
given promptly by the Securities Administrator upon the Securities Administrator
receiving notice of such date from the Depositor by letter to the
Certificateholders and the Securities Administrator mailed not earlier than the
15th day of the month preceding the month of such final distribution and not
later than the 15th day of the month of such final distribution specifying (1)
the Distribution Date upon which final distribution of the Certificates will be
made upon presentation and surrender of such Certificates at the office or
agency of the Securities Administrator therein designated, (2) the amount of any
such final distribution and (3) that the Record Date otherwise applicable to
such Distribution Date is not applicable, distributions being made only upon
presentation and surrender of the Certificates at the office or agency of the
Securities Administrator therein specified. Not less than five (5) Business Days
prior to such Determination Date relating to such Distribution Date, the
Securities Administrator shall notify the Depositor of the amount of any unpaid
Reimbursement Amount owed to the Trust.
(c) Upon presentation and surrender of the Certificates, the
Securities Administrator shall cause to be distributed to the Holders of the
Certificates on the Distribution Date for such final distribution, in proportion
to the Percentage Interests of their respective Class and to the extent that
funds are available for such purpose, an amount equal to the amount required to
be distributed to such Holders in accordance with the provisions of Sections
4.01 and 4.02 for such Distribution Date.
(d) In the event that all Certificateholders shall not surrender
their Certificates for final payment and cancellation on or before such final
Distribution Date, the Securities Administrator shall promptly following such
date cause all funds in the Distribution Account not distributed in final
distribution to Certificateholders to be withdrawn therefrom and credited to the
remaining Certificateholders by depositing such funds in a separate escrow
account for the benefit of such Certificateholders, and the Servicer shall give
a second written notice to the remaining Certificateholders, to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within nine months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Class R Certificateholder
shall be entitled to all unclaimed funds and other assets which remain subject
hereto (except with respect to the Class CE and Class P Certificates) and the
Securities Administrator upon transfer of such funds shall be discharged of any
responsibility for such funds, and all other Certificateholders shall look to
the Class R Certificateholder for payment.
Section 10.02 Additional Termination Requirements.
(a) In the event that the Majority Class CE Certificateholders or
the Depositor exercises its purchase option as provided in Section 10.01, the
Trust shall be terminated in accordance with the following additional
requirements, unless the Securities Administrator shall have been furnished with
an Opinion of Counsel to the effect that the failure of the Trust to comply with
the requirements of this Section will not (i) result in the imposition of taxes
on "prohibited transactions" of the Trust as defined in Section 860F of the Code
or (ii) cause either REMIC constituting part of the Trust Fund to fail to
qualify as a REMIC at any time that any Certificates (other than the Class P
Certificates) are outstanding:
(i) The Securities Administrator shall designate a date within 90
days prior to the final Distribution Date as the date of adoption of plans
of complete liquidation of each of REMIC 1 and REMIC 2 and shall specify
such date in the final federal income tax return of each REMIC;
(ii) After the date of adoption of such plans of complete
liquidation and at or prior to the final Distribution Date, the Securities
Administrator shall sell all of the assets of the Trust to the Majority
Class CE Certificateholders or Depositor for cash; and
(iii) At the time of the making of the final payment on the
Certificates, the Securities Administrator shall distribute or credit, or
cause to be distributed or credited in the order of priority set forth in
Section 4.02 and then to the Class R Certificateholder, all cash on hand
in respect of the REMICs after such payment (other than cash retained to
meet claims) and the Trust shall terminate at such time.
(b) By their acceptance of Certificates, the Holders thereof hereby
agree to appoint the Securities Administrator as their attorney in fact to: (i)
designate such date of adoption of plans of complete liquidation and (ii) to
take such other action in connection therewith as may be reasonably required to
carry out such plans of complete liquidation all in accordance with the terms
hereof.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment.
This Agreement may be amended from time to time by the Depositor,
the Servicer, the Securities Administrator and the Trustee without the consent
of the Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct,
modify or supplement any provision herein which may be inconsistent with any
other provision herein or the Prospectus Supplement, (iii) to make any other
provisions with respect to matters or questions arising under this Agreement,
which shall not be inconsistent with the provisions of this Agreement or (iv) to
comply with any requirements imposed by the Code; provided, however, that any
such action listed in clause (iii) above shall not adversely affect in any
respect the interests of any Certificateholder, as evidenced by (i) delivery to
the Depositor, the Servicer, the Securities Administrator and the Trustee of
written notification from each Rating Agency that provides, at the request of
the Depositor, a rating for each outstanding Class of Certificates (other than
the Class CE, Class P and Class R Certificates) to the effect that such
amendment will not cause such Rating Agency to lower or withdrawal of the then
current rating of such outstanding Classes of Certificates with respect to which
it is a Rating Agency, or (ii) an Opinion of Counsel delivered to the Servicer,
the Securities Administrator and the Trustee.
In addition, this Agreement may be amended from time to time by the
Depositor, the Servicer, the Securities Administrator and the Trustee, with the
consent of the Majority Certificateholders for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment or waiver shall (x)
reduce in any manner the amount of, or delay the timing of, payments on the
Certificates which are required to be made on any Certificate without the
consent of the Holder of such Certificate, (y) adversely affect in any material
respect the interests of the Holders of any Class of Certificates in a manner
other than as described in clause (x) above, without the consent of the Holders
of Certificates of such Class aggregating at least 66 2/3% of the Voting
Interests evidenced by such Class, or (z) reduce the percentage of Voting
Interests required by clause (y) above without the consent of the Holders of all
Certificates of such Class then outstanding. Upon approval of an amendment, a
copy of such amendment shall be sent to the Rating Agencies. Prior to the
execution of any amendment to this Agreement, the Trustee and the Securities
Administrator will not consent to any amendment of the applicable Agreement
unless it shall first have received an Opinion of Counsel stating that the
execution of such amendment is authorized or permitted by this Agreement. Each
of the Securities Administrator and Trustee may, but shall not be obligated to,
enter into any such amendment which affects the Trustee's or Securities
Administrator's own rights, duties or immunities under this Agreement.
Notwithstanding any provision of this Agreement to the contrary,
neither the Securities Administrator, nor the Trustee shall consent to any
amendment to this Agreement unless it shall have first received an Opinion of
Counsel, delivered by (and at the expense of) the Person seeking such Amendment,
to the effect that such amendment will not result in the imposition of a tax on
either REMIC constituting part of the Trust Fund pursuant to the REMIC
Provisions or cause either REMIC constituting part of the Trust Fund to fail to
qualify as a REMIC or the Grantor Trust to fail to qualify as a grantor trust at
any time that any Certificates are outstanding and that the amendment is being
made in accordance with the terms hereof.
Promptly after the execution of any such amendment the Securities
Administrator shall furnish, at the expense of the Person that requested the
amendment if such Person is the Servicer (but in no event at the expense of the
Trustee), otherwise at the expense of the Trust, a copy of such amendment and
the Opinion of Counsel referred to in the immediately preceding paragraph to the
Servicer and each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 11.01 to approve the particular form of any proposed
amendment; instead it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Securities Administrator may prescribe.
Section 11.02 Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, this Agreement is subject
to recordation in all appropriate public offices for real property records in
all the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicer at the expense of the Trust, but only upon direction of
Certificateholders, accompanied by an Opinion of Counsel to the effect that such
recordation materially and beneficially affects the interests of the
Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall together constitute but
one and the same instrument.
Section 11.03 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not (i)
operate to terminate this Agreement or the Trust, (ii) entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust, or (iii) otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
Except as expressly provided for herein, no Certificateholder shall
have any right to vote or in any manner otherwise control the operation and
management of the Trust, or the obligations of the parties hereto, nor shall
anything herein set forth or contained in the terms of the Certificates be
construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue of any provision
of this Agreement to institute any suit, action or proceeding in equity or at
law upon or under or with respect to this Agreement, unless such Holder
previously shall have given to the Trustee a written notice of default and of
the continuance thereof, as herein provided, and unless also the Holders of
Certificates entitled to at least 25% of the Voting Interests shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for 60 days after
its receipt of such notice, request and offer of indemnity, shall have neglected
or refused to institute any such action, suit or proceeding. It is understood
and intended, and expressly covenanted by each Certificateholder with every
other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, which priority or
preference is not otherwise provided for herein, or to enforce any right under
this Agreement, except in the manner herein provided and for the equal, ratable
and common benefit of all Certificateholders. For the protection and enforcement
of the provisions of this Section 11.03 each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 11.04 Governing Law; Jurisdiction.
This Agreement shall be construed in accordance with the laws of the
State of New York, and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws. With respect to any
claim arising out of this Agreement, each party irrevocably submits to the
exclusive jurisdiction of the courts of the State of New York and the United
States District Court located in the Borough of Manhattan in The City of New
York, and each party irrevocably waives any objection which it may have at any
time to the laying of venue of any suit, action or proceeding arising out of or
relating hereto brought in any such courts, irrevocably waives any claim that
any such suit, action or proceeding brought in any such court has been brought
in any inconvenient forum and further irrevocably waives the right to object,
with respect to such claim, suit, action or proceeding brought in any such
court, that such court does not have jurisdiction over such party, provided that
service of process has been made by any lawful means.
Section 11.05 Notices.
All directions, demands and notices hereunder shall be in writing
and shall be deemed to have been duly given if personally delivered at or mailed
by first class mail, postage prepaid, or by express delivery service, to (a) in
the case of the Trustee, HSBC Bank USA, National Association, 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: WFHET 2005-1, or such other address as may
hereafter be furnished to the Depositor, the Securities Administrator and the
Servicer in writing by the Trustee, (b) in the case of the Depositor, Xxxxx
Fargo Asset Securities Corporation, 0000 Xxx Xxxxxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxx
00000, Attention: Vice President, Structured Finance, or such other address as
may be furnished to the Servicer, the Securities Administrator and the Trustee
in writing by the Depositor, (c) in the case of the Servicer, Xxxxx Fargo Bank,
N.A., 000 Xxxxxxxxx 0xx Xxxxxx, Xxx Xxxxxx, Xxxx 00000, Attention: Senior Vice
President, Servicing, and Xxxxx Xxxxx Xxxx, X.X., 0 Xxxx Xxxxxx, Xxx Xxxxxx,
Xxxx 00000-0000, Attention: Xxxx X. Xxxxx, MAC X2401-042, or such other address
as may be hereafter furnished to the Depositor, the Trustee and the Securities
Administrator by the Servicer in writing and (d) in the case of the Securities
Administrator, Xxxxx Fargo Bank, N.A., 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxx 00000, Attention: Client Manager-WFHET, Series 2005-1, or such other
address as may be hereafter furnished to the Depositor, the Trustee and the
Servicer by the Securities Administrator in writing. Any notice required or
permitted to be mailed to a Certificateholder shall be given by first class
mail, postage prepaid, at the address of such Holder as shown in the Certificate
Register. Notice of any Servicer Event of Termination shall be given by telecopy
and by certified mail. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have duly been given when mailed,
whether or not the Certificateholder receives such notice. A copy of any notice
required to be telecopied hereunder shall also be mailed to the appropriate
party in the manner set forth above.
Section 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall for any reason whatsoever be held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.07 Article and Section References.
All article and section references used in this Agreement, unless
otherwise provided, are to articles and sections in this Agreement.
Section 11.08 Notice to the Rating Agencies.
(a) Each of the Trustee and the Securities Administrator shall be
obligated to use its reasonable efforts promptly to provide notice to the Rating
Agencies with respect to each of the following of which a Responsible Officer of
the Trustee or the Securities Administrator, as the case may be, has actual
knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Servicer Event of Termination that has
not been cured or waived;
(iii) the resignation or termination of the Servicer, the Securities
Administrator or the Trustee;
(iv) the final payment to Holders of the Certificates of any Class;
(v) any change in the location of any Account; and
(vi) if the Trustee is acting as successor servicer pursuant to
Section 7.02 hereof, any event that would result in the inability of the
Trustee to make Advances.
In addition, the Securities Administrator shall promptly furnish to
each Rating Agency copies of the following:
(A) each annual statement as to compliance described in
Section 3.19 hereof;
(B) each annual independent public accountants' servicing
report described in Section 3.20 hereof; and
(C) each notice delivered pursuant to Section 7.01(a) hereof
which relates to the fact that the Servicer has not made an Advance.
Any such notice pursuant to this Section 11.08 shall be in writing
and shall be deemed to have been duly given if personally delivered or mailed by
first class mail, postage prepaid, or by express delivery service to: Fitch
Ratings, Xxx Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Managing
Director, Residential Mortgage-Backed Securities; Xxxxx'x Investors Service,
Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Attention: Managing
Director, Residential Mortgage-Backed Securities; and Standard & Poor's, a
division of The XxXxxx-Xxxx Companies, Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Mortgage Surveillance Group.
Section 11.09 Further Assurances.
Notwithstanding any other provision of this Agreement, neither the
Regular Certificateholders, the Securities Administrator nor the Trustee shall
have any obligation to consent to any amendment or modification of this
Agreement unless they have been provided reasonable security or indemnity
against their out-of-pocket expenses (including reasonable attorneys' fees) to
be incurred in connection therewith.
Section 11.10 Benefits of Agreement.
Nothing in this Agreement or in the Certificates, expressed or
implied, shall give to any Person, other than the Certificateholders and the
parties hereto and their successors hereunder, any benefit or any legal or
equitable right, remedy or claim under this Agreement, except that the Custodian
is an express third party beneficiary of this Agreement for purposes of Section
8.05.
Section 11.11 Acts of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by the
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
agent duly appointed in writing; and such action shall become effective when
such instrument or instruments are delivered to the Trustee, the Securities
Administrator and the Servicer. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"act" of the Certificateholders 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 Agreement and conclusive in favor of the
Securities Administrator, the Trustee and the Trust, if made in the manner
provided in this Section 11.11.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Whenever
such execution is by a signer acting in a capacity other than his or her
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other action by any Certificateholder shall bind every future Holder
of such Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Trustee, the
Securities Administrator or the Trust in reliance thereon, whether or not
notation of such action is made upon such Certificate.
IN WITNESS WHEREOF, the Depositor, the Servicer, the Securities
Administrator and the 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.
XXXXX FARGO ASSET SECURITIES
CORPORATION, as Depositor
By:
------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
XXXXX FARGO BANK, N.A., as Servicer
By:
------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
XXXXX FARGO BANK, N.A., as Securities
Administrator
By:
------------------------------------
Name:
Title:
HSBC BANK USA, NATIONAL ASSOCIATION,
as Trustee
By:
------------------------------------
Name:
Title:
STATE OF MARYLAND)
) SS.:
COUNTY OF XXXXXXXXX)
On the 29th day of June, 2005 before me, a notary public in and for
said State, personally appeared Xxxxxxx Xxxxxx, known to me to be a Senior Vice
President of Xxxxx Fargo Asset Securities Corporation, a Delaware corporation,
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
Notary Public
STATE OF MARYLAND)
) ss.:
COUNTY OF XXXXXXXXX)
On the 29th day of June, 2005 before me, a notary public in and for
said State, personally appeared Xxxxxxx Xxxxxx, known to me to be a Senior Vice
President of Xxxxx Fargo Bank, N.A., a national banking association, that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said association, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On the 29th day of June, 2005 before me, a notary public in and for
said State, personally appeared _______________, known to me to be a _______ of
Xxxxx Fargo Bank, N.A., a national banking association, that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said association, and acknowledged to me that such association executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On the 29th day of June, 2005 before me, a notary public in and for
said State, personally appeared _______________, known to me to be a _______ of
HSBC Bank USA, National Association, a national banking association, that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said association, and acknowledged to me that such
association executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
Notary Public
EXHIBIT A-AI-1A
[FORM OF THE CLASS AI-1A CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS AI-1A
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class AI-1A Original Principal Balance of the
Class AI-1A Certificates as of the
Pass-Through Rate: Floating Closing Date: $532,610,000.00
Date of Pooling and Servicing: June Initial Principal Balance: $
29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AM 6
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _______________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class AI-1A Certificates)
in that certain beneficial ownership interest evidenced by all the Class AI-1A
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class AI-1A Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class AI-1A Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class AI-1A Certificates for each
Distribution Date will be the lesser of (i) the Class AI-1A Formula Rate and
(ii) the Group I Cap. Interest will accrue on the Class AI-1A Certificates
during each Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class AI-1A
Certificates.
The Class AI-1A Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Securities Administrator and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Servicer, the Securities Administrator and the Trustee with the
consent of the Holders of Certificates entitled to the Voting Interests
identified in the Agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Securities Administrator and required to be paid to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT A-AI-1B
[FORM OF THE CLASS AI-1B CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS AI-1B
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class AI-1B Original Principal Balance of the
Class AI-1B Certificates as of the
Pass-Through Rate: Floating Closing Date: $133,153,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AN 4
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _______________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class AI-1B Certificates)
in that certain beneficial ownership interest evidenced by all the Class AI-1B
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class AI-1B Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class AI-1B Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class AI-1B Certificates for each
Distribution Date will be the lesser of (i) the Class AI-1B Formula Rate and
(ii) the Group I Cap. Interest will accrue on the Class AI-1B Certificates
during each Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class AI-1B
Certificates.
The Class AI-1B Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Securities Administrator and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Servicer, the Securities Administrator and the Trustee with the
consent of the Holders of Certificates entitled to the Voting Interests
identified in the Agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Securities Administrator and required to be paid to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT A-AII-1
[FORM OF THE CLASS AII-1 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS AII-1
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class AII-1 Original Principal Balance of the
Class AII-1 Certificates as of the
Pass-Through Rate: Floating Closing Date: $385,512,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AP 9
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _______________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class AII-1 Certificates)
in that certain beneficial ownership interest evidenced by all the Class AII-1
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class AII-1 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class AII-1 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class AII-1 Certificates for each
Distribution Date will be the lesser of (i) the Class AII-1 Formula Rate and
(ii) the Group II Cap. Interest will accrue on the Class AII-1 Certificates
during each Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class AII-1
Certificates.
The Class AII-1 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Securities Administrator and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Servicer, the Securities Administrator and the Trustee with the
consent of the Holders of Certificates entitled to the Voting Interests
identified in the Agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-1
[FORM OF CLASS M-1 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-1
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-1 Original Principal Balance of the
Class M-1 Certificates as of the
Pass-Through Rate: Floating Closing Date: $32,028,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA,
National Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AA 2
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-1 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-1
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-1 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-1 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-1 Certificates for each
Distribution Date will be the lesser of (i) the Class M-1 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-1 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-1
Certificates.
The Class M-1 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates as described in the Pooling and Servicing Agreement referred to
herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Securities Administrator and required to be paid to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-2
[FORM OF CLASS M-2 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND
CLASS M-1 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-2
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-2 Original Principal Balance of the
Class M-2 Certificates as of the
Pass-Through Rate: Floating Closing Date: $30,145,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AB 0
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-2 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-2
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-2 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-2 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-2 Certificates for each
Distribution Date will be the lesser of (i) the Class M-2 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-2 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-2
Certificates.
The Class M-2 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates and Class M-1 Certificates as described in the Pooling and
Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-3
[FORM OF CLASS M-3 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1 AND CLASS M-2 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-3
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-3 Original Principal Balance of the
Class M-3 Certificates as of the
Pass-Through Rate: Floating Closing Date: $18,212,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AC 8
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-3 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-3
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-3 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-3 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-3 Certificates for each
Distribution Date will be the lesser of (i) the Class M-3 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-3 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-3
Certificates.
The Class M-3 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1 and Class M-2 Certificates as described in the Pooling and Servicing
Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-4
[FORM OF CLASS M-4 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2 AND CLASS M-3 CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-4
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-4 Original Principal Balance of the
Class M-4 Certificates as of the
Pass-Through Rate: Floating Closing Date: $15,700,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AD 6
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-4 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-4
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-4 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-4 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-4 Certificates for each
Distribution Date will be the lesser of (i) the Class M-4 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-4 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-4
Certificates.
The Class M-4 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2 and Class M-3 Certificates as described in the Pooling and
Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-5
[FORM OF CLASS M-5 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3 AND CLASS M-4 CERTIFICATES AS DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-5
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-5 Original Principal Balance of the
Class M-5 Certificates as of the
Pass-Through Rate: Floating Closing Date: $14,444,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AE 4
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-5 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-5
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-5 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-5 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-5 Certificates for each
Distribution Date will be the lesser of (i) the Class M-5 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-5 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-5
Certificates.
The Class M-5 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3 and Class M-4 Certificates as described in the
Pooling and Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-6
[FORM OF CLASS M-6 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4 AND CLASS M-5 CERTIFICATES AS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-6
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-6 Original Principal Balance of the
Class M-6 Certificates as of the
Pass-Through Rate: Floating Closing Date: $12,560,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AF 1
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-6 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-6
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-6 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-6 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-6 Certificates for each
Distribution Date will be the lesser of (i) the Class M-6 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-6 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-6
Certificates.
The Class M-6 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4 and Class M-5 Certificates as
described in the Pooling and Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-7
[FORM OF CLASS M-7 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5 AND CLASS M-6 CERTIFICATES
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-7
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-7 Original Principal Balance of the
Class M-7 Certificates as of the
Pass-Through Rate: Floating Closing Date: $12,560,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AG 9
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-7 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-7
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-7 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-7 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-7 Certificates for each
Distribution Date will be the lesser of (i) the Class M-7 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-7 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-7
Certificates.
The Class M-7 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class M-6 Certificates
as described in the Pooling and Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-8
[FORM OF CLASS M-8 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5, CLASS M-6 AND CLASS M-7
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-8
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-8 Original Principal Balance of the
Class M-8 Certificates as of the
Pass-Through Rate: Floating Closing Date: $8,792,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AH 7
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-8 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-8
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-8 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-8 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-8 Certificates for each
Distribution Date will be the lesser of (i) the Class M-8 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-8 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-8
Certificates.
The Class M-8 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6 and Class M-7
Certificates as described in the Pooling and Servicing Agreement referred to
herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-9
[FORM OF CLASS M-9 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5, CLASS M-6, CLASS M-7 AND
CLASS M-8 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-9
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-9 Original Principal Balance of the
Class M-9 Certificates as of the
Pass-Through Rate: Floating Closing Date: $12,560,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AJ 3
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-9 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-9
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-9 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-9 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-9 Certificates for each
Distribution Date will be the lesser of (i) the Class M-9 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-9 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-9
Certificates.
The Class M-9 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7 and
Class M-8 Certificates as described in the Pooling and Servicing Agreement
referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-10
[FORM OF CLASS M-10 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5, CLASS M-6, CLASS M-7,
CLASS M-8 AND CLASS M-9 CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-10
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-10 Original Principal Balance of the
Class M-10 Certificates as of the
Pass-Through Rate: Floating Closing Date: $12,560,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AK 0
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-10 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-10
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-10 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-10 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-10 Certificates for each
Distribution Date will be the lesser of (i) the Class M-10 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-10 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-10
Certificates.
The Class M-10 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8 and Class M-9 Certificates as described in the Pooling and Servicing
Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-11
[FORM OF CLASS M-11 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5, CLASS M-6, CLASS M-7,
CLASS M-8, CLASS M-9 AND CLASS M-10 CERTIFICATES AS DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-11
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-11 Original Principal Balance of the
Class M-11 Certificates as of the
Pass-Through Rate: Floating Closing Date: $7,536,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AL 8
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-11 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-11
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-11 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-11 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-11 Certificates for each
Distribution Date will be the lesser of (i) the Class M-11 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-11 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-11
Certificates.
The Class M-11 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9 and Class M-10 Certificates as described in the Pooling and
Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-12
[FORM OF CLASS M-12 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5, CLASS M-6, CLASS M-7,
CLASS M-8, CLASS M-9, CLASS M-10 AND CLASS M-11 CERTIFICATES AS DESCRIBED
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF ANY
STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A
TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THE INITIAL PURCHASER IN THIS CERTIFICATE, AND EACH SUBSEQUENT PURCHASER
OF THIS CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN INTEREST HEREIN,
IS DEEMED TO HAVE AGREED TO COMPLY WITH CERTAIN TRANSFER REQUIREMENTS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON
BEHALF OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN
INDIVIDUAL RETIREMENT ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE
OR LOCAL LAW ("SIMILAR LAW") WHICH IS SIMILAR TO ERISA OR THE CODE
(COLLECTIVELY, A "PLAN"), MAY RESULT IN "PROHIBITED TRANSACTIONS" WITHIN
THE MEANING OF ERISA, THE CODE OR SIMILAR LAW. TRANSFER OF THIS
CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO THE
CERTIFICATE REGISTRAR AND DEPOSITOR EITHER (I) A REPRESENTATION LETTER, IN
FORM AND SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE
DEPOSITOR, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON BEHALF OF, ANY
SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH PURCHASE OR
(B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS
SUCH TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 ("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE
IS NO PLAN WITH RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S
RESERVES AND LIABILITIES FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH
PLAN AND ALL OTHER PLANS MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE
THEREOF AS DEFINED IN SECTION V(A)(1) OF PTE 95-60) OR BY THE SAME
EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE TOTAL OF ALL RESERVES AND
LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS ARE DETERMINED UNDER
SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND ALL PLANS THAT
HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE 95-60
APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE EFFECT THAT THE
PURCHASE OR HOLDING OF THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL
NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE
MEANING OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW AND WILL NOT
SUBJECT THE DEPOSITOR, THE SERVICER, THE SECURITIES ADMINISTRATOR, THE
TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION IN ADDITION TO
THOSE UNDERTAKEN IN THE POOLING AND SERVICING AGREEMENT. EACH PERSON WHO
ACQUIRES THIS CERTIFICATE OR ANY INTEREST THEREIN SHALL BE DEEMED TO HAVE
MADE THE REPRESENTATIONS REQUIRED BY THE REPRESENTATION LETTER REFERRED TO
IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON SHALL HAVE PROVIDED SUCH
REPRESENTATION LETTER OR THE OPINION OF COUNSEL REFERRED TO IN THE
PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR AND DEPOSITOR. THE POOLING
AND SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL
VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-12
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-12 Original Principal Balance of the
Class M-12 Certificates as of the
Pass-Through Rate: Floating Closing Date: $9,420,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AQ 7
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-12 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-12
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-12 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-12 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-12 Certificates for each
Distribution Date will be the lesser of (i) the Class M-12 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-12 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-12
Certificates.
The Class M-12 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9, Class M-10 and Class M-11 Certificates as described in the
Pooling and Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. If a transfer of this Certificate is to be made without
registration under the 1933 Act, then the Certificate Registrar shall refuse to
register such transfer unless it receives (and upon receipt, may conclusively
rely upon) certain certificate(s) required pursuant to Section 5.02 of the
Agreement (as to which, so long as this Certificate is a Book-Entry Certificate,
the representations and agreements made therein will be deemed to have been made
by the prospective transferor and/or the prospective transferee, as applicable).
None of the Depositor, the Certificate Registrar or the Trustee is obligated to
register or qualify the Class of Certificates specified on the face hereof under
the 1933 Act or any other securities law or to take any action not otherwise
required under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any transferor desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar and the Servicer against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-13
[FORM OF CLASS M-13 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5, CLASS M-6, CLASS M-7,
CLASS M-8, CLASS M-9, CLASS M-10, CLASS M-11 AND CLASS M-12 CERTIFICATES
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF ANY
STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A
TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THE INITIAL PURCHASER IN THIS CERTIFICATE, AND EACH SUBSEQUENT PURCHASER
OF THIS CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN INTEREST HEREIN,
IS DEEMED TO HAVE AGREED TO COMPLY WITH CERTAIN TRANSFER REQUIREMENTS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON
BEHALF OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN
INDIVIDUAL RETIREMENT ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE
OR LOCAL LAW ("SIMILAR LAW") WHICH IS SIMILAR TO ERISA OR THE CODE
(COLLECTIVELY, A "PLAN"), MAY RESULT IN "PROHIBITED TRANSACTIONS" WITHIN
THE MEANING OF ERISA, THE CODE OR SIMILAR LAW. TRANSFER OF THIS
CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO THE
CERTIFICATE REGISTRAR AND DEPOSITOR EITHER (I) A REPRESENTATION LETTER, IN
FORM AND SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE
DEPOSITOR, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON BEHALF OF, ANY
SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH PURCHASE OR
(B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS
SUCH TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 ("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE
IS NO PLAN WITH RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S
RESERVES AND LIABILITIES FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH
PLAN AND ALL OTHER PLANS MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE
THEREOF AS DEFINED IN SECTION V(A)(1) OF PTE 95-60) OR BY THE SAME
EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE TOTAL OF ALL RESERVES AND
LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS ARE DETERMINED UNDER
SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND ALL PLANS THAT
HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE 95-60
APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE EFFECT THAT THE
PURCHASE OR HOLDING OF THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL
NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE
MEANING OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW AND WILL NOT
SUBJECT THE DEPOSITOR, THE SERVICER, THE SECURITIES ADMINISTRATOR, THE
TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION IN ADDITION TO
THOSE UNDERTAKEN IN THE POOLING AND SERVICING AGREEMENT. EACH PERSON WHO
ACQUIRES THIS CERTIFICATE OR ANY INTEREST THEREIN SHALL BE DEEMED TO HAVE
MADE THE REPRESENTATIONS REQUIRED BY THE REPRESENTATION LETTER REFERRED TO
IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON SHALL HAVE PROVIDED SUCH
REPRESENTATION LETTER OR THE OPINION OF COUNSEL REFERRED TO IN THE
PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR AND DEPOSITOR. THE POOLING
AND SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL
VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-13
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-13 Original Principal Balance of the
Class M-13 Certificates as of the
Pass-Through Rate: Floating Closing Date: $5,024,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AR 5
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-13 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-13
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-13 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-13 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-13 Certificates for each
Distribution Date will be the lesser of (i) the Class M-13 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-13 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-13
Certificates.
The Class M-13 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9, Class M-10, Class M-11 and Class M-12 Certificates as
described in the Pooling and Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. If a transfer of this Certificate is to be made without
registration under the 1933 Act, then the Certificate Registrar shall refuse to
register such transfer unless it receives (and upon receipt, may conclusively
rely upon) certain certificate(s) required pursuant to Section 5.02 of the
Agreement (as to which, so long as this Certificate is a Book-Entry Certificate,
the representations and agreements made therein will be deemed to have been made
by the prospective transferor and/or the prospective transferee, as applicable).
None of the Depositor, the Certificate Registrar or the Trustee is obligated to
register or qualify the Class of Certificates specified on the face hereof under
the 1933 Act or any other securities law or to take any action not otherwise
required under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any transferor desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar and the Servicer against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT B-14
[FORM OF CLASS M-14 CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE 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 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS
M-1, CLASS M-2, CLASS M-3, CLASS M-4, CLASS M-5, CLASS M-6, CLASS M-7,
CLASS M-8, CLASS M-9, CLASS M-10, CLASS M-11, CLASS M-12 AND CLASS M-13
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND CERTAIN OTHER PROPERTY.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES LAWS OF ANY
STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A
TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THE INITIAL PURCHASER IN THIS CERTIFICATE, AND EACH SUBSEQUENT PURCHASER
OF THIS CERTIFICATE, BY PURCHASING THIS CERTIFICATE OR AN INTEREST HEREIN,
IS DEEMED TO HAVE AGREED TO COMPLY WITH CERTAIN TRANSFER REQUIREMENTS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
UNDER CURRENT LAW THE PURCHASE AND HOLDING OF THIS CERTIFICATE BY OR ON
BEHALF OF ANY EMPLOYEE BENEFIT PLAN OR ARRANGEMENT, INCLUDING AN
INDIVIDUAL RETIREMENT ACCOUNT, SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), THE CODE OR ANY FEDERAL, STATE
OR LOCAL LAW ("SIMILAR LAW") WHICH IS SIMILAR TO ERISA OR THE CODE
(COLLECTIVELY, A "PLAN"), MAY RESULT IN "PROHIBITED TRANSACTIONS" WITHIN
THE MEANING OF ERISA, THE CODE OR SIMILAR LAW. TRANSFER OF THIS
CERTIFICATE WILL NOT BE MADE UNLESS THE TRANSFEREE DELIVERS TO THE
CERTIFICATE REGISTRAR AND DEPOSITOR EITHER (I) A REPRESENTATION LETTER, IN
FORM AND SUBSTANCE SATISFACTORY TO THE CERTIFICATE REGISTRAR AND THE
DEPOSITOR, STATING THAT (A) IT IS NOT, AND IS NOT ACTING ON BEHALF OF, ANY
SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH PURCHASE OR
(B) IF IT IS AN INSURANCE COMPANY, THAT THE SOURCE OF FUNDS USED TO
PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT" (AS
SUCH TERM IS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION CLASS
EXEMPTION 95-60 ("PTE 95-60"), 60 FED. REG. 35925 (JULY 12, 1995)), THERE
IS NO PLAN WITH RESPECT TO WHICH THE AMOUNT OF SUCH GENERAL ACCOUNT'S
RESERVES AND LIABILITIES FOR THE CONTRACT(S) HELD BY OR ON BEHALF OF SUCH
PLAN AND ALL OTHER PLANS MAINTAINED BY THE SAME EMPLOYER (OR AFFILIATE
THEREOF AS DEFINED IN SECTION V(A)(1) OF PTE 95-60) OR BY THE SAME
EMPLOYEE ORGANIZATION EXCEEDS 10% OF THE TOTAL OF ALL RESERVES AND
LIABILITIES OF SUCH GENERAL ACCOUNT (AS SUCH AMOUNTS ARE DETERMINED UNDER
SECTION I(A) OF PTE 95-60) AT THE DATE OF ACQUISITION AND ALL PLANS THAT
HAVE AN INTEREST IN SUCH GENERAL ACCOUNT ARE PLANS TO WHICH PTE 95-60
APPLIES, OR (II) AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY
TO THE CERTIFICATE REGISTRAR AND THE DEPOSITOR, TO THE EFFECT THAT THE
PURCHASE OR HOLDING OF THIS CERTIFICATE BY OR ON BEHALF OF SUCH PLAN WILL
NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION WITHIN THE
MEANING OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW AND WILL NOT
SUBJECT THE DEPOSITOR, THE SERVICER, THE SECURITIES ADMINISTRATOR, THE
TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION IN ADDITION TO
THOSE UNDERTAKEN IN THE POOLING AND SERVICING AGREEMENT. EACH PERSON WHO
ACQUIRES THIS CERTIFICATE OR ANY INTEREST THEREIN SHALL BE DEEMED TO HAVE
MADE THE REPRESENTATIONS REQUIRED BY THE REPRESENTATION LETTER REFERRED TO
IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON SHALL HAVE PROVIDED SUCH
REPRESENTATION LETTER OR THE OPINION OF COUNSEL REFERRED TO IN THE
PRECEDING SENTENCE TO THE CERTIFICATE REGISTRAR AND DEPOSITOR. THE POOLING
AND SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR PURPORTED TRANSFER
IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE NULL AND VOID AND WILL
VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS M-14
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class M-14 Original Principal Balance of the
Class M-14 Certificates as of the
Pass-Through Rate: Floating Closing Date: $3,768,000.00
Date of Pooling and Servicing Initial Principal Balance: $
Agreement: June 29, 2005
Servicer: Xxxxx Fargo Bank, N.A.
First Distribution Date: July 25,
2005 Trustee: HSBC Bank USA, National
Association
No.
Closing Date: June 29, 2005
CUSIP: 9497ER AS 3
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _________________ is the registered owner of a
Percentage Interest (obtained by dividing the Initial Principal Balance of this
Certificate by the Original Principal Balance of the Class M-14 Certificates) in
that certain beneficial ownership interest evidenced by all the Class M-14
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxx Fargo Asset
Securities Corporation (hereinafter called the "Depositor," which term includes
any successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class M-14 Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class M-14 Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
The Pass-Through Rate for the Class M-14 Certificates for each
Distribution Date will be the lesser of (i) the Class M-14 Formula Rate and (ii)
the Pool Cap. Interest will accrue on the Class M-14 Certificates during each
Interest Accrual Period at the Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing a Percentage Interest in the Class M-14
Certificates.
The Class M-14 Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8, Class M-9, Class M-10, Class M-11, Class M-12 and Class M-13
Certificates as described in the Pooling and Servicing Agreement referred to
herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. If a transfer of this Certificate is to be made without
registration under the 1933 Act, then the Certificate Registrar shall refuse to
register such transfer unless it receives (and upon receipt, may conclusively
rely upon) certain certificate(s) required pursuant to Section 5.02 of the
Agreement (as to which, so long as this Certificate is a Book-Entry Certificate,
the representations and agreements made therein will be deemed to have been made
by the prospective transferor and/or the prospective transferee, as applicable).
None of the Depositor, the Certificate Registrar or the Trustee is obligated to
register or qualify the Class of Certificates specified on the face hereof under
the 1933 Act or any other securities law or to take any action not otherwise
required under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any transferor desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar and the Servicer against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
Date of authentication:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT C-1
[FORM OF CLASS CE CERTIFICATES]
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A DIRECT
OR INDIRECT BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN
SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE "CODE") AND CERTAIN OTHER PROPERTY.
THIS CLASS CE CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES AND
THE CLASS M-12, CLASS M-13 AND CLASS M-14 CERTIFICATES OF THIS SERIES TO
THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
THIS CLASS CE CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS CE CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, SECTION 4975 OF THE CODE OR ANY
MATERIALLY SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW
WILL BE REGISTERED.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS CE
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class CE Servicer: Xxxxx Fargo Bank, N.A.
Date of Pooling and Servicing Trustee: HSBC Bank USA, National
Agreement: June 29, 2005 Association
First Distribution Date: July 25, Closing Date: June 29, 2005
2005
No.
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that __________________________________ is the
registered owner of a Percentage Interest set forth above in that certain
beneficial ownership interest evidenced by all the Class CE Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Xxxxx Fargo Asset Securities
Corporation (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
Class CE Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class CE Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing the Percentage Interest specified on the face
hereof.
The Class CE Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar and the Depositor the facts surrounding
the transfer, or (ii) unless such transfer is made in reliance upon Rule 144A
under the 1933 Act, that the Depositor and the Certificate Registrar receive an
Opinion of Counsel satisfactory to them that such transfer may be made without
such registration or qualification, which Opinion of Counsel shall not be an
expense of the Depositor, the Trustee, the Securities Administrator or the
Certificate Registrar, in their respective capacities as such. None of the
Depositor, the Certificate Registrar or the Trustee is obligated to register or
qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Securities Administrator and required to be paid to
them pursuant to the Agreement following the earlier of (i) the final payment or
other liquidation (or any advance with respect thereto) of the last Mortgage
Loan remaining in the Trust Fund, and (ii) the purchase by the party designated
in the Agreement at a price determined as provided in the Agreement from the
Trust Fund of all Mortgage Loans and all property acquired in respect of such
Mortgage Loans. The Agreement permits, but does not require, the party
designated in the Agreement to purchase from the Trust Fund all Mortgage Loans
and all property acquired in respect of any Mortgage Loan at a price determined
as provided in the Agreement. The exercise of such right will effect early
retirement of the Certificates; however, such right to purchase is subject to
the aggregate Principal Balance of the Mortgage Loans at the time of purchase
being 10% or less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assume no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Dated:
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT C-2
[FORM OF CLASS P CERTIFICATE]
THIS CLASS P CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, SECTION 4975 OF THE CODE OR ANY
MATERIALLY SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW
WILL BE REGISTERED.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS P
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class P Servicer: Xxxxx Fargo Bank, N.A.
Date of Pooling and Servicing Trustee: HSBC Bank USA, National
Agreement: June 29, 2005 Association
First Distribution Date: July 25, Closing Date: June 29, 2005
2005
No.
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that __________________________________ is the
registered owner of a Percentage Interest set forth above in that certain
beneficial ownership interest evidenced by all the Class P Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Xxxxx Fargo Asset Securities
Corporation (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Servicer, the Securities
Administrator and the Trustee, a summary of certain of the pertinent provisions
of which is set forth hereafter. To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from Prepayment Charges and
Servicer Prepayment Charge Payment Amounts in the Distribution Account in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class P
Certificates on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class P Certificates, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing the Percentage Interest specified on the face
hereof.
The Class P Certificates are limited in right of payment to
Prepayment Charges received on the Mortgage Loans, Originator Prepayment Charge
Payment Amounts and Servicer Prepayment Charge Payment Amounts, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Securities Administrator as
provided in the Agreement, duly endorsed by, or accompanied by an assignment in
the form below or other written instrument of transfer in form satisfactory to
the Trustee, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar the facts surrounding the transfer, or
(ii) unless such transfer is made in reliance upon Rule 144A under the 1933 Act,
that the Depositor and the Certificate Registrar receive an Opinion of Counsel
satisfactory to them that such transfer may be made without such registration or
qualification, which Opinion of Counsel shall not be an expense of the
Depositor, the Trustee, the Securities Administrator or the Certificate
Registrar, in their respective capacities as such. None of the Depositor, the
Certificate Registrar or the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any such Certificateholder desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar and any Servicer against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar or any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
Dated:
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT C-3
[FORM OF CLASS R CERTIFICATE]
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
"RESIDUAL INTEREST" IN TWO SEPARATE "REAL ESTATE MORTGAGE INVESTMENT
CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CLASS R CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES AND
THE CLASS M-12, CLASS M-13 AND CLASS M-14 CERTIFICATES OF THIS SERIES TO
THE EXTENT DESCRIBED HEREIN AND IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH TIME
AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN
A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND
IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, SECTION 4975 OF THE CODE OR ANY
MATERIALLY SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW
WILL BE REGISTERED.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE MAY
BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1) AN AFFIDAVIT TO THE
CERTIFICATE REGISTRAR THAT SUCH TRANSFEREE IS NOT (A) THE UNITED STATES,
ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN GOVERNMENT, ANY
INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF ANY OF THE
FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED IN
SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1
OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY
SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION
1381(a)(2)(C) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING
CLAUSES (A), (B) OR (C) BEING HEREINAFTER REFERRED TO AS A "DISQUALIFIED
ORGANIZATION"), OR (D) AN AGENT OF A DISQUALIFIED ORGANIZATION AND (2) NO
PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX,
AND (3) SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING
TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE
REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER
DISPOSITION OF THIS CLASS R CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR
AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED
TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE
DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT
NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH
HOLDER OF THE CLASS R CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL
BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH AND THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED ORGANIZATION IS PROHIBITED
FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS CLASS R CERTIFICATE.
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET-BACKED CERTIFICATES
SERIES 2005-1, CLASS R
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of a pool of conventional fixed-rate and adjustable-rate one- to four-family
first lien mortgage loans formed and sold by
XXXXX FARGO ASSET SECURITIES CORPORATION
Series 2005-1, Class R Servicer: Xxxxx Fargo Bank, N.A.
Date of Pooling and Servicing Trustee: HSBC Bank USA, National
Agreement: June 29, 2005 Association
First Distribution Date: July 25, Closing Date: June 29, 2005
2005
No.
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXX
FARGO ASSET SECURITIES CORPORATION, THE SERVICER, THE TRUSTEE, THE
SECURITIES ADMINISTRATOR OR ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS
NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR
ANY OTHER ENTITY.
This certifies that _______________________ is the registered owner
of 100% Percentage Interest in that certain beneficial ownership interest
evidenced by the Class R Certificate in the Trust Fund created pursuant to a
Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among Xxxxx Fargo Asset Securities Corporation (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Securities Administrator and the Trustee, a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, from funds in the Distribution
Account in the amount required to be distributed to the Holder of Class R
Certificate on such Distribution Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Securities
Administrator by wire transfer in immediately available funds to the account of
the Person entitled thereto if such Person shall have so notified the
Certificate Registrar in writing at least seven Business Days prior to the
Record Date immediately prior to such Distribution Date and is the registered
owner of Class R Certificate, or by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Securities Administrator of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Securities Administrator for that purpose as
provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates of the Series specified on the face hereof (herein called the
"Certificates") and representing the Percentage Interest specified on the face
hereof.
The Class R Certificate is limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Securities
Administrator and the Trustee with the consent of the Holders of Certificates
entitled to the Voting Interests identified in the Agreement. Any such consent
by the Holder of this Certificate shall be conclusive and binding on such Holder
and upon all future Holders of this Certificate and of any Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Securities
Administrator, the Securities Administrator and the Certificate Registrar duly
executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of the same Class in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer
is made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar the facts surrounding the transfer, or
(ii) unless such transfer is made in reliance upon Rule 144A under the 1933 Act,
that the Depositor and the Certificate Registrar receive an Opinion of Counsel
satisfactory to them that such transfer may be made without such registration or
qualification, which Opinion of Counsel shall not be an expense of the
Depositor, the Trustee, the Securities Administrator or the Certificate
Registrar, in their respective capacities as such. None of the Depositor, the
Certificate Registrar or the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any such Certificateholder desiring to effect such transfer
shall, and does hereby agree to, indemnify the Trustee, the Depositor, the
Certificate Registrar and any Servicer against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
The Holder of this Certificate, by its acceptance hereof, shall be
deemed for all purposes to have consented to the provisions of Section 5.02 of
the Agreement and to any amendment of the Agreement deemed necessary by counsel
of the Depositor to ensure that the transfer of this Certificate to any Person
other than a Permitted Transferee or any other Person will not cause the Trust
to cease to qualify as two separate REMICs or cause the imposition of a tax upon
the Trust.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, the Securities
Administrator and the Certificate Registrar and any agent of the Depositor, the
Servicer, the Trustee, the Securities Administrator or the Certificate Registrar
may treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Securities Administrator, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Securities Administrator assumes no responsibility for their
correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused this
Certificate to be duly executed.
Dated:
Xxxxx Fargo Bank, N.A., as Securities
Administrator
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is the one of the Certificates referred to in the
within-mentioned Agreement.
Dated:
Xxxxx Fargo Bank, N.A., as Certificate
Registrar
By:___________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee) _____________________________________________
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
________________________________________
Signature by or on behalf of assignor
________________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _______________________________, account number ____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ________________________________________, as its
agent.
EXHIBIT D-1
GROUP 1 MORTGAGE LOAN SCHEDULE
(Intentionally Omitted)
EXHIBIT D-2
GROUP 2 MORTGAGE LOAN SCHEDULE
(Intentionally Omitted)
EXHIBIT E
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: [Custodian]
Re: Pooling and Servicing Agreement dated as of June 29, 2005 among
Xxxxx Fargo Asset Securities Corporation, as depositor, Xxxxx Fargo
Bank, N.A., as servicer, Xxxxx Fargo Bank, National Association, as
securities administrator and HSBC Bank USA, National Association, as
trustee
All capitalized terms used herein shall have the means ascribed to
them in the Pooling and Servicing Agreement (the "Agreement") referenced above.
In connection with the administration of the Mortgage Loans held by
you as Custodian pursuant to the Agreement, we request the release, and hereby
acknowledge receipt, of the Custodian's Mortgage File for the Mortgage Loan
described below, for the reason indicated.
Mortgage Loan Number:
---------------------
Mortgagor Name, Address & Zip Code:
-----------------------------------
Reason for Requesting Documents (check one):
--------------------------------------------
_____ 1. Mortgage Paid in Full
_____ 2. Foreclosure
_____ 3. Substitution
_____ 4. Other Liquidation (Repurchases, etc.)
_____ 5. Nonliquidation Reason:_____________________
By:_________________________
(authorized signer)
Issuer:_____________________
Address:____________________
____________________________
Date:_______________________
Custodian
---------
[________________________________]
Please acknowledge the execution of the above request by your
signature and date below:
________________________________ ____________________
Signature Date
Documents returned to Custodian:
________________________________ ____________________
Custodian Date
EXHIBIT F-1
FORM OF CUSTODIAN'S INITIAL CERTIFICATION
Date
Xxxxx Fargo Asset Securities Corporation
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
HSBC Bank USA, National Association
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: WFHET 2005-1
Re: Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of June 29, 2005 among Xxxxx Fargo Asset
Securities Corporation, as depositor, Xxxxx Fargo Bank, N.A., as
servicer, Xxxxx Fargo Bank, National Association, as securities
administrator and HSBC Bank USA, National Association, as trustee,
with respect to Xxxxx Fargo Asset Securities Corporation, Home
Equity Asset Backed Certificates, Series 2005-1
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
original Mortgage Note (as described in Section 2.01(a)(i)) relating to each
Mortgage Loan listed on Exhibits D-1 and D-2 to the Pooling and Servicing
Agreement, subject to any exceptions noted on Schedule I hereto.
The Custodian has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement in connection with this initial certification.
The Custodian makes no representations as to: (i) the validity, legality,
sufficiency, enforceability, recordability or genuineness of any of the
documents contained in each Mortgage File or any of the Mortgage Loans
identified in the Mortgage Loan Schedule or (ii) the collectibility,
insurability, effectiveness or suitability of any such Mortgage Loan.
Capitalized words and phrases used herein and not otherwise defined
herein shall have the respective meanings assigned to them in the Pooling and
Servicing Agreement. This Certificate is subject in all respects to the terms of
Section 2.02 of the Pooling and Servicing Agreement and the Pooling and
Servicing Agreement sections cross-referenced therein.
XXXXX FARGO BANK, N.A.
as Custodian
By:___________________________________
Name:
Title:
EXHIBIT F-2
FORM OF CUSTODIAN'S FINAL CERTIFICATION
[Date]
Xxxxx Fargo Asset Securities Corporation
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
HSBC Bank USA, National Association
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: WFHET 2005-1
Re: Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of June 29, 2005 among Xxxxx Fargo Asset
Securities Corporation, as depositor, Xxxxx Fargo Bank, N.A., as
servicer, Xxxxx Fargo Bank, National Association, as securities
administrator and HSBC Bank USA, National Association, as trustee,
with respect to Xxxxx Fargo Asset Securities Corporation, Home
Equity Asset Backed Certificates, Series 2005-1
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing
Agreement, the undersigned, as Trustee, hereby certifies that as to each
Mortgage Loan listed in the Mortgage Loan Schedules attached as Exhibits D-1 and
D-2 to the Pooling and Servicing Agreement (other than any Mortgage Loan paid in
full or listed on Schedule I hereto), it has received the applicable documents
listed in Section 2.01(a) of the Pooling and Servicing Agreement.
The undersigned hereby certifies that as to each Mortgage Loan
identified on the Mortgage Loan Schedules, other than any Mortgage Loan listed
on Schedule I hereto, it has reviewed the applicable documents listed in Section
2.01 of the Pooling and Servicing Agreement and has determined that each such
document appears to have been executed and appear regular on their face, and
that such documents relate to the Mortgage Loans identified in the Mortgage Loan
Schedule based on a comparison of the Mortgage Loan identifying number,
Mortgagor name and street address.
The Custodian has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement in connection with this final certification. The
Custodian makes no representations as to: (i) the validity, legality,
sufficiency, enforceability, recordability or genuineness of any of the
documents contained in each Mortgage File or any of the Mortgage Loans
identified in the Mortgage Loan Schedule or (ii) the collectibility,
insurability, effectiveness or suitability of any such Mortgage Loan.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement. This
Certificate is qualified in all respects by the terms of said Pooling and
Servicing Agreement.
XXXXX FARGO BANK, N.A.,
as Custodian
By:___________________________________
Name:
Title:
EXHIBIT G
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement (the "Agreement"), dated as of
June 29, 2005, is between Xxxxx Fargo Asset Securities Corporation, a Delaware
corporation (the "Company"), and Xxxxx Fargo Bank, N.A., a national banking
association ("Xxxxx Fargo Bank").
The Company and Xxxxx Fargo Bank hereby recite and agree as follows:
1. Defined Terms. Terms used without definition herein shall have
the respective meanings assigned to them in the Pooling and Servicing Agreement,
dated as of June 29, 2005 (the "Pooling and Servicing Agreement"), among the
Company, Xxxxx Fargo Bank, as servicer (the "Servicer"), HSBC Bank USA, National
Association, as trustee (the "Trustee"), and Xxxxx Fargo Bank, N.A., as
securities administrator (the "Securities Administrator"), relating to the
issuance of the Company's Home Equity Asset-Backed Certificates, Series 2005-1
(the "Certificates") or, if not defined therein, in the underwriting agreement,
dated May 19, 2005 and terms agreement, dated May 19, 2005 (together, the
"Underwriting Agreement"), among the Company, Xxxxx Fargo Bank and Citigroup
Global Markets Inc. ("Citigroup"), or in the purchase agreement dated May 19,
2005 and the purchaser terms agreement, dated May 19, 2005 (together, the
"Purchase Agreement"), among the Company, Xxxxx Fargo Bank and Citigroup.
2. Assignment of Servicing Agreements. Xxxxx Fargo Bank agrees to
sell, and the Company agrees to purchase, the mortgage loans listed in Exhibit I
hereto and all of Xxxxx Fargo Bank's interest with respect to the Mortgage Loans
as the owner in, to and under each Servicing Agreement (as defined in the
Pooling and Servicing Agreement).
3. Purchase Price; Purchase and Sale. The purchase price (the
"Purchase Price") for the Mortgage Loans shall consist of $_________________
payable by the Company to Xxxxx Fargo Bank on the Closing Date in immediately
available funds.
Upon payment of the Purchase Price, Xxxxx Fargo Bank shall be deemed
to have transferred, assigned, set over and otherwise conveyed to the Company
all the right, title and interest of Xxxxx Fargo Bank in and to the Mortgage
Loans including all interest and principal received or receivable by Xxxxx Fargo
Bank on or with respect to the Mortgage Loans after the Cut-Off Date (and
including scheduled payments of principal and interest due after the Cut-Off
Date but received by Xxxxx Fargo Bank on or before the Cut-Off Date and
Principal Prepayments received or applied on the Cut-Off Date, but not including
payments of principal and interest due on the Mortgage Loans on or before the
Cut-Off Date), together with all of Xxxxx Fargo Bank's right, title and interest
in and to the proceeds of any related title, hazard, primary mortgage or other
insurance policies, Xxxxx Fargo Bank's right, title and interest in and to the
proceeds of the Letters of Credit, all of Xxxxx Fargo Bank's rights described in
Section 2 above, and all other property and rights described in the first
paragraph of Section 2.01(a) of the Pooling and Servicing Agreement. The Company
hereby directs Xxxxx Fargo Bank, and Xxxxx Fargo Bank hereby agrees, to deliver
to the Trustee or Custodian on behalf of the Trustee, all documents, instruments
and agreements required to be delivered by the Company to the Trustee under the
Pooling and Servicing Agreement; including, without limitation, the documents
required to be delivered under Section 2.01(a) of the Pooling and Servicing
Agreement; and upon the occurrence of a Document Transfer Event, the documents
required to be delivered under Section 2.01(b). Xxxxx Fargo Bank further agrees
to deliver such other documents, instruments and agreements as the Company or
the Trustee shall reasonably request.
4. Representations and Warranties; Covenants. Xxxxx Fargo Bank
hereby represents and warrants to the Company that (i) the Company's
representations and warranties to the Trustee pursuant to Section 2.04 of the
Pooling and Servicing Agreement are true and correct, as of the date thereof,
and (ii) Xxxxx Fargo Bank has not dealt with any broker, investment banker,
agent or other person (other than the Company and Citigroup) who may be entitled
to any commission or compensation in connection with the sale of the Mortgage
Loans. Xxxxx Fargo Bank hereby agrees to cure any breach of such representations
and warranties in accordance with the terms of the Pooling and Servicing
Agreement.
Xxxxx Fargo Bank hereby agrees to continue to pay on behalf of the
Company and its successors and assignees, promptly as they become due, any
lender-paid primary mortgage insurance premiums ("LPMI Premiums") with respect
to any lender-paid primary mortgage insurance policy (an "LPMI Policy") on each
Mortgage Loan so insured as of the Cut-Off Date, until such Mortgage Loan has
been paid in full or otherwise liquidated; provided, however, that the foregoing
obligation of Xxxxx Fargo Bank shall terminate with respect to all such Mortgage
Loans in the event that either (i) another entity acceptable to the insurers of
such LPMI Policies (the "LPMI Insurers") and the rating agencies rating the
Certificates undertakes to pay such LPMI Premiums, or (ii) Xxxxx Fargo Bank pays
one-time premiums to such LPMI Insurers such that all outstanding LPMI Policies
will remain in force until the related Mortgage Loans have been paid in full or
otherwise liquidated, without the requirement of any further premium payments.
5. Repurchase or Substitution. (a) Xxxxx Fargo Bank hereby agrees to
repurchase any Mortgage Loan (i) for which any document is not delivered, as
provided in paragraph 3 above, (ii) which is found by the Trustee to be
defective in any material respect, as provided in the Pooling and Servicing
Agreement, or (iii) which is discovered at any time not to be in conformance
with the representations and warranties referred to in paragraph 4 above and
which document relating thereto Xxxxx Fargo Bank does not deliver or which
defect or breach Xxxxx Fargo Bank does not cure (as provided in paragraph 4
above) within 60 days after the date of notice thereof from the Trustee or the
Company, at a price equal to the then unpaid principal balance thereof, plus
accrued and unpaid interest at the applicable Mortgage Interest Rate, through
the last day of the month in which such repurchase takes place. In addition,
Xxxxx Fargo Bank hereby agrees to reimburse the Company for any Reimbursement
Amount. Alternatively, Xxxxx Fargo Bank hereby agrees, if so requested by the
Company to substitute for any such Mortgage Loan, a new mortgage loan having
characteristics such that the representations and warranties referred to in
paragraph 4 above would not have been incorrect (except for representations and
warranties as to the correctness of the Mortgage Loan Schedule) had such
substitute mortgage loan originally been a Mortgage Loan. Xxxxx Fargo Bank
further agrees that a substituted mortgage loan will have (i) an unpaid
principal balance no greater than the Scheduled Principal Balance of the
Mortgage Loan for which it is substituted (after giving effect to the scheduled
principal payment due in the month of substitution on the Mortgage Loan for
which such mortgage loan is substituted), (ii) a Net Mortgage Interest Rate
equal to and a Loan-to-Value Ratio no greater than, that of the Mortgage Loan
for which it is substituted, (iii) the same Gross Margin and Index as that of
the Mortgage Loan for which it is substituted and (iv) the same frequency of
mortgage rate adjustment as that of the Mortgage Loan for which it is
substituted. Xxxxx Fargo Bank shall remit to the Company, in cash, the
difference between the unpaid principal balance of the Mortgage Loan to be
substituted and the unpaid principal balance of the substitute mortgage loan.
(b) In addition, Xxxxx Fargo Bank shall pay (i) the amount of any
Prepayment Premium (to the extent not collected and remitted to the Trust) to
the Trust if Xxxxx Fargo Bank is unable to collect a Prepayment Penalty as a
result of its enforceability being found to be limited or prohibited by
applicable law and (ii) without duplication of any amount payable under clause
(i), the amount due to the Trust by Xxxxx Fargo Bank pursuant to the last
paragraph of Section 2.03(a) of the Pooling and Servicing Agreement (any such
amounts, the "Originator Prepayment Penalty Payment Amount"). Xxxxx Fargo Bank
shall remit to the Securities Administrator for deposit into the Collection
Account any Originator Prepayment Penalty Payment Amount by the Servicer
Remittance Date following the month in which a Principal Prepayment was made on
the related Mortgage Loan.
(c) In the event that Xxxxx Fargo Bank has a right against the
originator or former owner of a Mortgage Loan (the "Prior Holder") for breach of
a representation or warranty regarding the characteristics of such Mortgage Loan
made by the Prior Holder, Xxxxx Fargo Bank may request the Company to repurchase
the Mortgage Loan from the Trust Estate pursuant to Section 2.03 of the Pooling
and Servicing Agreement and Xxxxx Fargo Bank agrees that at the time of the
repurchase by the Company, Xxxxx Fargo Bank will repurchase the Mortgage Loan
from the Company at a price equal to the then unpaid principal balance thereof,
plus accrued and unpaid interest at the applicable Net Mortgage Interest Rate,
through the last day of the month in which such repurchase takes place.
At the time of any such repurchase by Xxxxx Fargo Bank, Xxxxx Fargo
Bank agrees either to promptly (i) liquidate such Mortgage Loan, to the extent
that Xxxxx Fargo Bank's rights in respect of the Prior Holder consist of a claim
for indemnity or (ii) transfer such Mortgage Loan to the Prior Holder at a price
not less than that paid by Xxxxx Fargo Bank to the Company.
6. Underwriting. Xxxxx Fargo Bank hereby agrees to furnish any and
all information, documents, certificates, letters or opinions with respect to
the Mortgage Loans, reasonably requested by the Company in order to perform any
of its obligations or satisfy any of the conditions on its part to be performed
or satisfied pursuant to the Underwriting Agreement or the Purchase Agreement at
or prior to the Closing Date.
7. Costs. The Company shall pay all expenses incidental to the
performance of its obligations under the Underwriting Agreement and the Purchase
Agreement, including without limitation (i) any recording fees or fees for title
policy endorsements and continuations, (ii) the expenses of preparing, printing
and reproducing the Prospectus, the Prospectus Supplement, the Underwriting
Agreement, the Private Placement Memorandum, the Purchase Agreement, the Pooling
and Servicing Agreement and the Certificates and (iii) the cost of delivering
the Certificates to the offices of Citigroup insured to the satisfaction of
Citigroup.
8. Servicing. (a) Xxxxx Fargo Bank hereby represents to the Company
that the Mortgage Loans are serviced by the Servicer.
(b) With respect to each Mortgage Loan shall be as set forth on
Schedule I hereto.
(c) On the Closing Date, Xxxxx Fargo Bank shall assign to the
Company its interest with respect to the Mortgage Loans in, to and under each
Servicing Agreement.
9. Notices. All demands, notices and communications hereunder shall
be in writing, shall be effective only upon receipt and shall, if sent to the
Company, be addressed to it at Xxxxx Fargo Asset Securities Corporation, 0000
Xxx Xxxxxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxx 00000, Attn: Senior Vice President,
Structured Finance, or, if sent to Xxxxx Fargo Bank, be addressed to it at Xxxxx
Fargo Bank, N.A., 0000 Xxx Xxxxxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxx, 00000, Attn:
Senior Vice President, Structured Finance.
10. Trustee Beneficiary. The representations, warranties and
agreements made by Xxxxx Fargo Bank in this Agreement are made for the benefit
of, and may be enforced by, the Trustee and the holders of Certificates to the
same extent that the Trustee and the holders of Certificates, respectively, have
rights against the Company under the Pooling and Servicing Agreement in respect
of representations, warranties and agreements made by the Company therein.
11. Miscellaneous. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York. Neither this Agreement nor
any term hereof may be changed, waived, discharged or terminated except by a
writing signed by the party against whom enforcement of such change, waiver,
discharge or termination is sought. This Agreement may not be changed in any
manner which would have a material adverse effect on holders of Certificates
without the prior written consent of the Trustee. The Trustee shall be protected
in consenting to any such change to the same extent provided in Article VIII of
the Pooling and Servicing Agreement. This Agreement may be signed in any number
of counterparts, each of which shall be deemed an original, which taken together
shall constitute one and the same instrument. This Agreement shall bind and
inure to the benefit of and be enforceable by the Company and Xxxxx Fargo Bank
and their respective successors and assigns.
12. Recharacterization. The parties hereto intend the conveyance by
the Seller to the Company of all of its right, title and interest in and to the
Mortgage Loans pursuant to this Agreement to constitute a purchase and sale and
not a loan. Notwithstanding the foregoing, to the extent that such conveyance is
held not to constitute a sale under applicable law, it is intended that this
Agreement shall constitute a security agreement under applicable law and that
the Seller shall be deemed to have granted to the Company a first priority
security interest in all of the Seller's right, title and interest in and to the
Mortgage Loans.
IN WITNESS WHEREOF, the Company and Xxxxx Fargo Bank have caused
this Agreement to be duly executed by their respective officers as of the day
and year first above written.
XXXXX FARGO ASSET SECURITIES
CORPORATION
By:
------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
XXXXX FARGO BANK, N.A.
By:
------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
EXHIBIT H
FORM OF LOST NOTE AFFIDAVIT
Personally appeared before me the undersigned authority to
administer oaths, ______________________ who first being duly sworn deposes and
says: Deponent is ______________________ of ______________________________,
successor by merger to _________________________________________ ("Seller") and
who has personal knowledge of the facts set out in this affidavit.
On ___________________, _________________________ did execute and
deliver a promissory note in the principal amount of $__________.
That said note has been misplaced or lost through causes unknown and
is presently lost and unavailable after diligent search has been made. Seller's
records show that an amount of principal and interest on said note is still
presently outstanding, due, and unpaid, and Seller is still owner and holder in
due course of said lost note.
Seller executes this Affidavit for the purpose of inducing
[_______________________________], as trustee on behalf of Xxxxx Fargo Asset
Securities Corporation, Home Equity Asset Backed Certificates, Series 2005-1, to
accept the transfer of the above described loan from Seller.
Seller agrees to indemnify and hold harmless [_____________________]
and Xxxxx Fargo Asset Securities Corporation for any losses incurred by such
parties resulting from the above described promissory note has been lost or
misplaced.
By:___________________________________
______________________________________
STATE OF )
) SS:
COUNTY OF )
On this ____ day of _______ 20__, before me, a Notary Public, in and
for said County and State, appeared ________________________, who acknowledged
the extension of the foregoing and who, having been duly sworn, states that any
representations therein contained are true.
Witness my hand and Notarial Seal this ____ day of _______ 20__.
My commission expires .
EXHIBIT I
FORM OF ERISA REPRESENTATION
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Client Manager - WFHET, Series 2005-1
Xxxxx Fargo Asset Securities Corporation
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Xxxxx Fargo Asset Securities Corporation, Home Equity Asset Backed
Certificates, Series 2005-1
Ladies and Gentlemen:
1. [The undersigned is the ______________________ of (the
"Transferee") a [corporation duly organized] and existing under the laws of
__________, on behalf of which he makes this affidavit.] [The undersigned,
___________________, is the transferee (the "Transferee").]
2. The Transferee hereby acknowledges that under the terms of the
Pooling and Servicing Agreement (the "Agreement") among Xxxxx Fargo Asset
Securities Corporation, as depositor (the "Depositor"), Xxxxx Fargo Bank, N.A.,
as servicer, Xxxxx Fargo Bank, National Association, as securities
administrator, and HSBC Bank USA, National Association, as trustee (the
"Trustee"), no transfer of the ERISA-Restricted Certificates shall be permitted
to be made to any person unless the Depositor and the Certificate Registrar (as
defined in the Agreement) have received a certificate from such transferee in
the form hereof.
3. The Transferee either (x) (i) is not an employee benefit plan
subject to Section 406 or Section 407 of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or Section 4975 of the Internal Revenue Code
of 1986, as amended (the "Code") or any materially similar provisions of
applicable federal, state or local law ("Similar Law"), the Trustee of any such
plan or other than (except in the case of the Class CE, Class P or Class R
Certificates) an insurance company that represents (or is deemed to represent)
that (i) the source of funds used to purchase the Certificates is an "insurance
company general account" (as such term is defined in Section V(e) of PTE 95-60,
60 Fed. Reg. 35925 (July 12, 1995)), (ii) that there is no Plan with respect to
which the amount of such general account's reserves and liabilities for the
contract(s) held by or on behalf of such Plan and all other Plans maintained by
the same employer (or affiliate thereof as defined in Section V(a)(1) of PTE
95-60) or by the same employee organization exceeds 10% of the total of all
reserves and liabilities of such general account (as such amounts are determined
under Section I(a) of PTE 95-60) at the date of acquisition and (iii) all Plans
that have an interest in such general account are Plans to which PTE 95-60
applies, or (y) (except in the case of the Class CE, Class P or Class R
Certificates) shall deliver to the Certificate Registrar and the Depositor an
opinion of counsel (a "Benefit Plan Opinion") satisfactory to the Certificate
Registrar, and upon which the Certificate Registrar and the Depositor shall be
entitled to rely, to the effect that the purchase or holding of such Certificate
by the Transferee will not result in the assets of the Trust Fund being deemed
to be plan assets and subject to the prohibited transaction provisions of ERISA
or the Code (or similar provisions of Similar Law) and will not subject the
Trustee, the Securities Administrator or the Depositor to any obligation in
addition to those undertaken by such entities in the Pooling and Servicing
Agreement, which opinion of counsel shall not be an expense of the Trustee, the
Securities Administrator or the Depositor.
Capitalized terms used but not defined herein shall have the
meanings ascribed to such terms in the Agreement.
IN WITNESS WHEREOF, the Transferee has executed this certificate.
_____________________________________
[Transferee]
By:___________________________________
Name:
Title:
EXHIBIT J-1
FORM OF INVESTMENT LETTER [NON-RULE 144A]
[DATE]
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Client Manager - WFHET, Series 2005-1
Xxxxx Fargo Asset Securities Corporation
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
In connection with our acquisition of the Xxxxx Fargo Asset
Securities Corporation, Home Equity Asset Backed Certificates, Series 2005-1
(the "Certificates"), we certify that (a) we understand that the Certificates
are not being registered under the Securities Act of 1933, as amended (the
"Act"), or any state securities laws and are being transferred to us in a
transaction that is exempt from the registration requirements of the Act and any
such laws, (b) we are an "accredited investor," as defined in Regulation D under
the Act, and have such knowledge and experience in financial and business
matters that we are capable of evaluating the merits and risks of investments in
the Certificates, (c) we have had the opportunity to ask questions of and
receive answers from the Depositor concerning the purchase of the Certificates
and all matters relating thereto or any additional information deemed necessary
to our decision to purchase the Certificates, (d) we are acquiring the
Certificates for investment for our own account and not with a view to any
distribution of such Certificates (but without prejudice to our right at all
times to sell or otherwise dispose of the Certificates in accordance with clause
(g) below), (e) we agree that the Certificates must be held indefinitely by us
and we acknowledge that we are able to bear the economic risk of investment in
the Certificates, (f) we have not offered or sold any Certificates to, or
solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, or taken any
other action which would result in a violation of Section 5 of the Act, (g) we
will not sell, transfer or otherwise dispose of any Certificates unless (1) such
sale, transfer or other disposition is made pursuant to an effective
registration statement under the Act or is exempt from such registration
requirements, and if requested, we will at our expense provide an opinion of
counsel satisfactory to the addressees of this Certificate that such sale,
transfer or other disposition may be made pursuant to an exemption from the Act,
(2) the purchaser or transferee of such Certificate has executed and delivered
to you a certificate to substantially the same effect as this certificate, and
(3) the purchaser or transferee has otherwise complied with any conditions for
transfer set forth in the Pooling and Servicing Agreement and (h) we acknowledge
that the Certificates will bear a legend setting forth the applicable
restrictions on transfer.
Very truly yours,
[NAME OF TRANSFEREE]
By:___________________________________
Authorized Officer
EXHIBIT J-2
FORM OF RULE 144A INVESTMENT LETTER
[DATE]
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Client Manager - WFHET, Series 2005-1
Xxxxx Fargo Asset Securities Corporation
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Xxxxx Fargo Asset Securities Corporation,
Home Equity Asset Backed Certificates, Series 2005-1
Ladies and Gentlemen:
In connection with our acquisition of the Xxxxx Fargo Asset
Securities Corporation, Home Equity Asset Backed Certificates, Series 2005-1
(the "Certificates"), we certify that (a) we understand that the Certificates
are not being registered under the Securities Act of 1933, as amended (the
"Act"), or any state securities laws and are being transferred to us in a
transaction that is exempt from the registration requirements of the Act and any
such laws, (b) we have had the opportunity to ask questions of and receive
answers from the Depositor concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to our
decision to purchase the Certificates, (c) we have not, nor has anyone acting on
our behalf offered, transferred, pledged, sold or otherwise disposed of the
Certificates, any interest in the Certificates or any other similar security to,
or solicited any offer to buy or accept a transfer, pledge or other disposition
of the Certificates, any interest in the Certificates or any other similar
security from, or otherwise approached or negotiated with respect to the
Certificates, any interest in the Certificates or any other similar security
with, any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action, that
would constitute a distribution of the Certificates under the Securities Act or
that would render the disposition of the Certificates a violation of Section 5
of the Securities Act or require registration pursuant thereto, nor will act,
nor has authorized or will authorize any person to act, in such manner with
respect to the Certificates, (d) we are a "qualified institutional buyer" as
that term is defined in Rule 144A under the Securities Act and have completed
either of the forms of certification to that effect attached hereto as Annex 1
or Annex 2. We are aware that the sale to us is being made in reliance on Rule
144A. We are acquiring the Certificates for our own account or for resale
pursuant to Rule 144A and further, understand that such Certificates may be
resold, pledged or transferred only (i) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
pursuant to another exemption from registration under the Securities Act.
Very truly yours,
[NAME OF TRANSFEREE]
By:___________________________________
Authorized Officer
ANNEX 1 TO EXHIBIT J-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
i. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
ii. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis $_____(1) in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts
or similar business trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal Revenue Code of 1986,
as amended.
___ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of
Columbia, the business of which is substantially confined to banking
and is supervised by the State or territorial banking commission or
similar official or is a foreign bank or equivalent institution, and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is
attached hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision over
any such institutions or is a foreign savings and loan association
or equivalent institution and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
___ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
------------
(1) Buyer must own and/or invest on a discretionary basis at least $__________
in securities unless Buyer is a dealer, and, in that case, Buyer must own and/or
invest on a discretionary basis at least $__________ in securities.
___ Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State, territory
or the District of Columbia.
___ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the
benefit of its employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
___ Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
___ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958.
___ Business Development Company. Buyer is a business
development company as defined in Section 202(a)(22) of the
Investment Advisors Act of 1940.
iii. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned but
subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
iv. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not included if the Buyer is a
majority-owned, consolidated subsidiary of another enterprise and the Buyer is
not itself a reporting company under the Securities Exchange Act of 1934, as
amended.
v. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
vi. Until the date of purchase of the Rule 144A Securities, the
Buyer will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
____________________________________
Print Name of Buyer
By:___________________________________
Name:
Title:
Date:_________________________________
ANNEX 2 TO EXHIBIT J-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
___ The Buyer owned $ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with
Rule 144A).
___ The Buyer is part of a Family of Investment Companies which
owned in the aggregate $ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with
Rule 144A).
3. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) securities issued or guaranteed by
the U.S. or any instrumentality thereof, (iii) bank deposit notes and
certificates of deposit, (iv) loan participations, (v) repurchase agreements,
(vi) securities owned but subject to a repurchase agreement and (vii) currency,
interest rate and commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned
will notify the parties listed in the Rule 144A Transferee Certificate to which
this certification relates of any changes in the information and conclusions
herein. Until such notice is given, the Buyer's purchase of the Certificates
will constitute a reaffirmation of this certification by the undersigned as of
the date of such purchase.
____________________________________
Print Name of Buyer or Adviser
By:___________________________________
Name:
Title:
IF AN ADVISER:
____________________________________
Print Name of Buyer
Date:_______________________________
EXHIBIT K
FORM OF CLASS R CERTIFICATE TRANSFER AFFIDAVIT
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET BACKED CERTIFICATES, SERIES 2005-1
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as
follows:
1. The undersigned is [an officer of] , the proposed Transferee of
an Ownership Interest in the Class R Certificates (the "Certificate") issued
pursuant to the Pooling and Servicing Agreement, (the "Agreement"), relating to
the above-referenced Certificates, among Xxxxx Fargo Asset Securities
Corporation, as depositor, Xxxxx Fargo Bank, N.A., as servicer, Xxxxx Fargo
Bank, National Association, as securities administrator, and
[_______________________________], as trustee (the "Trustee"). Capitalized terms
used, but not defined herein shall have the meanings ascribed to such terms in
the Agreement. The Transferee has authorized the undersigned to make this
affidavit on behalf of the Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificates either (i) for its own account or (ii) as
nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the same form as this affidavit. The
Transferee has no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a
tax will be imposed on Transfers of the Certificate to Persons that are
Disqualified Organization; (ii) such tax will be imposed on the transferor, or,
if such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is a Disqualified Organization, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is not a Disqualified Organization and, at the time
of Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax
will be imposed on a "pass-through entity" holding the Certificate if at any
time during the taxable year of the pass-through entity a Person that is a
Disqualified Organization is the record holder of an interest in such entity.
The Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record holder is not a Disqualified Organization and the
pass-through entity does not have actual knowledge that such affidavit is false.
(For this purpose, a "pass-through entity" includes a regulated investment
company, a real estate investment trust or common trust fund, a partnership,
trust or estate, and certain cooperatives and, except as may be provided in
Treasury Regulations, persons holding interests in pass-through entities as a
nominee for another Person.)
5. The Transferee has reviewed the provisions of Section 5.02 of the
Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02 of the Agreement and the restrictions
noted on the face of the Certificate. The Transferee understands and agrees that
any breach of any of the representations included herein shall render the
Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth in Exhibit L-1 for any transfer of a Class CE, Class P or Class R
Certificate and Exhibit L-2 for any transfer of a Class M-12, Class M-13 or
Class M-14 Certificate to the Agreement (a "Transferor Certificate") to the
effect that such Transferee has no actual knowledge that the Person to which the
Transfer is to be made is not a Permitted Transferee.
7. The Transferee does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect to
the Certificate.
8. The Transferee's taxpayer identification number is ____________.
9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
10. The Transferee is aware that the Certificate may be a
"noneconomic residual interest" within the meaning of Treasury regulations
promulgated pursuant to the Code and that the transferor of a noneconomic
residual interest will remain liable for any taxes due with respect to the
income on such residual interest, unless no significant purpose of the transfer
was to impede the assessment or collection of tax.
11. That the Transferee will not cause income from the Class R
Certificate to be attributable to a foreign permanent establishment or fixed
base, within the meaning of an applicable income tax treaty, of the Transferee
or any other U.S. Person.
12. That, if the Transferee is purchasing the Class R Certificate in
a transfer intended to meet the safe harbor provisions of Treasury Regulations
Sections 1.860E-1(c), the Transferee has executed and attached Attachment A
hereto.
13. The Transferee is not an employee benefit plan that is subject
to ERISA or a plan that is subject to Section 4975 of the Code or a plan or
arrangement subject to any materially similar provisions of applicable federal,
state or local law, nor are we acting on behalf of such a plan.
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer, duly attested, this day of
, 20 .
[NAME OF TRANSFEREE]
By:___________________________________
Name:
Title:
[Corporate Seal]
ATTEST:
[Assistant] Secretary
Personally appeared before me the above-named _________, known or
proved to me to be the same person who executed the foregoing instrument and to
be the of the Transferee, and acknowledged that he executed the same as his free
act and deed and the free act and deed of the Transferee.
Subscribed and sworn before me this __ day of ____________, 20__.
___________________________________
NOTARY PUBLIC
My Commission expires the __ day
of __________, 20__.
ATTACHMENT A
to
AFFIDAVIT PURSUANT TO SECTION 860E(e)(4) OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
Check the appropriate box:
|_| The consideration paid to the Transferee to acquire the Class R Certificate
equals or exceeds the excess of (a) the present value of the anticipated tax
liabilities over (b) the present value of the anticipated savings associated
with holding such Certificate, in each case calculated in accordance with U.S.
Treasury Regulations Sections 1.860E-1(c)(7) and (8), computing present values
using a discount rate equal to the short-term Federal rate prescribed by Section
1274(d) of the Code and the compounding period used by the Transferee.
OR
|_| The transfer of the Class R Certificate complies with U.S. Treasury
Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly:
(i) the Transferee is an "eligible corporation," as defined in U.S.
Treasury Regulations Section 1.860E-1(c)(6)(i), as to which income from
Class R Certificate will only be taxed in the United States;
(ii) at the time of the transfer, and at the close of the
Transferee's two fiscal years preceding the year of the transfer, the
Transferee had gross assets for financial reporting purposes (excluding
any obligation of a person related to the Transferee within the meaning of
U.S. Treasury Regulations Section 1.860E-1(c)(6)(ii)) in excess of $100
million and net assets in excess of $10 million;
(iii) the Transferee will transfer the Class R Certificate only to
another "eligible corporation," as defined in U.S. Treasury Regulations
Section 1.860E-1(c)(6)(i), in a transaction that satisfies the
requirements of Sections 1.860E-1(c)(4)(i), (ii) and (iii) and Section
1.860E-1(c)(5) of the U.S. Treasury Regulations;
(iv) the Transferee has determined the consideration paid to it to
acquire the Class R Certificate based on reasonable market assumptions
(including, but not limited to, borrowing and investment rates, prepayment
and loss assumptions, expense and reinvestment assumptions, tax rates and
other factors specific to the Transferee) that it has determined in good
faith; and
(v) in the event of any transfer of the Class R Certificate by the
Transferee, the Transferee will require its transferee to complete a
representation in the form of this Attachment A as a condition of the
transferee's purchase of the Class R Certificate.
EXHIBIT L-1
FORM OF TRANSFEROR CERTIFICATE
[DATE]
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Client Manager - WFHET, Series 2005-1
Xxxxx Fargo Asset Securities Corporation
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Xxxxx Fargo Asset Securities Corporation,
Home Equity Asset Backed Certificates, Series 2005-1
Ladies and Gentlemen:
In connection with our disposition of the Xxxxx Fargo Asset
Securities Corporation, Home Equity Asset Backed Certificates, Series 2005-1
(the "Certificates"), we certify that (a) we understand that the Certificates
have not been registered under the Securities Act of 1933, as amended (the
"Act"), and are being disposed by us in a transaction that is exempt from the
registration requirements of the Act, (b) we have not offered or sold any
Certificates to, or solicited offers to buy any Certificates from, any person,
or otherwise approached or negotiated with any person with respect thereto, in a
manner that would be deemed, or taken any other action which would result in, a
violation of Section 5 of the Act, (c) to the extent we are disposing of the
Class R Certificate, we have no knowledge the Transferee is not a Permitted
Transferee and (d) no purpose of the proposed disposition of the Class R
Certificate is to impede the assessment or collection of tax.
Very truly yours,
[________________________]
By: ______________________________
EXHIBIT L-2
FORM OF TRANSFEROR CERTIFICATE
[DATE]
Xxxxx Fargo Bank, N.A.
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Client Manager - WFHET, Series 2005-1
Xxxxx Fargo Asset Securities Corporation
0000 Xxx Xxxxxxx Xxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Xxxxx Fargo Asset Securities Corporation,
Home Equity Asset Backed Certificates, Series 2005-1
Ladies and Gentlemen:
In connection with our disposition of the Xxxxx Fargo Asset
Securities Corporation, Home Equity Asset Backed Certificates, Series 2005-1
(the "Certificates"), we certify that (a) we understand that the Certificates
have not been registered under the Securities Act of 1933, as amended (the
"Act"), and are being disposed by us to a "qualified institutional buyer" as
defined under the Act, (b) we have not offered or sold any Certificates to, or
solicited offers to buy any Certificates from, any person, or otherwise
approached or negotiated with any person with respect thereto, in a manner that
would be deemed, or taken any other action which would result in, a violation of
Section 5 of the Act, (c) to the extent we are disposing of the Class R
Certificate, we have no knowledge the Transferee is not a Permitted Transferee
and (d) no purpose of the proposed disposition of the Class R Certificate is to
impede the assessment or collection of tax.
Very truly yours,
[_____________________]
By: ______________________________
EXHIBIT M
MONTHLY INFORMATION DELIVERED BY SERVICER
1. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the number and Principal Balances of all Mortgage
Loans which were the subject of Principal Prepayments during the related
Prepayment Period.
2. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the amount of all curtailments which were
received during the related Prepayment Period.
3. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the aggregate amount of the principal portion of
all Monthly Payments received during the related Collection Period.
4. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the amount of interest received on the Mortgage
Loans during the related Collection Period.
5. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the aggregate amount of the Advances made and
recovered with respect to such Distribution Date.
6. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the aggregate amount of the Servicing Advances
made and recovered with respect to such Distribution Date.
7. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the delinquency and foreclosure information and
the amount of Mortgage Loan Losses during the related Collection Period.
8. The information contained in the Liquidation Report for the related
Collection Period.
9. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the weighted average maturity, the weighted
average Mortgage Interest Rate and the weighted average Net Mortgage
Interest Rate as of the last day of the Collection Period preceding of the
related Interest Accrual Period.
10. The Servicing Fees paid and Servicing Fees accrued during the related
Collection Period.
11. [reserved]
12. [reserved]
13. The amount of all payments or reimbursements to the Servicer paid or to be
paid since the prior Distribution Date (or in the case of the first
Distribution Date, since the Closing Date).
14. The Pool Balance, the aggregate Principal Balance of the Group I Mortgage
Loans and the aggregate Principal Balance of the Group II Mortgage Loans.
15. With respect to the Mortgage Pool, the Group I Mortgage Loans and the
Group II Mortgage Loans, the number of Mortgage Loans outstanding at the
beginning and at the end of the related Collection Period.
16. The aggregate interest accrued on the Mortgage Loans, the Group I Mortgage
Loans and the Group II Mortgage Loans, at their respective Mortgage
Interest Rates for the related Collection Period.
17. The amount deposited in the Collection Account which may not be withdrawn
therefrom pursuant to an Order of a United States Bankruptcy Court of
competent jurisdiction imposing a stay pursuant to Section 362 of U.S.
Bankruptcy Code.
18. The aggregate Realized Losses in the Mortgage Pool, in the Group I
Mortgage Loans and in the Group II Mortgage Loans since the Cut-off Date
as of the end of the related Collection Period.
19. The amount of Prepayment Charges received and the reason for any
Prepayment Charges waived during the related Collection Period.
20. The amount of Yield Maintenance Agreement Payments received with respect
to such Distribution Date.
EXHIBIT N-1
Form of Class AI Yield Maintenance Agreement
[BEAR XXXXXXX LOGO] BEAR XXXXXXX FINANCIAL PRODUCTS INC.
000 XXXXXXX XXXXXX
XXX XXXX, XXX XXXX 00000
000-000-0000
DATE: June 29, 2005
TO: Xxxxx Fargo Bank, N.A, not individually but solely as
Securities Administrator on behalf of Xxxxx Fargo Home
Equity Asset-Backed Securities 2005-1 Trust
ATTENTION: Xxxxx Xxxxxxxxx
TELEPHONE: 000-000-0000
FACSIMILE: 000-000-0000
FROM: Derivatives
Documentation
TELEPHONE: 000-000-0000
FACSIMILE: 000-000-0000
SUBJECT: Fixed Income Derivatives Confirmation and Agreement
REFERENCE NUMBER:
The purpose of this letter agreement ("Agreement") is to confirm the terms and
conditions of the Transaction entered into on the Trade Date specified below
(the "Transaction") between Bear Xxxxxxx Financial Products Inc. ("BSFP") Xxxxx
Fargo Bank, N.A., not individually but solely as Securities Administrator (the
"Securities Administrator") on behalf of the Xxxxx Fargo Home Equity
Asset-Backed Securities 2005-1 Trust formed pursuant to the Pooling and
Servicing Agreement dated as of June 29, 2005 between Xxxxx Fargo Asset
Securities Corporation, as depositor, HSBC Bank USA, National Association, as
trustee, Xxxxx Fargo Bank, N.A., as servicer and the Securities Administrator
(the "Pooling and Servicing Agreement") (the This Agreement, which evidences a
"Counterparty"). complete and binding agreement between you and us to enter into
the Transaction on the terms set forth below, constitutes a "Confirmation" as
referred to in the "ISDA Form Master Agreement" (as defined below), as well as a
"Schedule" as referred to in the ISDA Form Master Agreement.
1. This Agreement is subject to the 2000 ISDA (the "Definitions"), as published
by Definitions the International Swaps and Derivatives Association, You and we
have agreed to enter into Inc. ("ISDA"). this Agreement in lieu of negotiating a
Schedule to the 1992 ISDA Master Agreement (Multicurrency-- Cross Border) form
(the "ISDA Form Master Agreement") but, rather, an ISDA Form Master Agreement
shall be deemed to have been executed by you and us on the date we entered into
the Transaction. All provisions contained in, or incorporated by reference to,
the ISDA Form Master Agreement shall govern the Transaction referenced in this
Confirmation, except as expressly modified below. In the event of any
inconsistency between the provisions of this Agreement and the Definitions or
the ISDA Form Master Agreement, this Agreement shall prevail for purposes of the
Transaction. Terms capitalized but not defined herein shall have the meanings
attributed to them in the Pooling and Servicing Agreement.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 2 of 14
2. The terms of the particular Transaction to which this Confirmation relates
are as follows:
Type of Transaction: Rate Cap
Notional Amount: With respect to any Calculation Period, the
amount set forth for such period in Schedule I
attached hereto.
Trade Date: June 24, 2005
Effective Date: June 29, 2005
Termination Date: April 25, 2008, subject to adjustment in
accordance with the Business Day Convention.
Fixed Amount (Premium):
Fixed Rate Payer: Counterparty
Fixed Rate Payer
Payment Date: June 29, 2005
Fixed Amount: [____________]
Floating Amounts:
Floating Rate Payer: BSFP
Cap Rate: With respect to any Calculation Period, the rate
set forth for such period in Schedule I attached
hereto.
Floating Rate Payer
Period End Dates: The 25th calendar day of each month during the
Term of this Transaction, commencing July 25,
2005 and ending on the Termination Date, subject
to adjustment in accordance with the Business
Day Convention.
Floating Rate Payer
Payment Dates: Early Payment is applicable. The Floating Rate
Payer Payment Dates shall be two Business Days
prior to each Floating Rate Payer Period End
Date.
Floating Rate Option: USD-LIBOR-BBA, provided, however, that if the
Floating Rate determined from such Floating Rate
Option for any Calculation
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 3 of 14
Period is greater than 9.77000% then the
Floating Rate for such Calculation Period shall
be deemed to be equal to 9.77000%.
Designated Maturity: One month
Floating Rate Day
Count Fraction: Actual/360
Reset Dates: The first day of each Calculation Period.
Compounding: Inapplicable
Business Days: New York
Business Day Convention: Following
3. Additional Provisions: Each party hereto is hereby advised and
acknowledges that the other party has engaged in
(or refrained from engaging in) substantial
financial transactions and has taken (or
refrained from taking) other material actions in
reliance upon the entry by the parties into the
Transaction being entered into on the terms and
conditions set forth herein and in the
Confirmation relating to such Transaction, as
applicable. This paragraph shall be deemed
repeated on the trade date of each Transaction.
4. Provisions Deemed Incorporated in a Schedule to the Master Agreement:
1) The parties agree that subparagraph (ii) of Section 2(c) of the ISDA Form
Master Agreement will apply to any Transaction.
2) Termination Provisions. For purposes of the Master Agreement:
(a) "Specified Entity" is not applicable to BSFP or Counterparty for any
purpose.
(b) "Specified Transaction" is not applicable to BSFP or Counterparty for any
purpose, and, accordingly, Section 5(a)(v) shall not apply to BSFP or
Counterparty.
(c) The "Cross Default" provisions of Section 5(a)(vi) will not apply to BSFP or
to Counterparty.
(d) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not apply
to BSFP or Counterparty.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 4 of 14
(e) The "Automatic Early Termination" provision of Section 6(a) will not apply
to BSFP or to Counterparty.
(f) Payments on Early Termination. For the purpose of Section 6(e) of this
Agreement:
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(g) "Termination Currency" means United States Dollars.
3) Tax Representations. Payer Representations. For the purpose of Section
3(e) of the ISDA Form Master Agreement, BSFP and the Counterparty make the
following representations:
It is not required by any applicable law, as modified by the practice of
any relevant governmental revenue authority, of any Relevant Jurisdiction
to make any deduction or withholding for or on account of any Tax from any
payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of the
ISDA Form Master Agreement) to be made by it to In the other party under
this Agreement. making this representation, it may rely on:
(i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement;
(ii) the satisfaction of the agreement contained in Section 4 (a)(i)
or 4(a)(iii) of the ISDA Form Master Agreement and the accuracy and
effectiveness of any document provided by the other party pursuant
to Section 4 (a)(i) or 4(a)(iii) of the ISDA Form Master Agreement;
and
(iii) the satisfaction of the agreement of the other party contained
in Section 4(d) of the ISDA Form Master Agreement Agreement,
provided that it shall not be a breach of this representation where
reliance is placed on clause (ii) and the other party does not
deliver a form or document under Section 4(a)(iii) by reason of
material prejudice of its legal or commercial position.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 5 of 14
4) Limitation on Events of Default. Notwithstanding the terms of Sections 5
and 6 of the ISDA Form Master Agreement, if at any time and so long as the
Counterparty has satisfied in full all its payment obligations under
Section 2(a)(i) of the ISDA Form Master Agreement and has at the time no
future payment obligations, whether absolute or contingent, under such
Section, then unless BSFP is required pursuant to appropriate proceedings
to return to the Counterparty or otherwise returns to the Counterparty
upon demand of the Counterparty any portion of any such payment, (a) the
occurrence of an event described in Section 5(a) of the ISDA Form Master
Agreement with respect to the Counterparty shall not constitute an Event
of Default or Potential Event of Default with respect to the Counterparty
as Defaulting Party and (b) BSFP shall be entitled to designate an Early
Termination Date pursuant to Section 6 of the ISDA Form Master Agreement
only as a result of the occurrence of a Termination Event set forth in
either Section 5(b)(i) or 5(b)(ii) of the ISDA Form Master Agreement with
respect to BSFP as the Affected Party, or Section 5(b)(iii) with respect
to BSFP as the Burdened Party. For purposes of the Transaction to which
this Agreement relates, Counterparty's only obligation under Section
2(a)(i) of the ISDA Form Master Agreement is to pay the Fixed Amount on
the Fixed Rate Payer Payment Date.
5) Documents to be Delivered. For the purpose of Section 4(a):
(1) Documents to be delivered are:
Party required
to deliver Form/Document/ Date by which to Covered by Section 3(d)
document Certificate be delivered Representation
---------------- --------------------------- ---------------------- -----------------------
BSFP and Any documents required Upon the execution and Yes
the Counterparty by the receiving party to delivery of this
evidence the authority of Agreement
the delivering party or its
Credit Support
Provider, if any, for it to
execute and deliver this
Agreement, any Confirmation,
and any Credit Support
Documents to which it is
a party, and to evidence
the authority of the
delivering party or its
Credit Support Provider
to perform its obligations
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 6 of 14
Party required
to deliver Form/Document/ Date by which to Covered by Section 3(d)
document Certificate be delivered Representation
---------------- --------------------------- ---------------------- -----------------------
under this Agreement,
such Confirmation
and/or Credit Support
Document, as the case
may be
BSFP and the A certificate of an Upon the execution and Yes
Counterparty authorized officer of the delivery of this
party, as to the Agreement
incumbency and authority
of the respective officers
of the party signing this
Agreement, any relevant
Credit Support
Document, or any
Confirmation, as the case
may be
6) Miscellaneous. Miscellaneous.
(a) Address for Notices: For the purposes of Section 12(a) of the ISDA Form
Master Agreement:
Address for notices or communications to BSFP:
Address: 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: DPC Manager
Facsimile: (000) 000-0000
with a copy to:
Address: Xxx Xxxxxxxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000
Attention: Derivative Operations - 7th Floor
Facsimile: (000) 000-0000
(For all purposes)
Address for notices or communications to the Counterparty:
Address: 0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 7 of 14
Facsimile: 000-000-0000
Phone: 000-000-0000
with a copy to:
Attention: Xxxxxxx Xxxxx
Facsimile: 000-000-0000
Phone: 000-000-0000
(For all purposes)
(b) Process Agent. For the purpose of Section 13(c):
BSFP appoints as its Process Agent: Not Applicable
The Counterparty appoints as its Process Agent: Not Applicable
(c) Offices. The provisions of Section 10(a) will not apply to this Agreement;
neither BSFP nor the Counterparty have any Offices other than as set forth
in the Notices Section and BSFP agrees that, for purposes of Section 6(b)
of the ISDA Form Master Agreement, it shall not in future have any Office
other than one in the United States.
(d) Multibranch Party. For the purpose of Section 10(c) of the ISDA Form
Master Agreement:
BSFP is not a Multibranch Party.
The Counterparty is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is BSFP; provided, however, that
if an Event of Default occurs with respect to BSFP, then the Counterparty
shall be entitled to appoint a financial institution which would qualify
as a Reference Market-maker to act as Calculation Agent.
(f) Credit Support Document. Not applicable for either BSFP or the
Counterparty.
(g) Credit Support Provider.
BSFP: Not Applicable
The Counterparty: Not Applicable
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 8 of 14
(h) Governing Law. The parties to this Agreement hereby agree that the law of
the State of New York shall govern their rights and duties in whole,
without regard to conflict of law provisions thereof other than New York
General Obligations Law Sections 5-1401 and 5-1402.
(i) Severability. If any term, provision, covenant, or condition of this
Agreement, or the application thereof to any party or circumstance, shall
be held to be invalid or unenforceable (in whole or in part) for any
reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Agreement had been
executed with the invalid or unenforceable portion eliminated, so long as
this Agreement as so modified continues to express, without material
change, the original intentions of the parties as to the subject matter of
this Agreement and the deletion of such portion of this Agreement will not
substantially impair the respective benefits or expectations of the
parties.
The parties shall endeavor to engage in good faith negotiations to replace
any invalid or unenforceable term, provision, covenant or condition with a
valid or enforceable term, provision, covenant or condition, the economic
effect of which comes as close as possible to that of the invalid or
unenforceable term, provision, covenant or condition.
(j) Consent to Recording. Each party hereto consents to the monitoring or
recording, at any time and from time to time, by the other party of any
and all communications between officers or employees of the parties,
waives any further notice of such monitoring or recording, and agrees to
notify its officers and employees of such monitoring or recording.
(k) Waiver of Jury Trial. Each party waives any right it may have to a trial
by jury in respect of any Proceedings relating to this Agreement or any
Credit Support Document.
(l) Non-Recourse. Notwithstanding any provision herein or in the ISDA Form
Master Agreement to the contrary, the obligations of Counterparty
hereunder are limited recourse obligations of Counterparty, payable solely
from the Trust Fund (as defined in the Pooling and Servicing Agreement)
and the proceeds thereof to satisfy Counterparty's obligations hereunder.
In the event that the Trust Fund and proceeds thereof should be
insufficient to satisfy all claims outstanding and following the
realization of the Trust Fund and the distribution of the proceeds thereof
in accordance with the Pooling and Servicing Agreement, any claims against
or obligations of Counterparty under the ISDA Form Master Agreement or any
other confirmation thereunder, still outstanding shall be extinguished and
thereafter not revive.
(m) Transfer, Amendment and Assignment. No transfer, amendment, waiver,
supplement, assignment or other modification of this Transaction (other
than the pledge of this Transaction to the trustee pursuant to the Pooling
and Servicing Agreement) shall be permitted by either party unless each of
Fitch Ratings ("Fitch"), Standard & Poor's, a division of The XxXxxx-Xxxx
Companies, Inc. ("S&P") and Xxxxx'x Investor Service, Inc. ("Moody's"),
has been provided notice of the same and confirms in writing (including by
facsimile transmission) within five Business Days after such
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 9 of 14
notice is given that it will not downgrade, qualify, withdraw or otherwise
modify its then-current rating of the Certificates (as defined in the
Pooling and Servicing Agreement).
(n) Proceedings. BSFP shall not institute against or cause any other person to
institute against, or join any other person in instituting against the
Counterparty, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any of the laws of the
United States, or any other jurisdiction for a period of one year and one
day (or, if longer, the applicable preference period) following
indefeasible payment in full of the Certificates.
(o) The ISDA Form Master Agreement is hereby amended as follows:
The word "third" shall be replaced by the word "second" in the third line
of Section 5(a)(i) of the ISDA Form Master Agreement.
(p) Securities Administrator Capacity. It is expressly understood and agreed
by the parties hereto that insofar as this Confirmation is executed by the
Securities Administrator (i) this Confirmation is executed and delivered
by Xxxxx Fargo Bank, N.A., not in its individual capacity but solely as
Securities Administrator pursuant to the Pooling and Servicing Agreement
in the exercise of the powers and authority conferred and vested in it
thereunder (ii) each of the representations, undertakings and agreements
herein made on behalf of the Xxxxx Fargo Home Equity Asset- Backed
Securities 2005-1 Trust (the "Trust") is made and intended not as personal
representations of the Securities Administrator but is made and intended
for the purpose of binding only the Trust, and (iii) under no
circumstances xxxx Xxxxx Fargo Bank, N.A. in its individual capacity be
personally liable for the payment of any indebtedness or expenses or be
personally liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken under this
Confirmation.
(q) Securities Administrator Representation. Xxxxx Fargo Bank, N.A., as
Securities Administrator represents and warrants that:
It has been directed under the Pooling and Servicing Agreement to enter
into this Agreement as Securities Administrator on behalf of the Trust.
(r) Set-off. Notwithstanding any provision of this Agreement or any other
existing or future agreement, each party irrevocably waives any and all
rights it may have to set off, net, recoup or otherwise withhold or
suspend or condition payment or performance of any obligation between it
and the other party hereunder against any obligation between it and the
other party under any other agreements. The last sentence of the first
paragraph of Section 6(e) of the ISDA Form Master Agreement shall not
apply for purposes of this Transaction.
(s) Additional Termination Events. Additional Termination Events will apply.
If a Ratings Event has occurred and BSFP has not, within 30 days, complied
with Section 6(t) below, then an Additional
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 10 of 14
Termination Event shall have occurred with respect to BSFP and BSFP shall
be the sole Affected Party with respect to such an Additional Termination
Event.
(t) Ratings Event. If a Ratings Event (as defined below) occurs with respect
to BSFP (or any applicable credit support provider), then BSFP shall, at
its own expense, (i) assign this Transaction within thirty (30) days of
such Ratings Event to a third party that meets or exceeds, or as to which
any applicable credit support provider meets or exceeds, the Approved
Ratings Thresholds (as defined below) on terms substantially similar to
this Confirmation, which party is approved by the Counterparty, which
approval shall not be unreasonably withheld, (ii) obtain a guaranty of, or
a contingent agreement of, another person with the Approved Rating
Thresholds to honor BSFP's obligations under this Agreement, provided that
such other person is approved by the Counterparty, such approval not to be
unreasonably withheld, (iii) post collateral under agreements and other
instruments satisfactory to Fitch Rating ("Fitch"), Standard and Poor's, a
division of The XxXxxx-Xxxx Companies, Inc. ("S&P") and Xxxxx'x Investor
Service, Inc. ("Moody's"), which will be sufficient to restore the
immediately prior ratings of the Certificates, or (iv) establish any other
arrangement satisfactory to Fitch, S&P and Moody's which will be
sufficient to restore the immediately prior ratings of the Certificates.
For avoidance of doubt, a downgrade of the rating on the Certificates
could occur in the event that BSFP does not post sufficient collateral.
For purposes of this Transaction, a "Ratings Event" shall occur with
respect to BSFP (or any applicable credit support provider) if its
long-term unsecured and unsubordinated debt rating is withdrawn or reduced
below "AA-" by S&P or "Aa3" by Moody's (including in connection with a
merger, consolidation or other similar transaction by BSFP or any
applicable credit support provider) such ratings being referred to herein
as the "Approved Ratings Thresholds," (unless, within 30 days thereafter,
each of S&P and Moody's has reconfirmed the ratings of the Certificates,
as applicable, which was in effect immediately prior thereto).
7) "Affiliate" will have the meaning specified in Section 14 of the ISDA Form
Master Agreement, provided that Counterparty shall not be deemed to have
any Affiliates for purposes of this Agreement, including for purposes of
Section 6(b)(ii).
8) Section 3 of the ISDA Form Master Agreement is hereby amended by adding at
the end thereof the following subsection (g):
"(g) Relationship Between Parties.
Each party represents to the other party on each date when it
enters into a Transaction that:--
(1) Nonreliance. It is not relying on any statement or
representation of the other party regarding the Transaction (whether written or
oral), other than the representations expressly made in this Agreement or the
Confirmation in respect of that Transaction.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 11 of 14
(2) Evaluation and Understanding.
(i) BSFP is acting for its own account and Counterparty is acting
solely as Securities Administrator and each party has the capacity to evaluate
(internally or through independent professional advice) the Transaction and has
made its own decision to enter into the Transaction; it is not relying on any
communication (written or oral) of the other party as investment advice or as a
recommendation to enter into such transaction; it being understood that
information and explanations related to the terms and conditions of such
transaction shall not be considered investment advice or a recommendation to
enter into such transaction. No communication (written or oral) received from
the other party shall be deemed to be an assurance or guarantee as to the
expected results of the transaction; and
(ii) It understands the terms, conditions and risks of the
Transaction and is willing and able to accept those terms and conditions and to
assume (and does in fact assume) those risks, financially and otherwise.
(3) Purpose. It is entering into the Transaction for the purposes of
managing its borrowings or investments, hedging its underlying assets or
liabilities or in connection with a line of business.
(4) Principal. The other party is not acting as a fiduciary or an
advisor for it in respect of this Transaction.
(5) Eligible Contract Participant. (A) It is an "eligible contract
participant" within the meaning of Section 1a(12) of the Commodity Exchange Act,
as amended; (B) this Agreement and each Transaction is subject to individual
negotiation by such party; and (C) neither this Agreement nor any Transaction
will be executed or traded on a "trading facility" within the meaning of Section
1a(33) of the Commodity Exchange Act, as amended.
NEITHER THE BEAR XXXXXXX COMPANIES INC. NOR ANY SUBSIDIARY OR AFFILIATE OF
THE BEAR XXXXXXX COMPANIES INC. OTHER THAN BSFP IS AN OBLIGOR OR A CREDIT
SUPPORT PROVIDER ON THIS AGREEMENT.
5. Account Details and
Settlement Information: Payments to BSFP:
[Intentionally Omitted]
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 12 of 14
Payments to Counterparty:
[Intentionally Omitted]
This Agreement may be executed in several counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument.
Counterparty hereby agrees to check this Confirmation and to confirm that the
foregoing correctly sets forth the terms of the Transaction by signing in the
space provided below and returning to BSFP a facsimile of the fully-executed
Confirmation to 000-000-0000. For inquiries regarding U.S. Transactions, please
contact Xxxxx Xxxxxx by telephone at 000-000-0000. For all other inquiries
please contact Derivatives Documentation by telephone at 000-0-000-0000 .
Originals will be provided for your execution upon your request.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 13 of 14
We are very pleased to have executed this Transaction with you and we look
forward to completing other transactions with you in the near future.
Very truly yours,
BEAR XXXXXXX FINANCIAL PRODUCTS INC.
By:
-----------------------------
Name:
Title:
Counterparty, acting through its duly authorized signatory, hereby agrees to,
accepts and confirms the terms of the foregoing as of the Trade Date.
XXXXX FARGO BANK, N.A., NOT INDIVIDUALLY BUT SOLELY
AS SECURITIES ADMINISTRATOR ON BEHALF OF XXXXX
FARGO HOME EQUITY ASSET-BACKED SECURITIES 2005-1
TRUST
By:
-----------------------------
Name:
Title:
lm/am
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 14 of 14
SCHEDULE I
(all such dates subject to adjustment in accordance with the Business Day
Convention)
From and Including To but excluding Notional Amount(USD) Cap Rate(%)
------------------ ---------------- -------------------- -----------
Effective Date 7/25/2005 701,050,000.00 7.260
7/25/2005 8/25/2005 694,012,802.72 6.052
8/25/2005 9/25/2005 685,542,954.25 6.052
9/25/2005 10/25/2005 675,653,503.22 6.263
10/25/2005 11/25/2005 664,364,425.25 6.054
11/25/2005 12/25/2005 651,703,144.18 6.265
12/25/2005 1/25/2006 637,704,562.01 6.056
1/25/2006 2/25/2006 622,411,028.52 6.058
2/25/2006 3/25/2006 605,872,248.34 6.733
3/25/2006 4/25/2006 588,145,123.26 6.061
4/25/2006 5/25/2006 569,293,528.76 6.287
5/25/2006 6/25/2006 550,839,957.62 6.079
6/25/2006 7/25/2006 532,865,917.85 6.292
7/25/2006 8/25/2006 515,358,992.86 6.084
8/25/2006 9/25/2006 498,307,086.90 6.086
9/25/2006 10/25/2006 481,698,416.80 6.299
10/25/2006 11/25/2006 465,521,503.89 6.092
11/25/2006 12/25/2006 449,765,166.15 6.305
12/25/2006 1/25/2007 434,418,510.54 6.097
1/25/2007 2/25/2007 419,470,925.56 6.100
2/25/2007 3/25/2007 404,912,073.94 6.782
3/25/2007 4/25/2007 390,731,885.62 6.107
4/25/2007 5/25/2007 356,346,784.97 8.750
5/25/2007 6/25/2007 324,103,402.24 8.498
6/25/2007 7/25/2007 294,149,856.67 8.782
7/25/2007 8/25/2007 266,316,335.10 8.486
8/25/2007 9/25/2007 254,492,933.07 8.492
9/25/2007 10/25/2007 243,340,821.57 8.790
10/25/2007 11/25/2007 232,507,363.20 9.266
11/25/2007 12/25/2007 222,011,300.26 9.605
12/25/2007 1/25/2008 211,814,838.17 9.296
1/25/2008 2/25/2008 201,908,921.88 9.305
2/25/2008 3/25/2008 0.00 0.000
3/25/2008 Termination Date 182,935,724.01 9.327
EXHIBIT N-2
Form of Class AII Yield Maintenance Agreement
[BEAR XXXXXXX LOGO] BEAR XXXXXXX FINANCIAL PRODUCTS INC.
000 XXXXXXX XXXXXX
XXX XXXX, XXX XXXX 00000
000-000-0000
DATE: June 29, 2005
TO: Xxxxx Fargo Bank, N.A., not individually but solely as
Securities Administrator on behalf of Xxxxx Fargo Home
Equity Asset-Backed Securities 2005-1 Trust
ATTENTION: Xxxxx Xxxxxxxxx
TELEPHONE: 000-000-0000
FACSIMILE: 000-000-0000
FROM: Derivatives Documentation
TELEPHONE: 000-000-0000
FACSIMILE: 000-000-0000
SUBJECT: Fixed Income Derivatives Confirmation and Agreement
REFERENCE NUMBER:
The purpose of this letter agreement ("Agreement") is to confirm the terms and
conditions of the Transaction entered into on the Trade Date specified below
(the "Transaction") between Bear Xxxxxxx Financial Products Inc. ("BSFP") and
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
(the "Securities Administrator") on behalf of the Xxxxx Fargo Home Equity
Asset-Backed Securities 2005-1 Trust formed pursuant to the Pooling and
Servicing Agreement dated as of June 29, 2005 between Xxxxx Fargo Asset
Securities Corporation, as depositor, HSBC Bank USA, National Association, as
trustee, Xxxxx Fargo Bank, N.A., as servicer and the Securities Administrator
(the "Pooling and Servicing Agreement") (the "Counterparty").. This Agreement,
which evidences a complete and binding agreement between you and us to enter
into the Transaction on the terms set forth below, constitutes a "Confirmation"
as referred to in the "ISDA Form Master Agreement" (as defined below), as well
as a "Schedule" as referred to in the ISDA Form Master Agreement.
1. This Agreement is subject to the 2000 ISDA Definitions (the "Definitions"),
as published by the International Swaps and Derivatives Association, Inc. You
and we have agreed to enter into ("ISDA"). this Agreement in lieu of negotiating
a Schedule to the 1992 ISDA Master Agreement (Multicurrency-- Cross Border) form
(the "ISDA Form Master Agreement") but, rather, an ISDA Form Master Agreement
shall be deemed to have been executed by you and us on the date we entered into
the Transaction. All provisions contained in, or incorporated by reference to,
the ISDA Form Master Agreement shall govern the Transaction referenced in this
Confirmation, except as expressly modified below. In the event of any
inconsistency between the provisions of this Agreement and the Definitions or
the ISDA Form Master Agreement, this Agreement shall prevail for purposes of the
Transaction. Terms capitalized but not defined herein shall have the meanings
attributed to them in the Pooling and Servicing Agreement.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 2 of 14
2. The terms of the particular Transaction to which this Confirmation relates
are as follows:
Type of Transaction: Rate Cap
Notional Amount: With respect to any Calculation Period, the
amount set forth for such period in Schedule I
attached hereto.
Trade Date: June 24, 2005
Effective Date: June 29, 2005
Termination Date: April 25, 2008, subject to adjustment in
accordance with the Business Day Convention.
Fixed Amount (Premium):
Fixed Rate Payer: Counterparty
Fixed Rate Payer
Payment Date: June 29, 2005
Fixed Amount: [_____________]
Floating Amounts:
Floating Rate Payer: BSFP
Cap Rate: With respect to any Calculation Period, the rate
set forth for such period in Schedule I attached
hereto.
Floating Rate Payer
Period End Dates: The 25th calendar day of each month during the
Term of this Transaction, commencing July 25,
2005 and ending on the Termination Date, subject
to adjustment in accordance with the Business
Day Convention.
Floating Rate Payer
Payment Dates: Early Payment is applicable. The Floating Rate
Payer Payment Dates shall be two Business Days
prior to each Floating Rate Payer Period End
Date.
Floating Rate Option: USD-LIBOR-BBA, provided, however, that if the
Floating Rate determined from such Floating Rate
Option for any Calculation
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 3 of 14
Period is greater than 9.77000% then the
Floating Rate for such Calculation Period shall
be deemed to be equal to 9.77000%.
Designated Maturity: One month
Floating Rate Day
Count Fraction: Actual/360
Reset Dates: The first day of each Calculation Period.
Compounding: Inapplicable
Business Days: New York
Business Day Convention: Following
3. Additional Provisions: Each party hereto is hereby advised and
acknowledges that the other party has engaged in
(or refrained from engaging in) substantial
financial transactions and has taken (or
refrained from taking) other material actions in
reliance upon the entry by the parties into the
Transaction being entered into on the terms and
conditions set forth herein and in the
Confirmation relating to such Transaction, as
applicable. This paragraph shall be deemed
repeated on the trade date of each Transaction.
4. Provisions Deemed Incorporated in a Schedule to the Master Agreement:
1) The parties agree that subparagraph (ii) of Section 2(c) of the ISDA Form
Master Agreement will apply to any Transaction.
2) Termination Provisions. For purposes of the Master Agreement:
(a) "Specified Entity" is not applicable to BSFP or Counterparty for any
purpose.
(b) "Specified Transaction" is not applicable to BSFP or Counterparty for any
purpose, and, accordingly, Section 5(a)(v) shall not apply to BSFP or
Counterparty.
(c) The "Cross Default" provisions of Section 5(a)(vi) will not apply to BSFP
or to Counterparty.
(d) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not
apply to BSFP or Counterparty.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 4 of 14
(e) The "Automatic Early Termination" provision of Section 6(a) will not apply
to BSFP or to Counterparty.
(f) Payments on Early Termination. For the purpose of Section 6(e) of this
Agreement:
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(g) "Termination Currency" means United States Dollars.
3) Tax Representations. Payer Representations. For the purpose of Section
3(e) of the ISDA Form Master Agreement, BSFP and the Counterparty make the
following representations:
It is not required by any applicable law, as modified by the practice of
any relevant governmental revenue authority, of any Relevant Jurisdiction
to make any deduction or withholding for or on account of any Tax from any
payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of the
ISDA Form Master Agreement) to be made by it to In the other party under
this Agreement. making this representation, it may rely on:
(i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement;
(ii) the satisfaction of the agreement contained in Section 4 (a)(i)
or 4(a)(iii) of the ISDA Form Master Agreement and the accuracy and
effectiveness of any document provided by the other party pursuant
to Section 4 (a)(i) or 4(a)(iii) of the ISDA Form Master Agreement;
and
(iii) the satisfaction of the agreement of the other party contained
in Section 4(d) of the ISDA Form Master Agreement Agreement,
provided that it shall not be a breach of this representation where
reliance is placed on clause (ii) and the other party does not
deliver a form or document under Section 4(a)(iii) by reason of
material prejudice of its legal or commercial position.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 5 of 14
4) Limitation on Events of Default. Notwithstanding the terms of Sections 5
and 6 of the ISDA Form Master Agreement, if at any time and so long as the
Counterparty has satisfied in full all its payment obligations under
Section 2(a)(i) of the ISDA Form Master Agreement and has at the time no
future payment obligations, whether absolute or contingent, under such
Section, then unless BSFP is required pursuant to appropriate proceedings
to return to the Counterparty or otherwise returns to the Counterparty
upon demand of the Counterparty any portion of any such payment, (a) the
occurrence of an event described in Section 5(a) of the ISDA Form Master
Agreement with respect to the Counterparty shall not constitute an Event
of Default or Potential Event of Default with respect to the Counterparty
as Defaulting Party and (b) BSFP shall be entitled to designate an Early
Termination Date pursuant to Section 6 of the ISDA Form Master Agreement
only as a result of the occurrence of a Termination Event set forth in
either Section 5(b)(i) or 5(b)(ii) of the ISDA Form Master Agreement with
respect to BSFP as the Affected Party, or Section 5(b)(iii) with respect
to BSFP as the Burdened Party. For purposes of the Transaction to which
this Agreement relates, Counterparty's only obligation under Section
2(a)(i) of the ISDA Form Master Agreement is to pay the Fixed Amount on
the Fixed Rate Payer Payment Date.
5) Documents to be Delivered. For the purpose of Section 4(a):
(1) Other documents to be delivered are:
Party required
to deliver Form/Document/ Date by which to Covered by Section 3(d)
document Certificate be delivered Representation
---------------- --------------------------- ---------------------- -----------------------
BSFP and the Any documents required Upon the execution and Yes
Counterparty by the receiving party to delivery of this
evidence the authority of Agreement
the delivering party or its
Credit Support Provider,
if any, for it to execute
and deliver this Agreement,
any Confirmation, and any
Credit Support Documents
to which it is a party, and
to evidence the authority of
the delivering party or its
Credit Support Provider
to perform its obligations
under this Agreement,
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 6 of 14
Party required
to deliver Form/Document/ Date by which to Covered by Section 3(d)
document Certificate be delivered Representation
---------------- --------------------------- ---------------------- -----------------------
such Confirmation
and/or Credit Support
Document, as the case
may be
BSFP and the A certificate of an Upon the execution and Yes
Counterparty authorized officer of the delivery of this
party, as to the Agreement
incumbency and authority
of the respective officers
of the party signing this
Agreement, any relevant
Credit Support
Document, or any
Confirmation, as the case
may be
6) Miscellaneous. Miscellaneous.
(a) Address for Notices: For the purposes of Section 12(a) of the ISDA Form
Master Agreement:
Address for notices or communications to BSFP:
Address: 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: DPC Manager
Facsimile: (000) 000-0000
with a copy to:
Address: Xxx Xxxxxxxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000
Attention: Derivative Operations - 7th Floor
Facsimile: (000) 000-0000
(For all purposes)
Address for notices or communications to the Counterparty:
Address: 0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Facsimile: 000-000-0000
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 7 of 14
Phone: 000-000-0000
with a copy to:
Attention: Xxxxxxx Xxxxx
Facsimile: 000-000-0000
Phone: 000-000-0000
(For all purposes)
(b) Process Agent. For the purpose of Section 13(c):
BSFP appoints as its Process Agent: Not Applicable
The Counterparty appoints as its Process Agent: Not Applicable
(c) Offices. The provisions of Section 10(a) will not apply to this Agreement;
neither BSFP nor the Counterparty have any Offices other than as set forth
in the Notices Section and BSFP agrees that, for purposes of Section 6(b)
of the ISDA Form Master Agreement, it shall not in future have any Office
other than one in the United States.
(d) Multibranch Party. For the purpose of Section 10(c) of the ISDA Form
Master Agreement:
BSFP is not a Multibranch Party.
The Counterparty is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is BSFP; provided, however, that
if an Event of Default occurs with respect to BSFP, then the Counterparty
shall be entitled to appoint a financial institution which would qualify
as a Reference Market-maker to act as Calculation Agent.
(f) Credit Support Document. Not applicable for either BSFP or the
Counterparty.
(g) Credit Support Provider.
BSFP: Not Applicable
The Counterparty: Not Applicable
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 8 of 14
(h) Governing Law. The parties to this Agreement hereby agree that the law of
the State of New York shall govern their rights and duties in whole,
without regard to conflict of law provisions thereof other than New York
General Obligations Law Sections 5-1401 and 5-1402.
(i) Severability. If any term, provision, covenant, or condition of this
Agreement, or the application thereof to any party or circumstance, shall
be held to be invalid or unenforceable (in whole or in part) for any
reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Agreement had been
executed with the invalid or unenforceable portion eliminated, so long as
this Agreement as so modified continues to express, without material
change, the original intentions of the parties as to the subject matter of
this Agreement and the deletion of such portion of this Agreement will not
substantially impair the respective benefits or expectations of the
parties.
The parties shall endeavor to engage in good faith negotiations to replace
any invalid or unenforceable term, provision, covenant or condition with a
valid or enforceable term, provision, covenant or condition, the economic
effect of which comes as close as possible to that of the invalid or
unenforceable term, provision, covenant or condition.
(j) Consent to Recording. Each party hereto consents to the monitoring or
recording, at any time and from time to time, by the other party of any
and all communications between officers or employees of the parties,
waives any further notice of such monitoring or recording, and agrees to
notify its officers and employees of such monitoring or recording.
(k) Waiver of Jury Trial. Each party waives any right it may have to a trial
by jury in respect of any Proceedings relating to this Agreement or any
Credit Support Document.
(l) Non-Recourse. Notwithstanding any provision herein or in the ISDA Form
Master Agreement to the contrary, the obligations of Counterparty
hereunder are limited recourse obligations of Counterparty, payable solely
from the Trust Fund (as defined in the Pooling and Servicing Agreement)
and the proceeds thereof to satisfy Counterparty's obligations hereunder.
In the event that the Trust Fund and proceeds thereof should be
insufficient to satisfy all claims outstanding and following the
realization of the Trust Fund and the distribution of the proceeds thereof
in accordance with the Pooling and Servicing Agreement, any claims against
or obligations of Counterparty under the ISDA Form Master Agreement or any
other confirmation thereunder, still outstanding shall be extinguished and
thereafter not revive.
(m) Transfer, Amendment and Assignment. No transfer, amendment, waiver,
supplement, assignment or other modification of this Transaction (other
than the pledge of this Transaction to the trustee pursuant to the Pooling
and Servicing Agreement) shall be permitted by either party unless each of
Fitch Ratings ("Fitch"), Standard & Poor's, a division of The XxXxxx-Xxxx
Companies, Inc. ("S&P") and Xxxxx'x Investor Service, Inc. ("Moody's"),
has been provided notice of the same and confirms in writing (including by
facsimile transmission) within five Business Days after such
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 9 of 14
notice is given that it will not downgrade, qualify, withdraw or otherwise
modify its then-current rating of the Certificates (as defined in the
Pooling and Servicing Agreement).
(n) Proceedings. BSFP shall not institute against or cause any other person to
institute against, or join any other person in instituting against the
Counterparty, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any of the laws of the
United States, or any other jurisdiction for a period of one year and one
day (or, if longer, the applicable preference period) following
indefeasible payment in full of the Certificates.
(o) The ISDA Form Master Agreement is hereby amended as follows:
The word "third" shall be replaced by the word "second" in the third line
of Section 5(a)(i) of the ISDA Form Master Agreement.
(p) Securities Administrator Capacity. It is expressly understood and agreed
by the parties hereto that insofar as this Confirmation is executed by the
Securities Administrator (i) this Confirmation is executed and delivered
by Xxxxx Fargo Bank, N.A., not in its individual capacity but solely as
Securities Administrator pursuant to the Pooling and Servicing Agreement
in the exercise of the powers and authority conferred and vested in it
thereunder (ii) each of the representations, undertakings and agreements
herein made on behalf of the Xxxxx Fargo Home Equity Asset- Backed
Securities 2005-1 Trust (the "Trust") is made and intended not as personal
representations of the Securities Administrator but is made and intended
for the purpose of binding only the Trust, and (iii) under no
circumstances xxxx Xxxxx Fargo Bank, N.A. in its individual capacity be
personally liable for the payment of any indebtedness or expenses or be
personally liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken under this
Confirmation.
(q) Securities Administrator Representation. Xxxxx Fargo Bank, N.A., as
Securities Administrator represents and warrants that:
It has been directed under the Pooling and Servicing Agreement to enter
into this Agreement as Securities Administrator on behalf of the Trust.
(r) Set-off. Notwithstanding any provision of this Agreement or any other
existing or future agreement, each party irrevocably waives any and all
rights it may have to set off, net, recoup or otherwise withhold or
suspend or condition payment or performance of any obligation between it
and the other party hereunder against any obligation between it and the
other party under any other agreements. The last sentence of the first
paragraph of Section 6(e) of the ISDA Form Master Agreement shall not
apply for purposes of this Transaction.
(s) Additional Termination Events. Additional Termination Events will apply.
If a Ratings Event has occurred and BSFP has not, within 30 days, complied
with Section 6(t) below, then an Additional
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 10 of 14
Termination Event shall have occurred with respect to BSFP and BSFP shall
be the sole Affected Party with respect to such an Additional Termination
Event.
(t) Ratings Event. If a Ratings Event (as defined below) occurs with respect
to BSFP (or any applicable credit support provider), then BSFP shall, at
its own expense, (i) assign this Transaction within thirty (30) days of
such Ratings Event to a third party that meets or exceeds, or as to which
any applicable credit support provider meets or exceeds, the Approved
Ratings Thresholds (as defined below) on terms substantially similar to
this Confirmation, which party is approved by the Counterparty, which
approval shall not be unreasonably withheld, (ii) obtain a guaranty of, or
a contingent agreement of, another person with the Approved Rating
Thresholds to honor BSFP's obligations under this Agreement, provided that
such other person is approved by the Counterparty, such approval not to be
unreasonably withheld, (iii) post collateral under agreements and other
instruments satisfactory to Fitch Rating ("Fitch"), Standard and Poor's, a
division of The XxXxxx-Xxxx Companies, Inc. ("S&P") and Xxxxx'x Investor
Service, Inc. ("Moody's"), which will be sufficient to restore the
immediately prior ratings of the Certificates, or (iv) establish any other
arrangement satisfactory to Fitch, S&P and Moody's which will be
sufficient to restore the immediately prior ratings of the Certificates.
For avoidance of doubt, a downgrade of the rating on the Certificates
could occur in the event that BSFP does not post sufficient collateral.
For purposes of this Transaction, a "Ratings Event" shall occur with
respect to BSFP (or any applicable credit support provider) if its
long-term unsecured and unsubordinated debt rating is withdrawn or reduced
below "AA-" by S&P or "Aa3" by Moody's (including in connection with a
merger, consolidation or other similar transaction by BSFP or any
applicable credit support provider) such ratings being referred to herein
as the "Approved Ratings Thresholds," (unless, within 30 days thereafter,
each of S&P and Moody's has reconfirmed the ratings of the Certificates,
as applicable, which was in effect immediately prior thereto).
7) "Affiliate" will have the meaning specified in Section 14 of the ISDA Form
Master Agreement, provided that Counterparty shall not be deemed to have
any Affiliates for purposes of this Agreement, including for purposes of
Section 6(b)(ii).
8) Section 3 of the ISDA Form Master Agreement is hereby amended by adding at
the end thereof the following subsection (g):
"(g) Relationship Between Parties.
Each party represents to the other party on each date when it
enters into a Transaction that:--
(1) Nonreliance. It is not relying on any statement or
representation of the other party regarding the Transaction (whether written or
oral), other than the representations expressly made in this Agreement or the
Confirmation in respect of that Transaction.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 11 of 14
(2) Evaluation and Understanding.
(i) BSFP is acting for its own account and Counterparty is acting
solely as Securities Administrator and each party has the capacity to evaluate
(internally or through independent professional advice) the Transaction and has
made its own decision to enter into the Transaction; it is not relying on any
communication (written or oral) of the other party as investment advice or as a
recommendation to enter into such transaction; it being understood that
information and explanations related to the terms and conditions of such
transaction shall not be considered investment advice or a recommendation to
enter into such transaction. No communication (written or oral) received from
the other party shall be deemed to be an assurance or guarantee as to the
expected results of the transaction; and
(ii) It understands the terms, conditions and (and does in fact
assume) risks of the Transaction and is willing and able to accept those terms
and conditions and to assume those risks, financially and otherwise.
(3) Purpose. It is entering into the Transaction for the purposes of
managing its borrowings or investments, hedging its underlying assets or
liabilities or in connection with a line of business.
(4) Principal. The other party is not acting as a fiduciary or an
advisor for it in respect of this Transaction."
(5) Eligible Contract Participant. (A) It is an "eligible contract
participant" within the meaning of Section 1a(12) of the Commodity Exchange Act,
as amended; (B) this Agreement and each Transaction is subject to individual
negotiation by such party; and (C) neither this Agreement nor any Transaction
will be executed or traded on a "trading facility" within the meaning of Section
1a(33) of the Commodity Exchange Act, as amended.
NEITHER THE BEAR XXXXXXX COMPANIES INC. NOR ANY SUBSIDIARY OR AFFILIATE OF
THE BEAR XXXXXXX COMPANIES INC. OTHER THAN BSFP IS AN OBLIGOR OR A CREDIT
SUPPORT PROVIDER ON THIS AGREEMENT.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 12 of 14
5. Account Details and
Settlement Information: Payments to BSFP:
[Intentionally Omitted]
Payments to Counterparty:
[Intentionally Omitted]
This Agreement may be executed in several counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument.
Counterparty hereby agrees to check this Confirmation and to confirm that the
foregoing correctly sets forth the terms of the Transaction by signing in the
space provided below and returning to BSFP a facsimile of the fully-executed
Confirmation to 000-000-0000. For inquiries regarding U.S. Transactions, please
contact Xxxxx Xxxxxx by telephone at 000-000-0000. For all other inquiries
please contact Derivatives 000-0-000-0000 Documentation by telephone at .
Originals will be provided for your execution upon your request.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 13 of 14
We are very pleased to have executed this Transaction with you and we look
forward to completing other transactions with you in the near future.
Very truly yours,
BEAR XXXXXXX FINANCIAL PRODUCTS INC.
By:
-----------------------------
Name:
Title:
Counterparty, acting through its duly authorized signatory, hereby agrees to,
accepts and confirms the terms of the foregoing as of the Trade Date.
XXXXX FARGO BANK, N.A., NOT INDIVIDUALLY BUT SOLELY
AS SECURITIES ADMINISTRATOR ON BEHALF OF XXXXX
FARGO HOME EQUITY ASSET-BACKED SECURITIES 2005-1
TRUST
By:
-----------------------------
Name:
Title:
lm
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 14 of 14
SCHEDULE I
(all such dates subject to adjustment in accordance with the Business Day
Convention)
From and Including To but excluding Notional Amount(USD) Cap Rate(%)
------------------ ---------------- -------------------- -----------
Effective Date 7/25/2005 401,463,000.00 6.678
7/25/2005 8/25/2005 397,324,427.71 5.564
8/25/2005 9/25/2005 392,357,245.10 5.565
9/25/2005 10/25/2005 386,569,393.07 5.759
10/25/2005 11/25/2005 379,972,857.88 5.567
11/25/2005 12/25/2005 372,583,975.25 5.761
12/25/2005 1/25/2006 364,423,445.41 5.569
1/25/2006 2/25/2006 355,516,312.58 5.570
2/25/2006 3/25/2006 345,891,907.58 6.194
3/25/2006 4/25/2006 335,583,752.41 5.574
4/25/2006 5/25/2006 324,631,611.98 5.801
5/25/2006 6/25/2006 313,956,974.56 5.608
6/25/2006 7/25/2006 303,563,314.71 5.805
7/25/2006 8/25/2006 293,443,271.15 5.613
8/25/2006 9/25/2006 283,589,674.85 5.616
9/25/2006 10/25/2006 273,995,543.96 5.813
10/25/2006 11/25/2006 264,654,078.98 5.621
11/25/2006 12/25/2006 255,558,657.99 5.819
12/25/2006 1/25/2007 246,702,832.02 5.627
1/25/2007 2/25/2007 238,080,320.54 5.630
2/25/2007 3/25/2007 229,685,007.11 6.262
3/25/2007 4/25/2007 221,510,935.06 5.637
4/25/2007 5/25/2007 200,637,157.94 8.504
5/25/2007 6/25/2007 181,263,095.97 8.225
6/25/2007 7/25/2007 163,293,952.34 8.510
7/25/2007 8/25/2007 146,626,452.38 8.234
8/25/2007 9/25/2007 139,979,354.54 8.242
9/25/2007 10/25/2007 133,615,781.73 8.533
10/25/2007 11/25/2007 127,437,683.38 9.100
11/25/2007 12/25/2007 121,458,462.40 9.421
12/25/2007 1/25/2008 115,653,028.85 9.120
1/25/2008 2/25/2008 110,016,328.32 9.131
2/25/2008 3/25/2008 0.00 0.000
3/25/2008 Termination Date 99,229,640.12 9.157
EXHIBIT N-3
Form of Class M Yield Maintenance Agreement
[BEAR XXXXXXX LOGO] BEAR XXXXXXX FINANCIAL PRODUCTS INC.
000 XXXXXXX XXXXXX
XXX XXXX, XXX XXXX 00000
000-000-0000
DATE: June 29, 2005
TO: Xxxxx Fargo Bank, N.A., not individually but solely as
Securities Administrator on behalf of Xxxxx Fargo Home
Equity Asset-Backed Securities 2005-1 Trust
ATTENTION: Xxxxx Xxxxxxxxx
TELEPHONE: 000-000-0000
FACSIMILE: 000-000-0000
FROM: Derivatives Documentation
TELEPHONE: 000-000-0000
FACSIMILE: 000-000-0000
SUBJECT: Fixed Income Derivatives Confirmation and Agreement
REFERENCE NUMBER:
The purpose of this letter agreement ("Agreement") is to confirm the terms and
conditions of the Transaction entered into on the Trade Date specified below
(the "Transaction") between Bear Xxxxxxx Financial Products Inc. ("BSFP") and
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
(the "Securities Administrator") on behalf of the Xxxxx Fargo Home Equity
Asset-Backed Securities 2005-1 Trust formed pursuant to the Pooling and
Servicing Agreement dated as of June 29, 2005 between Xxxxx Fargo Asset
Securities Corporation, as depositor, HSBC Bank USA, National Association, as
trustee, Xxxxx Fargo Bank, N.A., as servicer and the Securities Administrator
(the "Pooling and Servicing Agreement") (the This Agreement, which evidences a
complete "Counterparty"). and binding agreement between you and us to enter into
the Transaction on the terms set forth below, constitutes a "Confirmation" as
referred to in the "ISDA Form Master Agreement" (as defined below), as well as a
"Schedule" as referred to in the ISDA Form Master Agreement.
1. This Agreement is subject to the 2000 ISDA (the "Definitions"), as published
by the Definitions International Swaps and Derivatives Association, Inc. You and
we have agreed to enter into ("ISDA"). this Agreement in lieu of negotiating a
Schedule to the 1992 ISDA Master Agreement (Multicurrency-- Cross Border) form
(the "ISDA Form Master Agreement") but, rather, an ISDA Form Master Agreement
shall be deemed to have been executed by you and us on the date we entered into
the Transaction. All provisions contained in, or incorporated by reference to,
the ISDA Form Master Agreement shall govern the Transaction referenced in this
Confirmation, except as expressly modified below. In the event of any
inconsistency between the provisions of this Agreement and the Definitions or
the ISDA Form Master Agreement, this Agreement shall prevail for purposes of the
Transaction. Terms capitalized but not defined herein shall have the meanings
attributed to them in the Pooling and Servicing Agreement.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 2 of 14
2. The terms of the particular Transaction to which this Confirmation relates
are as follows:
Type of Transaction: Rate Cap
Notional Amount: With respect to any Calculation Period, the
amount set forth for such period in Schedule I
attached hereto.
Trade Date: June 21, 2005
Effective Date: June 29, 2005
Termination Date: April 25, 2008, subject to adjustment in
accordance with the Business Day Convention.
Fixed Amount (Premium):
Fixed Rate Payer: Counterparty
Fixed Rate Payer
Payment Date: June 29, 2005
Fixed Amount: [____________]
Floating Amounts:
Floating Rate Payer: BSFP
Cap Rate: With respect to any Calculation Period, the rate
set forth for such period in Schedule I attached
hereto.
Floating Rate Payer
Period End Dates: The 25th calendar day of each month during the
Term of this Transaction, commencing August 25,
2005 and ending on the Termination Date, subject
to adjustment in accordance with the Business
Day Convention.
Floating Rate Payer
Payment Dates: Early Payment is applicable. The Floating Rate
Payer Payment Dates shall be two Business Days
prior to each Floating Rate Payer Period End
Date.
Floating Rate Option: USD-LIBOR-BBA, provided, however, that if the
Floating Rate determined from such Floating Rate
Option for any Calculation
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 3 of 14
Period is greater than 8.46000% then the
Floating Rate for such Calculation Period shall
be deemed to be equal to 8.46000%.
Designated Maturity: One month
Floating Rate Day
Count Fraction: Actual/360
Reset Dates: The first day of each Calculation Period.
Compounding: Inapplicable
Business Days: New York
Business Day Convention: Following
3. Additional Provisions: Each party hereto is hereby advised and
acknowledges that the other party has engaged in
(or refrained from engaging in) substantial
financial transactions and has taken (or
refrained from taking) other material actions in
reliance upon the entry by the parties into the
Transaction being entered into on the terms and
conditions set forth herein and in the
Confirmation relating to such Transaction, as
applicable. This paragraph shall be deemed
repeated on the trade date of each Transaction.
4. Provisions Deemed Incorporated in a Schedule to the Master Agreement:
1) The parties agree that subparagraph (ii) of Section 2(c) of the ISDA Form
Master Agreement will apply to any Transaction.
2) Termination Provisions. For purposes of the Master Agreement:
(a) "Specified Entity" is not applicable to BSFP or Counterparty for any
purpose.
(b) "Specified Transaction" is not applicable to BSFP or Counterparty for any
purpose, and, accordingly, Section 5(a)(v) shall not apply to BSFP or
Counterparty.
(c) The "Cross Default" provisions of Section 5(a)(vi) will not apply to BSFP
or to Counterparty.
(d) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not
apply to BSFP or Counterparty.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 4 of 14
(e) The "Automatic Early Termination" provision of Section 6(a) will not apply
to BSFP or to Counterparty.
(f) Payments on Early Termination. For the purpose of Section 6(e) of this
Agreement:
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(g) "Termination Currency" means United States Dollars.
3) Tax Representations. Payer Representations. For the purpose of Section
3(e) of the ISDA Form Master Agreement, BSFP and the Counterparty make the
following representations:
It is not required by any applicable law, as modified by the practice of
any relevant governmental revenue authority, of any Relevant Jurisdiction
to make any deduction or withholding for or on account of any Tax from any
payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of the
ISDA Form Master Agreement) to be made by it to In the other party under
this Agreement. making this representation, it may rely on:
(i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement;
(ii) the satisfaction of the agreement contained in Section 4 (a)(i)
or 4(a)(iii) of the ISDA Form Master Agreement and the accuracy and
effectiveness of any document provided by the other party pursuant
to Section 4 (a)(i) or 4(a)(iii) of the ISDA Form Master Agreement;
and
(iii) the satisfaction of the agreement of the other party contained
in Section 4(d) of the ISDA Form Master Agreement Agreement,
provided that it shall not be a breach of this representation where
reliance is placed on clause (ii) and the other party does not
deliver a form or document under Section 4(a)(iii) by reason of
material prejudice of its legal or commercial position.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 5 of 14
4) Limitation on Events of Default. Notwithstanding the terms of Sections 5
and 6 of the ISDA Form Master Agreement, if at any time and so long as the
Counterparty has satisfied in full all its payment obligations under
Section 2(a)(i) of the ISDA Form Master Agreement and has at the time no
future payment obligations, whether absolute or contingent, under such
Section, then unless BSFP is required pursuant to appropriate proceedings
to return to the Counterparty or otherwise returns to the Counterparty
upon demand of the Counterparty any portion of any such payment, (a) the
occurrence of an event described in Section 5(a) of the ISDA Form Master
Agreement with respect to the Counterparty shall not constitute an Event
of Default or Potential Event of Default with respect to the Counterparty
as Defaulting Party and (b) BSFP shall be entitled to designate an Early
Termination Date pursuant to Section 6 of the ISDA Form Master Agreement
only as a result of the occurrence of a Termination Event set forth in
either Section 5(b)(i) or 5(b)(ii) of the ISDA Form Master Agreement with
respect to BSFP as the Affected Party, or Section 5(b)(iii) with respect
to BSFP as the Burdened Party. For purposes of the Transaction to which
this Agreement relates, Counterparty's only obligation under Section
2(a)(i) of the ISDA Form Master Agreement is to pay the Fixed Amount on
the Fixed Rate Payer Payment Date
5) Documents to be Delivered. For the purpose of Section 4(a):
(1) Documents to be delivered are:
Party required
to deliver Form/Document/ Date by which to Covered by Section 3(d)
document Certificate be delivered Representation
---------------- --------------------------- ---------------------- -----------------------
BSFP and the Any documents required Upon the execution and Yes
Counterparty by the receiving party to delivery of this
evidence the authority of Agreement
the delivering party or its
Credit Support Provider,
if any, for it to execute
and deliver this Agreement,
any Confirmation , and any
Credit Support Documents to
which it is a party, and to
evidence the authority of
the delivering party or its
Credit Support Provider
to perform its obligations
under this Agreement,
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 6 of 14
Party required
to deliver Form/Document/ Date by which to Covered by Section 3(d)
document Certificate be delivered Representation
---------------- --------------------------- ---------------------- -----------------------
such Confirmation
and/or Credit Support
Document, as the case
may be
BSFP and the A certificate of an Upon the execution and Yes
Counterparty authorized officer of the delivery of this
party, as to the Agreement
incumbency and authority
of the respective officers
of the party signing this
Agreement, any relevant
Credit Support
Document, or any
Confirmation, as the case
may be
6) Miscellaneous. Miscellaneous.
(a) Address for Notices: For the purposes of Section 12(a) of the ISDA Form
Master Agreement:
Address for notices or communications to BSFP:
Address: 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: DPC Manager
Facsimile: (000) 000-0000
with a copy to:
Address: Xxx Xxxxxxxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000
Attention: Derivative Operations - 7th Floor
Facsimile: (000) 000-0000
(For all purposes)
Address for notices or communications to the Counterparty:
Address: 0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Facsimile: 000-000-0000
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 7 of 14
Phone: 000-000-0000
with a copy to:
Attention: Xxxxxxx Xxxxx
Facsimile: 000-000-0000
Phone: 000-000-0000
(For all purposes)
(b) Process Agent. For the purpose of Section 13(c):
BSFP appoints as its Process Agent: Not Applicable
The Counterparty appoints as its Process Agent: Not Applicable
(c) Offices. The provisions of Section 10(a) will not apply to this Agreement;
neither BSFP nor the Counterparty have any Offices other than as set forth
in the Notices Section and BSFP agrees that, for purposes of Section 6(b)
of the ISDA Form Master Agreement, it shall not in future have any Office
other than one in the United States.
(d) Multibranch Party. For the purpose of Section 10(c) of the ISDA Form
Master Agreement:
BSFP is not a Multibranch Party.
The Counterparty is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is BSFP; provided, however, that
if an Event of Default occurs with respect to BSFP, then the Counterparty
shall be entitled to appoint a financial institution which would qualify
as a Reference Market-maker to act as Calculation Agent.
(f) Credit Support Document. Not applicable for either BSFP or the
Counterparty.
(g) Credit Support Provider.
BSFP: Not Applicable
The Counterparty: Not Applicable
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 8 of 14
(h) Governing Law. The parties to this Agreement hereby agree that the law of
the State of New York shall govern their rights and duties in whole,
without regard to conflict of law provisions thereof other than New York
General Obligations Law Sections 5-1401 and 5-1402.
(i) Severability. If any term, provision, covenant, or condition of this
Agreement, or the application thereof to any party or circumstance, shall
be held to be invalid or unenforceable (in whole or in part) for any
reason, the remaining terms, provisions, covenants, and conditions hereof
shall continue in full force and effect as if this Agreement had been
executed with the invalid or unenforceable portion eliminated, so long as
this Agreement as so modified continues to express, without material
change, the original intentions of the parties as to the subject matter of
this Agreement and the deletion of such portion of this Agreement will not
substantially impair the respective benefits or expectations of the
parties.
The parties shall endeavor to engage in good faith negotiations to replace
any invalid or unenforceable term, provision, covenant or condition with a
valid or enforceable term, provision, covenant or condition, the economic
effect of which comes as close as possible to that of the invalid or
unenforceable term, provision, covenant or condition.
(j) Consent to Recording. Each party hereto consents to the monitoring or
recording, at any time and from time to time, by the other party of any
and all communications between officers or employees of the parties,
waives any further notice of such monitoring or recording, and agrees to
notify its officers and employees of such monitoring or recording.
(k) Waiver of Jury Trial. Each party waives any right it may have to a trial
by jury in respect of any Proceedings relating to this Agreement or any
Credit Support Document.
(l) Non-Recourse. Notwithstanding any provision herein or in the ISDA Form
Master Agreement to the contrary, the obligations of Counterparty
hereunder are limited recourse obligations of Counterparty, payable solely
from the Trust Fund (as defined in the Pooling and Servicing Agreement)
and the proceeds thereof to satisfy Counterparty's obligations hereunder.
In the event that the Trust Fund and proceeds thereof should be
insufficient to satisfy all claims outstanding and following the
realization of the Trust Fund and the distribution of the proceeds thereof
in accordance with the Pooling and Servicing Agreement, any claims against
or obligations of Counterparty under the ISDA Form Master Agreement or any
other confirmation thereunder, still outstanding shall be extinguished and
thereafter not revive.
(m) Transfer, Amendment and Assignment. No transfer, amendment, waiver,
supplement, assignment or other modification of this Transaction (other
than the pledge of this Transaction to the trustee pursuant to the Pooling
and Servicing Agreement) shall be permitted by either party unless each of
Fitch Ratings ("Fitch"), Standard & Poor's, a division of The XxXxxx-Xxxx
Companies, Inc. ("S&P") and Xxxxx'x Investor Service, Inc. ("Moody's"),
has been provided notice of the same and confirms in writing (including by
facsimile transmission) within five Business Days after such
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 9 of 14
notice is given that it will not downgrade, qualify, withdraw or otherwise
modify its then-current rating of the Certificates (as defined in the
Pooling and Servicing Agreement).
(n) Proceedings. BSFP shall not institute against or cause any other person to
institute against, or join any other person in instituting against the
Counterparty, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any of the laws of the
United States, or any other jurisdiction for a period of one year and one
day (or, if longer, the applicable preference period) following
indefeasible payment in full of the Certificates.
(o) The ISDA Form Master Agreement is hereby amended as follows:
The word "third" shall be replaced by the word "second" in the third line
of Section 5(a)(i) of the ISDA Form Master Agreement.
(p) Securities Administrator Capacity. It is expressly understood and agreed
by the parties hereto that insofar as this Confirmation is executed by the
Securities Administrator (i) this Confirmation is executed and delivered
by Xxxxx Fargo Bank, N.A., not in its individual capacity but solely as
Securities Administrator pursuant to the Pooling and Servicing Agreement
in the exercise of the powers and authority conferred and vested in it
thereunder (ii) each of the representations, undertakings and agreements
herein made on behalf of the Xxxxx Fargo Home Equity Asset- Backed
Securities 2005-1 Trust (the "Trust") is made and intended not as personal
representations of the Securities Administrator but is made and intended
for the purpose of binding only the Trust, and (iii) under no
circumstances xxxx Xxxxx Fargo Bank, N.A. in its individual capacity be
personally liable for the payment of any indebtedness or expenses or be
personally liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken under this
Confirmation.
(q) Securities Administrator Representation. Xxxxx Fargo Bank, N.A., as
Securities Administrator represents and warrants that:
It has been directed under the Pooling and Servicing Agreement to enter
into this Agreement as Securities Administrator on behalf of the Trust.
(r) Set-off. Notwithstanding any provision of this Agreement or any other
existing or future agreement, each party irrevocably waives any and all
rights it may have to set off, net, recoup or otherwise withhold or
suspend or condition payment or performance of any obligation between it
and the other party hereunder against any obligation between it and the
other party under any other agreements. The last sentence of the first
paragraph of Section 6(e) of the ISDA Form Master Agreement shall not
apply for purposes of this Transaction.
(s) Additional Termination Events. Additional Termination Events will apply.
If a Ratings Event has occurred and BSFP has not, within 30 days, complied
with Section 6(t) below, then an Additional
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 10 of 14
Termination Event shall have occurred with respect to BSFP and BSFP shall
be the sole Affected Party with respect to such an Additional Termination
Event.
(t) Ratings Event. If a Ratings Event (as defined below) occurs with respect
to BSFP (or any applicable credit support provider), then BSFP shall, at
its own expense, (i) assign this Transaction within thirty (30) days of
such Ratings Event to a third party that meets or exceeds, or as to which
any applicable credit support provider meets or exceeds, the Approved
Ratings Thresholds (as defined below) on terms substantially similar to
this Confirmation, which party is approved by the Counterparty, which
approval shall not be unreasonably withheld, (ii) obtain a guaranty of, or
a contingent agreement of, another person with the Approved Rating
Thresholds to honor BSFP's obligations under this Agreement, provided that
such other person is approved by the Counterparty, such approval not to be
unreasonably withheld, (iii) post collateral under agreements and other
instruments satisfactory to Fitch Rating ("Fitch"), Standard and Poor's, a
division of The XxXxxx-Xxxx Companies, Inc. ("S&P") and Xxxxx'x Investor
Service, Inc. ("Moody's"), which will be sufficient to restore the
immediately prior ratings of the Certificates, or (iv) establish any other
arrangement satisfactory to Fitch, S&P and Moody's which will be
sufficient to restore the immediately prior ratings of the Certificates.
For avoidance of doubt, a downgrade of the rating on the Certificates
could occur in the event that BSFP does not post sufficient collateral.
For purposes of this Transaction, a "Ratings Event" shall occur with
respect to BSFP (or any applicable credit support provider) if its
long-term unsecured and unsubordinated debt rating is withdrawn or reduced
below "AA-" by S&P or "Aa3" by Moody's (including in connection with a
merger, consolidation or other similar transaction by BSFP or any
applicable credit support provider) such ratings being referred to herein
as the "Approved Ratings Thresholds," (unless, within 30 days thereafter,
each of S&P and Moody's has reconfirmed the ratings of the Certificates,
as applicable, which was in effect immediately prior thereto).
7) "Affiliate" will have the meaning specified in Section 14 of the ISDA Form
Master Agreement, provided that Counterparty shall not be deemed to have
any Affiliates for purposes of this Agreement, including for purposes of
Section 6(b)(ii).
8) Section 3 of the ISDA Form Master Agreement is hereby amended by adding at
the end thereof the following subsection (g):
"(g) Relationship Between Parties.
Each party represents to the other party on each date when it
enters into a Transaction that:--
(1) Nonreliance. It is not relying on any statement or
representation of the other party regarding the Transaction (whether written or
oral), other than the representations expressly made in this Agreement or the
Confirmation in respect of that Transaction.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 11 of 14
(2) Evaluation and Understanding.
(i) BSFP is acting for its own account and Counterparty is acting
solely as Securities Administrator and each party has the capacity to evaluate
(internally or through independent professional advice) the Transaction and has
made its own decision to enter into the Transaction; it is not relying on any
communication (written or oral) of the other party as investment advice or as a
recommendation to enter into such transaction; it being understood that
information and explanations related to the terms and conditions of such
transaction shall not be considered investment advice or a recommendation to
enter into such transaction. No communication (written or oral) received from
the other party shall be deemed to be an assurance or guarantee as to the
expected results of the transaction; and
(ii) It understands the terms, conditions and risks of the
Transaction and is willing and able to accept those terms and conditions and to
assume (and does in fact assume) those risks, financially and otherwise.
(3) Purpose. It is entering into the Transaction for the purposes of
managing its borrowings or investments, hedging its underlying assets or
liabilities or in connection with a line of business.
(4) Principal. The other party is not acting as a fiduciary or an
advisor for it in respect of this Transaction."
(5) Eligible Contract Participant. (A) It is an "eligible contract
participant" within the meaning of Section 1a(12) of the Commodity Exchange Act,
as amended; (B) this Agreement and each Transaction is subject to individual
negotiation by such party; and (C) neither this Agreement nor any Transaction
will be executed or traded on a "trading facility" within the meaning of Section
1a(33) of the Commodity Exchange Act, as amended.
NEITHER THE BEAR XXXXXXX COMPANIES INC. NOR ANY SUBSIDIARY OR AFFILIATE OF
THE BEAR XXXXXXX COMPANIES INC. OTHER THAN BSFP IS AN OBLIGOR OR A CREDIT
SUPPORT PROVIDER ON THIS AGREEMENT.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 12 of 14
5. Account Details and
Settlement Information: Payments to BSFP:
[Intentionally Omitted]
Payments to Counterparty:
[Intentionally Omitted]
This Agreement may be executed in several counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument.
Counterparty hereby agrees to check this Confirmation and to confirm that the
foregoing correctly sets forth the terms of the Transaction by signing in the
space provided below and returning to BSFP a facsimile of the fully-executed
Confirmation to 000-000-0000. For inquiries regarding U.S. Transactions, please
contact Xxxxx Xxxxxx by telephone at 000-000-0000. For all other inquiries
please contact Derivatives 000-0-000-0000 Documentation by telephone at .
Originals will be provided for your execution upon your request.
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 13 of 14
We are very pleased to have executed this Transaction with you and we look
forward to completing other transactions with you in the near future.
Very truly yours,
BEAR XXXXXXX FINANCIAL PRODUCTS INC.
By:
-----------------------------
Name:
Title:
Counterparty, acting through its duly authorized signatory, hereby agrees to,
accepts and confirms the terms of the foregoing as of the Trade Date.
XXXXX FARGO BANK, N.A., NOT INDIVIDUALLY BUT SOLELY
AS SECURITIES ADMINISTRATOR ON BEHALF OF XXXXX
FARGO HOME EQUITY ASSET-BACKED SECURITIES 2005-1
TRUST
By:
-----------------------------
Name:
Title:
lm/am
Reference Number:
Xxxxx Fargo Bank, N.A., not individually but solely as Securities Administrator
on behalf of Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust
June 29, 2005
Page 14 of 14
SCHEDULE I
(all such dates subject to adjustment in accordance with the Business Day
Convention)
From and Including To but excluding Notional Amount(USD) Rate Cap(%)
------------------ ---------------- -------------------- -----------
Effective Date 7/25/2005 0 0.000
7/25/2005 8/25/2005 204,828,000.00 5.009
8/25/2005 9/25/2005 204,828,000.00 5.009
9/25/2005 10/25/2005 204,828,000.00 5.211
10/25/2005 11/25/2005 204,828,000.00 5.009
11/25/2005 12/25/2005 204,828,000.00 5.211
12/25/2005 1/25/2006 204,828,000.00 5.009
1/25/2006 2/25/2006 204,828,000.00 5.009
2/25/2006 3/25/2006 204,828,000.00 5.657
3/25/2006 4/25/2006 204,828,000.00 5.009
4/25/2006 5/25/2006 204,828,000.00 5.231
5/25/2006 6/25/2006 204,828,000.00 5.028
6/25/2006 7/25/2006 204,828,000.00 5.231
7/25/2006 8/25/2006 204,828,000.00 5.028
8/25/2006 9/25/2006 204,828,000.00 5.028
9/25/2006 10/25/2006 204,828,000.00 5.231
10/25/2006 11/25/2006 204,828,000.00 5.028
11/25/2006 12/25/2006 204,828,000.00 5.230
12/25/2006 1/25/2007 204,828,000.00 5.028
1/25/2007 2/25/2007 204,828,000.00 5.028
2/25/2007 3/25/2007 204,828,000.00 5.678
3/25/2007 4/25/2007 204,828,000.00 5.028
4/25/2007 5/25/2007 204,828,000.00 7.696
5/25/2007 6/25/2007 204,828,000.00 7.423
6/25/2007 7/25/2007 204,828,000.00 7.685
7/25/2007 8/25/2007 204,828,000.00 7.383
8/25/2007 9/25/2007 204,828,000.00 7.380
9/25/2007 10/25/2007 204,828,000.00 7.658
10/25/2007 11/25/2007 204,828,000.00 8.143
11/25/2007 12/25/2007 204,828,000.00 8.455
12/25/2007 1/25/2008 204,828,000.00 8.145
1/25/2008 2/25/2008 204,828,000.00 8.141
2/25/2008 3/25/2008 0 0.000
3/25/2008 Termination Date 204,828,000.00 8.134
EXHIBIT O
Form of Certification
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET BACKED CERTIFICATES, SERIES 2005-1
I, [identify the certifying individual] certify that:
1. I have reviewed the annual report on Form 10-K, and all Monthly Form 8-K's
containing Distribution Date Statements filed in respect of periods
included in the year covered by this annual report, of the Xxxxx Fargo
Home Equity Asset-Backed Securities 2005-1 Trust;
2. Based on my knowledge, the information in these reports, taken as a whole,
does not contain any untrue statement of a material fact or omit to state
a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of
the last day of the period covered by this annual report;
3. Based on my knowledge, the distribution or servicing information required
to be provided to the Trustee and the Securities Administrator by the
Servicer under the Pooling and Servicing Agreement, dated as of June 29,
2005 (the "Agreement"), among Xxxxx Fargo Asset Securities Corporation, as
depositor, Xxxxx Fargo Bank, N.A., as servicer (the "Servicer"), Xxxxx
Fargo Bank, National Association, as securities administrator (the
"Securities Administrator") and HSBC Bank USA, National Association, as
trustee (the "Trustee") for inclusion in these reports is included in
these reports;
4. I am responsible for reviewing the activities performed by the Servicer
under the Agreement and based on my knowledge and upon the annual
compliance statement required to be delivered to the Securities
Administrator in accordance with the terms of the Agreement, and except as
disclosed in the reports, the Servicer has fulfilled its obligations under
the Agreement; and
5. The reports disclose all significant deficiencies relating to the
Servicer's compliance with the minimum servicing standards based upon the
report provided by an independent public accountant, after conducting a
review in compliance with the Uniform Single Attestation Program for
Mortgage Bankers or similar procedure, as set forth in the Agreement, that
is included in these reports.
By:___________________________________
Name:
Title:
EXHIBIT P
Form of Certification to be Provided by the Securities Administrator to the
Servicer
XXXXX FARGO ASSET SECURITIES CORPORATION,
HOME EQUITY ASSET BACKED CERTIFICATES, SERIES 2005-1
I, [identify the certifying individual], certify to Xxxxx Fargo
Bank, N.A. and its officers, directors and affiliates, and with the knowledge
and intent that they will rely upon this certification, that:
1. I have reviewed the annual report on Form 10-K for the calendar year [___]
and all Monthly Form 8-K's containing Distribution Date Statements filed
in respect of periods included in the year covered by that annual report,
of the Xxxxx Fargo Home Equity Asset-Backed Securities 2005-1 Trust;
2. Based on my knowledge, the distribution information in the Distribution
Date Statements contained in all Monthly Form 8-K's included in the year
covered by the annual report on Form 10-K for the calendar year [___],
taken as a whole, does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not
misleading as of the last day of the period covered by that annual report;
and
3. Based on my knowledge, the distribution information required to be
provided by the Securities Administrator under the Pooling and Servicing
Agreement, dated as of June 29, 2005 (the "Agreement"), among Xxxxx Fargo
Asset Securities Corporation, as depositor, Xxxxx Fargo Bank, N.A., as
servicer (the "Servicer"), Xxxxx Fargo Bank, National Association, as
securities administrator (the "Securities Administrator") and HSBC Bank
USA, National Association, as trustee (the "Trustee"), for inclusion in
these reports is included in these reports.
By:___________________________________
Name:
Title:
EXHIBIT Q
List of Recordation States
Maryland
Florida
EXHIBIT R
Prepayment Penalty Matrices
Xxxxx Fargo Home Mortgage Prepayment Penalty Guide
For Retail and Wholesale Loans
Maximum allowable prepayment penalty options
Fixed and Balloon Loans: The maximum allowed on 30 year fixed, 15 year fixed and
30/15 balloon loans is 3 years unless otherwise limited by state mandate. The
allowable limit for each state is noted in the table.
ARM Loans: For these loans, Xxxxx Fargo Home Mortgage has established the
following limits:
1 yr ARM - not allowed
2/6 ARM - maximum 2 year prepayment penalty option
3/6 ARM - maximum 3 year prepayment penalty option
Note: Prepayment penalty options are not available on table-funded transactions
(loans closed in the broker's or joint venture's name).
Estimating the penalty amount
Included in this guide you will find several examples of how to calculate a
prepayment penalty. Please remember that these examples are provided as a
helpful tool for estimating potential penalties when a customer is considering
the option of a prepayment penalty. The examples are specifically NOT to be used
to calculate payoff amounts.
02/28/2005
Prepayment Penalty Guide, continued
Alabama Louisiana Ohio
Alaska Maine Oklahoma
Arizona Maryland Oregon
Arkansas Massachusetts N/O Pennsylvania
California Massachusetts O/O Rhode Island
Colorado Michigan South Carolina
Connecticut Minnesota South Dakota
Delaware Mississippi Tennessee
District of Columbia Missouri Texas
Florida Montana Utah
Georgia Nebraska Vermont
Hawaii Nevada Virginia
Idaho New Hampshire Washington
Illinois New Jersey West Virginia
Indiana New Mexico Wisconsin
Iowa New York Wyoming
Kansas North Carolina
Kentucky North Dakota
This guide is intended solely for use by Xxxxx Fargo Home Mortgage originators,
broker and lender clients. It is not intended for distribution to real estate
agents, applicants, borrowers or any other third party. It is provided to assist
you in explaining to applicants the Xxxxx Fargo Home Mortgage prepayment penalty
products available in their state.
Information is accurate as of date of printing and is subject to change without
notice.
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Alabama Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
Minimum loan amount is $2,000 2/6 max 2 yrs; 3/6 max 3 yrs
------------------------------------------------------------------------------------------------------------------------------------
Alaska Not Permitted If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to
Example #1 the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Arizona Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
Minimum loan amount is $5,000. Minimum loan amount is $5,000
------------------------------------------------------------------------------------------------------------------------------------
Arkansas Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #13 2 year - If within the first year full prepayment is 2 year - If within the first year full prepayment is
made, the prepayment charge is an amount equal to two made, the prepayment charge is an amount equal to
percent (2%) of the unpaid principal balance. If two percent (2%) of the unpaid principal balance. If
within the second year full prepayment is made, the within the second year full prepayment is made, the
prepayment charge is an amount equal to one percent prepayment charge is an amount equal to one percent
(1%) of the unpaid principal balance. (1%) of the unpaid principal balance.
3 year - If within the first year full prepayment is 3 year - If within the first year full prepayment is
made, the prepayment charge is an amount equal to made, the prepayment charge is an amount equal to
three percent (3%) of the unpaid principal balance. If three percent (3%) of the unpaid principal balance.
within the second year a full prepayment is made, the If within the second year a full prepayment is made,
prepayment charge is an amount equal to two percent the prepayment charge is an amount equal to two
(2%) of the unpaid principal balance. If within the percent (2%) of the unpaid principal balance. If
third year full prepayment is made, the prepayment within the third year full prepayment is made, the
charge is an amount equal to one percent (1%) of the prepayment charge is an amount equal to one percent
unpaid principal balance. (1%) of the unpaid principal balance.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
California Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Colorado Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Connecticut Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Delaware Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
District of Columbia Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #12 (F & B) If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
Example #1 (ARM) the payment of 2 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
aggregate amount of all prepayments in excess of 1/3 amount prepaid which is in excess of twenty percent
of the original loan amount made in any twelve month (20%) of the original principal amount.
period.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Florida Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Georgia Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
Prohibited on 0/0 properties with loan amounts less Prohibited on 0/0 properties with loan amounts less
than or equal to $359,650. than or equal to $359,650.
------------------------------------------------------------------------------------------------------------------------------------
Hawaii Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Idaho Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Illinois Not Permitted 2/6 max 2 yrs; 3/6 max 3 yrs
Example #2 If within the first (option #) years full prepayment
is made within any 12-month period the total amount
of which exceeds twenty percent (20%) of the
original principal amount of the loan, the
prepayment charge is an amount equal to the payment
of 60 days' advance interest, at the interest rate
provided for under the Note, on the amount by which
the total of the prepayment(s) within that 12-month
period exceeds twenty percent (20%) of the original
principal amount.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Indiana Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Iowa Not Permitted 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Kansas Not Permitted 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Kentucky Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Louisiana Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #9 (F & B) If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge may not exceed (i) 5% is made, the prepayment charge is an amount equal to
Example #1 (ARM) of the unpaid principal balance if prepaid during the the payment of 6 months' advance interest, at the
first year; (ii) 4% of the unpaid principal balance if interest rate provided for under the Note, on the
prepaid during the second year; (iii) 3% of the unpaid amount prepaid which is in excess of twenty percent
principal balance if prepaid during the third year; (20%) of the original principal amount.
(iv) 2% of the unpaid principal balance if prepaid
during the fourth year; (v) 1% of the unpaid principal
balance if prepaid during the fifth year. No penalty
may be assessed after the fifth year.
Minimum loan amount is $25,000.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Maine Max 3 years Not Permitted
Example #1 If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Maryland Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #10 (F & B) If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to 2 is made, the prepayment charge is an amount equal to
Example #1 (ARM) months' advance interest, at the interest rate the payment of 6 months' advance interest, at the
provided for under the Note, on the aggregate amount interest rate provided for under the Note, on the
of all prepayments in excess of 1/3 of the original amount prepaid which is in excess of twenty percent
loan amount made in any 12-month period. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Massachusetts Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Non-Owner Occupied If within the first (option #) years full prepayment If within the first (option #) years full prepayment
Example #1 is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
Minimum loan amount is $6,001.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Massachusetts Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Owner Occupied and If within the first year full prepayment is made, the If within the first year full prepayment is made,
Second Homes prepayment charge is an amount equal to three months' the prepayment charge is an amount equal to three
Example #3 interest or the balance of the first year's interest, months' interest or the balance of the first years'
whichever is less, at the interest rate provided for interest, whichever is less, at the interest rate
under the Note. If full prepayment is made within the provided for under the Note. If full prepayment is
first (option #) year(s) for the purpose of made within the first (option #) year(s) for the
refinancing with another lender, an additional purpose of refinancing with another lender, an
prepayment charge in an amount equal to three months' additional prepayment charge in an amount equal to
interest can be charged. three months' interest can be charged.
Balloon loans not allowed. Minimum loan amount is $6001. Minimum property value
is $40,000.
Prohibited on O/O properties.
Prohibited on O/O properties.
This is a two-part rule. The first part of the rule
applies only to the first year of the loan. The second This is a two-part rule. The first part of the rule
part of the rule applies only in the event that the applies only to the first year of the loan. The
borrower refinances with another lender. second part of the rule applies only in the event
o Assuming a 3-year prepayment penalty option, if that the borrower refinances with another lender.
the borrower refinances with another lender o Assuming a 3-year prepayment penalty option,
within the first year, a charge may be assessed if the borrower refinances with another
under the first part of the rule and the second lender within the first year, a charge may be
part of the rule. assessed under the first part of the rule and
o Assuming a 3-year prepayment penalty option, if the second part of the rule.
the borrower refinances with another lender o Assuming a 3-year prepayment penalty option,
during the second or third years, a charge may if the borrower refinances with another
be assessed only under the second part of the lender during the second or third years, a
rule. charge may be assessed only under the second
o Assuming a 3-year prepayment penalty option, if part of the rule.
the borrower refinances with Xxxxx Fargo, pays o Assuming a 3-year prepayment penalty option,
off or sells the property within the first if the borrower refinances with Xxxxx Fargo,
year, a charge may be assessed under the first pays off or sells the property within the
part of the rule. first year, a charge may be assessed under
o Assuming a 3-year prepayment penalty option, if the first part of the rule.
the borrower refinances with Xxxxx Fargo, pays o Assuming a 3-year prepayment penalty option,
off or sells the property during the second or if the borrower refinances with Xxxxx Fargo,
third years a charge may not be assessed. pays off or sells the property during the
second or third years, a charge may not be
assessed.
------------------------------------------------------------------------------------------------------------------------------------
Michigan Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #4 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
one percent (1%) of the prepayment amount. one percent (1%) of the prepayment amount.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Minnesota Not Permitted 2/6 max 2 yrs; 3/6 max 3 yrs
Example #5 If within the first (option #) months full
prepayment is made for a purpose other than the sale
of the property, the prepayment charge is an amount
equal to two percent (2%) of the unpaid principal
balance or 60 days' interest on the unpaid principal
balance, at the interest rate provided for under the
Note, whichever is less.
------------------------------------------------------------------------------------------------------------------------------------
Mississippi Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #9 (F & B) If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge may not exceed (i) 5% is made, the prepayment charge is an amount equal to
Example #1 (ARM) of the unpaid principal balance if prepaid during the the payment of 6 months' advance interest, at the
first year; (ii) 4% of the unpaid principal balance if interest rate provided for under the Note, on the
prepaid during the second year; (iii) 3% of the unpaid amount prepaid which is in excess of twenty percent
principal balance if prepaid during the third year; (20%) of the original principal amount.
(iv) 2% of the unpaid principal balance if prepaid
during the fourth year; (v) 1% of the unpaid principal
balance if prepaid during the fifth year. No penalty
may be assessed after the fifth year.
------------------------------------------------------------------------------------------------------------------------------------
Missouri Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #11 (F & B) If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
Example #1 (ARM) two percent (2%) of the unpaid principal balance at the payment of 6 months' advance interest, at the
the time of the prepayment. interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Montana Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Nebraska Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Nevada Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
New Hampshire Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
New Jersey Not Permitted 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
Prohibited on O/O properties with loan amounts less
than or equal to $365,675.
------------------------------------------------------------------------------------------------------------------------------------
New Mexico Not Permitted 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
Prohibited on O/O properties with loan amounts less
than or equal to $359,650.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
New York Max 1 year 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
Prohibit on balloon loans.
------------------------------------------------------------------------------------------------------------------------------------
North Carolina Max 2 years 2/6 max 2 yrs; 3/6 max 2 yrs
Example #6 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
two percent (2%) of the unpaid principal balance at two percent (2%) of the unpaid principal balance at
the time of the prepayment. the time of the prepayment. Wholesale minimum loan
amount is $150,001.
Minimum loan amount is $150,001. Wholesale minimum loan amount is $150,001.
Baloon loans not allowed.
------------------------------------------------------------------------------------------------------------------------------------
North Dakota Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Ohio Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #7 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
one percent (1%) of the original loan amount. one percent (1%) of the original loan amount.
------------------------------------------------------------------------------------------------------------------------------------
Oklahoma Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Oregon Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. Minimum loan (20%) of the original principal amount.
amount is $50,001.
------------------------------------------------------------------------------------------------------------------------------------
Rhode Island PURCHASES: Max 1 year. If within the first year full 2/6 max 2 yrs; 3/6 max 3 yrs
year prepayment is made, the prepayment charge is an
Example #6 (F & B) amount equal to the payment of 2% of the balance due If within the first (option #) years full prepayment
as of the date of the payoff. is made, the prepayment charge is an amount equal to
Example #1 (ARM) the payment of 6 months' advance interest, at the
REFINANCES: Max 3 years. If within the first (option interest rate provided for under the Note, on the
#) years full year prepayment is made, the prepayment amount prepaid which is in excess of twenty percent
charge is an amount equal to the payment of 2% of the (20%) of the original principal amount.
balance due as of the date of the payoff.
------------------------------------------------------------------------------------------------------------------------------------
South Carolina Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 (F & B) If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
Example #6 (ARM) the payment of 6 months' advance interest, at the two percent (2%) of the unpaid principal balance at
interest rate provided for under the Note, on the the time of the prepayment.
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. Prohibited on O/O properties with loan amounts less
than or equal to $359,650.
Prohibited on O/O properties with loan amounts less
than or equal to $359,650. Minimum loan amount for N/O/O and second homes is
$150,001.
Minimum loan amount for N/O/O and second homes is
$150,001.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
South Dakota Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Tennessee Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Texas Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
Prohibited on home equity loans. Prohibited on home equity loans.
Prohibited on loans with APR rates >12%
------------------------------------------------------------------------------------------------------------------------------------
Utah Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Vermont Not Permitted 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent
(20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
State Fixed and Balloon Loans ARM Loans
------------------------------------------------------------------------------------------------------------------------------------
Virginia Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #8 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made and the original loan amount is less than is made and the original loan amount is less than
$75,000, the prepayment charge is an amount equal to $75,000, the prepayment charge is an amount equal to
the payment of one percent (1%) of the unpaid the payment of one percent (1%) of the unpaid
principal balance. principal balance.
If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made and the original loan amount is $75,000 or is made and the original loan amount is $75,000 or
greater, the prepayment charge is an amount equal to greater, the prepayment charge is an amount equal to
the payment of two percent (2%) of the amount of such the payment of two percent (2%) of the amount of
prepayment amount. such prepayment amount.
------------------------------------------------------------------------------------------------------------------------------------
Washington Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
West Virginia Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #7 PURCHASES: If within the first (option #) years full If within the first (option #) years full prepayment
prepayment is made, the prepayment charge is an amount is made, the prepayment charge is an amount equal to
equal to one percent (1%) of the original loan amount. one percent (1%) of the original loan amount.
Not permitted on refinances.
------------------------------------------------------------------------------------------------------------------------------------
Wisconsin Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #2 When full prepayment is made within any 12-month When full prepayment is made within any 12-month
period the total amount of which exceeds twenty period the total amount of which exceeds twenty
percent (20%) of the original principal amount of the percent (20%) of the original principal amount of
loan, the prepayment charge is an amount equal to the the loan, the prepayment charge is an amount equal
payment of 60 days' advance interest, at the interest to the payment of 60 days' advance interest, at the
rate provided for under the Note, on the amount by interest rate provided for under the Note, on the
which the total of the prepayment(s) within that amount by which the total of the prepayment(s)
12-month period exceeds twenty percent (20%) of the within that 12-month period exceeds twenty percent
original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
Wyoming Max 3 years 2/6 max 2 yrs; 3/6 max 3 yrs
Example #1 If within the first (option #) years full prepayment If within the first (option #) years full prepayment
is made, the prepayment charge is an amount equal to is made, the prepayment charge is an amount equal to
the payment of 6 months' advance interest, at the the payment of 6 months' advance interest, at the
interest rate provided for under the Note, on the interest rate provided for under the Note, on the
amount prepaid which is in excess of twenty percent amount prepaid which is in excess of twenty percent
(20%) of the original principal amount. (20%) of the original principal amount.
------------------------------------------------------------------------------------------------------------------------------------
02/28/2005
Prepayment Penalty Guide, continued
Example #1
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
------------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,444.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) 20,000.00 20% of original principal balance
------------
(7) 79,444.10 Amount subject to penalty
(8) x 10% Multiply (7) by note rate
(9) divide by 12 Divide result of (8) by 12 to obtain monthly interest figure
(10) x 6 Multiply result of (9) by number of months of penalty interest
$3,972.21 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #2 - Illinois, Wisconsin
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-------------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,444.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) -20,000.00 20% of original principal balance
-------------
(7) 79,444.10 Amount subject to penalty
(8) x 10% Multiply (7) by note rate
(9) divide by 365 Divide result of (8) by 365 to obtain daily interest figure
(10) x 60 Multiply result of (9) by number of days of penalty interest
$1,305.93 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #3 - Massachusetts (O/O and second homes)
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
---------------------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 6 Number of payments received
(5) 99,729.00 Full prepayment of unpaid principal balance (prior to 7th pmt)
(6) x 10% Note rate
(7) divide by 12 Number of months in one year
(8) x 3 Number of months of penalty interest
(9) $2,493.23 3 months' interest
(10)
(11) 99,729.00 Full prepayment of unpaid principal balance (prior to 7th pmt)
(12) x 10% Note rate
(13) divide by 365 Number of days in one year
(14) x 181 Number of remaining days in first year
(15) $4,945.47 Balance of first years' interest
$2,493.23 Penalty amount (lesser of 3 months' interest or first years' interest)
Continued on next page . . .
02/28/2005
Prepayment Penalty Guide, continued
Example #3, continued
If loan is paid off to refinance with another lender, borrower is subject to
this additional charge:
Step Example #s Your #s
------------------------------------------------------------------------------------------------
(1) 99,729.00 Full prepayment of unpaid principal balance (prior to 13th pmt)
(2) x 10% Note rate
(3) divide by 12 Number of months in one year
(4) x 3 Number of months of penalty interest
$2,493.23 Additional penalty amount
$4,986.46 Total penalty amount ($2,493.23 + $2,493.23)
02/28/2005
Prepayment Penalty Guide, continued
Example #4 - Michigan
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-----------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,440.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) x 1% Penalty rate
$994.40 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #5 - Minnesota
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
---------------------------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,440.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) x 2% Penalty rate
(7) $1,988.80 2% of unpaid principal balance
(8) 99,440.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(9) x 10% Note rate
(10) divide by 365 Number of days in one year
(11) x 60 Number of penalty days
$1,634.63 60 days' interest
$1,634.63 Penalty Amount (lesser of 2% of unpaid principal balance or 60 days' interest)
02/28/2005
Prepayment Penalty Guide, continued
Example #0 - Xxxxx Xxxxxxxx, Xxxxx Xxxxxx (X & X), Xxxxx Xxxxxxxx (ARM)
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-----------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 2 Number of option years
(4) 12 Number of payments received
(5) 99,440.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) x 2% Penalty rate
$1,988.80 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #7 - Ohio, West Virginia
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-----------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 100,000.00 Original principal balance
(6) x 1% Penalty rate
$1,000.00 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #8 - Virginia
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-----------------------------------------------------------------------------------------------
(1) $70,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 69,610.90 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) x 1% Penalty rate
$696.11 Penalty amount
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,440.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) x 2% Penalty rate
$1,988.80 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #9 - Louisiana (F & B), Mississippi (F & B)
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
----------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) Number of option years
(4) Number of payments received
(5) 98,151.60 Full prepayment of unpaid principal balance (prior to 37th pmt)
(6) x 3% Penalty rate for prepayment in third year
$2,944.55 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #10 - Maryland (F & B)
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-------------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,444.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) -33,333.33 1/3 of original principal balance
-----------
(7) 66,110.77 Amount subject to penalty
(8) x 10% Note rate
(9) divide by 12 Number of Months in One Year
(10) x 2 Number of Months of Penalty Interest
$1,101.85 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #11 Missouri (F & B)
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-----------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 2 Number of option years
(4) 30 Number of payments received
(5) 98,499.30 Full prepayment of unpaid principal balance (prior to 31st pmt)
(6) x 2% Penalty rate
$1,969.99 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #12 - District of Columbia (F & B)
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
------------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,444.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) -33,333.33 1/3 of original principal balance
-----------
(7) 66,110.77 Amount subject to penalty
(8) x 10% Note rate
(9) divide by 12 Number of Months in One Year
(10) x 2 Number of Months of Penalty Interest
$1,101.85 Penalty amount
02/28/2005
Prepayment Penalty Guide, continued
Example #13 - Arkansas
These examples are provided as a helpful tool for estimating potential penalties
when a customer is considering the option of a prepayment penalty. The examples
are specifically NOT to be used to calculate payoff amounts.
Step Example #s Your #s
-----------------------------------------------------------------------------------------------
(1) $100,000.00 Original principal balance
(2) 10% Note rate
(3) 3 Number of option years
(4) 12 Number of payments received
(5) 99,440.10 Full prepayment of unpaid principal balance (prior to 13th pmt)
(6) x 3% Penalty rate
$2983.20 Penalty amount
02/28/2005
